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Nuclear Energy Institute
FOR IMMEDIATE RELEASE: December 23, 1998
Contact: media@nei.org, 202.739.8000 or 703.644.8805 (after hours and weekends)

In 1999, Rejuvenated Nuclear Energy Industry Will Seek Federal Reforms Necessitated by Electric Utilities

WASHINGTON—The nuclear energy industry, building on 1998's positive developments, next year will seek a series of federal statutory and regulatory reforms necessitated by the competitive marketplace that nuclear power plant owners and operators are entering.

Beyond industry structure issues, the industry will work with the 106th Congress and the Clinton Administration for enactment of comprehensive legislation to reform the federal government's nuclear waste management program; and to break an impasse between the Environmental Protection Agency (EPA) and the Nuclear Regulatory Commission (NRC) over radiation health standards.

"The outlook for nuclear power plants in a competitive electricity market is excellent," said Joe F. Colvin, the Nuclear Energy Institute's president and chief executive officer. "Changes, such as nuclear power plant purchases and the filing of plant license renewal applications, will result in a stronger and more competitive nuclear energy business, as well as one in which our plants will produce electricity even more safely and reliably."

The changes that the industry seeks will fit philosophically into any federal restructuring legislation, regardless of whether it is a package of sweeping reforms or a smaller, more targeted bill, Colvin said.

"To maximize the benefits of our nation's leading source of emission-free electricity, the time has come for the federal government to remove unnecessary provisions in existing laws and regulations that impede the transition to a competitive business environment," Colvin added.

Examples of the changes that the industry will seek are:

  • Revisions to the 42-year-old Atomic Energy Act, including the removal of the requirement that the NRC conduct antitrust reviews during licensing proceedings for plant license transfers. The industry seeks expedited consideration of requests to change license conditions;
  • Revisions to the Atomic Energy Act that prohibit foreign ownership of commercial nuclear facilities. As long as the nation's common defense and security, or public health and safety, is not compromised, no restrictions on foreign ownership should remain in place;
  • Tax code amendments that will ensure future payments into decommissioning trust funds for nuclear power plants; and
  • Clarification that the user fees levied on NRC licensees reflect only those NRC programs necessary to regulate licensees. Experts estimate user fees are $56 million higher than needed for the agency to recover the cost of its services.

Colvin said decommissioning is a public health and safety imperative and, therefore, legislation is needed to ensure recovery of unfunded decommissioning obligations via a non-bypassable charge to electricity consumers. This legislation, along with Internal Revenue Code amendments that ensure corporate restructurings do not adversely affect decommissioning trust funds, would help protect the integrity of those funds.

The industry also seeks changes to the unusual funding arrangement that makes the NRC the only environmental, safety or health regulatory agency that recovers 100 percent of agency costs. Unlike "user fees" levied by other agencies to provide specific services, the NRC's fee system functions as a general revenue-raising mechanism that forces licensees to pay more money in user fees than they receive in regulatory services.

"Congressional appropriations committees pegged the cost of these extraneous NRC programs, like international activities and regulatory support to various states, at $33 million for fiscal 1999. These costs should not be included in the user fees to the industry," Colvin said.

Colvin expressed confidence that the convergence of issues that have helped to increase recognition of nuclear energy's benefits to society will continue in 1999.

"Nuclear energy plays a crucial role in helping the nation's economy to grow, and in achieving our environmental goals, such as reducing emissions of greenhouse gases and polluting particulates that cause acid rain," he said. "Nuclear power plants generate electricity at extremely competitive prices and will thrive in a competitive marketplace. Restructuring the electric utility industry actually provides utilities with strong incentives to increase their portfolio of nuclear units and to extend the operating licenses of those units."

In addition to structural industry issues, management of used nuclear fuel will be a legislative priority in 1999, Colvin said. Since October 30, the U.S. Court of Federal Claims has ruled in three separate cases that the Department of Energy (DOE) is financially responsible for its failure to remove used nuclear fuel from the nation's nuclear power plants beginning Jan. 31, 1998.

"These rulings are momentous because American consumers have paid more than $15 billion into the Nuclear Waste Fund for waste disposal services and still do not have a permanent disposal facility. If the federal government's foot-dragging continues, U.S. taxpayers will be one step closer to paying a bill of as much as $56 billion to cover DOE's default," Colvin said. "The rulings also make it increasingly clear that the Energy Department needs to immediately begin meeting its responsibility for moving used fuel."

Colvin said the court's rulings are encouraging, but they do not obviate the need for action by Congress to instruct the Energy Department to develop a central storage facility for used fuel until a disposal facility is ready.

On Dec. 18, DOE released its viability assessment of Yucca Mountain, Nev., the site that is being studied for disposal of used nuclear fuel from defense facilities and nuclear power plants. The report said, "based on the viability assessment, DOE believes that Yucca Mountain remains a promising site for a geologic repository and that work should proceed to support a decision in 2001 on whether to recommend the site to the President for development as a repository."
 

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The Nuclear Energy Institute is the nuclear energy industry’s policy organization. This news release and additional information about nuclear energy are available on NEI’s Internet site at http://www.nei.org.



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