Public Policy

On behalf of the nuclear energy industry, I thank you for your support of nuclear technology-related programs in the Energy Department (DOE) and your oversight of the Nuclear Regulatory Commission (NRC) for fiscal 2004.

The Nuclear Energy Institute is responsible for developing policy for the U.S. nuclear industry.  NEI’s 270 corporate and other members represent a broad spectrum of interests, including every U.S. energy company that operates a nuclear power plant.  NEI’s membership also includes nuclear fuel cycle companies, suppliers, engineering and consulting firms, national research laboratories, manufacturers of radiopharmaceuticals, universities, labor unions and law firms.

My statement for the record addresses three key points for your consideration this year:

1. Congress should reclassify the Nuclear Waste Fund, reorienting it to its original purpose and ensuring adequate funding for the Yucca Mountain repository project. 
2. Increased research and development (R&D) on advanced nuclear technology is essential to maintain America’s leadership role in commercial nuclear technologies.
3. The NRC’s budget and staffing should be reassessed in light of current trends.

I also will discuss briefly several important programs that the nuclear energy industry supports, including research into the health effects of low levels of radiation.

Congress Should Reclassify the Nuclear Waste Fund
The Nuclear Waste Fund was established in 1982 as a separate account in the federal treasury. However, congressional efforts to control deficit spending in the 1980s and 1990s changed the status of the fund. Currently, Congress funds the used fuel programs within the confines of the discretionary spending allocation for the Energy and Water Development Appropriations bill. As a result, annual appropriations for Yucca Mountain and related programs have been reduced $723 million below DOE’s budget requests in the past 11 years—significantly hampering DOE’s progress toward accepting the nation’s used nuclear fuel.  Funding shortfalls in past years have forced DOE to defer important programs, including procuring transportation containers for used reactor fuel; acquiring transportation and logistics services; creating the final grant process for providing emergency responder assistance; developing a transportation infrastructure in Nevada; and working with regional, state, tribal and local representatives on transportation planning.

The industry urges Congress to reclassify the Nuclear Waste Fund this year, as proposed by the president’s fiscal 2005 budget and introduced as H.R. 3981, to prevent future funding shortfalls for Yucca Mountain. The Nuclear Waste Fund has three unique characteristics that justify modifying the current budget rules governing its use in this way:

• The federal government is obligated by law and contracts signed with electric companies that operate nuclear power plants to implement the used fuel management program.
• The fund is intended to cover the entire cost of the federal government’s commercial used fuel management program over several decades.
• The disposal of used nuclear fuel from commercial reactors is financed entirely through a fee established by federal law and paid by consumers of electricity generated at nuclear power plants.

Industry Supports Budget Request of $880 Million for Yucca Mountain
The industry greatly appreciates the House for its report language emphasizing the need for early action on infrastructure development for the used nuclear fuel disposal program. The committee’s direction resulted in an announcement by DOE on preferences for rail transport in Nevada and should lead to a record of decision on route selection this year.

Last year, the H.R. 6 conference report endorsed the highest level of funding for Yucca Mountain to date. At $580 million, DOE could address many technical challenges necessary for submitting an application to the NRC by December for a license to construct the repository.

NEI recognizes the challenge that the committee faces in fiscal 2005, based on assumptions included in the budget request on this issue and urges the committee to make allocations under section 302 (b) of the Budget Act consistent with fully funding the administration request of $880 million for Yucca Mountain. Absent full funding in fiscal 2005, the industry does not believe the program will meet key milestones for accepting used fuel in 2010, and these potential delays will result in higher costs for the program and increased liabilities to the government.

Although the repository program is the foundation of our national policy for managing used nuclear fuel, the nuclear industry also recognizes the value in researching emerging technology for used reactor fuel treatment and management. Such farsighted programs will allow our nation to remain the world leader in nuclear technologies. However, technologies like transmutation—the conversion of used nuclear fuel into a smaller volume of less toxic materials—still require a federal repository for disposal of the radioactive byproducts generated from the process.

Research and Development of New Nuclear Energy Systems Necessary
The industry supports increased funding for fiscal 2005 for DOE’s R&D programs for the development of new nuclear energy systems. The nuclear energy industry urges the committee to approve at least $60 million for the Nuclear Energy Technology (NET) program. Within the NET program, $10 million should be earmarked for the early site permit process as requested by DOE. This is an important component of the revised NRC licensing process for new nuclear power plants passed by Congress in 1992, and testing is already under way. An additional $50 million should be used to begin a six-year, cost-shared program to test the combined operating and construction license process for new nuclear plants, based on the industry’s response to a DOE solicitation that will be awarded this year. DOE should support deployment of proven generation III-plus technology for this program.

The industry believes that the government has an early role in bringing advanced reactor concepts, known as Generation IV reactors, to the marketplace. NEI urges your support for a next-generation nuclear plant at the new Idaho National Laboratory, funded through the Generation IV Nuclear Energy Systems Initiative program. The industry also supports the Nuclear Hydrogen Initiative at $9 million.

Although DOE continues to fund the International Nuclear Energy Research Initiative (I-NERI), the domestic version of this program, NERI, has been terminated and a new initiative has been proposed. We believe the current program fills a vital need identified in a 1997 report by the President’s Council of Advisers on Science and Technology (PCAST) and endorsed by the energy secretary’s Nuclear Energy Research Advisory Committee. We do not support the change for NERI.  Rather, the industry believes this collaborative program between national laboratories, industry and universities should be continued at $7 million for fiscal 2005.

PCAST also recommended another R&D initiative—the Nuclear Energy Plant Optimization (NEPO) program—to produce additional amounts of affordable energy from America’s 103 commercial reactors. Through NEPO, DOE has been working with the nuclear industry and DOE’s national laboratories to apply new technology to nuclear and non-nuclear equipment. The industry encourages the committee to allocate $10 million for the NEPO program to help fund important research on materials management issues at nuclear power plants, including improved availability and maintenance at nuclear plants; technology to predict and measure the extent of materials degradation from plant aging; introducing new materials in a cost-effective manner to mitigate materials effects; and as an underpinning to both the applied materials and technology development and deployment activities, advanced research tools and the evolving knowledge of materials properties. DOE has proposed no funding for the program in fiscal 2005 despite the obvious benefits that the national laboratories can bring to bear on these issues.

The industry also requests $27.5 million for DOE’s University Support Program, which supports vital research and educational programs in nuclear science at the nation’s colleges and universities. With nuclear plant license renewal continuing at a brisk pace and the industry considering plans for new nuclear plants, demand for highly educated and trained professionals will continue. NEI encourages the committee to consider a new $2 million program within the Office of Nuclear Energy, Science and Technology to support universities that have undergraduate and graduate programs in health physics. The industry’s most recent human resources survey reveals an increasing demand for health physics professionals. This need will become acute in the next few years when many will retire.

NRC Budget and Staffing Should Be Reassessed
Our nation’s focus on security has led to significant security enhancements at nuclear power plants. Nuclear power plant security was among the most robust in the industrial sector before the Sept. 11, 2001, terrorist attacks, and our facilities are even more secure today. By year’s end, our industry will have invested an additional $1 billion over the past two years in security-related improvements, such as fortified perimeter security, improved background checks and tighter access control and detection ability at our plants. The nuclear energy industry has added one-third more security officers, for a total of 7,000 well-trained, armed security officers at our 67 nuclear power plant sites. The industry will continue to make these investments and improvements to enhance private industry’s best security program.

The NRC’s proposed fiscal 2005 budget totals $670.3 million, an increase of $44.2 from the fiscal 2004 budget, and the highest ever for this agency. Fiscal 2005 is an appropriate time for the NRC to review its budget and resource allocations in light of current demands and other resources available. The industry’s 103 commercial reactors are operating at world-class levels of safety and reliability. Nearly 75 percent of the reactors have the NRC’s highest safety performance indicator in all categories, and most of the others have only a single indicator in the next lower level. The excellent safety record of U.S. nuclear power plants lays the groundwork for refining regulatory oversight based on performance and safety insights. Additionally, insights from the reactor oversight process indicate that several major regulations for power reactors are not providing a significant safety value. A disciplined review of the regulatory process should be undertaken to focus on the more probable, safety-significant events rather than highly unlikely events.

Industry Support for Additional Activities

Nuclear Nonproliferation
The industry supports the disposal of excess weapons-grade nuclear materials through the use of mixed-oxide fuel in reactors in the United States and Russia. 

Low-Dose Radiation Health Effects Research
The industry strongly supports continued funding for the DOE’s low-dose radiation research program. 

Nuclear Research Facilities
The industry is concerned with the declining number of nuclear research facilities. We urge the committee to fully fund the request for a DOE lead lab in Idaho for nuclear energy research and development.

Uranium Facility Decontamination and Decommissioning
The industry fully supports cleanup of the gaseous diffusion plants at Paducah, Ky.; Portsmouth, Ohio; and Oak Ridge, Tenn.  Commercial nuclear power plants contribute more than $150 million to the Decontamination and Decommissioning Fund for government-managed uranium enrichment plants each year. Other important environmental, safety and/or health activities at these facilities should be paid for out of general revenues.

International Nuclear Safety Program and Nuclear Energy Agency
NEI supports the funding requested for the DOE and NRC’s international nuclear safety programs. They are programs aimed at improving the safe commercial use of nuclear energy worldwide.

Medical Isotopes Infrastructure
The nuclear industry supports the administration’s program for the production of medical and research isotopes.