    [House Hearing, 115 Congress]
    [From the U.S. Government Publishing Office]

    DOE MODERNIZATION: LEGISLATION ADDRESSING DEVELOPMENT, REGULATION, AND
            COMPETITIVENESS OF ADVANCED NUCLEAR ENERGY TECHNOLOGIES

    =======================================================================

                                    HEARING

                                   BEFORE THE

                             SUBCOMMITTEE ON ENERGY

                                     OF THE

                        COMMITTEE ON ENERGY AND COMMERCE
                            HOUSE OF REPRESENTATIVES

                         ONE HUNDRED FIFTEENTH CONGRESS

                                 SECOND SESSION

                                   __________

                                  MAY 22, 2018

                                   __________

                               Serial No. 115-132

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                        COMMITTEE ON ENERGY AND COMMERCE

                              GREG WALDEN, Oregon
                                     Chairman

    JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
      Vice Chairman                        Ranking Member
    FRED UPTON, Michigan                 BOBBY L. RUSH, Illinois
    JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
    MICHAEL C. BURGESS, Texas            ELIOT L. ENGEL, New York
    MARSHA BLACKBURN, Tennessee          GENE GREEN, Texas
    STEVE SCALISE, Louisiana             DIANA DeGETTE, Colorado
    ROBERT E. LATTA, Ohio                MICHAEL F. DOYLE, Pennsylvania
    CATHY McMORRIS RODGERS, Washington   JANICE D. SCHAKOWSKY, Illinois
    GREGG HARPER, Mississippi            G.K. BUTTERFIELD, North Carolina
    LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
    BRETT GUTHRIE, Kentucky              KATHY CASTOR, Florida
    PETE OLSON, Texas                    JOHN P. SARBANES, Maryland
    DAVID B. McKINLEY, West Virginia     JERRY McNERNEY, California
    ADAM KINZINGER, Illinois             PETER WELCH, Vermont
    H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
    GUS M. BILIRAKIS, Florida            PAUL TONKO, New York
    BILL JOHNSON, Ohio                   YVETTE D. CLARKE, New York
    BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
    LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
    BILL FLORES, Texas                   JOSEPH P. KENNEDY, III,
    SUSAN W. BROOKS, Indiana             Massachusetts
    MARKWAYNE MULLIN, Oklahoma           TONY CARDENAS, California
    RICHARD HUDSON, North Carolina       RAUL RUIZ, California
    CHRIS COLLINS, New York              SCOTT H. PETERS, California
    KEVIN CRAMER, North Dakota           DEBBIE DINGELL, Michigan
    TIM WALBERG, Michigan
    MIMI WALTERS, California
    RYAN A. COSTELLO, Pennsylvania
    EARL L. ``BUDDY'' CARTER, Georgia
    JEFF DUNCAN, South Carolina

                             Subcommittee on Energy

                              FRED UPTON, Michigan
                                     Chairman
    PETE OLSON, Texas                    BOBBY L. RUSH, Illinois
      Vice Chairman                        Ranking Member
    JOE BARTON, Texas                    JERRY McNERNEY, California
    JOHN SHIMKUS, Illinois               SCOTT H. PETERS, California
    ROBERT E. LATTA, Ohio                GENE GREEN, Texas
    GREGG HARPER, Mississippi            MICHAEL F. DOYLE, Pennsylvania
    DAVID B. McKINLEY, West Virginia     KATHY CASTOR, Florida
    ADAM KINZINGER, Illinois             JOHN P. SARBANES, Maryland
    H. MORGAN GRIFFITH, Virginia         PETER WELCH, Vermont
    BILL JOHNSON, Ohio                   PAUL TONKO, New York
    BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
    LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
    BILL FLORES, Texas                   JOSEPH P. KENNEDY, III,
    MARKWAYNE MULLIN, Oklahoma               Massachusetts
    RICHARD HUDSON, North Carolina       G.K. BUTTERFIELD, North Carolina
    KEVIN CRAMER, North Dakota           FRANK PALLONE, Jr., New Jersey (ex
    TIM WALBERG, Michigan                    officio)
    JEFF DUNCAN, South Carolina
    GREG WALDEN, Oregon (ex officio)

                                      (ii)

                                 C O N T E N T S

                                  ----------
                                                                       Page
    Hon. Fred Upton, a Representative in Congress from the State of
      Michigan, opening statement....................................     1
        Prepared statement...........................................     3
    Hon. Bobby L. Rush, a Representative in Congress from the State
      of Illinois, opening statement.................................     4
        Prepared statement...........................................     5
    Hon. Greg Walden, a Representative in Congress from the State of
      Oregon, opening statement......................................     6
        Prepared statement...........................................     8
    Hon. Frank Pallone, Jr., a Representative in Congress from the
      State of New Jersey, opening statement.........................     9
        Prepared statement...........................................    10

                                   Witnesses

    Brent Park, Ph.D., Deputy Administrator for Defense Nuclear
      Proliferation, National Nuclear Security Administration,
      Department of Energy...........................................    12
        Prepared statement...........................................    14
        Answers to submitted questions...............................   176
    Edward G. McGinnis, Principal Deputy Assistant Secretary for
      Nuclear Energy, Department of Energy...........................    19
        Prepared statement...........................................    21
        Answers to submitted questions...............................   189
    Jeffrey S. Merrifield, Partner, Pillsbury Winthrop Shaw Pittman,
      LLP, and Senior Advisor, ClearPath Action......................    52
        Prepared statement...........................................    55
        Answers to submitted questions...............................   202
    Melissa C. Mann, President, URENCO USA, Inc., and Member, United
      States Nuclear Industry Council................................    62
        Prepared statement...........................................    64
        Answers to submitted questions...............................   206
    James Nicholas Irvin, Director, Research and Development,
      Strategy, Advanced Nuclear, and Crosscutting Technology,
      Southern Company, and Member, Advanced Reactor Working Group,
      Nuclear Energy Institute.......................................    74
        Prepared statement...........................................    76
    Edwin Lyman, Ph.D., Senior Scientist, Global Security Program,
      Union of Concerned Scientists..................................    92
        Prepared statement...........................................    94

                               Submitted Material

    H.R. 1320, the Nuclear Utilization of Keynote Energy Act,
      submitted by Mr. Upton.........................................   126
    Discussion Draft, a Bill to Amend the Atomic Energy Act of 1954,
      submitted by Mr. Upton.........................................   146
    Discussion Draft, the Advanced Nuclear Fuel Availability Act,
      submitted by Mr. Upton.........................................   154
    Discussion Draft, a Report on Pilot Program for Micro-Reactors,
      submitted by Mr. Upton.........................................   159
    Issue Brief of March 2018, ``US Nuclear-Power Leadership and the
      Chinese and Russian Challenge,'' by Dr. Robert F. Ichord, Jr.,
      Atlantic Council, submitted by Mr. Upton.......................   164
    Letter of May 21, 2018, from John Hopkins, Chairman and Chief
      Executive Officer, NuScale Power, LLC, to Mr. Upton and Mr.
      Rush, submitted by Mr. Shimkus.................................   171
    Speech, ``The Nuclear Power Plant in Astrava, Belarus,'' by Mr.
      Shimkus, submitted by Mr. Shimkus..............................   172

    DOE MODERNIZATION: LEGISLATION ADDRESSING DEVELOPMENT, REGULATION, AND
            COMPETITIVENESS OF ADVANCED NUCLEAR ENERGY TECHNOLOGIES

                                  ----------

                             TUESDAY, MAY 22, 2018

                      House of Representatives,
                                Subcommittee on Energy,
                              Committee on Energy and Commerce,
                                                        Washington, DC.
        The subcommittee met, pursuant to call, at 10:04 a.m., in
    room 2123, Rayburn House Office Building, Hon. Fred Upton
    (chairman of the subcommittee) presiding.
        Members present: Representatives Upton, Barton, Shimkus,
    Latta, Harper, McKinley, Kinzinger, Griffith, Johnson, Long,
    Bucshon, Flores, Mullin, Hudson, Walberg, Duncan, Walden (ex
    officio), Rush, McNerney, Peters, Green, Doyle, Castor, Welch,
    Tonko, Loebsack, Schrader, Kennedy, and Pallone (ex officio).
        Staff present: Mike Bloomquist, Staff Director; Samantha
    Bopp, Staff Assistant; Daniel Butler, Staff Assistant; Kelly
    Collins, Legislative Clerk, Energy/Environment; Margaret Tucker
    Fogarty, Staff Assistant; Adam Fromm, Director of Outreach and
    Coalitions; Jordan Haverly, Policy Coordinator, Environment;
    Milly Lothian, Press Assistant and Digital Coordinator; Mary
    Martin, Chief Counsel, Energy/Environment; Drew McDowell,
    Executive Assistant; Brandon Mooney, Deputy Chief Counsel,
    Energy; Mark Ratner, Policy Coordinator; Peter Spencer, Senior
    Professional Staff Member, Energy; Austin Stonebraker, Press
    Assistant; Hamlin Wade, Special Advisor for External Affairs;
    Everett Winnick, Director of Information Technology; Andy Zach,
    Senior Professional Staff Member, Environment; Priscilla
    Barbour, Minority Energy Fellow; Jeff Carroll, Minority Staff
    Director; Rick Kessler, Minority Senior Advisor and Staff
    Director, Energy and Environment; John Marshall, Minority
    Policy Coordinator; Alexander Ratner, Minority Policy Analyst;
    Andrew Souvall, Minority Director of Communications, Member
    Services, and Outreach; Tuley Wright, Minority Energy and
    Environment Policy Advisor; and C.J. Young, Minority Press
    Secretary.

       OPENING STATEMENT OF HON. FRED UPTON, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF MICHIGAN

        Mr. Upton. Good morning, everybody. Sorry I am a few
    minutes late. Good morning. And welcome to our hearing to
    discuss four very important legislative proposals to address
    and advance our Nation's nuclear energy policy.
        You know, as we have heard throughout Congress, our
    Nation's international nuclear leadership is eroding. Last
    week, a report by Bloomberg New Energy Finance found that
    nearly a quarter of our Nation's fleet of nuclear power
    reactors are at risk of early closure in the next couple of
    years.
        These 24 at-risk reactors total over 6 percent of the total
    electricity generated in the U.S., about how much electricity
    is consumed in Michigan and Illinois combined. And if we are
    going to get serious about an all-of-the-above energy strategy
    and the value of a diverse, clean energy portfolio, the
    implications of this threat cannot be ignored.
        The decision to close a nuclear power plant is
    irreversible. We know that. Reactors cannot be re-licensed to
    produce power once they cease operation. And if the projected
    retirement of nuclear energy is realized, the fleet's
    significant loss will lead to a ripple effect throughout the
    nuclear supply chain.
        Fuel cycle facilities that underpin both commercial and
    national security needs lose critical capacity. And technology
    services that provide world-class simulation to modernize and
    maximize nuclear safety will look to other global markets that
    have growth potential. The next generation of nuclear
    engineering and scientists would dry up as educational
    institutions can no longer continue to support the necessary
    facilities and programs. International leaders in the nuclear
    field made clear, made clear to this subcommittee a couple
    months ago that these cumulative repercussions will weaken our
    national security standing and, if it continues, would require
    a generation of sustained Federal commitment to rebuild.
        I don't cede that the outcome is inevitable. The thoughtful
    proposals that we are going to examine today provide directed
    solutions to address these multifaceted challenges.
        H.R. 1320, sponsored by Representatives Kinzinger and
    Doyle, brings budgetary discipline to the NRC and improves
    transparency and predictability for civilian nuclear companies.
    Under current statutory requirements, the NRC recovers about 90
    percent of its total budget from NRC licensees. As a result, my
    Southwest Michigan ratepayers help fund the NRC to regulate,
    license, and oversee the commercial nuclear industry. The
    Kinzinger-Doyle bill also lays out basic expectations that
    align with the NRC's established tradition of adhering to the
    organization's Principles of Good Regulation.
        Congressman Johnson's discussion draft discusses the global
    competitive challenges for the nuclear supplier community. When
    provided a level playing field, I am confident American know-
    how and technological leadership is the best in the world.
    However, nuclear companies backed by foreign governments, which
    don't necessarily share our values, artificially subsidize our
    competition. The motivation behind these actions is clear. Mr.
    Johnson's bill will improve the ability of our companies to
    compete, and win, in international markets.
        Imagine designing a new car that is cheaper, safer, and
    gets triple the fuel mileage from anything that we see on the
    road today, but when the vehicle is ready to hit the road,
    there is just no gas to fill up the tank. Nuclear innovators
    face just that challenge.
        Advanced nuclear technologies offer a wealth of promising
    benefits. However, for these designs to become reality, a
    certain amount of advanced nuclear fuel must be available for
    the first movers. Congressman Flores' legislation helps address
    this obstacle by directing DOE to undertake specific actions to
    provide what is known as high-assay low-enriched uranium. The
    time to begin addressing this problem is now in order to have
    the advanced fuel available when it is needed.
        The fourth bill, bipartisan legislation from Congressmen
    Hudson, Peters, Wilson, and Norcross, directs the Secretary of
    Energy to identify the key components for a pilot program that
    could capture the energy security benefits of future nuclear
    technologies to support critical national security
    infrastructure.
        This morning we are going to hear from the Department
    Energy on the first panel, including the Office of Nuclear
    Energy and NNSA. We are also going to hear several expert
    perspectives on the second panel.
        I look forward to that discussion, and at this point would
    yield to the ranking member of the subcommittee, Mr. Rush from
    Illinois.
        [The proposed legislation appears at the conclusion of the
    hearing.]
        [The prepared statement of Mr. Upton follows:]

                     Prepared statement of Hon. Fred Upton

        Good morning and welcome to our hearing to discuss four
    important legislative proposals to address and advance our
    Nation's nuclear energy policy.
        As we have heard throughout Congress, our Nation's
    international nuclear leadership is eroding. Just last week, a
    report by Bloomberg New Energy Finance found that nearly a
    quarter of our Nation's fleet of nuclear power reactors are at
    risk of early closure in the next few years.
        These 24 at-risk reactors total over 6 percent of the total
    electricity generated in the United States, about how much
    electricity is consumed in Michigan and Illinois combined. If
    we are serious about an all-of-the-above energy strategy and
    the value of a diverse, clean energy portfolio, the
    implications of this threat cannot be ignored.
        The decision to close a nuclear power plant is
    irreversible. Reactors cannot be relicensed to produce power
    once they cease operation. If the projected retirement of
    nuclear energy is realized, the fleet's significant loss will
    lead to a ripple effect throughout the nuclear supply chain.
        Fuel cycle facilities, that underpin both commercial and
    national security needs, lose critical capacity. Technology
    services that provide world-class simulation to maximize
    nuclear safety will look to other global markets that have
    growth potential. The next generation of nuclear engineering
    and scientists would dry up as educational institutions can no
    longer continue to support the necessary facilities and
    programs. International leaders in the nuclear field made clear
    to this subcommittee in February, these cumulative
    repercussions will weaken our national security standing and,
    if it continues, would require a generation of sustained
    Federal commitment to rebuild.
        But I do not yet cede that outcome as inevitable. The
    thoughtful proposals we will examine today provide directed
    solutions to address these multifaceted challenges.
        H.R. 1320, sponsored by Representatives Kinzinger and
    Doyle, brings budgetary discipline to the Nuclear Regulatory
    Commission (NRC) and improves transparency and predictability
    for civilian nuclear companies. Under current statutory
    requirements, the NRC recovers about 90 percent of its total
    budget from NRC licensees. As a result, my Southwestern
    Michigan ratepayers help fund NRC to regulate, license, and
    oversee the commercial nuclear industry. The Kinzinger-Doyle
    bill also lays out basic expectations that align with NRC's
    established tradition of adhering to the organization's
    Principles of Good Regulation.
        Congressman Johnson's discussion draft addresses the global
    competitive challenges for the nuclear supplier community. When
    provided a level playing field, I am confident American know-
    how and technological leadership is the best in the world.
    However, nuclear companies backed by foreign governments, which
    don't necessarily share our American values, artificially
    subsidize our competition. The motivation behind these actions
    is clear. Our adversaries seek to establish 50-year, or longer,
    geostrategic relationships. Mr. Johnson's bill will improve the
    ability of our companies to compete, and win, in international
    markets.
        Imagine designing a new car that is cheaper, safer, and
    gets triple the fuel mileage from anything we see on the road
    today. But when the vehicle is ready to hit the road, there is
    no gas to fill up the tank. Nuclear innovators face just that
    challenge.
        Advanced nuclear technologies offer a wealth of promising
    benefits. However, for these designs to become reality, a
    certain amount of advanced nuclear fuel must be available for
    the first movers. Congressman Flores' legislation helps address
    this obstacle by directing DOE to undertake specific actions to
    provide what is known as high-assay low-enriched uranium. The
    time to begin addressing this problem is now in order to have
    the advanced fuel available when needed.
        The fourth bill, the bipartisan legislation from
    Congressmen Hudson, Peters, Wilson, and Norcross, directs the
    Secretary of Energy to identify the key components for a pilot
    program that could capture the energy security benefits of
    future nuclear technologies to support critical national
    security infrastructure.
        This morning we will here from the Department of Energy on
    the first panel, including from the office of Nuclear Energy
    and the NNSA. We will also hear several expert perspectives on
    the second panel. I look forward to the discussion and working
    with my colleagues on both sides of the aisle to advance these
    important bipartisan bills.
        I look forward to the feedback the two panels of expert
    witnesses will provide this morning, as well as working with my
    colleagues on both sides of the aisle to advance these
    important bipartisan bills.

     OPENING STATEMENT OF HON. BOBBY L. RUSH, A REPRESENTATIVE IN
                  CONGRESS FROM THE STATE OF ILLINOIS

        Mr. Rush. Well, thank you, Mr. Chairman. Mr. Chairman,
    thank you so much for holding this important hearing today on
    legislation addressing the development, regulation, and
    competitiveness of advanced nuclear technologies.
        As I have said many times before, Mr. Chairman, I subscribe
    to an all-of-the-above energy portfolio, even as we move
    towards a low carbon energy economy. I have also stated on many
    occasions that I believe nuclear energy must play a vital role
    as a source of safe, reliable, low carbon power that can help
    us meet the energy and environmental needs of the 21st Century.
        I look forward to working with the majority as we proceed
    through regular order. And I believe that we may be able to
    come to a strong, bipartisan agreement on most, if not all of
    these bills.
        Today, Mr. Chairman, I support the discussion draft offered
    by Mr. Flores of Texas which would simply direct the Secretary
    of Energy to establish a program to support the availability of
    high-assay low-enriched uranium, or HA-LEU, for commercial use.
    We have learned that there are several companies looking to
    design and license advanced nuclear reactor technologies
    utilizing uranium-235 isotopes enriched at levels greater than
    5 percent and less than 20 percent. Some of these companies
    identified significant challenges associated with assessing HA-
    LEU.
        And I believe Mr. Flores' discussion draft will address
    some of these concerns and make HA-LEU more accessible with the
    right safeguards. Also, I support, Mr. Chairman, that the
    discussion draft offered by a group of bipartisan Members,
    including two from this subcommittee, Mr. Hudson of North
    Carolina, and Mr. Peters of California. This bill would require
    the Secretary of Energy to develop a report on a pilot program
    to site, construct, and operate microreactors at critical
    national security locations.
        Mr. Chairman, I am also inclined to support some of the
    objectives of H.R. 1320, which will amend the NRC fee recovery
    process associated with the advanced reactor regulatory
    framework, while also limiting internal funds available for
    corporate support costs and capping fees on operating reactors.
        However, Mr. Chairman, I do have some concerns regarding
    the bill's provisions essentially repealing licensing
    assistance to foreign governments. Also want to better
    understand verification of repealing requirements for mandatory
    hearing while also implementing specific time lines to review
    environmental impact statements and how these changes might
    impact public input.
        Finally, Mr. Chairman, I also look forward to engaging
    today's witnesses on the discussion draft sponsored by Mr.
    Johnson of Ohio. This bill would, among other things, revise
    DOE's review of Part 810 process by expediting procedures for
    transferring civilian nuclear technology, including to foreign
    powers. Mr. Chairman, this proposal comes against the
    background of the current administration's decision to renege
    on the U.S. commitment in the Iran deal while also moving
    forward on potential talks with North Korea's volatile dictator
    on denuclearization issues.
        So I look forward to hearing today's distinguished panel on
    both the timing and the necessity of this legislation, as well
    as identifying possible unintended consequences.
        I want to thank you, Mr. Chairman, and I yield back the
    balance of my time.
        [The prepared statement of Mr. Rush follows:]

                    Prepared statement of Hon. Bobby L. Rush

        I want to thank you, Mr. Chairman, for holding this
    important hearing today on legislation addressing the
    development, regulation, and competitiveness of advanced
    nuclear technologies.
        Mr. Chairman, as I have stated many times before, I
    subscribe to an all-of-the-above energy portfolio, even as we
    move towards a low-carbon energy economy.
        I have also stated on many occasions that I believe nuclear
    energy must play a vital role as a source of safe, reliable,
    low-carbon power that can help us meet both the energy and
    environmental needs of the 21st Century.
        Mr. Chairman, I look forward to working with the majority
    as we proceed through regular order and I believe we may be
    able to come to a strong bipartisan agreement on most, if not
    all of those bills.
        Today, I support the discussion draft, authored by Rep.
    Flores of Texas, which would simply direct the Secretary of
    Energy to establish a program to support the availability of
    high-assay low-enriched uranium, or HA-LEU, for commercial use.
        We have learned that there are several companies looking to
    design and license advanced nuclear reactor technologies
    utilizing uranium-235 isotopes enriched at levels greater than
    5 percent and less than 20 percent.
        Some of these companies identified significant challenges
    associated with accessing HA-LEU and I believe Mr. Flores'
    discussion draft would address some of these concerns and make
    HA-LEU more accessible with the right safeguards.
        I also support the discussion draft authored by a group of
    bipartisan Members, including two from this subcommittee, Mr.
    Hudson of North Carolina and Mr. Peters of California.
        This bill would require the Secretary of Energy to develop
    a report on a pilot program to site, construct, and operate
    microreactors at critical national security locations.
        Mr. Chairman, I am also inclined to support some of the
    objectives of HR 1320, which would amend the NRC's fee recovery
    process associated with the advanced reactor regulatory
    framework, while also limiting the total funds available for
    corporate support costs, and capping fees on operating
    reactors.
        However, I have some concerns regarding the bills'
    provision potentially repealing licensing restrictions to
    foreign governments.
        I also want to better understand the implications of
    repealing requirements for mandatory hearings, while also
    implementing specific timelines to review final environmental
    impact statements and how that might impact public input.
        Finally, Mr. Chairman, I also look forward to engaging
    today's witnesses on the discussion draft sponsored by Mr.
    Johnson of Ohio.
        This bill would, among other things, revise DOE's review of
    the Part 810 process by expediting procedures for transferring
    civilian nuclear technology, including to foreign powers.
        Mr. Chairman, this proposal comes against the backdrop of
    the current administration's decision to renege on the U.S.
    commitment in the Iran Deal, while also moving forward on
    potential talks with North Korea's volatile dictator on
    denuclearization issues.
        So, I look forward to engaging today's distinguished
    panelists on both the timing and necessity of this legislation,
    as well as identifying possible unintended consequences.
        Thank you, Mr. Chairman, and with that I yield back the
    balance of my time.

        Mr. Upton. The Chair recognizes for an opening statement
    the chair of the full committee, the gentleman from Oregon.

      OPENING STATEMENT OF HON. GREG WALDEN, A REPRESENTATIVE IN
                   CONGRESS FROM THE STATE OF OREGON

        Mr. Walden. Good morning, Mr. Chairman. Thanks for holding
    this hearing. This really represents an important component of
    our Department of Energy effort at modernization.
        The bills we will examine today provide key ingredients to
    enhance a core national security and energy security mission
    for the Department, and of the Nation: promoting the safe and
    peaceful use of nuclear technology. It is really important.
        Congress first authorized the commercial application of
    atomic energy in 1954, when it declared the, and I quote,
    ``development, use, and control of atomic energy shall be
    directed so as to promote world peace, improve the general
    welfare, increase the standard of living, and strengthen free
    competition in private enterprise.'' That policy remains as
    relevant today and as important as ever.
        By any measure, atomic energy has already brought
    tremendous benefits to the Nation; it has provided a baseload,
    emissions-free source of electricity that has powered homes and
    industry over the last half a century. It has provided an
    infrastructure for our national and international security,
    from the technologies and fuels for our nuclear navy to the
    safety and security for civilian nuclear power the world over.
        However, as everyone on this panel knows well, a confluence
    of factors--abundant natural gas, power market designs,
    economic and regulatory burdens--have inhibited the Nation's
    nuclear energy over the past decade. The challenge confronting
    policymakers is how to preserve the beneficial use of atomic
    energy for future generations. Thoughtful, targeted legislative
    proposals today I think are a really good start.
        The bipartisan bill from Representatives Kinzinger and
    Doyle establishes reasonable and predictable time frames for
    regulatory decisions so companies like Oregon-based Nuscale
    Power can develop business plans to commercialize new nuclear
    technologies, while also protecting future consumers from high
    regulatory costs.
        The many regulatory requirements imposed by the Federal
    Government on special nuclear material are understandable due
    to the risk associated with unsecured radioactive sources, but
    this presents barriers to new market entrants, too. Congressman
    Flores' discussion draft will spur innovation by providing a
    solution to advanced nuclear fuel needs.
        And the bipartisan discussion draft from E&C members Hudson
    and Peters and two members of the Armed Services Committee,
    Congressmen Wilson and Norcross, will help identify specific
    national security applications to capture the benefits of
    transformational nuclear reactor designs. For example, Idaho
    National Laboratory's remote location and critical defense
    programs may be an ideal location to construct and operate a
    resilient nuclear reactor.
        And lastly, Congressman Johnson's discussion draft will
    help reduce barriers to competition facing our domestic
    manufacturing, vendors, and nuclear service companies. This is
    a critical conversation for this subcommittee and one we must
    not shy away from.
        This morning's witnesses bring both extensive experience in
    public service and business acumen. And we thank you both for
    being here.
        I want to welcome Dr. Brent Park, the recently confirmed
    Deputy Administrator for Defense Nonproliferation at the
    National Nuclear Security Administration. Dr. Park is
    responsible for critical national security programs that keep
    America safe. Dr. Park is joined on the first panel by Ed
    McGinnis from DOE's Office of Nuclear Energy. So we appreciate
    your being here.
        And the second panel this morning includes Melissa Mann,
    the president of URENCO, USA. URENCO is the only domestically
    located, NRC-licensed facility to enrich uranium for commercial
    use. Ms. Mann brings a wealth of insight to this discussion on
    behalf of the U.S. nuclear supply chain industry.
        And Southern Nuclear has assumed the leadership mantle on
    behalf of utilities to assess and develop advanced nuclear
    reactor designs. Nick Irvin leads those efforts for Southern
    Company and offers a hands-on testimonial of the rigorous
    process underway across the country to seek regulatory approval
    for promising first-of-its-kind technologies.
        I also want to welcome back Jeff Merrifield, who has
    testified in this room many times, going back to his tenure as
    an NRC Commissioner. He is now practicing law with a focus on
    advanced nuclear reactors and strategic counsel to energy
    companies. Jeff provides an abundance of experience to inform
    today's discussions.
        There remains tremendous promise for America's nuclear
    technology. And we can ensure that promise through legislative
    reforms reflective of our committee priorities to put consumers
    first, advance innovation, protect national security, and spur
    competition. I believe the four bills today align with those
    priorities.
        So I look forward to and thank our Members on both sides of
    the aisle for coming together for these initiatives. And I
    would be remiss if I didn't also thank the committee, and
    especially Mr. Shimkus, for the effort to get a permanent and
    interim nuclear waste storage facility up and running. He and I
    won the pool on the vote count in the House. We both
    independently predicted 340 votes would be achieved, and that
    was the number. Now we just need, you know, 100 in the Senate.
    Maybe 98 would do.
        So, with that, Mr. Chairman, we remain committed to moving
    forward on this energy front. And I return the balance of my
    time.
        [The prepared statement of Mr. Walden follows:]

                     Prepared statement of Hon. Greg Walden

        Today's Energy Subcommittee legislative hearing represents
    an important component of our DOE modernization efforts.
        The bills we will examine provide key ingredients to
    enhance a core national security and energy security mission of
    the Department, and of the Nation: promoting the safe and
    peaceful use of nuclear technology.
        When Congress first authorized the commercial application
    of atomic energy in 1954, it declared: the ``development, use,
    and control of atomic energy shall be directed so as to promote
    world peace, improve the general welfare, increase the standard
    of living, and strengthen free competition in private
    enterprise.''
        That policy remains as relevant today and as important as
    ever.
        By any measure, atomic energy has already brought
    tremendous benefits to the Nation; it has provided a baseload,
    emissions-free source of electricity that has powered homes and
    industry over the past half-century. It has provided an
    infrastructure for our national and international security--
    from the technologies and fuels for our nuclear navy to the
    safety and security for civilian nuclear power.
        However, as everybody on this panel knows well, a
    confluence of factors--abundant natural gas, power market
    designs, economic and regulatory burdens- have inhibited the
    Nation's nuclear industry over the past decade.
        The challenge confronting policymakers is how to preserve
    the beneficial use of atomic energy for future generations.
    Today's thoughtful, targeted legislative proposals are a good
    start.
        The bipartisan bill from Representatives Kinzinger and
    Doyle establishes reasonable and predictable timeframes for
    regulatory decisions so companies like Oregon-based Nuscale
    Power can develop business plans to commercialize new nuclear
    technologies, while also protecting future consumers from
    unnecessarily high regulatory costs.
        The many regulatory requirements imposed by the Federal
    Government on special nuclear material are understandable due
    to the risk associated with unsecure radioactive sources, but
    these regulations present barriers to new market entrants.
    Congressman Flores' discussion draft will spur innovation by
    providing a solution to advanced nuclear fuel needs.
        The bipartisan discussion draft from committee members
    Hudson and Peters and two members of the Armed Services
    Committee, Congressmen Wilson andNorcross, will help identify
    specific national security applications to capture the benefits
    of transformational nuclear reactor designs. For example, Idaho
    National Laboratory's remote location and critical defense
    programs may be an ideal location to construct and operate a
    resilient nuclear reactor.
        And lastly, Congressman Johnson's discussion draft will
    help reduce barriers to competition facing our domestic
    manufacturing, vendors, and nuclear service companies. This is
    a critical conversation for this subcommittee, and one we must
    not shy away from.
        This morning's witnesses bring both extensive experience in
    public service and business acumen.
        I welcome Dr. Brent Park, the recently confirmed Deputy
    Administrator for Defense Nonproliferation at the National
    Nuclear Security Administration. Dr. Park is responsible for
    overseeing critical national security programs that keep
    America safe. Dr. Park is joined on the first panel by Ed
    McGinnis from DOE's Office of Nuclear Energy.
        The second panel this morning includes Melissa Mann, the
    president of Urenco, USA. Urenco is the only domestically
    located, NRC-licensed facility to enrich uranium for commercial
    use. Ms. Mann brings a wealth of insight to this discussion on
    behalf of the U.S. nuclear supply chain industry.
        Southern Nuclear has assumed the leadership mantle on
    behalf of utilities to assess and develop advanced nuclear
    reactor designs. Nick Irvin leads those efforts for Southern
    Company and offers a hands-on testimonial of the rigorous
    process underway across the country to seek regulatory approval
    for promising first-of-a-kind technologies.
        I also welcome back Jeff Merrifield, who has testified in
    this room many times going back to his tenure as an NRC
    Commissioner. He is now practicing law with a focus on advanced
    nuclear reactors and strategic counsel to energy companies.
    Jeff provides an abundance of experience to inform today's
    discussion.
        There remains tremendous promise for American nuclear
    technology; and we can ensure that promise through legislative
    reforms, reflective of our committee priorities to put
    consumers first, advance innovation, protect national security,
    and spur competition. The four bills today align with those
    priorities.
        I appreciate the bipartisan leadership from Members on this
    topic and look forward to moving these important bills forward.

        Mr. Upton. The Chair would recognize the ranking member of
    the full committee, Mr. Pallone, for an opening statement.

    OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE
                IN CONGRESS FROM THE STATE OF NEW JERSEY

        Mr. Pallone. Thank you, Mr. Chairman.
        Today's hearing will examine four bills addressing a range
    of topics relating to advanced nuclear energy technology. H.R.
    1320, the Nuclear Utilization of Keynote Energy Act, introduced
    by Representatives Kinzinger and Doyle, builds upon a
    discussion draft that this subcommittee reviewed in 2016.
        H.R. 1320 makes several major changes to the Nuclear
    Regulatory Commission's budgeting process and fee structure.
    The bill caps corporate support costs at the Commission and
    puts a ceiling on the fee charged to each nuclear reactor. I
    appreciate the financial strain the nuclear industry is facing
    and the carbon free energy it provides, however, I am concerned
    that these budgetary changes could arbitrarily limit the
    resources the NRC needs and adversely affect its ability to do
    its job.
        I also have questions about Section 7 of the bill which
    sets up an expedited time line for review of nuclear reactors
    at the NRC. The bill provides 24 months to complete a draft
    environmental impact statement and 42 months to complete the
    technical review process. Inflexible deadlines could jeopardize
    the environmental and safety review process for more complex
    applications.
        And I am also concerned with the provision in the section
    that requires NRC issue a construction permit to a nuclear
    facility even if an entity has filed a formal request for a
    hearing objecting to the project. Stakeholders should have the
    chance to voice their concerns publicly before a project permit
    is issued.
        But despite my issues with those sections of the bill, I am
    supportive of setting a deadline for the NRC to finish its
    decommissioning rulemaking and removing advanced nuclear
    reactor work at NRC from the fee recovery requirement. I look
    forward to work with my colleagues on this bill as we move
    forward in the process.
        The committee will also review a discussion draft from
    Representative Johnson that makes changes to the process by
    which the Secretary of Energy authorizes the transfer of
    unclassified nuclear energy technology and assistance to
    foreign countries. This is known as the Part 810 process. I
    appreciate that this process must function well for the U.S. to
    remain competitive in the commercial nuclear space, but the
    bill establishes a 30-day time frame for the Secretary to
    approve the transfer of certain low proliferation risk nuclear
    technologies to countries that are not nuclear weapon states.
        Unfortunately, President Trump has put us on the path to
    upend the current dynamic of nuclear weapons proliferation
    across the globe. The President has walked away from the Iran
    deal. And now Saudi Arabia has said that if Iran restarts its
    nuclear program Saudi Arabia will itself pursue building
    nuclear weapons. And I am uncomfortable with expediting the
    review process of Part 810 at a time when there is so much
    global uncertainty on nuclear proliferation. This is not the
    right time to address this issue.
        Next, the committee will consider a discussion draft from
    Representative Flores to accelerate the availability of high-
    assay low-enriched uranium. This is the fuel needed for most
    advanced nuclear reactor designs. It is not commercially
    available today. In order to ensure the fuel is available for
    advanced reactors once they are licensed and ready to begin
    producing electricity, the Federal Government will need to
    coordinate efforts within agencies and with the commercial
    nuclear sector. This is a worthy effort, and I look forward to
    working with the majority on this proposal.
        And last, we have a discussion draft that directs the
    Departments of Energy and Defense to develop a report
    evaluating the resiliency benefits of siting microreactors at
    critical DOE and DoD infrastructure sites. I believe this
    report will provide the committee with valuable information,
    and commend Representatives Peters and Hudson, as well as my
    New Jersey colleague, Representative Norcross, for taking up
    this important issue.
        But finally, I want to thank, I do want to thank Priscilla
    Barbour, who has provided invaluable support over the last year
    as an energy fellow on the minority committee staff. Priscilla
    is finishing her fellowship tomorrow, and I wish her well on
    her future endeavors.
        [The prepared statement of Mr. Pallone follows:]

                 Prepared statement of Hon. Frank Pallone, Jr.

        Today's hearing will examine four bills addressing a range
    of topics relating to advanced nuclear energy technologies.
        H.R. 1320, the Nuclear Utilization of Keynote Energy Act,
    introduced by Representatives Kinzinger and Doyle, builds upon
    a discussion draft that this subcommittee reviewed in 2016.
    H.R. 1320 makes several major changes to the Nuclear Regulatory
    Commission's (NRC) budgeting process and fee structure. The
    bill caps corporate support costs at the Commission and puts a
    ceiling on the fee charged to each nuclear reactor. I
    appreciate the financial strain the nuclear industry is facing
    and the carbon-free energy it provides. However, I am concerned
    that these budgetary changes could arbitrarily limit the
    resources the NRC needs and adversely affect its ability to do
    its job.
        I also have questions about section 7 of the bill, which
    sets up an expedited timeline for review of nuclear reactors at
    the NRC. The bill provides 24 months to complete a draft
    environmental impact statement and 42 months to complete the
    technical review process. Inflexible deadlines could jeopardize
    the environmental and safety review process for more complex
    applications. I am also concerned with a provision in this
    section that requires NRC to issue a construction permit for a
    nuclear facility even if an entity has filed a formal request
    for a hearing objecting to the project. Stakeholders should
    have the chance to voice their concerns publicly before a
    project permit is issued.
        Despite my issues with those sections of the bill, I am
    supportive of setting a deadline for the NRC to finish its
    decommissioning rulemaking and removing advanced nuclear
    reactor work at NRC from the fee recovery requirement. I look
    forward to working with my colleagues on this bill as we move
    forward in the process.
        The committee will also review a discussion draft from Rep.
    Johnson that makes changes to the process by which the
    Secretary of Energy authorizes the transfer of unclassified
    nuclear energy technology and assistance to foreign countries.
    This is known as the Part 810 process. I appreciate that this
    process must function well for the U.S. to remain competitive
    in the commercial nuclear space. But, the bill establishes a
    30-day time frame for the Secretary to approve the transfer of
    certain ``low proliferation risk'' nuclear technologies to
    countries that are not nuclear weapons states.
        Unfortunately, President Trump has put us on the path to
    upend the current dynamic of nuclear weapons proliferation
    across the globe. The President has walked away from the Iran
    deal, and now Saudi Arabia has said that if Iran restarts its
    nuclear program, Saudi Arabia will itself pursue building
    nuclear weapons. I am uncomfortable with expediting the review
    process for Part 810 at a time when there is so much global
    uncertainty on nuclear proliferation. This is not the right
    time to address this issue.
        Next, the committee will consider a discussion draft from
    Rep. Flores to accelerate the availability of high-assay low-
    enriched uranium. This is the fuel needed for most advanced
    nuclear reactor designs. It is not commercially available
    today. In order to ensure the fuel is available for advanced
    reactors once they are licensed and ready to begin producing
    electricity, the Federal Government will need to coordinate
    efforts within agencies, and with the commercial nuclear
    sector. This is a worthy effort, and I look forward to working
    with the majority on this proposal.
        Last, we have a discussion draft that directs the
    Departments of Energy and Defense to develop a report
    evaluating the resiliency benefits of siting microreactors at
    critical DOE and DOD infrastructure sites. I believe this
    report will provide the committee with valuable information,
    and commend Representatives Peters and Hudson, as well as my
    New Jersey colleague, Rep. Norcross for taking up this
    important issue.
        Finally, I want to thank Priscilla Barbour, who has
    provided invaluable support over the last year as an energy
    fellow on the minority committee staff. Priscilla is finishing
    her fellowship tomorrow.

        Mr. Pallone. And then I would like to yield my minute to
    Mr. Doyle.
        Mr. Doyle. Thank you, Mr. Pallone. And thank you, Mr.
    Chairman, for holding this hearing today. I appreciate the
    opportunity to discuss nuclear energy, which is a critical
    component of our Nation's energy portfolio.
        Nuclear energy provides nearly 40 percent of Pennsylvania's
    electricity, and employs thousands of skilled workers in
    Pennsylvania. This carbon-free, reliable baseload power is also
    an important factor in meeting our climate goals, which is why
    it is necessary to work collaboratively to address the issues
    confronting the nuclear industry.
        I want to thank my colleague, Congressman Adam Kinzinger,
    for his leadership introducing H.R. 1320, the NUKE Act. This
    bipartisan legislation would take important steps to modernize
    the NRC's fee structure, study new opportunities for additional
    regulatory certainty, and look to future reforms that will
    ensure the NRC can continue to effectively protect public
    health and safety.
        I would note that this legislation was originally entitled
    the NUKEPA Act, so I appreciate that the name has evolved so
    that it no longer poses a threat to the State of Pennsylvania.
        Mr. Chairman, with that, I thank you and yield back.
        Mr. Upton. The gentleman's time has expired. We are now
    ready to start our distinguished panel's testimony. We welcome
    Brent Park, the Deputy Administrator for Defense Nuclear
    Nonproliferation at the NNSA; and Ed McGinnis, Principal Deputy
    Assistant Secretary for the Office of Nuclear Energy at DOE.
        So, welcome to both. And each, thank you for submitting
    your testimony in advance. It will be made part of the record
    in its entirety. And we would like you to spend 5 minutes each,
    no longer than that, to discuss the summary, at which point we
    will go to questions.
        Dr. Park, we will welcome you first.

       STATEMENTS OF BRENT PARK, PH.D., DEPUTY ADMINISTRATOR FOR
       DEFENSE NUCLEAR PROLIFERATION, NATIONAL NUCLEAR SECURITY
     ADMINISTRATION, DEPARTMENT OF ENERGY, AND EDWARD G. MCGINNIS,
       PRINCIPAL DEPUTY ASSISTANT SECRETARY FOR NUCLEAR ENERGY,
                          DEPARTMENT OF ENERGY

                        STATEMENT OF BRENT PARK

        Dr. Park. Good morning, Chairman Upton, Ranking Member
    Rush, members of the subcommittee. Thank you for the
    opportunity to provide views on behalf of the Department of
    Energy's National Nuclear Security Administration on the
    proposed pieces of legislation. I appreciate the ongoing
    bipartisan efforts to address our Nation's energy challenges.
        First I would like to discuss the potential for DOE to
    establish a program to support the availability of high-assay
    low-enriched uranium, so-called HA-LEU. NNSA fully agrees with
    the committee that availability of HA-LEU is important, and
    recognizes the need that industry has expressed for researching
    and developing HA-LEU fuels.
        Enriched uranium is required at various levels of
    enrichment and forms for national security and nonproliferation
    missions, as well as an equalizer for production. Since the
    United States no longer has a uranium enrichment capability for
    these missions, the Nation relies on inventory of highly
    enriched uranium material that is unblended to meet the
    enriched uranium requirements identified above. However, our
    supply is finite, and at present irreplaceable. Moreover, our
    current stores of HA-LEU will run out in the early 2040s.
        To meet industry needs, NNSA will evaluate any specific
    requests from industry for this material alongside NNSA's
    ongoing needs for enriched uranium for defense and nondefense
    purposes.
        NNSA supports the language in the bill regarding the
    development of a transportation package for HA-LEU, and
    exploring options to establish a domestic HA-LEU enrichment and
    production capability. NNSA strongly supports such an
    enrichment capability which we believe is essential in assuring
    a long-term supply of HA-LEU to meet the needs of the
    commercial industry, research reactors, and medical isotope
    products.
        A second bill with NNSA components for discussion today
    pertains to DOE's authority under 10 C.F.R. Part 810 to
    regulate exports of U.S. civil nuclear technology and
    assistance for peaceful purposes. Overall, this draft
    legislation will deliver useful and practical improvements of
    the regulatory process that is important to the Nation's
    security and economic prosperity.
        We appreciate the opportunity to come before you today as
    well as continue the discussion with your staff on any issues
    that may arise. The Department seeks to ensure the highest
    nonproliferation standards are applied globally in such a way
    as to facilitate U.S. exports. The burgeoning international
    nuclear energy market provides a significant commercial
    opportunity for the U.S. nuclear industry, and the export of
    U.S. nuclear technology plays a large part in making sure U.S.
    industry remains an active player in this market.
        In response to feedback from the U.S. industry and other
    stakeholders, we have taken a number of steps to simplify and
    update the Part 810 regulation, and have implemented
    significant improvements in the process for reviewing export
    applications. In addition to the Department's recent
    implementation of the e810 electronic application system, the
    committee's legislation will further streamline the review
    process in general, while maintaining strong nonproliferation
    controls on U.S. nuclear technology.
        We agree that this legislation will empower the Secretary
    of Energy to authorize technology and systems exports in a more
    expeditious manner. I look forward to additional discussion
    with the committee.
        In our view, this legislation will reduce processing times
    for applications involving certain reactor technologies and
    destinations that present a low risk of nuclear proliferation,
    and will provide the Department with flexibility to recommend
    the Secretary to delegate some application approvals to a lower
    level.
        Another advantage the bill provides is the requirement for
    DOE offices to review Part 810 applications at the same time
    that they are being reviewed by the interagency whether they
    are performing these reviews expressly. We are happy to report
    that the Department has already begun this process, and we are
    confident this is yet another step in the right direction.
        NNSA recognizes that the effective implementation of our
    mission is to strengthen our strong partnerships with industry.
    NNSA needs these strong energy partners to resolve the critical
    national security issues that we face.
        Thank you for the opportunity to testify before you today.
    And I, with my staff, look forward to future discussions of
    this draft bill. I stand ready to answer any questions you may
    have.
        [The prepared statement of Dr. Park follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Upton. Thank you so much.
        Mr. McGinnis.

                    STATEMENT OF EDWARD G. MCGINNIS

        Mr. McGinnis. Thank you very much, Chairman Upton, Ranking
    Member Rush, and other members of the subcommittee. I am very
    pleased to appear before you today to discuss legislation
    addressing advanced nuclear energy technologies, including
    high-assay low-enriched uranium, which I will refer to in
    shorthand during my testimony as high-assay LEU.
        Although the administration is still evaluating your bills
    and has not taken an official position at this time, the
    Department greatly appreciates the committee's interest in
    these topics and recognizes the potentially very important role
    high-assay LEU may well play in meeting our Nation's energy and
    national security needs.
        Over the last seven decades, the nuclear energy
    capabilities pioneered by the United States have served and
    supported our Nation's energy security and, in turn, national
    security. In recognition of this vital role, the White House-
    led review of U.S. nuclear energy policy is underway, and we
    are already beginning to take steps to revitalize and expand
    our civil nuclear energy sector. The outcomes of the civil
    nuclear review will inform our approach to revitalizing this
    critical sector.
        While our Nation's nuclear infrastructure, supply chain,
    and manufacturing base have been significantly degraded, the
    United States still leads the world in other key areas of
    nuclear energy. In fact, we believe the most mature advanced
    U.S. designs could potentially be deployed as early as the mid
    to late 2020s by the private industry. This is where the need
    for high-assay LEU arises.
        Nearly all U.S. advanced nonlight-water reactors under
    development will require high-assay LEU, including advanced
    microreactors. The advanced reactor community has stressed the
    near-term need and importance of high-assay LEU for advanced
    nuclear fuel, qualification testing, and for potential
    demonstration reactors.
        No commercial enricher currently provides high-assay LEU.
    While current enrichment plants could be modified to produce
    high-assay LEU, it is unlikely that a commercial capability
    would be pursued without further indication of progress towards
    deployment by advanced reactor vendors. The Department
    recognizes the industry's concerns regarding high-assay LEU
    fuel, and we are taking a number of actions to support the
    development of high-assay LEU in the near and longer term.
        First, the Department is working with industry to refine
    its near-term R&D needs for fuel development and qualification,
    particularly how much material is needed, when, and in what
    form, and also to understand more about projections for longer-
    term needs.
        Second, we are leveraging our expertise in support of the
    technical aspects of commercial high-assay LEU infrastructure.
    The Department is aware that high-assay LEU may be needed in
    various fuel forms by different vendors. On the transportation
    side there are no large scale shipments of uranium enriched
    above 5 percent. And the transportation packages currently used
    for these smaller shipments may not support commercial-scale
    operations.
        Third, the Department is reviewing materials across the DOE
    complex with an eye toward materials and processing options
    that may support some near-term industry R&D needs. Once
    industry needs in terms of quantities, forms, tolerances for
    impurities, and timing are known, the Department can then
    evaluate specific requests from industry for material,
    alongside our ongoing needs for research, reactor fuel, and
    medical isotope production. Current Department mission needs
    are supplied from our finite and diminishing supply of high-
    enriched uranium.
        In conclusion, the Department is working closely with U.S.
    nuclear innovators to define the challenges to bringing the
    next generation of advanced nuclear reactors and power into the
    marketplace, and are embarking on a number of actions to
    support the development of a commercial fuel cycle for high-
    assay LEU.
        We look forward to working with Congress, including in
    particular the subcommittee here, industry, and our partners
    across the Department on defining and exploring high-assay LEU
    issues now and in the future.
        And, finally, I would just like to say that we greatly
    appreciate the work and focus of this subcommittee on such
    important matters to our Nation's energy and national security.
    Thank you very much.
        [The prepared statement of Mr. McGinnis follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Upton. Well, thank you both. And appreciate your kind
    words. And we do work, try to work in a bipartisan way in
    potentially all the things that we move through this
    subcommittee. And we look forward to working with you.
        I would say as we talk about these bills, and the sponsors
    are here, we intend to move these bills. And there is a
    legislative process. We want your input. I know that you have
    not taken a formal stand with staff on any of these, but we
    would like your technical assistance, but also your continued
    input as these bills begin to move through the process. So if
    you can take that back to your department heads, that would be
    great.
        Quick, couple of quick questions from my vantage point. You
    know, we know that, according to the EIA and World Nuclear
    Association data, there are presently about 50 nuclear reactors
    under construction around the world, mostly in Asia. There are
    about 150 to 160 reactors on order or planned, and upwards of
    300 that have been proposed. Almost all of that growth is in
    Asia, the Middle East, with a little bit in Russia.
        Not a lot here in the U.S., I think primarily because of
    the cheap natural gas. We're seeing big advancements there in
    terms of new permitting. I've got a facility in my district
    that looks to break ground a little bit later this fall. And I
    have got a nuclear plant, it is like a plant that is looking to
    phase out now over the next couple years, the Palisades plant.
    And more power will have to be generated by other sources,
    whether it be renewable, gas, that type of thing.
        So as the U.S. companies are competing primarily with
    China, Russia, France, South Korea, if we are unable to
    successfully compete and are excluded from those emerging
    markets, including the Middle East, will the dominance of
    China, Russia in these markets be beneficial to international
    nuclear security, nonproliferation, and nuclear safety? How
    will that all fit as we lose probably our leading role as we
    see the number of domestic facilities here in the U.S. actually
    be reduced without any real plans to finish construction.
        The new plants won't make up for the ones that are being
    taken offline. How does that work with what is happening
    internationally?
        Dr. Park. Thank you. First of all, I agree with your
    assessment that the U.S. needs to reclaim the leadership
    clearly. There is no question in your statement. And how we go
    about doing that is what is on the table for us to discuss.
        I think we are taking your leadership and guidance from
    this committee to make sure we streamline many of these
    approval processes and so on. But we need to do better. I
    acknowledge that. And in terms of actually not playing in the
    theaters that you just talked about, many dozens of nuclear
    reactors being built and being designed and so on, we need to
    get into that world as quickly as possible and work closely
    with any other sectors to make sure we have a competitive edge.
        Again, our--as a nuclear physicist I am happy to share with
    you we actually have the edge on the nuclear technologies on
    the science and technology side, we just need to better
    transfer these proven technologies in a safe, secure--in a
    safeguarded format. We are doing our very best at the moment.
        Mr. Upton. Mr. McGinnis, do you have anything?
        Mr. McGinnis. Thank you very much. I would say that the
    implications to the United States trending out of its nuclear
    leadership role, which most of the DNA still today around the
    world in nuclear technologies is from the United States and
    some great innovators, if we continue with this trend and if we
    don't find a way to re-vector into a sustainable growth
    potential, it goes far beyond electricity. Resiliency is really
    important. But when it comes to the global, competitive,
    strategic state of play in nuclear with Russia and China, the
    implications go directly into our national security interests
    and not just our energy security interests.
        So it is vital that we begin building again. We have had an
    extraordinary run of our fleet, which is by far the most
    efficiently run in the world. And we still lead as the greatest
    innovators. We know how to disrupt and innovate like other
    industries we are witnessing in aerospace and others in the
    United States. Frankly, our competitors are hoping that we
    don't find and tap that innovation in this moment for nuclear.
        I strongly believe we are at that point where we are in the
    process of disrupting the market, innovating right now. And so
    we have a great opportunity, and I want to say in large part
    because of the really unprecedented, I would say in my career,
    bipartisan support from Congress, including such as is
    reflected in this subcommittee. So thank you.
        Mr. Upton. And before I yield there to my friend Mr. Rush,
    I want to insert into the record a report from the Atlantic
    Council titled ``U.S. Nuclear-Power Leadership and the Chinese
    and Russian Challenge.'' And without objection, so ordered.
        [The information appears at the conclusion of the hearing.]
        Mr. Upton. I yield to my friend, the gentleman from
    Illinois, for 5 minutes.
        Mr. Rush. I want to thank you, Mr. Chairman.
        Dr. Park, you noted Secretary Perry's December 2017 letter
    to this subcommittee detailing the agency's commitment to
    reducing processing time for application on the Part 810. You
    stated that DOE and NNSA have already made significant progress
    in improving efficiency and transparency on the Part 810
    regulatory regime by implementing the Part 810 process
    improvement plan.
        These improvements help to reduce the average processing
    time for a request under Part 810 from a high of more than 18
    months to approximately 12 months. In light of this process
    improvement plan do you see a need for legislation such as the
    discussion draft that is before us today that will amend the
    Atomic Energy Act to improve the process for authorizing the
    transfer of civilian nuclear commerce, technology, and
    assistance. And does this bill overlap with aspects of the
    improvement plan?
        Dr. Park. First of all, I did a really detailed analysis of
    the committee's help and guidance, by the way. That is in
    concert with this committee that we have been developing PIP,
    performance improvement plan. We actually had implemented many
    of your guidance in our planning, by the way.
        For example, as we are developing e810 for example, your
    example, we actually, I think we shared with your staff that
    the internal processing--this is only an example by the way--
    instead of waiting for State Department to do--to wait for
    official assurance on operation requirements we actually do a
    parallel process, number one.
        Number two, as it turns out that many of the things that we
    used to do in paper form, the industry partners did not know
    what kind of progress they were making with us, through e810,
    for example. If they are able to have a transparency into where
    are their packages and, you know, ask us how to speed things
    along and so on, there are a lot of improvements that we have
    made. We still need to do more.
        But, again, there are enough of positive signs. Yesterday I
    asked my staff to give me statistics on what kind of uses we
    have for e810. I am happy to report to the committee that the
    improvement of the usage has gone up substantially from last
    year to this year on month-by-month rollout. Compared to 2017,
    2018 usage of e810 is 50 percent higher. It is too early to
    tell whether this will really seal the deal in terms of
    expediting the approval process and so on and so forth.
        But so far, indicators are that we are making a positive
    difference and we are training the interested partners so they
    know how to work with us. So this is all being realized.
        Mr. Rush. Right. So on the proposed legislation, will that
    enhance your ability or will that retract from your ability?
        Dr. Park. So, I don't think I could comment on whether that
    would help or whatever. But I appreciate the fact that there
    are many, many useful guidelines out of this committee. So we
    will look for ways to work with the committee.
        Mr. Rush. Thank you. I am going to ask you another
    question.
        In your written statement, you say that the Avanced Nuclear
    Fuel Availability Act, as written, may be redundant to existing
    requirements and initiatives currently being conducted at the
    agency. You also note that ``allowing a consortium that
    includes industry members to determine who can purchase HA-LEU
    from the Department may present conflicts of interest or an
    unfair advantage to certain players in the emerging market.''
    Can you briefly discuss both the redundancies that are found in
    this bill with regards to your current practice?
        Also, what recommendation will you suggest to help avoid
    the occurrence of conflict of interest or unfair advantage for
    industry members helping to decide who can purchase HA-LEU?
        Dr. Park. So, appreciate your thoughtful question.
        As it turns out, I would not look at the word
    ``redundancy'' as a negative word. The fact that we actually
    have been working with your staff of this committee for quite
    some time we then implemented the redundancy of the word would
    come in the form of, we heard you already. If the bill actually
    incorporates these guidelines, we are happy to absorb, follow
    the guidelines. But we have been doing quite a bit already in
    the form of, we are actually working with any and other parts
    within DOE to collectively promise from industry partners.
        We have some rough numbers that we got. But, again, we are
    actually incorporating that into our projections, as I shared
    with you in my oral testimony. Our supply would run out in
    early 2040s, so we are required to update our projections as we
    collect information from industry partners or other players.
    So, to that extent, ``redundancy'' is not a bad word, number
    one, if that helps you.
        Mr. Rush. I get your point.
        Mr. Upton. The gentleman's time has expired.
        Mr. Barton.
        Mr. Barton. Thank you, Mr. Chairman. I don't have too many
    questions.
        My primary question is about the discussion draft by
    Congressmen Hudson, Wilson, Norcross, and Peters about these
    microreactors at Department of Energy--I mean Department of
    Defense facilities. I'm not real sure what a microreactor is.
    So I want a definition. And I also want to know who would have
    jurisdiction. Would it be the Defense Department or would it be
    the Energy Department?
        Mr. McGinnis. Thank you very much for that question.
    Microreactors, depending on who you talk to, define it by the
    power level. And one conventional range is 1 to up to 10
    megawatts electric. Some companies are defining it 1 to 30,
    even in the kilowatt range.
        But it is smaller, lower level than what is a conventional
    small modular reactor, number one.
        Number two, this is a very interesting emerging technical
    sector that I am witnessing, we are witnessing right now in the
    United States with regards to microreactors. There are a number
    of exciting designs and companies in different parts of the
    United States, some of which we are working with at the
    Department of Energy on supporting an appropriate technical
    role early stage on supporting the proving out of these
    microreactors.
        In fact, we have an MOU with one such microreactor where
    they are targeting 2021 to have the first demonstration built
    at Idaho National Lab, just to give you a sense of how fast
    this is moving. These microreactors, the key--I know about this
    from the fuel supply--is they all, virtually all, require high-
    assay LEU, maybe smaller amounts, but if they prove out the
    business line they are going to, they will be selling many of
    them.
        Now, on the question of the Department of Defense and
    Department of Energy, what I can say is that we are certainly
    working with the Department of Defense. We are in
    communications with them. We are sharing our information and
    know-how on microreactors with the Department of Defense, more
    than one part of the Department of Defense. We are sharing
    information with them from the infrastructure side, the
    Assistant Secretary as well as from Army. And we see, frankly,
    great potential, significant potential with regards to the role
    and value of microreactors.
        And I think, frankly, this could be one of those surprise
    disruptive, very positively disruptive sectors that may, may
    catch a lot of us by surprise in a very good way. And I am
    excited about it.
        Mr. Barton. I yield back.
        Mr. Upton. Mr. Peters.
        Mr. Peters. Thank you, Mr. Chairman. I appreciate having
    this hearing today.
        Nuclear energy technology is an important part of
    increasing our zero mission energy sources. We need this energy
    generation and the clean air standards it can help us achieve.
    And for these reasons, and many more, I supported research and
    development in next generation energy technologies,
    particularly advanced nuclear development in small modular
    reactors.
        And I am one of the, with Mr. Hudson, one of the lead
    sponsors of the draft bill before us today. And I appreciate
    his work on that.
        My bill would--our bill would--direct the Department of
    Defense and Department of Energy to work together in analyzing
    how microreactors can bolster energy resiliency for national
    security.
        In my home district in San Diego and in the nearby region,
    we have piloted microgrids at Marine Corps Air Station Miramar.
    We have tested battery generation rucksacks at Camp Pendleton,
    and performed other energy development project partnerships
    between the Navy and the University of California at San Diego.
    DoD has been a willing and helpful partner in testing clean and
    innovative energy sources. It is not because they are tree
    huggers or doctrinaire environmentalists, but from their
    perspective energy resilience is a life and death question.
        For instance, the fewer batteries that Marines have to
    carry, the more ammunition they can take in their pack; and
    that could be what saves their life in a firefight in a faraway
    country. It is a stark reminder of how energy resilience is
    critical. I think the partnership in this bill makes sense and
    I hope to see it advance quickly.
        To Mr. McGinnis, I had a question about research funding. I
    am an advocate for early stage innovation and research support
    from the Federal Government. I wanted to just give you an
    opportunity to say if you think we are missing any areas of
    nuclear research and innovation, where we need to bolster that
    investment.
        Mr. McGinnis. Thank you very much.
        There, as indicated, we are in the process of revitalizing
    our nuclear energy sector. We made it clear that we have
    experienced great degradation, frankly, including in our test
    capabilities, whether it is not having fast neutrons for a fast
    spectrum reactor to be able to test those key components for
    the next class of reactors coming in, or advanced fuels, or
    whether it is other technical capabilities that we need as a
    key element of our nuclear sector.
        So I can say, first of all, that the authorization language
    that we have seen today, and also the appropriations has been
    very important to support our efforts to revitalize. We don't
    just rely on Idaho National Lab, although Idaho National Lab is
    a flagship lab for nuclear energy, we are relying on Oak Ridge,
    we are relying on many of the others, and Lawrence Livermore
    and other labs. But if we are going to get back in the game we
    have got to get our fuel cycle R&D test capabilities back to
    where it belongs, back in a robust area.
        We are on a good trajectory now. And all I can say is
    strong support is greatly appreciated as we work with a
    private/public posture where we are finding that sweet spot to
    support and dispatch the technical challenges that with our
    labs and our capabilities that our U.S. industry can most
    benefit from.
        So, thank you very much for the support. And we stand ready
    to follow additional laws that may come in that you are moving
    through.
        Mr. Peters. Maybe I will just explore a bit more kind of
    what, what areas you might see us investing in, what particular
    areas in nuclear that you think offer promise?
        Mr. McGinnis. One is, of course, the fast test capability
    is very important, having testing capabilities for the new
    class of reactors. We are experience--we are seeing a lot
    through our new industry funding opportunity mechanisms where
    it also becomes an opportunity to hear from industry where they
    most need us. Whether it is testing, whether it is benchmarking
    data, simulation modeling and simulation, even supporting the
    NRC with our modeling and simulation and supporting their
    development of advanced guidelines, frankly, industry needs us
    to support them in the data and benchmarking as they go through
    certification. That is one of the biggest challenges for our
    new innovators.
        But also, having the testing capabilities, just continuing
    to support our reinvestment in establishing our test capability
    for both the front and back end and for reactors, fuels. And
    also, very important, if not most important, is our efforts to
    support the continued life and longevity of the fleet of
    reactors operating in this country now.
        Mr. Peters. Thank you very much. And thank you, Mr.
    Chairman. I yield back.
        Mr. Upton. Mr. Shimkus.
        Mr. Shimkus. Thank you, Mr. Chairman.
        Mr. McGinnis, I have a lot to go through so let's be
    efficient with our time if we can. Are you aware of an
    enrichment facility located in Eunice, New Mexico?
        Mr. McGinnis. Yes, indeed.
        Mr. Shimkus. Is that enrichment facility licensed by the
    Nuclear Regulatory Commission?
        Mr. McGinnis. Yes, indeed.
        Mr. Shimkus. In order to meet future demand for high-assay
    low-enrichment uranium, is that facility capable of making the
    material for commercial use? If the facility secures the
    appropriate modification to its NRC licensing basis?
        Mr. McGinnis. I believe yes.
        Mr. Shimkus. Are you aware of a recent GAO report that
    found DOE's cost estimate to develop new enrichment options
    lacked credibility because it was not well documented or
    accurate?
        Mr. McGinnis. I am aware of the GAO report in general.
        Mr. Shimkus. And have made no judgment on being aware of
    the GAO report as far as accuracy?
        Mr. McGinnis. I would have to get back with you on the
    specifics on my view on that.
        Mr. Shimkus. It is just important because as you go forward
    if GAO's analysis is not accurate then we don't want to do our
    basis of decision making on that fact.
        Based on the availability of U.S. enrichment capabilities
    for commercial use would you agree that the U.S. Government
    does not need to spend billions of dollars of nondefense money
    to subsidize Government-backed competition to an existing
    operational facility?
        Mr. McGinnis. I certainly don't support subsidies. But I
    think it is premature to say whether there would be a need for
    a second supply for enrichment. I can tell you that some
    companies have come to me strongly encouraging the support of
    at least two suppliers to have good, robust competition and
    pricing. Notwithstanding, though, we are very fortunate and
    very thankful for having that top world class facility in New
    Mexico in the form of LES.
        But the question is whether--and I am just basing it on
    what we are hearing from certain industry--whether that is the
    final end state if they end up establishing a cascade for high-
    assay LEU, or do you want to get to the point where you have a
    couple of suppliers, such as in the fuel fabrication business
    where you have pretty strong competition because--and pretty
    good pricing because of that competition.
        Mr. Shimkus. Well, you know, other pricing debates that we
    have in the other realm of fuel. So, also we want, we really
    want to be cautious about in this time of fiscal constraints. I
    do believe in competition. I do believe that that drives that
    through. But we have dealt with Government subsidization of
    helping infrastructure to move to markets that weren't
    existing. Not saying that they needed competition, but there
    was no business plan or model for that.
        So, again, I am just raising some concerns.
        Dr. Park, if the United States funds a Government-sponsored
    facility to support both defense and nondefense purposes would
    you be concerned that this could send conflicting messages to
    the international community about developing dual-purpose fuel
    cycle facilities?
        Dr. Park. So U.S. segment has made a commitment to
    international partners. For example, when they downgrade from
    HA-LEU to lower level LEU, we would provide the fuels because,
    actually, it's going to be the right thing for us to do to
    minimize the risks of HA-LEU falling into the wrong hands. So
    we need to follow through on those commitments. And we also
    follow through on the medical isotope production efforts and so
    on.
        The first example that I used is high performance reactors
    that require the use of HA-LEU and so on. So there are
    different examples. But to answer your question, it actually
    depends on case by case. We need to actually analyze the
    benefits and risks and then make appropriate recommendations.
    So I don't think that we could provide some general, overall,
    you know, response that this is what we are going to do. It
    really depends on who the players are, who are partners are,
    and so on, and other considerations that we need to fold in.
        Mr. Shimkus. Yes, and I was listening carefully to my
    colleague Scott Peters from California. And when he was asking
    really Mr. McGinnis what other things, you know, he was trying
    to reach what other things should we be looking at? My point
    would be we need to look at the front end here to address the
    international concerns and the commitments, but also the
    Government being involved in an area where we may not need to
    be involved, and how much of those nondefense dollars which are
    always, we are scrambling for, goes to that when there is an
    available, looks like there will be an available commercial
    production facility already in place.
        So those are my concerns. We have aired them out now
    publicly. And with that, Mr. Chairman, thank you. I yield back
    my time.
        Mr. Upton. The gentleman yields back. The Chair would
    recognize the gentleman from California, Mr. McNerney.
        Mr. McNerney. Thank you, Mr. Chairman.
        Just last week Mr. Flores approached me and asked me if I
    would support his bill on HA-LEU. And I think it is a good
    bill. I am glad to do that. But I do have a concern about
    proliferation. I think that is something that we all are
    worried about.
        The world has changed in the last few months, and I am
    worried about where we are going with additional capabilities,
    especially if it is in the commercial sector. Could you address
    that, Mr. Park?
        Dr. Park. Your concern is to certify everybody in this room
    and throughout the Government system. But, again, we have not
    relaxed reviews and assessments of how we share our nuclear
    technologies with our partners, international partners and so
    on.
        Mr. McNerney. Were you to have more commercial control of
    that information?
        Dr. Park. From my perspective, and obviously Ed McGinnis
    actually should chime in, but again as the person responsible
    for issuing the safeguards aspect of sharing the nuclear
    technologies, we first have to evaluate the whole big picture.
    It is a balancing act. Cannot delay forever.
        Mr. McNerney. Right.
        Dr. Park. We cannot expedite without actually doing the
    right analysis so we know what the risks are and we need to
    mitigate those. And as far as country partnership and the--what
    we are actually concerned about is more of with the
    technologies that we share with country A could be sent to
    somewhere else without our knowing. So safeguards is not one-
    to-one, it's actually one of many that we have to worry about.
        So that is where my guys come in to do a very careful
    analysis working with the State Department and other
    interagency partners.
        Mr. McNerney. Mr. McGinnis, do you see SMRs and
    microreactors becoming prominent in the next decade or two?
        Mr. McGinnis. Yes, very possibly I do. And they offer many
    attributes that one does not see in the current class of
    reactors, from far more passive safety aspects. Some of these
    reactors will--are designed to safely shut down even in the
    event of a complete loss of power indefinitely, or a complete
    loss of coolant.
        Some of these reactors, micro and others, reactors are
    smaller source term, more manageable. Some of these have life
    of core where you do not need refueling such as every 18 months
    for a fuel reactor, so, or a large reactor.
        But with respect to international I would just like to make
    one thing very clear in my view. I have worked international as
    the Deputy Assistant Secretary for 11 years. There is no other
    country on this planet that has a higher standard, more
    stringent standard on nonproliferation and safety than us. I
    can assure you the Russians, the Chinese, and the others, they
    do not insist on the level of nonpro and safety, even in our
    current 123 and our Part 810 process and the others. We are
    very proud of it. And I think you will hear the U.S. industry
    continue to say that is a key aspect of our product, that we
    bring the safest products and with the highest levels of
    nonproliferation.
        Mr. McNerney. Well, I think the SMR promise is good. And I
    am looking forward to seeing that realized in our country. And
    I recognize, along with everyone here I think, that the
    industry is struggling at the moment. But how do we make it
    easier for the industry to prosper without harming the NRC's
    ability to regulate effectively?
        Mr. McGinnis. Yes, indeed, that is the question. We, in my
    view, we want the most efficient process for the regulatory
    reviews. And we want the least costly but in a manner that does
    not compromise in any way, shape, or form the current standard
    of safety. That is our objective.
        The Department of Energy is ready. We made it clear with
    the NRC and we continue to do it, make all of our capabilities,
    model, in simulation and testing, available to help them and
    help the vendors go through this process.
        Mr. McNerney. Thank you. I yield back, Mr. Chairman.
        Mr. Upton. Mr. McKinley.
        Mr. McKinley. Thank you, Mr. Chairman.
        Not long ago the Defense Science Board put out a report
    that said our grid system, our national grid system is fragile,
    vulnerable, and near its capacity. And as a result of that, or
    perhaps influenced by that, DoD has been expressing more and
    more of an interest in using small nuclear reactors, and much
    like maybe Barton was talking about, the microreactors on plant
    or on bases so that they could be islands of independence from
    the grid, a fascinating concept with that.
        Do you, do either of you agree with the Defense Science
    Board, with their conclusion? Because we have been having quite
    a few hearings about this grid reliability, about reliability
    and resilience, do you agree with their, their findings that
    there are problems with the--with reliability and resilience?
        Mr. McGinnis. I agree that resiliency is a huge issue. And
    it is only going to get more challenging if we don't get new
    baseload plants coming in, including nuclear.
        I would also say there is still no other energy source on
    the planet that compares to the attributes of nuclear power:
    clean baseload, no refueling for at least 18 months. The new
    SMRs coming in they could possibly go 4 years or longer.
        With regards to resiliency and microreactors and the 2016
    Defense Science Board, we think it certainly, while we see that
    it is driving the Department of Defense in evaluating their
    options with microreactors now for that very purpose of
    resiliency. Obviously, resiliency----
        Mr. McKinley. If I could on that, I might disagree slightly
    with you on that, and that is your own department there--excuse
    me, DOE, has come out with its own report saying that actually
    to improve reliability and resilience it is nuclear and coal
    because of the storage, the capabilities of onsite storage and
    the lack of interruption of supply.
        So you are saying you share that concern?
        Mr. McGinnis. Oh yes, indeed.
        Mr. McKinley. Let me go to the next issue that is a little
    bit more sensitive to this. Because I am fascinated with the
    nuclear industry. We don't have any plants in West Virginia but
    we did have a shipping port that was not very far from where I
    live and in my district.
        But not long ago, it was just last October, The Hill came
    out with a report that talked about how Russia's Putin was
    trying to influence and get involved and take more influence,
    control over our atomic energy business in the United States.
    And he was using, according to the article, there was
    litigation over bribery, kickbacks, extortion, and money
    laundering, all that took place in and around sale of Uranium
    One and how we--how CFIUS apparently dropped the ball and
    allowed us to lose a lot of control of our uranium.
        So with this issue of nuclear energy as much, how do we,
    how do we restore the confidence that we are not, we are not
    allowing a foreign entity like Russia to influence our nuclear
    energy field, given that the history. And I am curious, what
    has taken place internally to reverse the damage that was done
    under the previous administration as a result of this?
        Mr. McGinnis. I would say first of all it is very important
    to have a diversity of supply. In the United States there is
    about 5 percent of the uranium that comes from U.S. uranium
    mining miners. That is an historic low.
        For enrichment, apart from LES, again which we appreciate
    for an enricher in the United States, but the fact is we have
    zero American-owned enrichers.
        With regards to supply, between 17 and 20 percent of all
    the enrichment that comes into our Nation's 99 reactors comes
    from Russia. There is a suspension agreement that limits them
    to go where they cannot supply more than 20 percent. That
    suspension agreement is slated to end in 2020. The Department
    of Commerce is following that very closely.
        I can't speak to the details of what you said, but I can
    say that it is very important for us to have a balanced and
    diverse supply, including strong supply capability for the
    front end, as was mentioned, for fuel supply in this country.
        Mr. McKinley. And my time has expired. So I just going to
    ask you if you could please, could you stop by my office? I
    would like to have more of a conversation about this, how we--
    what are the next steps that need to be done.
        Thank you, and I yield back.
        Mr. Upton. Mr. Green.
        Mr. Green. Thank you, Mr. Chairman and Ranking Member Rush,
    for holding this hearing.
        We are discussing these four important bills that deal with
    various aspects of domestic nuclear energy. As a fuel source,
    nuclear energy generates 20 percent of our domestic power and
    constitutes over 60 percent of the country's clean energy.
    While renewables have grown by leaps and bounds in recent
    years, I think it is important to remember that nuclear
    generation is the original environmental friendly source of
    power generation.
        While most of our fleet is under strain from economic
    factors, the legislation we are discussing today has the
    potential to reshape our focus and bring our nuclear fleet into
    the 21st Century. I particularly want to thank my friend
    Congressman Doyle for working on language to address the burden
    that our NRC fee structure places on plants.
        Mr. Park, Mr. McGinnis thank you for being here today. I
    would like to talk about my friend Mr. Flores' bill, the
    Advanced Nuclear Fuel Availability Act. This legislation is
    aimed at addressing many of the challenges faced by the high-
    assay low-enriched uranium fuel, HA-LEU, or HA-LOW. I don't
    know how, in my Texas accent.
        Mr. Park, would you talk about how the enriching process is
    different compared to the typical uranium?
        Dr. Park. If you are talking about HA-LEU or H-A-L-E-U,
    right now the only way we can do it is by downblending from the
    aging stockpile that we have. Right now we can only enrich up
    to 5 percent. The HA-LEU is over 5 percent, below 20. So you
    need more work to get to HA-LEU, yes.
        Mr. Green. In 2016, the Office of Defense Programs began
    working to establish domestic uranium enrichment capability in
    time to establish a supply of need for tritium production. What
    is the current domestic capacity for this production? And what
    do you expect the DOE capacity to be going forward when it
    comes to HA-LEU?
        Dr. Park. So, right now our current projection is we will
    run out of tritium production capacity in about 20 years or so
    from today. 2038 is the projected time line. So we are actually
    in the Office of Defense Programs at NNSA is in the process of
    looking at the options to see if we can actually produce our
    own enrichment enriched uranium for tritium production. And
    what we are looking for is industry partners working with Ed
    McGinnis and others to actually share with us their
    requirements.
        It might be possible for us to fold in that requirement on
    top of DOE. We are actually very anxious to look for purpose of
    opportunity with the industry partners. And so it is in
    progress.
        Mr. Green. What are the challenges that transportation of
    this highly enriched uranium lead to in comparison with the
    typical levels of enrichment?
        Dr. Park. So, obviously the 5 percent is the LEU. When you
    go to higher level of enrichment it requires totally different
    containers, transportation methods, and so on and so forth. And
    the quantity--and this is worth pointing out, and I'm going to
    hand it over to Ed to talk about this--quantity we are
    potentially facing is much larger than we ever faced. It
    requires a different look at the--a bit of R&D on top of
    everything.
        Mr. Green. Mr. McGinnis?
        Mr. McGinnis. Yes, indeed. In fact, transportation is key.
    I would like to express appreciation for this subcommittee and
    the bill to address the issue of transportation. I think it is
    time, very timely to look at it now. We need to plan in advance
    to support, hopefully, a successful advanced reactor fleet
    coming in through the pipeline with new high-assay LEU fuel.
        As Dr. Park said, right now we are relying on a limited and
    ever-decreasing supply of high-enriched uranium. Ultimately
    there are a couple of additional pathways one can secure that
    supply. And the most traditional way is through enrichment.
        And as Dr. Park said, the Department of--well, the NNSA
    side of the Department of Energy is looking at it from defense
    requirements primarily in tritium production. So that time line
    I would suggest--and this is part of the challenge--we may have
    a much earlier time line in the commercial sector, maybe as
    soon, as I indicated, mid-2020s where the commercial sector
    will need high-assay LEU. When you get that, you also not just
    need enrichment cascades, but you are going to need conversion,
    you are going to need fabrication, you are going to need
    actually new NRC license packages, transportation packages. So
    there is quite a lot to be done.
        Mr. Green. One last question. Do you think----
        Mr. Shimkus [presiding]. The gentleman's time has expired.
        Mr. Green [continuing]. The legislation addresses these
    challenges?
        Mr. McGinnis. I would say that I appreciate the focus. We
    do believe that it addresses the challenges. And we stand ready
    to work with the subcommittee.
        Mr. Green. Appreciate the chairman.
        Mr. Shimkus. Pretty sneaky getting that last question in
    there.
        The chairman now recognizes the gentleman from Illinois,
    and one of the authors of this legislation, Mr. Kinzinger, for
    5 minutes.
        Mr. Kinzinger. Thank you, Mr. Chairman. And thanks for your
    leadership on this issue as well. And thanks for holding
    today's hearing.
        As many of you know, my district is home to four nuclear
    power plants. And I continue to be deeply concerned that we are
    ceding U.S. global leadership in the nuclear space. I
    introduced H.R. 1320, the NUKE Act, with Congressman Doyle to
    make common sense reforms in the NRC recovery structure, fee
    recovery structure. And I am pleased to see it included.
        I still like NUKEPA, but in the spirit of our Founding
    Fathers and compromise, I was happy to relent on that.
        Section 2 of Congressman Johnson's bill requires the
    Secretary of Energy to report on all legal, regulatory, and
    commercial barriers imposed on our domestic nuclear industry.
    Compare those to our foreign--compared to our foreign
    competitors and recommend ways to improve our global
    competitiveness.
        Dr. Park, as part of your confirmation process you stated
    that you would continue to work with American companies so that
    they may engage in civil nuclear commerce around the world.
    Based on your previous experience, as well as your initial
    impressions leading NNSA's Defense Nuclear Proliferation
    Office, have you identified some of the actions that inhibit
    competitiveness at the U.S. nuclear industry?
        Dr. Park. So the standard practice asked me that. As I
    mentioned earlier, we look at the big picture and we do the
    best we can. And now the challenge is that the world is
    evolving so fast, as it was stated, in the last four months
    alone the world changed. And that there are new actors coming
    in to have more nuclear power and so on and so forth. And I
    need to recognize the fact that our policies, and procedures,
    and processes are a little bit behind time at times, and that
    we need to find a way to accelerate it and make it more
    meaningful so that we can apply the latest standards.
        So I would not necessarily call them deficiencies. That is
    how our system works. But at the same time, I appreciate your
    involvement and the committee's engagement so we can actually
    better implement the guidelines you might give to us.
        Mr. Kinzinger. Thank you.
        Mr. McGinnis, you have heard me speak about the DOE's
    Nuclear Energy International Program. Could you offer some
    preliminary observations about how our foreign competition,
    specifically the Russians and the Chinese, use state-backed
    resources to strategically use their civilian nuclear programs
    and undercut our interests?
        Mr. McGinnis. Indeed they do. And they use the full breadth
    of resources that they can draw on from their respective
    governments. I have seen it firsthand with Rosatom in Russia
    and the Big 3 utilities in China.
        The competition, one cannot overstate how foreboding and
    how challenging it is for American companies to compete against
    states. That is the fact. They bring financing. They bring
    deep, deep offers for training, for resources. In many other
    areas we are working really hard to try and support in our
    own--let me back up and say what we don't want to do is try and
    compete and be seen like a Russian company, like a Chinese
    company. We believe we are far more innovative, far more
    appealing. We bring our systems, our safety and security. So we
    do believe we can compete and win.
        But it takes strong Government support and advocacy from
    the United States. And it takes--and I think we need to all be,
    you know, just always continue to say we need to try and do
    better, in our efficiency for our regulatory reviews, for our
    license reviews. We need to continuously try and maintain the
    high level of safety while making it as easy as possible for
    these companies that are already in a formidable position to be
    able to complete and win.
        Mr. Kinzinger. Let me ask you, and I am sorry to do this,
    but put yourself in the sick and twisted mind of Vladimir
    Putin. What would be the reason you would want government
    support for the nuclear industry? What is your 10- or 20-year
    goal in that? What do you want to see a world that looks like
    X?
        Mr. McGinnis. Well, in just my own opinion, again having
    worked with Rosatom employees for quite some time in a
    competitive way, first of all they want to dominate the nuclear
    sector. I don't think, at least my colleagues, I have had
    difficulty with my Russian company colleagues seeing the virtue
    of competition. It is more of a monopoly objective.
        Mr. Kinzinger. And let me ask you more specifically, do you
    think Vladimir Putin looks at this as an economic benefit to
    his country or a national security benefit and ability to
    spread influence of Russia?
        Mr. McGinnis. Oh, so my first point was economically or
    sectoral-wise dominating as much as possible, but strategically
    nuclear energy goes well beyond, certainly in foreign
    countries, well beyond just electricity on the grid. So when
    one wins a commercial nuclear deal for a reactor, it is a 100-
    year relationship. It is a unique leverage point one has with
    those foreign countries. And it is, frankly, coveted by our
    competitors from a strategic perspective.
        Mr. Kinzinger. Thank you. And thanks, Mr. Chairman, I yield
    back.
        Mr. Shimkus. The gentleman's time has expired. The Chair
    now recognizes the gentleman from Pennsylvania, Mr. Doyle, for
    5 minutes.
        Mr. Doyle. Thank you, Mr. Chairman.
        Dr. Park, I appreciate the Department's commitment to
    streamlining the processing times to export nuclear-related
    goods under the Part 810 process. International markets
    represent a critical opportunity for domestic nuclear companies
    and their suppliers. And the ability to export these products
    remains important for U.S. companies. These opportunities can
    mean hundreds, even thousands of jobs, for hardworking
    Americans.
        My question is, how is the NNSA working with other agencies
    to ensure that this trade can continue to support American jobs
    without violating the NDAA review requirements and without
    posing a threat to national security? And more specifically,
    can you provide more information on the agency's overall
    strategy with regards to exports to China?
        Dr. Park. So, when it comes to China, there is a very
    specific requirement under NDAA 2016 that requires OD&I review.
    And it gets very difficult. So I would be more than happy to
    provide additional information.
        When it comes to NNSA doing its job to help accelerate the
    appropriate sharing, peaceful use of nuclear technologies and
    so on, I think that with this committee's help and assistance
    and guidance I think we have got the right frame of mind in
    terms of what we can do. For example, as I stated earlier,
    there is parallel processing. In other words, we don't wait for
    State Department to achieve, to get the country assurance on
    safeguards. We actually do the processing as if it is a done
    deal and we converge at the end.
        So instead of doing things in serial or the sequential
    manner, we do things in parallel at the same time. This new
    e810 process that we have adopted that you encouraged us to
    pursue is putting more what I call a transparency to all the
    users. They know what the package is. It is actually worth
    repeating a couple more times because instead of--in the past
    they didn't know where their package was in the approval
    process. But now they can actually call us.
        You know, some of the stories that my staff have been
    sharing with me, for example. You know, a couple of them got to
    know how to use the e810 system. It took them a while, but now
    they are thinking, the program managers are sitting in the back
    or they help because they can actually move things along much
    faster than ever before. And these are repeat users that we are
    talking about. And I am happy to report to you, again, roughly
    15 percent of the users from the commercial sector using our
    e810, I think that number would grow.
        And so there are some really good signs with the e810
    process. And, again, I need to caution all of us, you know,
    much of the delay does not come from our side. But, again, we
    have to wait for country assurances through the State
    Department, and sometimes that takes a year or more.
        Mr. Doyle. I would appreciate you corresponding with our
    office. We'd like to get a better sense of the strategy with
    regards to China. And I would appreciate that.
        Dr. Park. Yes.
        Mr. Doyle. Mr. McGinnis, I am glad to see your department's
    commitment to nuclear energy. We all know that investments in
    research and advanced nuclear technology are important, and in
    addition to supporting our existing fleet. I am concerned,
    though, that the President's fiscal year 2019 budget has
    proposed to reduce funding for nuclear energy by cutting $259
    million below the FY 2017 enacted level.
        Do you think that reforming the NRC fee structure could
    reduce the downward pressure on nuclear plant operators?
        Mr. McGinnis. With regards to the--thank you very much for
    the question. I respectfully would need to defer to the NRC as
    an independent agency on the fee structure. But I will say
    overall, obviously as indicated earlier, the fees are a
    significant factor in many U.S. companies attempting to get
    their technologies licensed and their operation license
    received. So it is a very significant factor.
        And so we certainly support the most efficient, least
    costly pathway with the highest standards of safety that makes
    us world-class products that we have to provide.
        Mr. Doyle. Let me ask you this, too. I do think that energy
    markets currently consider carbon, the carbon-free attributes
    of nuclear energy. And we have seen State policies that take
    these attributes into account. And I want to--do you support
    States' ability to properly account for these attributes?
        Mr. McGinnis. Certainly respect the States' decisions to
    do, to decide how to do that. That is the States' rights. And
    so we approach it from a resiliency perspective, trying to
    address the structural issues that, frankly, at times don't
    price, or don't price the value of resiliency.
        But with regards to States, certainly we respect that
    approach to support their electricity sources.
        Mr. Doyle. Thank you. I yield back, Mr. Chairman.
        Mr. Upton [presiding]. Mr. Long.
        Mr. Long. Thank you, Mr. Chairman.
        Mr. McGinnis and Dr. Park, I have got a question for both
    of you. Dr. Lyman's testimony suggests that any country that
    has access to light-water reactor technology is just a step
    away from becoming a nuclear weapons state. However, his
    testimony neglects to mention the International Atomic Energy
    Agency and international safeguards that are in place in
    addition to the U.S.'s capability to monitor nuclear fuel cycle
    programs around the world.
        Would you please describe the respective roles of NNSA and
    the Office of Nuclear Energy in supporting the IAEA program?
        Dr. Park. So, yes. NNSA does work closely with IAEA. In
    fact, we provide much of the technologies to IAEA and train
    them, and in terms of light-water reactor and so on and so
    forth.
        Any nuclear technology that actually produces plutonium we
    care about, we worry about. And there are no exceptions. As I
    stated earlier, we actually look for who these partners are and
    how they actually protect the materials, spent fuels, or
    whatnots, to make a determination as to what kind of
    arrangement we could have. But, again, there is no one-size-
    fits-all approach that we have.
        But, again, the light-water reactor, the fuel does have
    plutonium built in, so we need to worry about the results. We
    cannot ignore that aspect.
        Mr. Long. Mr. McGinnis?
        Mr. McGinnis. Yes. The Office of Nuclear Energy also works
    closely with the IAEA and also the NNSA. And we do commit a
    significant amount of funds for that work, including for
    safeguards, and security, and safety ultimately, both directly
    and indirectly.
        I would say one other point. And this is my view, it is
    just reality. We have these large state-owned suppliers. They
    are going to provide the choice if we don't provide an option
    to foreign countries that are considering nuclear energy. If we
    just say no, then they will very likely still proceed. And they
    will just proceed with another supplier with a lower level of
    safety and security. And we will also have lost a great number
    of other benefits, including a 100-year relationship with the
    highest standards of safety and security.
        Mr. Long. Again for both of you, can you briefly describe
    the U.S. programs to track and identify emerging international
    nuclear programs?
        Dr. Park. So, obviously, there is open literature. And we
    actually do track, you know, the progress being made throughout
    the world. And we have avenues, as well, that I am more than
    happy to brief you at appropriate locations.
        Mr. McGinnis. And we do participate in the materials
    tracking within the Department, with NNSA playing a lead role.
        Mr. Long. Well, would you agree with Mr. Lyman's assertion
    that any country that has access to nuclear energy can easily
    develop a nuclear weapons program, presumably without the
    international community's knowledge?
        Mr. Park. So, as a physicist, is it a possibility? Yes. Is
    it likely? It is very difficult. Especially at what we call the
    production scale, I hope our monitoring technologies, and our
    partnerships with IAEA, and our international partners we
    should be able to do a good job on who these actors might be.
        And should I be concerned? Of course. But, again, we have
    adequate technologies to help us to monitor the situation
    globally. And, again, I am more than happy to provide you with
    additional information.
        Mr. Long. Yes, well that is what I would hope. And that is,
    that is what I would think. But I just wanted your opinion.
        Mr. McGinnis, do you care to weigh in?
        Mr. McGinnis. I do not believe it would be easy.
        Mr. Long. OK, thank you.
        For you, Mr. McGinnis. In your testimony you mentioned the
    advancements around nuclear reactor design that are currently
    underway. Can you talk a little bit about these technologies
    and, if proven to work, how they can help revolutionize or
    revitalize, excuse me, revitalize our nuclear energy sector?
        Mr. McGinnis. Thank you very much. Yes, we are in my view
    at the precipice of an entirely new, innovative phase in the
    U.S. nuclear energy sector. I don't say that lightly. We are
    seeing it happen right now.
        The advance reactors such as the advanced SMR for the first
    time going through the NRC, receiving the first phase approval,
    including passive safety features, validates that they do not
    need any electric pumps or motors in order to be able to safely
    shut down because of the passive safety system. This is just
    one example of many of the advanced reactor designs that are
    coming out of the United States' nuclear innovation community
    that offers a step change, step change improvement on what is
    already strong safety in our reactors, number one.
        Number two is their versatility. We are witnessing reactors
    being designed that are unlike anything we have seen. We have
    reactors, advanced reactors that are designed to be able to go
    from 0 to 100 percent power in 60 minutes. That is load
    following. We haven't seen that with large reactors.
        We have finance ability for the advanced reactors unlike
    what we have seen. Instead of $8 billion per unit, not
    including financing, we are talking maybe a billion, maybe a
    billion and a half for a substantial generating capacity.
        We also have distributed opportunity where we have the
    opportunity now to place smaller reactors, modular scaled-up
    reactors in locations we never could do with a large reactor.
    So, product choice, versatility in application, desalinization
    or hydrogen production, this is an entirely new class of
    disruptive reactors, and that is why we are so excited about
    this.
        Mr. Long. This is a very important hearing we are having
    here today. And I want to thank both of you for taking the time
    to be here and sharing your knowledge with us.
        Mr. Chairman, I yield back.
        Mr. Upton. The gentleman yields back.
        Mr. Tonko.
        Mr. Tonko. Thank you. Thank you, Mr. Chair. And thank you,
    gentlemen, for joining us and for your insights on these bills.
        Administrator Park, Dr. Park, I have a few questions on the
    discussion draft that addresses the Part 810 process. It is my
    understanding that Section 3 would expedite the review process
    for, and I quote, ``low proliferation risk reactor
    technologies.'' However, I do not believe that these
    technologies are defined in the draft.
        Can you offer us a sense of what types of technologies
    would be captured by these low proliferation risk reactor
    technologies?
        Dr. Park. Yes. So, obviously this is interagency effort.
    DOE does have a lead on determining what would go in the
    category, but at the same time we need to coordinate that
    review process with the other agencies, including State, for
    example. Again, it's to a large extent a case-by-case. But
    there is no single category that says if it falls in the
    category, it's free for all. It doesn't work that way.
        Really because one agency appreciates or gives us
    flexibility at the same time as different challenges. But what
    is in the middle is country assurance. And that actually
    changes the calculation by the way. If it is a country that we
    have a 123 agreement with, it is straightforward. But, again,
    if it is not one of those countries, or China, India, or other
    countries it is very difficult. So we need to look at it from
    what I call a totality or big picture perspective.
        So to that extent you can actually categorize as light-
    water, low-risk, et cetera, but it really depends on who the
    recipients are.
        Mr. Tonko. Thank you. Currently, would those Part 810
    reviews qualify as low proliferation risks?
        Dr. Park. I need to get back to you. I don't, basically
    don't have specifics on.
        Mr. Tonko. OK, thank you. Does the Part 810 process look
    just at the technology or also the conditions within the
    potential partner country? That is to say is the current review
    process the same for each potential partner country?
        Mr. Park. I also need to get back to you because it is
    quite different from, you know, case to case. So maybe it might
    be more appropriate for us to give you solid data with a
    sample, with great examples as to what we are doing for several
    countries so you have appreciation for the challenges that we
    have.
        Mr. Tonko. OK. And you will forward that to us?
        Dr. Park. Yes.
        Mr. Tonko. Your testimony mentions that currently the
    lengthiest part of the review is the time it takes partner
    countries to provide the required governmental nonproliferation
    assurances. Can you give us some examples of these assurances?
        Dr. Park. So, we actually apply conditions so that they can
    actually enjoy U.S.-developed technologies. But these
    conditions require that they do not share with the third
    parties, and they do not actually modify without conditions and
    so on. It goes on and on and on.
        Oftentimes the host countries or the recipient countries
    when I think about this because there are obviously
    ramifications for they sign up for some things without fully
    understanding. But so it's along that line that satisfies.
        Mr. Tonko. But are these assurances different for each
    export partner country?
        Dr. Park. To a large extent. There is variation, obviously.
    As, for example, countries that we have a 123 agreements went
    through the review process with us at the highest level, so
    they know the what I call boundary conditions as to how to
    receive our U.S.-developed technologies.
        But, again, when you leave that small group of countries,
    which is 20-some-odd countries, the rest of the world still
    needs to go through the category process, how they respond to
    our requests and so on. We do a lot of hand holding but there
    is a limit as to how much we can do. We cannot speak for their
    countries.
        Mr. Tonko. My understanding is that the discussion draft
    would allow DOE to continue the review while it waits for the
    State Department to secure the assurances. Would this bill
    reduce or limit the time it takes for the State Department to
    secure those given assurances?
        Dr. Park. It is a separate process, somewhat decoupled. At
    the same time because of our experience working with our
    international partners and our industry partners who are
    actually trying to export the technologies, I think we can
    actually give them the right answers. It is up to them whether
    to take them or not. But, again, we can actually show them what
    steps they need to take. And, again, this is open to test, if I
    can use that phrase.
        Mr. Tonko. But do you think there should be limitations on
    how long the State Department might have to obtain these
    assurances?
        Dr. Park. So, it also depends on whether we have agreement
    with a country. I would stress, as was stated, that it really
    depends on what kind of assurance they provide us to safeguard
    our technologies.
        The biggest fear I personally have is our technologies go
    into wrong hands and we don't have any assurance that we know
    what they do with that technology that we have transferred.
    Safeguards concerns are monumental in what we do, even in the
    e810 process.
        Mr. Tonko. So those limitations are--could be critical.
        Dr. Park. Yes.
        Mr. Tonko. With that, Mr. Chair, I thank you and yield
    back.
        Mr. Upton. The gentleman yields back.
        Dr. Bucshon.
        Mr. Bucshon. Thank you, Mr. Chairman.
        The Department of Energy's public/private partnership with
    Nuscale Power which followed a similar effort that led to the
    licensing and construction of Southern Company's new nuclear
    reactors has proven to be a successful model to address a
    costly regulatory approval process for new nuclear
    technologies. Congressman Flores' legislation builds on that
    model with a public/private partnership for advanced nuclear
    fuel needs.
        Mr. McGinnis, DOE's Isotope Program includes an industry
    consortium to help meet specific needs, material needs of
    californium-252, which is used for an assortment of industrial
    applications. This consortium could be a model for the
    consortium in Mr. Flores' bill.
        Has your office discussed how the Isotope Consortium could
    apply to an advanced fuel program?
        Mr. McGinnis. Thank you very much. Isotope production is
    very important. There are certainly applications for advanced
    reactor technologies. But with regards to the lead for isotope
    production, that is both within the Office of Science and also
    NNSA. So if you don't mind, respectfully I may ask Dr. Park. I
    don't know if you have any refer--anything you want to say on
    the isotope production.
        Dr. Park. If it is appropriate we will get back to you
    because it involves yet another member within the DOE family,
    and they do more of that work. And isotope production that we
    are responsible for is really just purifications for medical
    isotopes or in R&D.
        Mr. Bucshon. Yes, if you can get a response back to the
    committee, that would be great. I would appreciate it.
        I yield the balance of my time to Mr. Shimkus.
        Mr. Shimkus. I thank my colleague.
        I just wanted to follow up on Adam Kinzinger's comments
    about the international aspect of this. I deal a lot with the
    Baltic countries, Eastern European issues, so I focus a lot on
    the Astravets plant being constructed on the border between
    Lithuania and Belarus. And I just want to highlight a couple
    issues on this.
        The International Atomic Energy Commission recommended a
    six-step process to review building of nuclear power plants to
    prevent disasters like Chernobyl and also, recently, Fukushima.
    Belarus has chosen to skip four of the six steps. That already
    identifies a concern.
        When asked why they want to build this plant, the President
    of Belarus said, ``This is a,'' and I quote, ``a fishbone in
    the throat of the European Union and the Baltic States.'' So it
    is not a power plant being constructed for energy security,
    energy efficiency, it is really economic warfare against
    Eastern European countries.
        Nuclear power plants in sensitive areas should be discussed
    within the Espoo Convention, which this is not. Nearly all of
    Lithuania is 300 kilometers of the plant, which means that if a
    disaster were to strike, long-term food consumption in the
    country could be affected, the drinking water could be
    affected.
        But there is also concerns, again highlighting what Adam
    was trying to raise on the national security aspects of this.
    Incidents occurring and cast on Belarus' commitment to working
    with neighbors and ensuring the plant's safety. In 2016, six
    serious incidents occurred, and Belarus has failed to be up
    front with Lithuania about any of them. A 330-ton nuclear
    reactor shell was allegedly dropped from about 13 feet. This
    was two summers ago now, not last summer. Belarus did not
    reveal anything about the incident until independent media
    reported it, and then downplayed it.
        Earlier, a structural frame at the site collapsed after
    workers, apparently under time pressure, filled it too quickly.
        So, and this is all based upon a statement in the record I
    did for the Congressional Record on the floor just raising this
    issue. So the international concern, state-sponsored actors
    versus competitive marketplace do bring a point of needed
    discussion to this debate. So I appreciate that. I just wanted
    to be additive to what Congressman Kinzinger has stated.
        With that, I want to thank my colleague from Indiana and
    yield back to him.
        Mr. Bucshon. Yes, I yield back, Mr. Chairman.
        Mr. Johnson [presiding]. The gentleman yields back.
        We now recognize the gentlewoman from Florida, Ms. Castor.
        Ms. Castor. Thank you very much. And thank you, Dr. Park
    and Mr. McGinnis, for being here today.
        I am very passionate about the United States remaining a
    leader in technology and innovation, especially in nuclear
    energy. I believe the commercialization of nuclear technology
    can be positive in that expanding and exporting this technology
    can be beneficial to businesses here on our economy and on
    international security.
        But I have concerns about the discussion draft that makes
    changes to DOE's Part 810 process. I believe the Secretary of
    Energy should have more discretion when reviewing
    authorization. But I question whether or not the legislation as
    drafted is as precise as it should be, actually providing a
    firm definition of low proliferation risk.
        And then I am also concerned that the application time line
    for low proliferation risk reactor technology will be untenable
    in the long run.
        Dr. Park, can you share with us how DOE currently defines
    low proliferation risk?
        Dr. Park. So with the--because of the many different
    parameters in reviewing the applications, for example, again
    the biggest factor is the recipient country risk. It is not a
    simple formula that actually would work for us. So only as they
    fit in the certain categories, for example, as I stated
    earlier, if we already have established a relationship through
    123 agreements we can go through a 5-week expedited process. It
    is not a big deal. We actually have done that before.
        But, again, if you don't belong in that category it becomes
    much more difficult. We need to actually work with them so they
    know what we are looking for and they can provide responses
    that we need to have to make sure that our technologies aren't
    shared in a manner that is not appropriate.
        So I do appreciate the fact that we need to find a way to
    expedite the processes. Again, we are somewhat limited in what
    we can do in terms of whether they already have an agreement
    with us or not. So, to that extent I would like to look for
    ways to work in these countries as best as we can so we can
    minimize, we can actually manage the risks in sharing U.S.
    technologies with these countries.
        I do apologize for giving you a roundabout answer, but it
    really depends on who the host countries are.
        Ms. Castor. Mr. McGinnis, do you have a comment on that?
        Mr. McGinnis. Just to say, obviously the Office of Nuclear
    Energy, its mission, the U.S. nuclear industry greatly relies
    upon this very important Part 810 process, as well as the two
    other export control authorities at the Department of Commerce
    and also NRC, as well as the 123. So this is a process, I
    think, that we are all collectively always trying to improve.
        Ms. Castor. Maybe you can rally those folks to look at
    that, that portion of and definition.
        Mr. McGinnis. Yes.
        Ms. Castor. That would be helpful.
        Mr. McGinnis. Will do.
        Ms. Castor. Dr. Park, do you foresee any challenges with
    the draft legislation that could hinder the U.S. as a producer
    of commercialized nuclear technology?
        Dr. Park. I don't see any showstoppers. If I can give you
    that as a response. The fact that the committee is very
    involved with us and asking our technical assistance and
    interpretations, we welcome it. We look forward to continue the
    relationship. I think it is a positive step where we see many
    positive signs.
        Ms. Castor. How about national security risk? I know you
    can't go into detail, great detail there, but are there any
    national security risks that could develop as a result of the
    changes made in the discussion draft?
        Dr. Park. There are always possibilities and potentials.
    And I think we are comfortable, we are confident that we can
    actually mitigate some of those risks along the way. And again,
    the minimizing and managing risks is what we do on NNSA's side.
    And so far I think that we have a pretty good handle on how to
    move forward with this whole situation and as far as the
    process of technology sharing and so on and so forth.
        But again, there are some things that just take time. And
    we appreciate your patience on it.
        Ms. Castor. Sometimes time is important when we are talking
    about national security. But I, I believe that the U.S. has to
    remain the leader in nuclear technology. And as I mentioned
    before, there are many benefits associated with reforming Part
    810, but there could also be unintended consequences. And
    that's what we need to focus on.
        I want to ensure, I want to ensure that we are proactive
    and efficient, as you said, when it comes to the
    commercialization of the nuclear technology. But we are
    counting on you and the experts out there to help poke and prod
    at this piece of legislation to make sure there are not
    unintended consequences.
        Dr. Park. We will. And we will work with you.
        Ms. Castor. Thank you. And I yield back.
        Mr. Johnson. The gentlewoman yields back. The Chair now
    recognizes himself for 5 minutes.
        Dr. Park, I understand that for many years the Department
    allowed the Secretary to delegate signature authority on Part
    810 authorizations. And it was only recently that DOE's general
    counsel revised its previous interpretation to disallow this
    delegation.
        Section 3 of my discussion draft simply clarifies in the
    Atomic Energy Act that the previous process was acceptable. So
    do you know if there were any delegations to your knowledge
    that involved unacceptable proliferation risk or created an
    unacceptable lack of visibility by the Secretary's office over
    the proposed exports?
        Dr. Park. So, my understanding is that there was not a
    delegation because of interpretation of the law, the way our
    general counsel read the law. And it is not because of lack of
    the appreciation for our technical staff.
        But again, we actually welcome this opportunity to delegate
    some of these ``routine'' things, although there is nothing
    routine about sharing nuclear technologies. But again, we
    appreciate it.
        Mr. Johnson. But I mean back when they were, because it was
    previously delegation was allowed. So when delegation was
    allowed are you aware of any delegations that, that involved
    any unacceptable proliferation risks?
        Dr. Park. I don't think there was any delegation in the
    past. That's my understanding.
        I am more than happy to correct myself after this hearing
    and get back to you.
        Mr. Johnson. OK. Well, based on your understanding of the
    decision, was the legal interpretation made in any way because
    staff weren't qualified or able to appropriately consider the
    impacts of the specific application?
        Dr. Park. Not at all. I think there is the highest
    confidence from the beginning of all the secretaries we have
    had on the technical qualifications and their judgment. It is a
    matter of how one read the law, and it is as simple as that.
        Mr. Johnson. Back to that first question. Would you, would
    you go back and take a look at that? Would you look and see if
    there were any delegations? Because it was my understanding
    that we used to do it that way and that there were. So I would
    like to clear that one up.
        Dr. Park. We will get back to you.
        Mr. Johnson. OK, thank you.
        Based on NNSA's review of the process, would enactment of
    this bill to revert to the previous delegation process have the
    practical effect of shortening the review process with minimal
    proliferation risk? Do you think it is a smart thing to do?
        Dr. Park. One-word answer: Yes. And obviously, as a
    physicist I will give you a 10-minute answer which you don't
    need right now. But, again, I think there are enough good
    qualities in the proposed legislation, and we will work with
    you. I think this is a positive sign. So, there are many things
    that we know how to fix. And this legislation will certainly
    help us to achieve that goal.
        Mr. Johnson. OK. All right.
        Dr. Park, continuing on, could reverting to the pre-2005
    process by which DOE can review an authorization in a
    concurrent process as the State Department's required process,
    would that help reduce the overall time frame, approval time
    frame?
        Dr. Park. Yes. The biggest challenge, again, is waiting for
    our partner countries to provide assurances. And there is just
    no simple way to get the answers.
        At the same time, one of the things that we have been doing
    is that we actually give ``credit'' for these countries having
    123 agreements with us. So there are some exceptions that allow
    us to accelerate the sharing the technologies. But, again,
    there are just a few dozen countries that we have a
    relationship with.
        Mr. Johnson. OK. All right. And would this change to the
    approvable process in any way reduce information that is
    reviewed, weaken the rigor of such reviews, or alter the
    various agencies that concur, or consult on the authorization
    in a manner that could undermine our national security
    interests?
        Dr. Park. So when I look at the positive side of this
    legislation it might actually help us because, for example,
    this online system would allow all the reviewers to actually
    look at each others' comments, for example, in real time. So I
    see potential positive changes that this system, this
    legislation will produce. But, also, we will look for
    unintended consequences along the way. You don't want to hurry
    up too fast, too much on some of the review processes.
        But, again, there are enough positive signs that we are
    really embracing this legislation.
        Mr. Johnson. OK. All right. Well, I will yield back my
    total of 21 seconds. And with that I think we have no
    colleagues on the left that want to ask questions.
        Mr. Flores, you are recognized for 5 minutes.
        Mr. Flores. Well, thank you, Mr. Chairman. I want to thank
    the witnesses also for joining us today. This is an important
    discussion. Nuclear power is the ultimate admissions-free,
    green-power source, particularly when it comes to the
    generation of baseload electricity. And so it is important for
    our country moving forward, not only for economic opportunity,
    national security, and also for the environment.
        Earlier this year I asked both Under Secretary Menezes and
    you, Mr. McGinnis, about collaborating to develop a policy to
    provide high-assay LEU. NNSA officials also testified at both
    of these hearings. Thus far DOE and NNSA's input in this
    discussion draft has been limited.
        Dr. Park's testimony notes that there are efforts underway
    relating to high-assay LEU, and I hope to increase our
    collaboration as we work towards formally introducing this
    legislation.
        Let's turn to a few questions. One provision in my
    discussion draft relates to the need to develop what is known
    as criticality benchmark data. This data is important to
    develop the underlying information to establish the necessary
    safe regulatory framework for the provision of nuclear fuels.
    Mr. McGinnis, can you succinctly describe the nature of this
    criticality information, why it is necessary, and what
    Government or non-Government facilities will be able to gather
    this type of data?
        Mr. McGinnis. Thank you very much. The benchmarking data is
    very important for a number of reasons, including
    transportation and packaging. This, in part, is because the
    criticality issues where you have a higher level of enrichment,
    and so whether it is needing new NRC licensed transportation
    systems to be able to transport in the U.S. enriched fuel above
    5 percent, much of the fuel that is anticipated to be needed
    will be as high as 17, 18, or 19 percent.
        Mr. Flores. Right.
        Mr. McGinnis. So the configuration, the way the materials
    is packaged. But a lot of this also is driven by what we are
    waiting on. And that is waiting to get a better sense, even
    though we want to get as much data as possible, who are the
    first movers? And what are the types of reactors--are we
    talking metal or are we talking oxide fuel? And different
    reactors designs have different types of fuels.
        Then there are other options for transportation as well,
    including in gas form.
        Mr. Flores. Can we move to the next part of the question,
    that is, what Government or non-Government facilities are
    available to gather this type of data?
        Mr. McGinnis. Well, the Department of Energy--first of all
    let me, again, recognize that the front end enrichment capacity
    is addressed, is being addressed fairly well in the U.S.,
    particular by--in particular by LES for the enrichment
    services. And I would say that the industry is poised to
    respond to additional needs, including high-assay LEU when they
    see the market coming and the customers coming in at a
    sufficient volume. So, in the meantime the Department of Energy
    does stand ready to make available its facilities to be able to
    do that data benchmarking, and other testing.
        We are doing some now. We are working with industry now in
    order to get as much of a clear understanding of what types of
    fuels are going to be needed when.
        Mr. Flores. OK. Dr. Park, you indicate in your testimony
    that you agree that advanced reactors will require HA-LEU. You
    note further that you will evaluate that need alongside the
    needs for our Nation's defense programs. The question is are
    these two programs on the same time frame or different time
    frames?
        According to your testimony there is ample fuel for weapons
    use available today. But it is unclear that there will be ample
    fuel for advanced civilian reactor use over the next 10 years.
    Is it appropriate to suggest that DOE's civilian nuclear
    program should focus on the near term commercial needs while
    your office can look at the longer term defense enrichment
    requirements?
        Dr. Park. So, as it turns out, even for the self-absorption
    program tritium production requirement that we need to start
    the work today because of the long lead time it takes to get
    the production up and running. So time is appropriate for us to
    collect the requirements from industry partners.
        It doesn't necessarily mean we will incorporate the
    commercial sectors we find through our DOE. Our commitment is
    to review all possibilities and make sure we stretch every
    dollar that we have to produce the enriched uranium. But,
    again, at the earliest moment we can collect and incorporate
    the requirements we will have a better idea as to what actions
    are available. If indeed we start with the enriched uranium
    enrichment then later it will stretch out into much longer and
    that will give us more options in terms of entertaining
    possibilities of supporting commercial sectors.
        So it really depends on the requirements within----
        Mr. Flores. It is possible our bill could help you in terms
    of our Nation's defense needs, as well as taking care of HA-LEU
    for advanced, for the advanced sector.
        OK, we have run out of time. I will submit additional
    questions for the record. I appreciate those responses.
        Thank you. I yield back.
        Mr. Johnson. The gentleman yields back. And I want to,
    seeing that there are--I am sorry, I didn't see Mr. Griffith
    walk in. Mr. Griffith is recognized for 5 minutes.
        Mr. Griffith. Thank you very much.
        Mr. McGinnis, nearly a year ago President Trump announced
    the administration was going to conduct a complete review of
    the Nation's civil nuclear policy. Following your appearance
    before this committee in early February you were asked to
    provide information for the record regarding this ongoing
    review. Nearly three months after those questions were
    submitted to you, we have not yet received a response from you
    or your team.
        So, I would like to ask a few questions about this ongoing
    civil nuclear review, and I would request that you please
    answer yes or no so we have time to get to all of them.
        As a principal on the National Security Council is the
    Secretary of Energy providing direct input into this ongoing
    review? Yes or no?
        Mr. McGinnis. Yes.
        Mr. Griffith. Are you aware if the review is engaging with
    other governmental agencies such as the Department of Commerce
    and the Department of State?
        Mr. McGinnis. Yes.
        Mr. Griffith. Are you aware if this review is receiving
    input from non-Government stakeholders?
        Mr. McGinnis. I cannot say yes or no on that one. I do not
    know.
        Mr. Griffith. OK, thank you.
        Are you aware if the review intends to seek input from
    Congress to inform the review?
        Mr. McGinnis. Again, I can't speak for the White House on
    whether they, when they plan, if they plan to give input.
        Mr. Griffith. But input's a good thing from Congress,
    wouldn't you agree? Yes or no?
        Mr. McGinnis. It's a good thing.
        Mr. Griffith. All right. To the best of your understanding,
    and obviously this can't be yes or no, to the best of your
    understanding when do you expect the review to be completed?
        Mr. McGinnis. I do not know the answer to that, other than
    the fact that I can tell you that we have attended quite a few
    meetings, very substantive. We have made significant progress.
        And I can also say that our charge at the Department was
    not to wait for any completion to be able to do things that we
    can do now, whether it is loan guarantees, whether it is notice
    of proposed rulemaking, whether it is industry quotas or
    supporting the revitalization.
        Mr. Griffith. And I appreciate that. And I hope included in
    that would be recommendations that you need legislative
    support. And that was the last of my series of questions as to
    the best of your understanding where the review makes specific
    legislative recommendations for Congress to consider. And I
    would hope that even if it is not finished, if you find one let
    us know, because we cannot operate on those suggestions if you
    don't give them to us.
        Mr. McGinnis. And, respectfully, I would like to apologize
    for not getting those answers to you. I am fully aware of them.
    I have been part of that process giving the answers. But,
    unfortunately, it is taking longer than we had hoped for to get
    them back to you. We will get them back to you.
        Mr. Griffith. Well, I appreciate that. I am glad we were
    able to clear this up a little bit today.
        As this morning's hearing clearly indicates, as well as the
    dozens of other Energy and Commerce Committee hearings in this
    Congress there is a strong bipartisan support to address key
    challenges confronting our Nation's nuclear sector. And I hope
    the administration will commit to working with us as we go
    forward.
        Mr. McGinnis. Absolutely.
        Mr. Griffith. Thank you very much. And I yield back.
        Mr. Johnson. The gentleman yields back.
        We are now pleased to recognize the gentleman from North
    Carolina, Mr. Hudson, for 5 minutes.
        Mr. Hudson. Thank you, Mr. Chairman. I want to first thank
    Chairman Upton and Ranking Member Rush for holding this very
    important hearing. Thank both our witnesses for being here and
    taking so much time with us.
        A number of studies have identified the potential benefits
    of applying advanced nuclear reactor designs to fill specific
    national security needs. Mr. McGinnis, you have talked a lot
    about the microreactors and sort of what you see in the future.
    I represent Fort Bragg, the largest military base in America.
    This is an issue that I am very interested in.
        I believe it is critical that we have your input on how we
    can improve the safety and security of our soldiers in the
    field on military installations, as well as critical DOE sites
    around the country. Mr. McGinnis, I asked for information
    regarding ongoing DOE and Department of Defense discussions on
    this topic back in February after a subcommittee hearing. And I
    am disappointed that I haven't gotten any response. I really
    wanted to get some of this feedback as we were developing my
    discussion draft.
        I hope you will carry this message back to the Department's
    senior leadership that this committee expects more timely and
    coordinated response in advance on our agenda because, again,
    we value your input and think it will improve the process.
        Mr. McGinnis. Again I apologize. But I would like to
    reinforce the importance of microreactors as a key aspect
    potentially for resiliency and also, of course, security,
    establishing a secure energy supply chain by having indigenous
    generation on site. So there is tremendous potential value to
    having a microreactor potentially on site supplying power for a
    base or other Federal or non-Federal facility.
        Mr. Hudson. I appreciate that.
        And I want to thank Mr. Peters for working with me on the
    discussion draft. Our discussion draft asks a number of
    questions to help identify key components of how a pilot
    program might be developed. Briefly, Mr. McGinnis, are the
    topics in this bipartisan bill the right questions to ask for
    Congress to make a fully informed decision on the framework of
    this pilot program?
        Mr. McGinnis. Yes, indeed. In fact, I have been meaning to
    say how timely and how appropriate and, frankly, how important
    the issues that have been addressed, are addressed in these
    four pieces of legislation, are incredibly important. We are in
    a key moment in time to revitalize, and the support as we are
    seeing in this legislation, the issues that are going to be
    vital if we are to succeed.
        Mr. Hudson. Thank you for that.
        Are there any additional issues that we should be aware of
    relative to, particularly, my discussion draft?
        Mr. McGinnis. Just to say, again, we are in a key moment in
    time. Industry needs all the help we can give them in the
    appropriate way to get back on a revitalized footing to be able
    to not only supply resilient power in the United States but to
    be globally very, very competitive. Thank you.
        Mr. Hudson. I appreciate that.
        Dr. Park, Congressman Johnson's discussion draft includes a
    section that creates an expedited process or procedures for low
    proliferation risk technologies. Will you please describe how
    you envision the development and implementation of that
    process?
        Dr. Park. As we have been building up the cases where we
    were able to, we are able to transfer technologies we would
    like to be able to copy that over as much as possible. But,
    again, there are challenges related to who the host countries
    are. So we still need to juggle both ends to make sure we
    actually provide safeguard assurances at the same time we do
    expedited process and approval. So it's a balancing act.
        Mr. Hudson. Appreciate that.
        Like the other sections of this discussion draft, these
    procedures will help enable our domestic suppliers to more
    effectively compete in the world market, as has been mentioned
    by my colleagues, while not impacting our national security
    interests, and allowing NNSA to focus on the applications that
    truly present national security risks. Do you believe this
    section will have that intended effect? Do you think we strike
    the right balance?
        Dr. Park. I think it is on the right path.
        Mr. Hudson. Great. I appreciate that. And with that, Mr.
    Chairman, I yield back.
        Mr. Johnson. The gentleman yields back.
        And now seeing that there are no further Members wishing to
    ask questions I would like to thank our panelists, our
    witnesses for joining us here today. You are excused.
        We will call up our second panel, if they would take their
    seats. These include Jeffrey S. Merrifield, partner at
    Pillsbury Winthrop Shaw Pittman; and Melissa Mann, president of
    URENCO; Nick Irvin, Director, Research and Development for
    Strategy in Advanced Nuclear Technology, Southern Company; and
    Edwin Lyman, Senior Scientist, Global Security Program, Union
    of Concerned Scientists.
        And as soon as our second panel takes their seat, just for
    Members' understanding and information, we will get through as
    many of these introductory or the witness testimonies as
    possible before we have to break for an anticipated vote
    sometime in the next 10, 15 minutes or so.
        So, with that, Mr. Merrifield, would recognize you for 5
    minutes.

        STATEMENTS OF JEFFREY S. MERRIFIELD, PARTNER, PILLSBURY
       WINTHROP SHAW PITTMAN LLP, AND SENIOR ADVISOR, CLEARPATH
       ACTION; MELISSA C. MANN, PRESIDENT, URENCO USA, INC., AND
    MEMBER, UNITED STATES NUCLEAR INDUSTRY COUNCIL; JAMES NICHOLAS
     IRVIN, DIRECTOR, RESEARCH AND DEVELOPMENT, STRATEGY, ADVANCED
      NUCLEAR, AND CROSSCUTTING TECHNOLOGY, SOUTHERN COMPANY, AND
        MEMBER, ADVANCED REACTOR WORKING GROUP, NUCLEAR ENERGY
      INSTITUTE; AND EDWIN LYMAN, PH.D., SENIOR SCIENTIST, GLOBAL
            SECURITY PROGRAM, UNION OF CONCERNED SCIENTISTS

                   STATEMENT OF JEFFREY S. MERRIFIELD

        Mr. Merrifield. Thank you. Chairman, Ranking Member Rush,
    and members of the subcommittee, it is a pleasure to testify
    before a committee that I had the opportunity to be in front of
    when I was an NRC Commissioner. I am here today as a senior
    advisor to ClearPath Action, although I am a full-time partner
    in Pillsbury Law.
        Founded by businessman Jay Faison, ClearPath Action's
    mission is to accelerate conservative clean energy solutions.
    To advance the mission, ClearPath Action develops cutting-edge
    policy and messaging and works with policymakers and industry.
        During my time at the NRC and in positions I have held
    since then, I have had the opportunity to visit all 99 nuclear
    power plants in the United States, and over half of the 450
    nuclear power plants around the world. I have been impressed by
    the commitment to excellence in nuclear power operations that I
    have seen at all the plants I have visited.
        I would first like to turn to the matter of advanced
    nuclear reactors. These designs, which utilize high temperature
    gas, molten salt, and liquid metal, among other designs, range
    from microreactors of a few megawatts to large gigawatt-size
    reactors. While they represent a diversity of sizes and cooling
    methods, they generally possess enhanced safety features as
    well as improved economics when compared to existing reactors.
        In a report issued by ClearPath in the Nuclear Industry
    Council in February, Pillsbury identified that of the over 50
    advanced reactor designs in North America the vast majority of
    these are planning to use higher enrichments of fuel, typically
    between 8 and 19.75 percent. And some of these designs could
    come to the U.S. market by the mid to late 2020s.
        As the development of a fuel supply and regulatory approval
    can take multiple years, work must begin immediately to ensure
    a sufficient supply of this high-assay low-enriched uranium.
    Unfortunately, the Department of Energy, which has been a
    traditional supplier of these enriched levels of material, does
    not currently possess the high-assay enriched uranium or
    enrichment capabilities that are needed for advanced reactors
    as the current inventory is dedicated to other needs such as
    research reactors and the Navy propulsion program.
        The draft legislation sponsored by Representative Flores is
    a positive step in the right direction to address the need for
    DOE to create an inventory of HA-LEU material, the need for
    criticality information to develop and license transportation
    packages, and the need for the NRC to develop an appropriate
    and timely licensing framework.
        In addition to strongly supporting this legislation,
    ClearPath Action's written comments provide specific
    suggestions for improving this legislation.
        We also support the draft legislation offered by
    Congressman Wilson to require the DOE to prepare a report on
    the potential deployment of privately developed microreactors
    at DoD and DOE facilities. ClearPath's written testimony also
    includes a recommendation for strengthening this legislation.
        The NRC has continued to make commendable progress in
    rightsizing its workforce and budget. ClearPath Action believes
    the Commission can and should take further steps to streamline
    its services consistent with the mission to protect public
    health, safety, and the environment.
        The legislation sponsored by Congressman Kinzinger and
    Congressman Doyle appears to be a common sense step to provide
    the agency with a funding mechanism that aligns its mission and
    costs. We applaud the provision that excludes fees for the
    development of the regulatory infrastructure for advanced
    reactor technologies. We believe this exclusion will allow the
    NRC to be appropriately prepared to review these technologies,
    yet avoid placing the cost burden for these preparations on the
    nascent developers of these promising designs.
        As it relates to the provision in the bill to require a
    study about the elimination of the Foreign Licensing
    Restrictions of Section 103(d) and 104(d) of the Atomic Energy
    Act, while I would prefer the outright elimination of the
    ownership requirement, I understand the rationale for
    commissioning a study and support it.
        Recently, the U.S. has had several perfectly good nuclear
    reactors shut down for economic reasons. Previously, Pillsbury
    was previously approached by several European utilities who
    were interested in purchasing U.S. nuclear reactors but were
    prohibited from doing so. Eliminating this requirement could
    provide an opportunity to save these vital clean energy
    facilities through investment by friendly foreign utilities.
        I would note that in 2008, British Energy's nuclear fleet
    faced similar financial hardships, and a decision to permit EDF
    to purchase these units allowed the continued operation of
    these clean UK energy assets.
        We have reviewed the draft submitted by Congressman Johnson
    to facilitate the process by which DOE authorizes export of
    civilian nuclear technologies. We believe this legis--we
    support this legislation and believe it makes an important step
    to further streamline the process for some applications
    submitted under 10 C.F.R. Part 50.10. That said, we remain
    concerned that the legislation only targets a limited portion
    of the nuclear technology export approvals process. We have
    submitted some specific suggestions for improvement in our
    written testimony.
        Thank you. And we thank you for allowing me to testify on
    this important topic.
        [The prepared statement of Mr. Merrifield follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Johnson. Thank you, Mr. Merrifield.
        Ms. Mann, you are now recognized for 5 minutes.

                      STATEMENT OF MELISSA C. MANN

        Ms. Mann. Thank you, Mr. Chairman, Ranking Member Rush, and
    members of the subcommittee. We appreciate your leadership on
    nuclear energy issues. And it is a privilege to speak with you
    today about means of increasing the competitiveness of the
    nuclear fleet and advancing advanced technologies and
    infrastructure.
        I am Melissa Mann, president of URENCO USA and the owner of
    the only operating uranium enrichment facility in the United
    States. But I am also here today as a member of the U.S.
    Nuclear Industry Council, whose 82 members represent the full
    breadth of the nuclear supply chain.
        On behalf of the Council we salute the full committee and
    this subcommittee's laser focus on sustaining the current fleet
    and pushing forward advanced technologies. And we salute the
    multifaceted initiatives that are covered by the four bills
    under discussion today. I would like to focus specifically on
    Mr. Flores' discussion draft on what we now know we call HA-
    LEU, or high-assay low-enriched uranium.
        The current nuclear fleet relies on a uranium fuel enriched
    to just under 5 percent in the uranium-235 isotope. And we have
    a fuel cycle that is able to process that material. But a
    comparable fuel cycle does not exist for many advanced designs
    because they require higher enrichment at levels above 5 but
    just below 20 percent.
        There is a broad community of users who would benefit from
    HA-LEU supply. They include research and test reactors,
    including those currently fueled by the Department of Energy,
    both here and abroad.
        It includes many advanced reactor designs and advanced
    fuels, including accident tolerant fuels.
        It includes producers of targets for medical isotope
    production, and even existing light-water reactors who are
    seeking certain fuel reliability and cost performance
    enhancers.
        A complete and sustainable HA-LEU fuel cycle would
    necessarily include three components: an enrichment facility; a
    conversion facility to take that material to the form of metal
    or oxide; and one or more fabrication facilities to manufacture
    the full type of fuel forms required.
        And there is a strong potential to develop the HA-LEU fuel
    cycle in the United States. The New Mexico enrichment plant,
    the technology that it uses is already capable of producing at
    the full gamut of HA-LEU enrichments. And only an NRC license
    amendment is required to bring that capacity to bear.
        Two fabrication facilities supporting NNSA missions already
    operate at much higher enrichment levels, demonstrating both
    the viability of licensing and operating at these greater
    enrichments.
        There is several, three in particular, critical fleet
    conditions that need to be met before we can move forward:
        First, it is imperative that you license and develop the
    enrichment, conversion, and fabrication capabilities
    concurrently, otherwise you will have critical gaps.
        Secondly, we need a predictable and streamlined licensing
    framework, and the regulator needs the appropriate resources to
    manage timely and contemporaneous reviews.
        And we have talked a little bit about nuclear criticality
    benchmarks. We need those both for the fixed facilities and for
    transportation packages. We are also seeking clear NRC guidance
    on physical protection, security, and material control and
    accountability.
        And, finally, those companies that are making investments
    in HA-LEU facilities need to be assured of a reasonable return
    on investment. A consortium-based approach in cooperation with
    DOE, as envisioned by this discussion draft, is a good step in
    that direction.
        I am speaking about these recommendations not just as a
    member of the fuel cycle. My company is also a designer of a
    small microreactor, 10-megawatt, thermal, high-temperature,
    gas-cooled design that itself relies on HA-LEU. What we know is
    that without fuel, reactors don't run. And that is perhaps the
    most significant aspect of the discussion draft, that it
    recognizes the need for collaboration, because unless the users
    of this material, the fuel cycle itself, the Department, and
    the NRC effectively hold hands and jump forward together, we
    won't be able to reap the benefit of these designs.
        Thank you.
        [The prepared statement of Ms. Mann follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Johnson. Ms. Mann yields back. Mr. Irvin, you are now
    recognized for 5 minutes. And if I could remind our witnesses
    votes have just been called. We are going to get through both
    of your testimonies. Don't want to cut you short but we will
    not hold it against you if you speak fast.

                   STATEMENT OF JAMES NICHOLAS IRVIN

        Mr. Irvin. Shouldn't be a problem as I am from Alabama,
    sir. We speak pretty fast in the south.
        Thank you for the opportunity, Mr. Chairman, thank you,
    Member Rush, to appear before you about this very important
    topic of advanced nuclear technology. My name is Nick Irvin. I
    am the Director of R&D at Southern Company. And I have
    responsibility for developing advanced reactor technology, as
    well as supporting our efforts to modernize the licensing
    framework for those technologies.
        At Southern Company we talk a lot about providing our
    customers with clean, safe, reliable, and affordable energy.
    And for me personally that is a very important concept in that
    I believe that access to energy is foundational to maintaining
    a high quality of life for every human on this planet.
        In addition, I was raised in a home where continuous
    learning is--was a requirement, and not only to be a continuous
    learner but to also put that learning to good use. And so, to
    work at a company like Southern Company that provides energy
    but also provides a strong focus on innovation makes me one of
    the lucky ones.
        When it comes to innovation, a very important component of
    innovation is collaboration. And a very important collaboration
    that we have maintained for the entirety of our history in R&D
    is a strong relationship with the Department of Energy through
    public/private partnerships. We believe public/private
    partnerships are essential to help manage the transition of new
    technology, particularly in the energy space, from concept to
    deployment and where the technology and financial risks become
    married in that process.
        To that end, we currently operate as a contractor to the
    Department of Energy, developing an advanced reactor in
    collaboration with a company called TerraPower where we are in
    year two, approaching year three, of a 5-year agreement to
    advance that technology towards deployment in the mid-2030s. We
    believe it is an important technology that has a potential to
    not only advance the components of the advanced reactors that
    we think about, nominally safety, baseload electricity, but
    also do so in a very cost competitive way, which is important,
    again, to protect the interests of our customers.
        Additionally, we are working in partnership with the
    Department of Energy on a project called a licensing
    modernization project. It is an effort to reflect the
    differences in the nature of these advanced reactors and how
    the regulatory approach needs to be modified so that we can be
    efficient and effective in regulating those to the same
    standards as we currently regulate the light-water reactor
    fleet.
        As we look at the four bills that were presented from the
    subcommittee, we feel like they are all very supportive and
    aligned with our mission goals and our activities at Southern
    Company. Specifically, this idea of an efficient and effective
    regulator is a critically important component to maintaining
    the competitiveness of nuclear reactor technology in the
    nuclear industry, both domestically and globally. We do see
    nuclear energy as a global market. And as a consumer of nuclear
    technology, we see the vital importance of having a healthy
    supply chain in order to maintain access to those, those
    components and technologies here domestically.
        And given that the market domestically is challenged, the
    international markets may maintain that foundation from which
    we need to build advanced reactors.
        Given the prior comment about a global market, we can't
    miss the opportunity to take advantage of near-term
    opportunities such as the ones identified in the bill
    discussing microreactors as it relates to resiliency with the
    Department of Defense. We think these microreactors can be
    deployed in the near term, and do provide a great opportunity
    to, for lack of a better term, pilot the entire, the entire
    concepts necessary to deploy advanced reactors in a very
    measurable way, given their size and scale.
        And then as was previously mentioned, none of these
    machines operate without fuel. And so, access to HA-LEU is a
    critically important component that I do believe it is time to
    begin working towards if we want to support early or mid-next
    decade either deployment of microreactors, or demonstration
    reactors, or some other technologies.
        Again, I appreciate the opportunity to provide comments and
    look forward to your questions.
        [The prepared statement of Mr. Irvin follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Johnson. Thank you, Mr. Irvin.
        Dr. Lyman, you are now recognized for 5 minutes.

                        STATEMENT OF EDWIN LYMAN

        Dr. Lyman. Thank you. On behalf of the Union of Concerned
    Scientists I would like to thank the chairman, ranking member,
    and other members of the committee for the opportunity to
    testify today.
        UCS supports DOE investment in nuclear energy research and
    development, but with a focus on increasing safety and security
    of the once-through cycle.
        In the near term we see promise in projects such as
    developing accident tolerant fuels for current light-water
    reactors. But our analysis to date has not identified any
    advanced reactor design that offers clear safety and security
    improvements over today's light-water reactors.
        So, it is in that spirit that I would like to comment on
    the four bills today.
        We support the discussion draft on advanced nuclear fuel
    availability. We think it makes sense for an assessment to be
    made of the availability or the likely availability of HA-LEU.
    And that will help to assess the viability of advanced reactor
    declining in mid-term. But the acquisition of HA-LEU should be
    closely tied to realistic projections of the need for the
    material.
        A couple of additions. We think that the study shouldn't
    evaluate the larger nonproliferation implications of the
    production of HA-LEU. Even though HA-LEU is low-enriched
    uranium and cannot be directly used in nuclear weapons, the
    material does pose proliferation security concerns and if there
    is going to be expanded production and use of that material, as
    well as the potential for exports of reactors that would use
    it, and foreign customers, we think that that is not--that
    evaluation has not been made yet, and it should be.
        On H.R. 1320, we oppose most aspects of the bill because we
    do not support so-called streamlining of licensing that might
    lead to shortcuts in the approval of advanced reactors without
    fully resolving the safety and security concerns that are
    unique to these new designs.
        On the nuclear energy competitiveness discussion draft we
    share a lot of the concerns that we have heard today about the
    definition of lost proliferation risk technology, and how that
    must be evaluated within the context of any export, especially
    today.
        And I would just like to clarify the record. My testimony
    did not say that it is easy for a country to misuse a light-
    water reactor to produce plutonium for weapons, however, it is
    not out of the question. In fact, the technology for processing
    has been available now publicly for many decades. So you can't
    discount that. And you need to consider the risk of breakout--
    that is, throwing the IAEA inspectors out and using the
    facilities you have to make weapons rapidly--in any export
    consideration.
        Finally, on the issue of microreactors, we do not share the
    optimism about the promise of these facilities, especially for
    Department of Defense sites and energy resilience. We think
    that the military should cast a skeptical eye on the stories
    that they are being told about how these reactors are going to
    be so safe and secure they can't melt down, and especially how
    they can provide resilience. In fact, any nuclear reactor
    really requires electrical power to operate safely, and the
    only way these reactors could provide power and disconnect it
    from the grid is in what is called island mode, which is not
    well established in any designs.
        So, I would urge that the study include an assessment of
    the safety and security, and the potential applications for the
    safety of U.S. military personnel and usability of military
    facilities if there were a safety, or security, or sabotage
    incident that would lead to large-array large release.
        I hope these observations are useful. I welcome your
    questions. Thank you.
        [The prepared statement of Dr. Lyman follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

        Mr. Johnson. Thank you, Dr. Lyman.
        The committee will now stand in recess until after votes.
    And we will reconvene and begin our rounds of questions. Thank
    you.
        [Recess.]
        Mr. Johnson. The hearing will come to order. And the Chair
    will now recognize himself for 5 minutes for questions.
        Mr. Merrifield, your testimony notes that the discussion
    draft's expedited process for low proliferation risk
    technologies could be improved. How can the legislation find
    the right balance between having a defined set of technologies
    that would clearly be directed under the new process while
    still providing flexibility going forward that future
    innovations are not limited?
        Mr. Merrifield. Well, I think, Mr. Chairman, there are a
    couple aspects that we would focus on. One is obviously how you
    define low proliferation technologies. And we, it is our view
    that defining that, those technologies, commercial nuclear
    reactors other than those which are designed to utilize mixed
    oxide fuel would be a common sense way of doing that.
        We have a, you know, obviously, very stringent process with
    the NNSA here in the United States, as well as IAEA, which
    looks very closely at countries that operate those, those
    reactors. That is a solid and common sense framework that
    provides I think an appropriate level of protection.
        As it relates to the U.S. Governmental process, I think one
    of the issues that really drags these things out right now is
    the interagency process. That, combined with the assurance
    processes is, as it is currently put in place, has really
    caused many U.S. companies which are exporting these
    technologies to really be put at disadvantage and they are
    having their applications really dragged out far longer than
    they need to be.
        So, simplifying that process for obtaining those assurances
    potentially by having more standardized form of assurances we
    think makes a whole lot of sense. At the end of the day if we
    make it too hard to export U.S. technologies, people will go
    elsewhere to countries that don't have those concerns.
        Mr. Johnson. All right. Well, thank you.
        Ms. Mann, the legislation that I am proposing to reform
    DOE's Part 810 review process is meant to provide the U.S.
    nuclear industry at least a level playing field in the global
    nuclear marketplace, as in some countries, the suppliers are
    primarily, if not exclusively, government-owned vendors.
        In your experience can you tell me how has, how has your
    experience been working with DOE on 810 applications? What have
    you experienced?
        Ms. Mann. Thank you. So because our, our activity involves
    uranium enrichment we are absolutely caught entirely by the 810
    system, and at the very highest level of the licensing
    restrictions for everything we do. You know, that process is
    not necessarily fun or painless, but we have found that the
    Department of Energy has been incredibly professional in
    working with us.
        Now, do those approvals take longer than they need to? In
    many cases they do. That is partly due to the problem we have
    been talking about, getting the foreign government assurances.
    But we see that many of the reforms that have been made to date
    with electronic licensing, increased transparency, and
    accountability have been incredibly helpful.
        But I do think that your draft makes some very useful
    recommendations: the delegation of authority, and looking at
    ways that you can improve what falls into the general license
    category, will definitely support American users.
        Mr. Johnson. OK. Well, what further needs to be done to
    ensure that regulatory requirements don't have a chilling
    impact on U.S. exports of nuclear technology and assistance to
    those countries requesting it?
        Ms. Mann. The balance between promotion and protection is
    always a tricky one. And as a company that does deal with very
    sensitive technology, that is the balance that we are always
    looking to have in place.
        I think that, again, the transparency and the
    accountability in the process go far towards supporting that
    process. The recommendation that Commissioner Merrifield is
    making about a more standardized form of assurance helps. And
    whatever you can do to get those time frames down.
        But I also note that the 810 system does something for the
    U.S. that we don't see our competitors having an advantage of,
    and that is the general license system. So, to the extent that
    we can improve that further, we will get better, you know,
    better gains.
        Mr. Johnson. OK.
        Mr. Merrifield. Mr. Chairman.
        Mr. Johnson. Did you want to comment?
        Mr. Merrifield. Well, I was just going to say one thing I
    forgot to mention in our suggestion is also the notion of
    reducing the number of agencies that need to concur. The DOE
    and NNSA are perfectly capable of doing the vast bulk of these.
    We ought to let them go ahead and do it and not necessarily
    need some of the others in the process.
        Mr. Johnson. OK. Nuclear power plants last a long time. And
    I would think U.S. engagement with those reactors around the
    world can help ensure many years of economic cooperation and
    peace. According to the EIA, almost 200 gigawatts of new
    nuclear energy capacity are projected to be added throughout
    the world by 2050. These plants are going to be built.
        Mr. Merrifield, in your testimony you mention that today
    the U.S. is but one of many highly competitive countries vying
    for a role in supporting the development of, development of
    operations of nuclear power plants overseas. Can you describe
    the type of competition U.S. suppliers face and the benefits of
    U.S. engagement in these opportunities around the world?
        Mr. Merrifield. Well, it is----
        Mr. Johnson. And I am already out of time. So if you can
    make it a quick answer I would appreciate it.
        Mr. Merrifield. Yes. It is very strong competition. You
    have got China and Russia, which are often very competitive
    technologies with a lot of financing behind them. You have
    Korea, which has a demonstrated technology which is going to
    deploy four units in the UAE, which is a very aggressive
    competitor. And France has been very successful in a variety of
    other countries.
        The U.S. has strong competition. We don't have the same
    economic tools behind us. We really do need all of the effort
    of the U.S. Government if we are to increase these U.S., these
    vital U.S. technologies.
        Mr. Johnson. Thank you. I yield----
        Mr. Merrifield. Oh, I was going to say these are 100-year
    relationships. That is what our competitors know and that is
    what we need to focus on.
        Mr. Johnson. The long term.
        I yield back the balance of my time, which I have none, and
    I recognize Mr. McNerney for 5 minutes.
        Mr. McNerney. Well, I thank the Chair. And I thank the
    witnesses. I apologize for missing your testimony. I was in
    another committee.
        I am going to start with Mr. Lyman. What are the costs
    associated with fabricating HA-LEU through downblending of
    excessive highly enriched uranium stocks as opposed to using
    conventional or alternative fabrication methods?
        Dr. Lyman. Well, I think until--it is hard to talk about
    the cost of the alternative until the scope of the program has
    been established, as well as what it would take not only to--
    what it would take really to support Ms. Mann's effort to
    acquire a capability to reconfigure plants and license them for
    producing HA-LEU.
        So until that scope is recognized, there are a factors on
    the costs, so I couldn't say. But clearly if existing HA-LEU
    stocks are available, that downblending, depending on the
    quality of the source material, could be, you know, a
    competitive option I would think since----
        Mr. McNerney. Thank you. What about the nonproliferation
    comments, could you expand on that a little bit?
        Dr. Lyman. Yes. Well, in general HA-LEU, even though it is
    below the 20 percent enrichment threshold, it is only if you
    look at a material that is right below that threshold it only
    takes about one-tenth of the separated work to produce weapons
    grade uranium over 90 percent as it does for natural uranium.
        So, having a stock of that moderately enriched uranium does
    give a leg up to a nation that might want to start producing
    high-enriched uranium for weapons. And that is our point now,
    that is why Iran, there was so much concern about Iran
    stockpiling this material.
        In addition, that material could be used for radiological
    weapons which has been their study in the past.
        So it is important to examine those issues if you do
    develop a new demand and production capacity for this material,
    start exporting, other countries may be kind of interested in
    similar designs, want to start producing HA-LEU themselves. I
    think that warrants further exploration.
        Mr. McNerney. Thank you. Mr. Irvin, where does the Southern
    Company see small modular reactors fitting into their business
    model?
        Mr. Irvin. That is a good question and it is an interesting
    one. We view SMRs as being a critical component of the
    maintaining the supply chain as we go forward for advanced
    reactors. We are always looking at our customers' needs and
    evaluating what they are telling us with regards to their price
    and performance requirements.
        I believe that SMRs have a critical challenge with respect
    to being competitive against natural gas combined cycle in the
    U.S. That doesn't mean that that future is not bright. And
    certainly there is a significant opportunity for SMRs, but I do
    think it is challenged.
        We, we see advanced reactors as providing a potential to
    drive down the costs low enough to be competitive with the
    natural gas combined cycle. And so really the core component of
    SMR is providing a bridge to that future.
        Mr. McNerney. Good segue.
        Mr. Merrifield, how do you, how do we help jump start the
    industry without hampering the NRC's capability to do their
    job?
        Mr. Merrifield. Well, I think, I think, you know, a number
    of pieces of legislation that you have before you today would
    be, would be helpful. In terms of the NRC's process, I think
    the agency's made a lot of, a lot of progress on right-sizing
    itself. I think putting in specific deadlines for reviewing
    applications, reviewing environmental reviews, I think that is
    certainly appropriate and I certainly would support that.
        Overall, in the part of the advanced reactor community, I
    think having appropriate funding through other committees of
    Congress is going to be important to your technologies which
    have great promise. They are certainly deployable in the late
    2020s, and the U.S. is ahead in this technology. Certainly want
    to take advantage of that for export purposes.
        Mr. McNerney. So in honor of the sitting chairman, what
    about the nuclear waste issue? Do you see a resolution of that
    in the works or what are your feeling about that?
        Mr. Merrifield. Is that directed toward me?
        Mr. McNerney. Yes. Yes, sir.
        Mr. Merrifield. Well, I have a specific prohibition against
    lobbying Congress on Yucca Mountain related issues. So, with
    that caveat I think that there are common-sensical ways to
    address the material. There are several proposals for interim
    storage facilities, both in Texas and New Mexico, which provide
    I think common sense ways of dealing with this in the interim.
        At the end of the day, my personal view as an American is
    Yucca Mountain is a perfectly safe place to put that fuel.
        Mr. McNerney. Thank you. Mr. Chairman, I yield back.
        Mr. Shimkus [presiding]. Thank you. The gentleman yields
    back his time.
        It is great to have you here. It is great to be in the
    chair for the Energy Subcommittee. So let me go with my round
    of questions, kind of similar to what I did with the first
    panel. I want to go to Ms. Mann.
        Your testimony notes that your NRC-licensed facility is
    capable of producing high-assay LEU or low-enrichment uranium
    for advanced nuclear fuels. I would like a brief clarification.
    Are there any technical, regulatory, or other legal
    restrictions from your enrichment plant to make high-assay LEU
    for commercial purposes?
        Ms. Mann. Certainly the technology is fully capable now of
    doing that. The site that we have we think is certainly
    suitable. We do need a nuclear NRC license amendment to build a
    HA-LEU enrichment module. But there are no other restrictions
    on that technology or that proposal other than, of course,
    having a market that we can serve.
        Mr. Shimkus. Markets are important as you directly put.
        Are you aware--and you were in here for the first panel, so
    this is a similar question--are you aware of the GAO report
    that recently analyzed the NNSA's preliminary cost estimates
    and mission statement regarding future enrichment needs for
    American defense purposes?
        Ms. Mann. I am generally familiar.
        Mr. Shimkus. Based on your experience in building and
    operating the only enrichment plant in the United States, what
    is your perspective on GAO's conclusions on NNSA's cost
    estimates?
        Ms. Mann. There are certainly two very different things. We
    built a greenfield commercial enrichment facility in New
    Mexico, taking it from what was a effectively a square mile of
    scrub brush and coyotes in 2006, and turning it into a high
    class enrichment facility. And investment to date is about $5
    billion.
        I think that is very different than the cost range that was
    envisioned for a much smaller footprint of capacity for the DOE
    domestic uranium program.
        Two comments on that. One, I do believe there is strictly a
    clear delineation between civil and military programs. I can
    also tell you that the cost estimates that are in that GAO
    report are unsustainable, whether it be for the commercial
    fleet or for an emerging advanced reactor community.
        Mr. Shimkus. So you were, again, here during the first
    panel. And what do you respond--and he could have stayed, too--
    Mr. McGinnis' comments on the similar question?
        Ms. Mann. I certainly appreciate that the Department has
    other missions it needs to fulfill. And I understand that they
    may be looking to merge some of those. But what we are looking
    at is the near-term need for HA-LEU fuel for commercial
    reactors, on a relatively small demand, even if you aggregate
    all of those small pieces from different users.
        If you try to put the defense program on that backs of
    that, you will break it.
        Mr. Shimkus. And Mr. McGinnis' comment which, you know, I
    fleshed out a little bit but not enough, he seemed to be making
    the debate of competitive marketplace and having two production
    facilities. How would you comment on that?
        Ms. Mann. We certainly support competition. And I can tell
    you we are very much aware of the competition that we see, both
    in the enrichment market and other parts of the fuel cycle. And
    that's really up to the market to bear.
        We know that utilities, like Southern here, like a very
    diverse range of supplier. I think the question is until we
    know what the full demand profile is, how many advanced
    designs, advanced fuel types move forward I am not sure what
    that industry is capable of sustaining in the earliest years.
        Mr. Shimkus. Well, I think that's been my point, too,
    because I would concur that we would like to have multiple
    sources, like to have competition. We want lower costs and more
    efficiencies.
        But I am also concerned about the Government overbuilding
    on a projected market which may not be there immediately to
    fulfill the production needs and desires, and you will have
    stranded costs there in producing fuel that you may not need to
    do.
        Ms. Mann. I will just tell you quickly that the existing
    fuel cycle is under quite duress due to the falling demand, to
    the significant amount of inventories, to state-sponsored
    competition. We are trying to sustain that. And if you look at
    trying to add additional pressures on top of that, it's not
    sustainable.
        Mr. Shimkus. Well, and I follow it very closely because I
    have the Honeywell facility. And I have talked with DOE quite a
    bit about the multiple individual markets that don't produce
    it, but then the repurposing of, in essence, Government-
    subsidized ability to purchase and buy and then also create
    fuel waste. It makes it hard for a corporate entity to be able
    to provide that certainty.
        So, I am going to yield back my time. And thank you for
    answering those questions. And then yield to Mr. Green for 5
    minutes, from Texas.
        Mr. Green. Thank you, Mr. Chairman. I thank our witnesses
    for waiting here today.
        Mr. Merrifield, based on your vast experience in the
    Nuclear Regulatory Commission I would like to ask you a few
    questions on the NRC's fee and Mr. Kinzinger and Mr. Doyle's
    bill.
        Section 3(b) of the bill would provide an exclusion of fees
    for those costs associated with the development of regulatory
    infrastructure for advanced nuclear reactor technology. Can you
    talk a little bit about why this provision is so important to
    this new industry and how our current NRC fee structure stifles
    growth in the sector?
        Mr. Merrifield. Yes. Thank you very much, Congressman, for
    that question.
        A couple of things. First, I think if you look
    historically, with the current fee in nuclear reactors they did
    not have to pay those kind of fees when those reactors were
    developed in the 1960s, 1970s, and 1980s. So concurrently I
    think that is one issue.
        The second one is these are nascent technologies. These are
    not large companies that are developing these technologies.
    They are smaller. They are innovative. And they are currently
    in the market seeking funding to bring those designs forward.
        Placing on top of all of that effort the costs of the NRC,
    building its regulatory infrastructure would be, would be
    potentially crushing. And that's really a role and
    responsibility that is more appropriately left to the U.S.
    Government. And so I believe, and ClearPath Action believes
    that the language is appropriate.
        Mr. Green. As more and more nuclear plants go offline
    across the country, the fee burden is felt more heavily by
    those who remain. Do you feel the current NRC structure is
    sustainable? And if not, is there a tipping point that you
    expect to come?
        Mr. Merrifield. I think that is, I think that is a great
    question. And I agree with the direction from which it comes.
        Yes, I do think Congress is going to have to continue to
    take a look at the number of reactors and adjust the amount of
    fees that are put on licensees as a result of it. The NRC has
    certain breadth of work that they have to do. But there will
    become a point at which I think there will need to be increased
    general revenues dedicated to that to make sure that that fee
    structure isn't overly burdensome to U.S. utilities.
        Mr. Green. So, do you have a year. I mean, because some of
    this legislation needs, sometimes it takes years to get
    something passed. Do you have any idea when that may be,
    looking into the future?
        Mr. Merrifield. Well, I think, I think this is something
    that this committee should be thinking about and Congress
    should be thinking about right now. I mean the discussion is as
    many of a quarter of the reactors could potentially go offline.
    I think, you know, changing the current ration that previously
    was 90:10, I think taking it to a different ratio makes sense
    currently right now.
        Mr. Green. Do you feel the draft legislation adequately
    addresses these challenges?
        Mr. Merrifield. I think the legislation is a great step in
    the right direction.
        Mr. Green. While I made clear before that I am not fond of
    DOE's recent notice of public review that proposed subsidizing
    certain industries, I do think we face a challenge that needs
    to be addressed. We have heard from many witnesses on multiple
    pieces of legislation.
        What else should Congress be looking at to shore up the
    domestic nuclear energy production in the coming year other
    than these legislations?
        Mr. Merrifield. Well, I think having, having the fast
    reactor capability out in Idaho is going to be important for
    the testing of the various rules that will be used for these
    reactors. So I think that is an important one.
        I think the actions that Congress has made to make sure the
    DOE loan guarantee program stays in place is important.
        I think the Ex-Im Bank is an important tool for the export
    of these reactors, so I would certainly recommend continuation
    and, frankly, some strengthening of their nuclear capabilities.
        Those are among some of the things I think Congress ought
    to look at.
        Mr. Green. Well, hopefully next time we reauthorize Ex-Im
    Bank it won't take such a battle as we had last time.
        Mr. Chairman, I will yield back my time. And thank you for
    my earlier extra 20 seconds.
        Mr. Shimkus. The gentleman yields back his time. And the
    Chair recognizes the gentleman from Missouri, Mr. Long, for 5
    minutes.
        Mr. Long. Thank you, Mr. Chairman.
        Mr. Irvin, your testimony focuses a lot on the research and
    development of advanced nuclear reactors. What are the long-
    term benefits your customers will see after Southern Company
    invests in these new technologies?
        Mr. Irvin. So, the industry at large, we talked a lot today
    about the nuclear industry being in the crossroads, but I think
    the industry at large is at a crossroads as well. We have seen
    the influx of lots of new technologies being disruptive across
    the board. And so as we look forward, we believe investing in
    technology that is, I am going to use the phrase, options
    positive. So I want to create options. Knowing that I am
    believing that the future is uncertain I want to create
    technologies that provide multiple options for my customers.
        So, the first and foremost for me is the technology, does
    it have a potential to drive down the cost of energy? I believe
    advanced reactors do have that potential.
        But further than that, does the technology have the
    potential to serve more than just electricity needs? Does it
    have options for a multitude of product slates? And these
    advanced reactors and the nature in which they operate creates
    opportunities for nuclear energy to be transitioned into the
    industrial sector, into the transportation sector, but
    certainly providing low cost electrons.
        And so, we see the opportunity for this long-term, stable
    energy supply to be pervasive across the entire energy economy.
        Mr. Long. What does Congress or the Department of Energy
    need to do to help companies like Southern Company and other
    companies streamline the development of these advanced
    reactors?
        Mr. Irvin. Well, I think the one of the most important
    things there, and it is something I have seen out of the
    Department over the last 5 years do more and more is really
    seek out industry's input and partner with industry in a
    collaborative way, and take that feedback from industry as to
    where we need to move the technologies to. I think industry, in
    partnership with the Department, can accelerate. And we need
    that collaboration with the Department on things like
    fundamental science, testing capabilities such as the advanced
    reactor, fast test reactor that was mentioned earlier.
        But then, ultimately, as that collaboration matures we need
    the Department and Federal Government to allow industry to then
    move forward and commercialize and take advantage of the
    investment that has been put in before it.
        Mr. Long. OK. This next question is for everyone. We will
    just start Merrifield, Mann, Irvin, and Lyman down the line if
    we can.
        But for all of you, I have seen some of your testimonies
    reference the--in reference to China starting to load fuel into
    new nuclear power, a new nuclear power plant, and India,
    Russia, and Korea leading the United States in deploying large
    nuclear reactors over 1,000 megawatt units. Is the United
    States falling behind these countries in the field of nuclear
    energy and nuclear technology in your opinion, Mr. Merrifield?
        Mr. Merrifield. That is--I have got a mixed answer to that.
    Frankly, the reactor that is being built in China is a
    Westinghouse technology. The United States continues to possess
    the most modern nuclear design out there in that particular
    technology, so we are leading in that regard.
        In terms of construction, obviously Southern Company has
    two of those reactors that continue to be built. It is
    unfortunate that the cost of natural gas is what it is, which
    is hindering utilities like Southern, more and more of those.
    But certainly there is a robust export market. And certainly
    the United States should be a leader in that, in that regard.
        Mr. Long. OK. Ms. Mann, is the United States falling behind
    these other countries in the field of nuclear energy, nuclear
    technology in your opinion?
        Ms. Mann. Mr. Long, my specialty is on the nuclear fuel
    cycle. And in that regard the answer is clearly no.
        But in order to be able to supply into China we need to
    have an open market. And that is one of the things we are
    concerned about is to make sure that they are able to continue
    to receive the output of American technology in their home.
        Mr. Long. Mr. Irvin?
        Mr. Irvin. Personally, I think the race is a little too
    close to call right now. But I think the reference to natural
    gas being low, by the way it is a good thing for Southern
    Company if natural gas prices are low, but it is a clear
    indication that when the U.S., when we put U.S. innovation to
    work through collaboration with the Federal Government, like we
    did with learning how to frack, and finding shale gas, then we
    can clearly stay ahead and put ourselves further ahead than the
    rest of the world. And so that is the reason why we are so
    focused on innovation.
        Mr. Long. Dr. Lyman?
        Dr. Lyman. Well, I would say the answer is no. From our
    perspective safety and security are paramount. And I do agree
    with Mr. McGinnis when he said that the U.S. as far as its
    safety and security infrastructure for nuclear power is
    probably the best in the world.
        So we would like to see those concepts, you know, exported.
    We don't want to see a race to the bottom where the U.S. has to
    compromise on its own principles just to compete with China on
    nuclear safety concerns. So we think that that is the best
    selling point of U.S. technology is that backbone of safety and
    security.
        Mr. Long. Thank you, Mr. Chairman. I yield back.
        Mr. Shimkus. The gentleman's time has expired. The Chair
    recognizes the gentleman from Pennsylvania, Mr. Doyle, for 5
    minutes.
        Mr. Doyle. Thank you, Mr. Chairman.
        Commissioner Merrifield, welcome back. I want to thank you
    for taking the time to speak to the committee on nuclear energy
    issues and the NUKE Act. The NUKE Act made several changes from
    the discussion draft that was under consideration when you last
    testified before the committee. These changes include
    significantly longer time lines for major license applications,
    milestones for new plants, and the removal of deemed approved
    language.
        Under the current version of the NUKE Act, if the NRC does
    not meet the time lines that are laid out in the bill will that
    have any effect on an operator's application?
        Mr. Merrifield. Yes, I would have to go back and look at
    the explicit detail, but I think it does provide an opportunity
    for that process to continue. So I don't think it has a
    hindrance. But I will certainly look at that and give you some
    comments.
        Mr. Doyle. Now, do you think the current language gives the
    NRC sufficient flexibility?
        Mr. Merrifield. I do. I do.
        Mr. Doyle. Do you think the current NRC fee structure is
    able to appropriately adjust to reflect current market and
    future changes to our national energy portfolio without
    congressional action?
        Mr. Merrifield. As I indicated--great question--as I
    indicated in the questions earlier, I believe there needs to be
    additional revisions to that fee structure, part of which is
    envisioned by the legislation we have been talking about today.
    I think that is going to be a continually evolving issue if
    there are additional U.S. reactors that go into decommissioning
    prematurely.
        Mr. Doyle. Can you speak to the current budgetary burden
    that is placed on remaining nuclear reactors when a plant
    retires? I mean, how do you anticipate this is going to affect
    our nuclear fleet if it is not addressed?
        And do you see the changes that are proposed in the NUKE
    Act as helping to address this problem?
        Mr. Merrifield. Well, I will start with, I will start with
    the second question first. I do think they are helpful. But
    there is no question there are certain fixed assets that the
    agency has that it needs in order to be an effective regulator.
    At some point that will become large enough that the burden
    placed on the individual reactor operators will become larger
    and larger. And that is troublesome and problematic because it
    makes even more complicated the likelihood that some of those
    reactors will be shut down. And I don't think that is a good
    thing.
        Those are important, carbon-free, clean-generating assets
    for our country. I think there are some that have shut down
    that have been, frankly, a real shame.
        Mr. Doyle. Thank you very much. Mr. Chairman, I yield back.
        Mr. Shimkus. The gentleman yields back his time. The Chair
    would now like to recognize the gentleman from Illinois, Mr.
    Kinzinger, for 5 minutes.
        Mr. Kinzinger. Thank you, Mr. Chairman. Thank you all for
    being here today. I very much appreciate it.
        Mr. Merrifield, Section 7 of H.R. 1320 sets time lines and
    goals for the NRC to issue environmental impact statements and
    safety evaluation reports for several NRC licensing actions
    such as early site permits, construction or operating permits,
    and combining operating licenses. Are the time lines in Section
    7 generally reasonable to expect based on historical processing
    times?
        Mr. Merrifield. I believe so.
        Mr. Kinzinger. And in your view would instituting such time
    lines in any way weaken the underlying stringency of the
    established reasonable assurance regulatory requirements?
        Mr. Merrifield. I do not believe so. And frankly, you know,
    we looked, and as I mentioned in prior testimony before this
    committee, I led a task force that looked at some of these very
    same issues when I was on the Commission. We felt at that time
    there was really a need to streamline some of those processes,
    and it didn't really happen. I think the language that you all
    have put into that draft will be very--would be a very welcome
    change and would give the discipline necessary for you just to
    go ahead and do that without sacrificing their mission of
    protecting public health, safety, and the environment.
        Mr. Kinzinger. Thank you.
        Ms. Mann, your enrichment facility holds an NRC license and
    is subject to NRC's fee recovery. My bill, or our bill creates
    reasonable and predictable expectations for NRC's fee recovery
    process. I understand the number of licensees who fund NRC fuel
    cycle activities has decreased recently without a reduction in
    overall NRC staffing.
        Will you discuss recent trends associated with NRC fuel
    cycle facilities?
        Ms. Mann. Certainly. What we are seeing on the fuel cycle
    in many way echoes what we have just talked about with regard
    to the reactors. The first I would note is that since our
    enrichment plant started operation in 2010, we have seen on
    average a 12-percent-a-year increase across the board. And even
    though the amount of work that is being done at our facility
    has slightly gone down now, we are fully operational.
        As the number of fuel cycle facilities that are licensed
    has dropped, the fees, the total fees that they are trying to
    collect have not gone down. And we are, in fact, spreading
    those fees across a fewer number of licensees. And so, by that
    logic, if we were to perhaps be the last one standing we would
    be bearing the full $25-million-a-year burden.
        What I think is also notable, and we touched on it a little
    bit, is there are things that have to be paid for at the NRC
    that have nothing to do with the operation of an individual
    facility. And right now what we are looking at is that 74
    percent of our fees go to those nondirect services rather than
    directly to licensing our site. And we certainly understand the
    need to share that burden, but that burden is becoming
    prohibitively high.
        Mr. Kinzinger. Thank you. And how does this embed cost in
    the nuclear fuel cycle that you have touched on, business, and
    ultimately impact the commercial nuclear industry and
    electricity rates that my constituents pay?
        Ms. Mann. Well, I can tell you sitting next here to one of
    the utilities is that it is highly unlikely we would be able to
    pass those additional costs along to any of our utility
    customers. They have other choices and they have other
    suppliers who don't bear the burden of those fees. So we need
    to be careful.
        And, likewise, we understand why Nick couldn't do that, he
    can't pass it on to his customers. So the question is what is a
    more rational way to spread those total fees across, and then
    also reflect the individual licensing work being done at each
    of our sites.
        Mr. Kinzinger. And that, by definition, would skew the
    whole energy mix anyway, which is something that we are
    obviously very concerned with. And so, would enacting this
    legislation help control those costs in your mind?
        Ms. Mann. Yes, it would.
        Mr. Kinzinger. Thank you.
        Mr. Lyman, H.R. 1320 contains substantially similar
    language regarding NRC's fee structure as the Nuclear Energy
    Innovation and Modernization Act sponsored by the Senate EPW
    Chairman Barrasso. With respect to that, though, your
    organization said the bill balanced reforms to the licensing
    process while allowing the NRC flexibility to regulate in the
    public interest and the Union of Concerned Scientists took a
    neutral position on the bill. Does that position also apply to
    the same language fee that is included in my legislation?
        Dr. Lyman. Yes, it does. And as you see in my testimony
    with regard to the fee cap and the corporate support costs, we
    also, you see that we take a neutral position because we think
    there is language in there that provides enough flexibility. We
    just don't want to see Congress mandate an arbitrary cap that
    would force the NRC to curtail important safety and security
    work and needs some flexibility. And I think the way the
    language is written now they would have that.
        Mr. Kinzinger. Thank you. And I yield back.
        Mr. Shimkus. The gentleman yields back. At this time the
    Chair recognizes the ranking member of the Environment
    Subcommittee, Mr. Tonko, for 5 minutes.
        Mr. Tonko. We have the environment team here and----
        Mr. Shimkus. They are taking over.
        Mr. Tonko [continuing]. The energy team. So only kidding.
        Welcome to our witnesses, and thank you for your input. Mr.
    Merrifield, H.R. 1320 would exempt a number of activities from
    NRC's fee structure. Can you give us the sense of what those
    activities would include?
        Mr. Merrifield. I don't have, I don't have the list in
    front of me right now. The one that we focused on is an
    exclusion for costs associated with developing a regulatory
    infrastructure for regulation on advanced reactors. We think
    that that, that particular language makes a lot of sense. It is
    important the NRC put that structure in place. It is working
    very hard to do so right now.
        There are upfront costs that are associated with that kind
    of activity. And certainly we think that should be borne by the
    general revenues rather than individual developers.
        One of the elements I included in my written testimony is
    the suggestion that you may wish to increase that to allow some
    degree of regulatory research as part of that advanced reactor
    program so the NRC had the tools looking forward to
    appropriately regulate those, including an appropriate balance
    of risk-informed regulation in that part. So that, we certainly
    think that that is a very good element of that program.
        Mr. Tonko. So the NRC currently recovers approximately 90
    percent of its budget from license fees?
        Mr. Merrifield. Yes.
        Mr. Tonko. Are any activities exempted under this bill
    currently recoverable by NRC?
        Mr. Merrifield. I would have to look at, I would have to
    look at the individual elements of the legislation that go past
    it. And there are certainly some areas where there may be an
    overlap, but I would have to confirm that.
        Mr. Tonko. OK, thank you.
        And do you have any estimates, and if not, Mr. Chair, maybe
    we could ask NRC, of how this bill might change that 90:10 cost
    recovery, if enacted?
        Mr. Merrifield. I do not have an estimate of that. And I do
    think you are quite correct, directing that to the NRC would be
    more appropriate.
        Mr. Tonko. Thank you. The bill also places a cap on the
    fees that NRC can charge an operating reactor. Mr. Merrifield
    or Mr. Irvin, do you know the current average annual fees
    assessed on operating reactors?
        Mr. Merrifield. I am going to pass that one to Mr. Irvin.
        Mr. Irvin. Unfortunately, I don't, I don't know that. I am
    in the R&D sector, not the operations side, so.
        Mr. Tonko. OK, thank you.
        Dr. Lyman, you expressed concerns about the expedited
    review process in Section 7 of H.R. 1320, which would require
    the draft environmental impact statement within 24 months and a
    42-month deadline for technical review process and final
    environmental impact statement. Can you explain your concerns
    with the time line for these reviews?
        Dr. Lyman. Yes. As a policy matter we don't support the
    micromanagement by Congress of regulatory agencies to that
    extent that they should be given these strict time lines to
    conduct environmental reviews. Often during the review new
    issues will arise that simply take time to resolve. And I do
    not think that it is appropriate to try to force resolution of
    those where they are right.
        So that is why we don't think, unless there was more
    discretion to the agency to be able to exempt those time lines,
    we don't think it is appropriate.
        Mr. Tonko. Thank you. And, Dr. Lyman, again, and let's
    switch to Part 810, it seems you believe we should err on the
    side of caution for nuclear technology transfers. What role
    should the State Department play in assessing proliferation
    threats?
        Mr. Irvin. I think the State Department has a critical role
    and brings its own expertise to these reviews. And in
    particular by taking a broader view that we did hear about this
    morning, that any technology export has to be seen in context.
    So, even a light-water reactor without any fuel cycle
    technology could potentially pose undue risk if it goes to,
    let's say, a region of the world like the Middle East or Saudi
    Arabia where the countries are stating its desire to acquire
    fuel cycle technology possibly from somewhere else.
        So if, if we give them cover to be able to acquire that
    technology, possibly for eventual misuse for nuclear weapons, I
    think that would be a dangerous development.
        Mr. Tonko. And is it important to be able to reassess those
    risks in real time?
        Mr. Irvin. Yes. One would hope getting information and
    making decisions is always based on the best available
    information at the time, but also by looking ahead. And
    understanding we heard earlier a nuclear reactor, you know,
    could be a 60- or a 100-year proposition. Well, that cuts both
    ways. Governments often don't last that long. So you have to
    look forward and make conservative projections about what may
    happen in the future with that technology.
        Mr. Tonko. Thank you to all of you. I yield back.
        Mr. Shimkus. The gentleman's time has expired. The Chair
    recognizes the gentleman from Michigan, Mr. Walberg, for 5
    minutes.
        Mr. Walberg. Thank you, Mr. Chairman, and thanks to the
    panel for being here.
        Ms. Mann, your testimony notes that there is a need to
    address packaging and transportation needs. But you also note
    that we already transport nuclear fuel to meet the needs of the
    commercial fleet. Additionally, we currently ship HA-LEU for
    research reactors and other purposes.
        Can you please provide a bit more context on what is
    different about the needs and designs for transportation
    packages for HA-LEU on a larger scale?
        And, second, why are the existing packages not adequate for
    widespread commercial use for uranium enriched at higher
    levels?
        Ms. Mann. Certainly. Thank you.
        One of the things that we, that we know is that the HA-LEU
    is at a higher enrichment level than the commercial industry.
    And when we look at the HA-LEU fuel cycle, the first piece of
    that, the enrichment piece, will come out in the form of what
    we call uranium hexafluoride. There are no current commercial
    packages that are suitable for HA-LEU enrichments of uranium
    hexafluoride.
        Moreover, existing NRC regulations require additional
    performance requirements for such packages. So what we need to
    do is to develop that, that capability. Similarly, we don't
    have packages for higher enrichments of oxides in most cases.
    We do for some metals. And we have used the research reactor
    fuel that is in metallic form. However, there is only a handful
    of I think six to ten packages in total that would not serve
    the full breadth of the industry.
        So what we are looking to do is develop that capability.
    Or, alternatively, is one of the things we suggest in our
    written testimony is you could obviate some of that need by
    collocating one or more of those HA-LEU fuel cycle steps on a
    single facility, thus avoiding public transportation.
        Mr. Walberg. Is that in the works?
        Ms. Mann. Certainly we would be happy to find a dance
    partner if there were somebody who wanted to collocate with us
    in New Mexico. That makes a lot of sense as well from an
    economic standpoint, as well as from a regulator standpoint,
    because these existing licensed sites are known to the NRC,
    they are well characterized. We could take advantage of
    existing infrastructure, security, manpower.
        Mr. Walberg. You also note that the design, development,
    testing, and NRC certification for transportation packages
    typically take between 4 to 7 years. Would the program required
    by the Advanced Nuclear Fuel Availability Act help move the
    time frame earlier through a public/private partnership for the
    design and the DOE efforts to develop criticality benchmark
    data?
        Ms. Mann. It would in two important ways. First, it
    recognizes that there is a transportation challenge. And I
    think that has been lower on the priority list, as much of the
    focus has appropriately been on the reactor design.
        But, secondly, we talked a little bit in the earlier
    session about the need for nuclear criticality benchmarks. And
    this is a sort of data analysis to see how will these nuclear
    materials perform. And to the extent that we can come up with a
    common set of those benchmark codes that we can use in our
    enrichment facility, that converters and fabricators can use,
    and that are also used in transportation packages, gives us a
    single set of data to focus our attention on and to allow the
    NRC to focus on that, rather than reviewing multiple different
    sets of submissions.
        Mr. Walberg. Thank you.
        Mr. Irvin, I understand that a research reactor in Norway,
    known as the Halden Reactor, is currently shut down for
    maintenance. And the Norwegian Government is discussing the
    future of the reactor. My question is, what sort of
    capabilities does that reactor provide for American research
    needs? And what are the implications for the advanced nuclear
    community if the reactor is shut down?
        Mr. Irvin. So, my understanding is that reactor is a
    boiling water reactor. And if I am not mistaken, much of the
    interest in that reactor has to do with evaluating something
    called accident tolerant fuels which would be used in the
    existing fleet.
        Certainly, in general, access to research and testing
    capabilities for the existing fleet as well as for the future
    fleet is of critical importance. There has been some talk today
    about a fast neutron source. I am not intimately familiar with
    the level that the industry is relying on that reactor right
    now, so I can't comment really any further than that.
        Mr. Merrifield. Congressman, if I may?
        Mr. Walberg. Yes.
        Mr. Merrifield. I had the opportunity to visit the Halden
    Reactor when I was a member of the NRC. The NRC actually
    contributes money toward that program. There are a variety of
    countries around the world that are members of their research
    programs there. It is a critical research facility. It is one
    that has some of the longest fuels in there for some of the
    longest periods of time in the world. It would be a real loss
    to the international nuclear community if Norway were to make
    the choice not to----
        Mr. Walberg. So there is a potential role for the U.S. in
    that?
        Mr. Merrifield. I would, I would say certainly. There
    certainly is a role. If we don't have--right now we don't have
    the ability to do a lot of research that we need to do in U.S.
    fuels. We use the hindsight mind, who I support, if we can't
    get it done here in the U.S. you have got to look to Russia,
    you have got to look to China, you have to look elsewhere, and
    we really shouldn't be in that position.
        We, as a country, are the world's inventor, and innovator,
    and leader in nuclear technologies. We should not lose that
    leadership. And certainly we are at risk of doing so.
        Mr. Walberg. Thank you. I yield back.
        Mr. Shimkus. The gentleman's time has expired. The Chair
    recognizes the ranking member of the subcommittee, Mr. Rush,
    for 5 minutes.
        Mr. Rush. I want to thank you, Mr. Chairman.
        Mr. Merrifield, in your written testimony you state that
    eliminating the foreign ownership provision, as Section 4 of
    H.R. 1320 proposes, there could be essentially provide an
    opportunity to save the messy nuclear facility fuel investment
    by friendly foreign utility partners. Can you briefly discuss
    how that would work?
        Also, do you have any concern about unintentional
    consequences that are listed in this provision might cause? And
    I would like to invite anybody in the panel who would want to
    have some input. So, Mr. Merrifield, will you answer the
    question?
        Mr. Merrifield. Thank you very much, Congressman.
        So, I will start off with the second half of that first,
    and that is regarding the concerns. As currently written in
    statute, the foreign ownership provision really has two
    elements to it, one of which is an absolute prohibition on the
    foreign entity owning a majority of the U.S. nuclear power
    plant.
        The second half of that requirement is one that imposes a
    inimicality test where a determination is made whether the
    own--whether ownership in whole or in part would be inimical to
    the interests of the United States.
        I have testified many times before this committee and
    before the Congress dating back to when I was on the Commission
    where we said, as a member of the Commission, we really felt
    the first half of that question is unnecessary. And the
    inimicality test, if left in place, would give an appropriate
    tool to make a determination about whether that ownership was
    against the interests of the United States.
        I used in both my written and my verbal testimony an
    example where the decision of the United Kingdom to allow
    Electricite de France to purchase U.K. nuclear units had the
    beneficial aspect of allowing those reactors to continue to
    operate. And they have done so effectively and safely since the
    late 2000s.
        In terms of the potential in the United States, I can't, I
    would be--it would be inaccurate for me to say I have got a
    list of foreign utilities that today wish to purchase U.S.
    nuclear power plants. What I was suggesting in my testimony is
    there are past examples of utilities that I am aware of that
    have expressed an interest in purchasing U.S. nuclear plants
    but made the determination not to do so when they found out
    they couldn't purchase the plants in their totality because
    they were prohibited from that under U.S. law.
        So the suggestion is that perhaps if that provision were to
    be taken out of law, there may be the emergence of companies
    currently not on the market who may be interested in owning
    U.S. generating assets in the nuclear arena.
        Mr. Rush. Does anybody else want to weigh in on that? Mr.
    Lyman?
        Dr. Lyman. Just briefly. I think I may sound like a hawk
    here, but from the national security perspective I think
    removing these requirements and allowing a foreign nation to
    own, exert control over dominant U.S. nuclear facilities would
    be an irresponsible move. So we certainly oppose. We opposed
    that provision in the Senate version. We oppose, we don't think
    there is any point in reviewing it in the study that is
    proposed in this committee.
        Mr. Rush. Mr. Lyman, you think a study in this proposal
    would be dangerous?
        Dr. Lyman. I am sorry, could you repeat the question?
        Mr. Rush. You point out concerns with Section 4 and 5.
        Dr. Lyman. Yes.
        Mr. Rush. Which involved the GAO study on implication of
    repealing restriction on ownership, control, and domination by
    a foreign entity of nuclear facilities here in the U.S. And you
    are not in favor of the study?
        Dr. Lyman. Oh, I am sorry, in the Senate there is a bill,
    Nuclear Energy Innovation and Modernization Act. In the
    original version of that bill, it had a provision to strike the
    restrictions on foreign ownership, control, and domination. So
    we opposed that provision in that bill that ended up being
    stricken from the final version that was passed by the
    committee.
        Mr. Rush. I am concerned about this GAO study. Is there
    anything in your opinion that you are opposed to GAO conducting
    a study on foreign ownership?
        Dr. Lyman. Yes, the draft or the H.R. 1320 calls for a
    review and calls for a study on elimination of foreign
    licensing restrictions done by the Comptroller General in
    consultation with the Secretary of Energy. As we say, you know,
    generally we don't oppose a study as long as it is done
    properly, because studies always bring more information. So we
    wouldn't oppose the study. But we think that the results of
    that study would probably support strongly the conclusion that
    those restrictions should be maintained.
        Mr. Shimkus. The gentleman's time is far expired. The Chair
    recognizes the gentleman from South Carolina for 5 minutes. We
    thank him for being very patient.
        Mr. Duncan. Thank you, Mr. Chairman. Thank you guys for
    being here and being very patient. It will all be over soon; I
    am last.
        Mr. Merrifield, you talked a lot about the benefits of
    nuclear energy. And I agree with you, I have long been a
    proponent of the industry. And being from South Carolina you
    have talked today about VC Summer and what happened there. I
    also heard the gentleman from Missouri, Mr. Long, talk about
    China, and Russia, and others that are leading the United
    States in nuclear technology, and research and development.
        So I have got to ask you, have we lost the ability here in
    the United States to do big things in the nuclear power sector?
        Mr. Merrifield. I don't think so. I mean, I think what we
    had is we had some first-of-the-kind activities for the United
    States that we hadn't done in 20 or 30 years. Although it is
    unfortunate that there was a decision made to, hopefully,
    temporarily shut down the VC Summer construction, I certainly
    give credit to Southern Company for moving forward with those
    AP1000 reactors at the Vogtle site and fully expect to help
    them celebrate those going online years down the road.
        Mr. Duncan. So we all know that there is a lot of
    Government bureaucracy, and the regulatory environment seems to
    be getting tougher and tougher for these type projects. What
    steps could be considered potentially for a cumbersome and
    inflexible regulatory regime from inhibiting new nuclear
    development. Do you think the gentleman from Illinois Mr.
    Kinzinger's legislation will help with that?
        Mr. Merrifield. I do. I think there is a couple of things
    here. One is I do think it is appropriate to have time lines
    for the agency to conduct review of various activities. I think
    there is nothing wrong with that. We did those kind of things
    when I was a Commissioner.
        I think as well making sure that the agency is the right
    size and has the appropriate mix of people and dollars is
    important. They have reduced to a certain extent. I think there
    is more than can be done in the areas of the agency, frankly,
    having gotten the focus it probably should have.
        So, I think between the two, the legislation, and then
    things that NRC can do on its own are going to be important in
    getting there.
        Mr. Duncan. And to Mr. Irvin, I am glad to see that Vogtle
    is moving on there for Southern Company, given what happened in
    South Carolina.
        One of my biggest concerns is continuing private sector
    investment. I mean if the tens of billions of dollars that are
    required to build new nuclear reactors in this country and the
    long regulatory framework that takes place before construction,
    then starts the long construction period as we see with Vogtle
    and VC Summer, and then 7 years into the project the
    construction side of it the rug gets pulled out from under the
    project and those investors lose that money or the ratepayers
    are on the hook for something possibly in South Carolina, how
    are we as a nation going to get the investors and attract the
    investors to invest in these type projects going forward?
        And that has got to be a question Southern is asking
    itself.
        Mr. Irvin. This is a question I get asked often in terms of
    our need to try and get more investment in developing
    technology. I think, I think the answer, maybe because I am an
    R&D guy, is innovation.
        If you look at the work we are doing on advanced reactors,
    as I said earlier, we believe they have the potential to drive
    down that cost. And they drive down that cost in multiple ways.
    But in a very notable way it is shortening construction time
    lines, it is simplifying plants, it is making the time from
    concept to delivery much more effective and efficient for the
    resources.
        Mr. Duncan. That is a good point. We want to reinvent the
    wheel every time we do a new nuclear project when we have got
    proven reactor technology out there, and then design. But we
    are spending all this money to reinvent.
        Mr. Irvin. Certainly I think one of the reasons we are
    having to spend time to reinvent the technology space is that
    the rest of the industry has moved forward. So, if you look at
    15 years ago relative to natural gas combined cycle, the
    technology we have right now, we have today to deploy, we are
    highly competitive. And with the innovation that happened in
    that sector, they no longer are.
        And so, I think we, as a nuclear industry, are challenged
    to not reinvent for reinventing's sake, but to seek those
    technologies that provide the right level of benefit to our
    customers that can also be deployed in a timely manner and in
    the right characteristics.
        Mr. Merrifield. I was going to say just on that score, I
    mean these new technologies provide also some different
    avenues. You know, the traditional technologies, AP1000, 1,000
    megawatt baseload power; some of the molten salt reactors, high
    temperature gas reactors are smaller. They can be used in
    different ways. They can be used for desalinization. They can
    be used in remote locations in some circumstances. And they can
    be used for process technologies to provide very high
    temperature heat for chemical and industrial processes.
        So, in that regard although we are doing something
    different, it is meeting a series of demands that currently are
    met.
        Mr. Duncan. My time has expired.
        Mr. Chairman, at any given time we have got over 100 small
    reactors floating around the seas of the world in the United
    States Navy. So, I didn't hear small modular reactor technology
    enough from this group. I don't hear thorium and molten salt
    technology.
        I hope the industry is looking at that because they are
    safer, they are easier. SMRs may be the future for the cities
    across America and also, you know, improving the quality of
    lives of folks on other continents, possibly.
        So, thanks for the hearing. Thanks, guys. And I yield back.
        Mr. Shimkus. The gentleman yields back his time. Seeing
    there are no further Members wishing to ask questions, I would
    like to thank all the witnesses for being here today and being
    very patient as we had to go to vote.
        Before we conclude, I would like to ask unanimous consent
    to submit the following documents for the record: A letter from
    NuScale Power; an awesome floor speech by Mr. Shimkus on March
    28th, 2017, regarding the nuclear power plant in Belarus. You
    are not objecting to that, are you? Maybe it wasn't that
    awesome.
        [The information appears at the conclusion of the hearing.]
        Mr. Shimkus. And pursuant to committee rules, I remind
    Members that they have 10 business days to submit additional
    questions for the record. And I ask that witnesses submit their
    response within 10 business days upon receipt of the questions.
    Without objection.
        The subcommittee is adjourned. Thank you for being here.
        [Whereupon, at 2:06 p.m., the subcommittee was adjourned.]
        [Material submitted for inclusion in the record follows:]
        [GRAPHICS NOT AVAILABLE IN TIFF FORMAT]

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