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Nuclear Energy Institute
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Nuclear Energy Industry Recommends Indefinite Renewal of Price-Anderson Act by Congress

WASHINGTON—Given its proven effective framework for the past 45 years, the nuclear energy industry recommended to a congressional committee today that Congress renew the Price-Anderson Act indefinitely. The Price-Anderson Act assures the availability of over $9.5 billion to compensate members of the public as the result of a nuclear incident, said Nuclear Energy Institute (NEI) Senior Vice President Marvin Fertel. The law "establishes a simplified claims process for the public to expedite recovery for losses and provides immediate reimbursement for costs associated with any evacuation that may be ordered near nuclear power plants," he added.

Fertel testified before the Senate Environment and Public Works Committee’s subcommittee on transportation, infrastructure and nuclear safety.

Since the inception of the Price-Anderson Act, the law has been extended three times for successive 10-year periods, and in 1988 it was extended for 15 years. If Congress does not renew the Price-Anderson Act, it will expire Aug. 1, 2002.

Both the Nuclear Regulatory Commission (NRC) and the Department of Energy (DOE) have recommended renewal of the Price-Anderson Act to Congress.

Fertel noted that the NRC, in 1998, said that the Price-Anderson Act has been successful and it "should be extended to cover future as well as existing nuclear power plants." The Energy Department, in 1999, said that the indemnification "should be continued without any substantial change because it is essential to DOE’s ability to fulfill its statutory missions involving defense, national security and other nuclear activities…"

The U.S. House of Representatives acknowledged the importance of nuclear energy and of Price-Anderson Act renewal last November when it approved bipartisan legislation (H.R. 2983) extending the law for 15 years.

The Price-Anderson Act establishes the framework for industry insurance, but it is not a subsidy to the industry. The law establishes two tiers of liability for each nuclear incident involving commercial nuclear energy and provides a guarantee that the federal government will review the need for compensation beyond that explicitly required by law.

For the primary level of coverage, Fertel explained, the law requires nuclear power plant operators to buy $200 million worth of liability insurance. For the second level, power plant operators are assessed up to $88 million for each accident that exceeds the primary level at a rate not to exceed $10 million per year, per reactor for a total of $9.3 billion.

If this law is indefinitely renewed, Congress has the option to reconsider and amend the law at any time. "The industry encourages Congress to hold periodic oversight hearings and, if required, modify the law accordingly," Fertel said. "Congress can request updates on the status of Price-Anderson Act implementation from the Nuclear Regulatory Commission (NRC) in order to provide a basis for change if necessary."

Given the outstanding performance of the nation’s 103 nuclear plants, an indefinite renewal of the Price Anderson Act would ensure the availability of new nuclear power plants—which "is essential to meet both our increasing electricity demand and to maintain the 30 percent share of all emission-free electricity generation today," said Fertel.


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