Public Policy

Chairman Carper, ranking member Voinovich, and distinguished members of the subcommittee, I appreciate the opportunity to testify today and, on behalf of the nuclear industry, thank this subcommittee for its long-standing interest in and oversight of the U.S. Nuclear Regulatory Commission’s activities and issues important to the continued beneficial uses of nuclear energy.  In particular, we appreciate the leadership of Senator Carper and Senator Voinovich on key issues including infrastructure, the loan guarantee program and waste confidence that are critical to new plant build.

My testimony today addresses the following topics:

* The performance of the 104 power reactors and the contribution nuclear energy makes toward the United States energy and environmental policies.
* The importance of license renewal to extending the value of nuclear power plant assets and the U.S. Nuclear Regulatory Commission’s (NRC) license renewal process.
* The prospects for building new nuclear plants in the United States and the importance of an effective and efficient NRC licensing process for these projects. 

U.S. Nuclear Power Plants Are Operating at Record-High Levels

The U.S. nuclear fleet continues to operate at record high levels of safety and reliability.  In 2007, the highlights include:

* The industry’s capacity factor was 91.8 percent.
* U.S. reactors produced 806 billion kilowatt-hours at an average production cost of 1.76 cents per kWh—both new industry standards. 

With this excellent performance, nuclear energy continues to generate about 20 percent of U.S. electricity despite the fact that nuclear power plants represent only about 12 percent of the installed electric generating capacity.  In addition, nuclear energy accounts for more than 70 percent of the nation’s carbon-free electricity generation and prevented the emissions of CO2 equivalent to those from all passenger vehicles in the U.S. in 2007.

The outstanding performance of the U.S. nuclear fleet along with its contributions to our energy and environmental goals provide the context and foundation for renewing the licenses of existing plants and the preparations for new plant build.

License Renewal

License renewal of nuclear power plants in the U.S. is founded upon technical research begun in 1982 through the Nuclear Plant Aging Research Program established by the NRC.  The program concluded that aging phenomena are manageable and should not preclude extended operations for reactors.  The rulemaking that followed, 10 CFR Part 54, included two fundamental principles:

* The regulatory process will ensure that the licensing basis provides and maintains plant safety, and
* The licensing basis carries forward throughout the renewed period of operation.

The license renewal process does not attempt to duplicate the regulatory oversight that occurs continually at all reactors.  Rather, it appropriately focuses on managing the effects of aging on key structures and components that are not routinely inspected.

Applicants for renewal are required to identify the important structures and components within the scope of the rule.  Secondly, they must identify the aging mechanisms or effects that these structures and components are subject to, and finally, they must describe how they will address the aging effects through plant programs and inspections.

The NRC developed the Generic Aging Lessons Learned or GALL report to capture experience on aging effects.  The report also captures practices acceptable to the NRC for managing those aging effects.  Applicants routinely reference the practices detailed in the GALL report in their applications.  This in large part explains some of the findings in the NRC Inspector General audit of the license renewal process.

New Plants

Turning to new plant build, I cannot overstate the importance of a viable loan guarantee program to kick start the first wave of plants and that would lower the cost of electricity to consumers.  NEI expects four to eight plants will be deployed by the middle of the next decade.  The industry is well aware of the areas that plagued the construction of the existing fleet and we have focused our efforts on mitigating those risks.  This must be demonstrated by completing these first projects within schedule and budget constraints to build confidence for a more significant expansion to occur.

From a licensing perspective, the NRC and the industry are on a steep learning curve with regard to the implementation of Part 52.  Thus far, the reviews are progressing per established schedules.  Of utmost importance is the completion of key rulemaking activities, including Part 73 on security, aircraft impact assessments, and the revision of the waste confidence rule that will further strengthen the current regulatory basis for NRC’s waste confidence determination.  In addition, we expect that efficiencies in the licensing process will be gained as the design certifications are completed and lessons learned are incorporated from the initial early site permit and combined license reviews.

Going forward, the industry’s highest priority will remain the continued safe and reliable operation of the existing fleet.  It is this performance that enabled successful license renewal thus far, and that will sustain the recognition of nuclear energy as an indispensable element of meeting our nation’s energy and environmental goals.