[Federal Register Volume 89, Number 126 (Monday, July 1, 2024)]
[Rules and Regulations]
[Pages 54336-54339]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-14244]


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DEPARTMENT OF ENERGY

10 CFR Part 612

RIN 1901-AB57


Civil Nuclear Credit Program and Recapture of Credits

AGENCY: Grid Deployment Office, Department of Energy.

ACTION: Final rule.

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SUMMARY: The Department of Energy (DOE or the Department) is adopting 
the interim final rule (IFR) published on January 8, 2024, as final, 
without change. This final rule establishes the procedure for the 
recapture of credits awarded under the Civil Nuclear Credit (CNC) 
Program in accordance with the Infrastructure Investment and Jobs Act.

DATES: This rule is effective on July 1, 2024.

FOR FURTHER INFORMATION CONTACT: Mr. Theodore Taylor, Civil Nuclear 
Credit Program Manager, U.S. Department of Energy, Grid Deployment 
Office, 1000 Independence Avenue SW, Washington, DC 20585, (240) 477-
0458, [email protected].

ADDRESSES: The docket for this rulemaking, which includes Federal 
Register notices and comments, can be found at Regulations.gov 
(www.regulations.gov/document/DOE-HQ-2024-0005). The docket web page 
contains instruction on how to access all documents, including public 
comments, in the docket.

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Summary of the Final Rule
II. Authority and Background
    A. The Statute
    B. Interim Final Rule
III. Public Comments on the IFR
IV. Section by Section Analysis of the Final Rule
    A. Purpose, Applicability, and Definitions
    B. Recapture
    C. Notice and Reconsideration of Recapture Determination
    D. Petition to the Department's Office of Hearings and Appeals
V. Regulatory Review
    A. Review Under Executive Orders 12866, 13563, and 14094
    B. Executive Order 13132
    C. National Environmental Policy Act of 1969
    D. Paperwork Reduction Act of 1995
    E. Regulatory Flexibility Act
    F. Executive Order 12988
    G. Unfunded Mandates Reform Act of 1995
    H. Treasury and General Government Appropriations Act, 1999
    I. Treasury and General Government Appropriations Act, 2001
    J. Executive Order 12630
    K. Executive Order 13211
    L. Congressional Notification
VII. Approval of the Office of the Secretary

I. Summary of the Final Rule

    Section 40323 of the Infrastructure Investment and Jobs Act (IIJA) 
(Pub. L. 117-58), codified at 42 U.S.C. 18753, also known as the 
Bipartisan Infrastructure Law, directs the Department to establish the 
Civil Nuclear Credit Program to prevent premature closures of nuclear 
power plants by providing financial support for existing nuclear 
reactors projected to cease operations due to economic factors.
    The IIJA also directs the Department to promulgate a regulation to 
provide for the recapture of credits awarded to a nuclear reactor if 
either (a) the nuclear reactor terminates operations during the 4-year 
award period or (b) the nuclear reactor does not operate at an annual 
loss in the absence of an allocation of credits. The purpose of this 
final rule is to establish the procedure for the recapture of credits 
under the CNC Program. The rule provides a mechanism for the Department 
to enforce the obligation of the nuclear reactor to continue operation 
during the 4-year award period and to relinquish its rights to credits 
if the nuclear reactor is not operating at a loss in the absence of the 
credits. To minimize the likelihood for the need to recapture credits 
under the rule, the Department has included in the CNC Program an audit 
and annual payment adjustment mechanism at the end of each award year 
during the 4-year award period to evaluate the financial results of 
operation for that year and to adjust payment of credits based on that 
evaluation. The recapture regulation ensures that a reactor cannot 
retain the value of credits if, despite the annual adjustment, the 
nuclear reactor would not have operated at an annual loss in the 
absence of an allocation of credits over the 4-year award period or if 
the nuclear reactor terminates operations despite its contractual 
obligation to operate for the entire 4-year award period.

II. Authority and Background

A. The Statute

    Section 40323 of the IIJA directs the Department to establish the 
CNC Program to provide financial support for existing nuclear reactors 
projected to cease operations due to economic factors in the form of 
credits to be awarded for a 4-year award period. Section 40323(g)(2) of 
the IIJA requires that the Secretary, ``by regulation, provide for the 
recapture of the allocation of any credit to a certified nuclear 
reactor that during [the 4-year award period]--(A) terminates 
operations; or (B) does not operate at an annual loss in the absence of 
an allocation of credits to the certified nuclear reactor.'' IIJA 
section 40323(g)(2). This final rule establishes the procedure for the 
recapture of credits in accordance with that requirement. This final 
rule relates only to the recapture provision. No other provision of the 
CNC Program is subject to implementation by regulation.

B. Interim Final Rule

    On January 8, 2024, DOE published an IFR and request for comments. 
89 FR 864 (Jan. 8, 2024). The IFR established an interim final rule for 
the recapture of credits awarded under the CNC Program. DOE accepted 
public comments through February 7, 2024. DOE received three comments, 
none of which commented on the text of the regulation itself.

III. Public Comments on the IFR

    DOE received three comments from individuals in response to the 
IFR. These comments are available in the public docket for this 
rulemaking. One commenter expressed ``strong support'' for both the CNC 
Program and IFR. The commenter described the CNC Program

[[Page 54337]]

as a ``vital and timely policy'' that supports grid reliability and 
resilience, promotes high paying jobs, enhances national security, and 
fosters innovation. The commenter stated that the recapture provision 
ensures ``accountability and transparency of the program'' and is 
``sound and consistent'' with the IIJA. The commenter also offered 
feedback outside the scope of the IFR, recommending that DOE revise the 
CNC Program Guidance to define a ``competitive market'' and what 
constitutes a material amount of revenue from competitive sources, 
neither of which is necessary for the recapture rule.
    Another commenter stated that the CNC Program is ``beneficial to 
the nation's movement towards cleaner energy'' and expressed the 
importance of keeping existing nuclear power plants running for the 
people who rely on their power. The commenter also observed that these 
plants ``won't be able to function forever'' and urged that ``this 
should be treated as a transitory period for these plants while we move 
towards a less harmful energy source'' like wind and solar.
    The third commenter submitted a comment outside the scope of the 
IFR relating to energy costs.

IV. Section by Section Analysis of the Final Rule

A. Purpose, Applicability, and Definitions

    Section 612.1 of the final rule identifies the purpose of the 
regulations to set forth the procedure by which the Department may 
recapture credits awarded pursuant to the CNC Program. Section 612.2 
provides that the regulations will apply to an owner or operator of a 
nuclear reactor that is awarded credits under the CNC Program. Section 
612.3 contains defined terms used in the rule.

B. Recapture

    Section 612.4(a) of the regulation identifies the two circumstances 
in which credits will be recaptured: (1) if the nuclear reactor 
terminates operation during the award period or (2) at the conclusion 
of the award period if the nuclear reactor would not have operated at 
an annual loss in the absence of the credits.
    Section 612.4(b) addresses the first circumstance in which 
recapture will be pursued, namely termination by the nuclear reactor of 
operations during the award period. In that instance, the Secretary 
will rescind the award of any unpaid credits, including the credits for 
the award year in which the termination occurred and for any remaining 
award years in the award period. In addition, the Department will 
require the owner or operator to repay the value of credits paid with 
respect to a prior award year if the Department determines that the 
nuclear reactor terminated operations as a result of the owner or 
operator's failure to adhere to prudent industry practice in the 
operation of the nuclear reactor during the award period.
    Section 612.4(c) addresses recapture in the circumstance in which 
the Secretary determines that the nuclear reactor, during the award 
period, would not have operated at an annual loss in the absence of the 
credits. To make this determination, the Department will calculate the 
recapture amount in the same manner as the annual adjustment of credits 
is calculated. Although this scenario is unlikely because the recapture 
analysis will use the same evaluation methodology as the annual 
adjustment calculation, it could occur if, for example, subsequent 
information became available that differs from the data relied on in 
the annual adjustment calculation.

C. Notice and Reconsideration of Recapture Determination

    Section 612.5 of the regulation identifies (1) the manner in which 
the Secretary will notify an owner or operator of its determination to 
recapture credits and payments for previously paid credits, if any, (2) 
how an owner or operator may request reconsideration of the recapture 
determination, and (3) the effective date of a recapture determination. 
This section also specifies that notices issued with respect to 
recapture will be public, except that data and supporting documentation 
constituting confidential business information will not be disclosed.

D. Petition to the Department's Office of Hearings and Appeals

    Section 612.6 provides that an owner or operator of a nuclear 
reactor that is aggrieved by the Secretary's decision to affirm, 
withdraw, or modify the notice of recapture as provided in paragraph 
(c) of Sec.  612.5 may file a petition with the Department's Office of 
Hearings and Appeals in accordance with 10 CFR 1003.11, not later than 
thirty days after notification of the Secretary's decision.

V. Regulatory Review

A. Review Under Executive Orders 12866, 13563, and 14094

    Executive Order 12866, ``Regulatory Planning and Review,'' 58 FR 
51735 (Oct. 4, 1993), as supplemented and reaffirmed by Executive Order 
13563, ``Improving Regulation and Regulatory Review,'' 76 FR 3821 (Jan. 
21, 2011) and amended by Executive Order 14094, ``Modernizing 
Regulatory Review,'' 88 FR 21879 (April 11, 2023), requires agencies, 
to the extent permitted by law, to (1) propose or adopt a regulation 
only upon a reasoned determination that its benefits justify its costs 
(recognizing that some benefits and costs are difficult to quantify); 
(2) tailor regulations to impose the least burden on society, 
consistent with obtaining regulatory objectives, taking into account, 
among other things, and to the extent practicable, the costs of 
cumulative regulations; (3) select, in choosing among alternative 
regulatory approaches, those approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity); (4) to the 
extent feasible, specify performance objectives, rather than specifying 
the behavior or manner of compliance that regulated entities must 
adopt; and (5) identify and assess available alternatives to direct 
regulation, including providing economic incentives to encourage the 
desired behavior, such as user fees or marketable permits, or providing 
information upon which choices can be made by the public. DOE 
emphasizes as well that Executive Order 13563 requires agencies to use 
the best available techniques to quantify anticipated present and 
future benefits and costs as accurately as possible. In its guidance, 
the Office of Information and Regulatory Affairs (OIRA) has emphasized 
that such techniques may include identifying changing future compliance 
costs that might result from technological innovation or anticipated 
behavioral changes. For the reasons stated in this preamble, this 
regulatory action is consistent with these principles.
    Section 6(a) of Executive Order 12866 requires agencies to submit 
``significant regulatory actions'' to OIRA for review. OIRA has 
determined that this final rule does not constitute a ``significant 
regulatory action'' within the scope of Executive Order 12866. 
Accordingly, this action was not subject to review under that Executive 
Order by OIRA.

B. Executive Order 13132

    Executive Order 13132, ``Federalism,'' 64 FR 43255 (August 10, 
1999), imposes certain requirements on agencies formulating and 
implementing policies or regulations that preempt State law or that 
have federalism implications. Executive Order 13132 requires agencies

[[Page 54338]]

to examine the constitutional and statutory authority supporting any 
action that would limit the policymaking discretion of the states and 
to carefully assess the necessity for such actions. DOE has examined 
this final rule and has determined that it does not preempt State law 
and does not have a substantial direct effect on the states, on the 
relationship between the national government and the states, or on the 
distribution of power and responsibilities among the various levels of 
government. Moreover, the recapture regulation is required by statute. 
No further action is required by Executive Order 13132.

C. National Environmental Policy Act of 1969

    In this final rule, DOE establishes the procedure for the recapture 
of credits awarded under the CNC Program. DOE has determined that this 
rule falls into a class of actions that are categorically excluded from 
review under the National Environmental Policy Act (NEPA) of 1969 (42 
U.S.C. 4321 et seq.) and DOE's implementing regulations at 10 CFR part 
1021. Specifically, DOE has determined that promulgating procedures for 
the recapture of credits through administrative and audit procedures is 
consistent with activities identified in 10 CFR part 1021, appendix A 
to subpart D, A6. Therefore, DOE has determined that promulgation of 
the recapture rule is not a major Federal action significantly 
affecting the quality of the human environment within the meaning of 
NEPA and does not require an environmental assessment or an 
environmental impact statement.

D. Paperwork Reduction Act of 1995

    This final rule imposes no information collection requirements 
subject to the Paperwork Reduction Act.

E. Regulatory Flexibility Act

    The Regulatory Flexibility Act (5 U.S.C. 601 et seq.) requires 
preparation of an initial regulatory flexibility analysis for any rule 
that by law must be proposed for public comment. As discussed in the 
IFR, DOE has determined that prior notice and opportunity for public 
comment is unnecessary under the Administrative Procedures Act (APA). 
Because a notice of proposed rulemaking is not required for this action 
pursuant to 5 U.S.C. 553, or any other law, no regulatory flexibility 
analysis has been prepared for this final rule. See 5 U.S.C. 601(2), 
603(a).

F. Executive Order 12988

    Regarding the review of existing regulations and the promulgation 
of new regulations, section 3(a) of Executive Order 12988, ``Civil 
Justice Reform,'' 61 FR 4729 (Feb. 7, 1996), imposes on Federal 
agencies the general duty to adhere to the following requirements: (1) 
eliminate drafting errors and ambiguity; (2) write regulations to 
minimize litigation; (3) provide a clear legal standard for affected 
conduct rather than a general standard; and (4) promote simplification 
and burden reduction. Regarding the review required by section 3(a), 
section 3(b) of Executive Order 12988 specifically requires that each 
executive agency make every reasonable effort to ensure that when it 
issues a regulation, the regulation: (1) clearly specifies the 
preemptive effect, if any; (2) clearly specifies any effect on existing 
Federal law or regulation; (3) provides a clear legal standard for 
affected conduct while promoting simplification and burden reduction; 
(4) specifies the retroactive effect, if any; (5) adequately defines 
key terms; and (6) addresses other important issues affecting clarity 
and general draftsmanship under any guidelines issued by the Attorney 
General. Section 3(c) of Executive Order 12988 requires Executive 
agencies to review regulations in light of applicable standards in 
sections 3(a) and 3(b) to determine whether they are met, or it is 
unreasonable to meet one or more of them. DOE has completed the 
required review and has determined that, to the extent permitted by 
law, this final rule meets the relevant standards of Executive Order 
12988.

G. Unfunded Mandates Reform Act of 1995

    Title II of the Unfunded Mandates Reform Act of 1995 (UMRA) (Pub. 
L. 104-4) requires each Federal agency to assess the effects of Federal 
regulatory actions on state, local, and Tribal governments and the 
private sector. For a proposed regulatory action likely to result in a 
rule that may cause the expenditure by state, local, and Tribal 
governments, in the aggregate, or by the private sector of $100 million 
or more in any one year (adjusted annually for inflation), section 202 
of UMRA requires a Federal agency to publish a written statement that 
estimates the resulting costs, benefits, and other effects on the 
national economy. 2 U.S.C. 1532(a), (b). UMRA also requires a Federal 
agency to develop an effective process to permit timely input by 
elected officers of state, local, and Tribal governments on a proposed 
``significant intergovernmental mandate,'' and requires an agency to 
plan for giving notice and opportunity for timely input to potentially 
affected small governments before establishing any requirements that 
might significantly or uniquely affect them. On March 18, 1997, DOE 
published a statement of policy on its process for intergovernmental 
consultation under UMRA. 62 FR 12820. This policy is also available at 
www.energy.gov/gc/office-general-counsel under ``Guidance & Opinions'' 
(Rulemaking). DOE examined this final rule according to UMRA and its 
statement of policy and has determined that the rule contains neither 
an intergovernmental mandate, nor a mandate that may result in the 
expenditure by state, local, and Tribal governments, in the aggregate, 
or by the private sector, of $100 million or more in any year. 
Accordingly, no further assessment or analysis is required under UMRA.

H. Treasury and General Government Appropriations Act, 1999

    Section 654 of the Treasury and General Government Appropriations 
Act, 1999 (Pub. L. 105-277) requires Federal agencies to issue a Family 
Policymaking Assessment for any rule that may affect family well-being. 
This final rule would not have any impact on the autonomy or integrity 
of the family as an institution. Accordingly, DOE has concluded that it 
is not necessary to prepare a Family Policymaking Assessment.

I. Treasury and General Government Appropriations Act, 2001

    Section 515 of the Treasury and General Government Appropriations 
Act, 2001 (44 U.S.C. 3516 note) provides for Federal agencies to review 
most disseminations of information to the public under guidelines 
established by each agency pursuant to general guidelines issued by the 
Office of Management and Budget (OMB). OMB's guidelines were published 
at 67 FR 8452 (Feb. 22, 2002), and DOE's guidelines were published at 
67 FR 62446 (Oct. 7, 2002). Pursuant to OMB Memorandum M-19-15, 
Improving Implementation of the Information Quality Act (April 24, 
2019), DOE published updated guidelines, which are available at 
www.energy.gov/sites/prod/files/2019/12/f70/DOE%20Final%20Updated%20IQA%20Guidelines%20Dec%202019.pdf. DOE has 
reviewed this final rule under the OMB and DOE guidelines and has 
concluded that it is consistent with the applicable policies in those 
guidelines.

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J. Executive Order 12630

    Pursuant to Executive Order 12630, ``Governmental Actions and 
Interference with Constitutionally Protected Property Rights,'' 53 FR 
8859 (Mar. 15, 1988), DOE has determined that this final rule would not 
result in any takings that might require compensation under the Fifth 
Amendment to the U.S. Constitution.

K. Executive Order 13211

    Executive Order 13211, ``Actions Concerning Regulations That 
Significantly Affect Energy Supply, Distribution, or Use'' 66 FR 28355 
(May 22, 2001), requires Federal agencies to prepare and submit to OIRA 
a Statement of Energy Effects for any proposed significant energy 
action. A ``significant energy action'' is defined as any action by an 
agency that promulgates or is expected to lead to promulgation of a 
final rule and that: (1) is a significant regulatory action under 
Executive Order 12866, or any successor order; and (2) is likely to 
have a significant adverse effect on the supply, distribution, or use 
of energy; or (3) is designated by the Administrator of OIRA as a 
significant energy action. For any proposed significant energy action, 
the agency must give a detailed statement of any adverse effects on 
energy supply, distribution, or use should the proposal be implemented, 
and of reasonable alternatives to the action and their expected 
benefits on energy supply, distribution, and use. This final rule 
establishes a procedure to recapture credits awarded under the CNC 
Program and, therefore, does not meet any of the three criteria listed 
above. It is not a significant energy action because it would not have 
a significant adverse effect on the supply, distribution, or use of 
energy. Accordingly, DOE has not prepared a Statement of Energy 
Effects.

L. Congressional Notification

    As required by 5 U.S.C. 801, DOE will report to Congress on the 
promulgation of this rule before its effective date. The report will 
state that this rule does not meet the criteria set forth in 5 U.S.C. 
804(2).

VI. Approval of the Office of the Secretary

    The Secretary of Energy has approved publication of this final 
rule.

List of Subjects in 10 CFR Part 612

    Civil nuclear credit program, Nuclear energy, Nuclear power plants 
and reactors, Petition to the Department of Energy's Office of Hearings 
and Appeals, Recapture of civil nuclear credits.

Signing Authority

    This document of the Department of Energy was signed on June 21, 
2024, by Maria D. Robinson, Director, Grid Deployment Office, pursuant 
to delegated authority from the Secretary of Energy. That document with 
the original signature is maintained by DOE. For administrative 
purposes only, and in compliance with requirements of the Office of the 
Federal Register, the undersigned DOE Federal Register Liaison Officer 
has been authorized to sign and submit the document in electronic 
format for publication, as an official document of the Department of 
Energy. This administrative process in no way alters the legal effect 
of this document upon publication in the Federal Register.

    Signed in Washington, DC, on June 25, 2024.
Treena V. Garrett,
Federal Register Liaison Officer, U.S. Department of Energy.

PART 612--RECAPTURE OF CIVIL NUCLEAR CREDITS

0
Accordingly, the interim final rule amending chapter II, subchapter H, 
of title 10, part 612, of the Code of Federal Regulations, which was 
published at 89 FR 864 on January 8, 2024, is adopted as final without 
change.

[FR Doc. 2024-14244 Filed 6-28-24; 8:45 am]
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