Public Policy

Mr. Chairman and members of the committee, I am Frank L. “Skip” Bowman, president and chief executive officer at the Nuclear Energy Institute. Thank you for this opportunity to share the nuclear energy industry’s assessment of the Department of Energy’s civilian radioactive waste management policies and of the Yucca Mountain project. Having served 38 years in our United States Navy, I am convinced that our country’s national security is inextricably linked to our energy security, and that nuclear energy must be a large part of that energy security.

NEI is responsible for developing policy for the commercial nuclear industry. NEI’s 250 members represent a broad spectrum of interests, including every U.S. electric 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.

Summary
In keeping with the scope of this hearing, I will focus my testimony on the following key issues:

• DOE must make visible and measurable progress in implementing an integrated national used nuclear fuel management strategy, which has as an integral component the Yucca Mountain, Nev., repository. This progress will help ensure that the expanded use of nuclear energy will play a key role in our nation’s strategy for meeting growing electricity demand.
• The industry’s evaluation of DOE’s civilian used nuclear fuel program’s actions to address challenges so that the federal government meets its statutory and contractual obligations to remove used nuclear fuel from utility sites and dispose of it in a timely manner.

The industry believes that the provisions of the Nuclear Fuel Management and Disposal Act, S. 2589, provide a solid basis for making the necessary progress towards addressing the challenges. We urge the committee to hold a subsequent hearing on the details of this legislation as soon as possible and report to the Senate its legislative recommendations to move forward on implementing our national policy during this session of Congress.

Nuclear Energy Must Play a Key Role in Our Energy Future
In the 2005 State of the Union address, President Bush affirmed the nation’s commitment to “safe, clean nuclear energy” as part of a diverse portfolio that will meet America’s future electricity needs. A long-term commitment to nuclear energy will make the United States more energy independent and energy efficient. The administration and Congress demonstrated strong leadership by enacting the Energy Policy Act of 2005, which encourages diversity of energy sources, including emission-free sources of electricity, such as nuclear energy.

The nation must focus on clean, reliable and affordable energy sources, such as nuclear, that are available today. Nuclear energy offers several unique advantages. It is the only expandable baseload energy source that does not emit carbon or other greenhouse gases into the atmosphere. Nuclear energy safely and reliably provides price stability for electricity customers as the prices for fossil fuels fluctuate. It also provides exciting new opportunities in areas such as hydrogen production. Although our nation must continue to employ a mix of fuel sources for generating electricity, we believe it is important that nuclear energy maintain at least the current 20 percent contribution to U.S. electricity production. Maintaining that level of production will require construction of a significant number of new nuclear plants beginning in the next decade.

There is strong, bipartisan support for a continuing significant role for nuclear power. More than two-thirds of the public supports keeping nuclear energy as a key component of our energy portfolio. Many in the environmental community recognize the key role that nuclear energy can play in controlling greenhouse gas emissions. The industry appreciates the recognition of nuclear energy’s importance that Congress and the administration demonstrated in the last year’s comprehensive Energy Policy Act of 2005.

Recently, a new coalition of diverse organizations and individuals has been formed to educate the public on nuclear energy and participate in policy discussions on U.S. energy issues. The Clean and Safe Energy Coalition, co-chaired by Greenpeace co-founder Patrick Moore and former Environmental Protection Agency Administrator Christine Todd Whitman, includes business, environmental, labor, health and community leaders among its 120 members.

Progress on Used Fuel Management Must Move Hand-in-Hand With Industry Development
The provisions of the Energy Policy Act of 2005 clearly stimulated interest among electric utilities in constructing new nuclear plants. This increased interest requires progress on the federal government’s used fuel management policies. The federal government must meet its contractual responsibility to accept, transport and dispose of used nuclear fuel through a comprehensive radioactive waste management program, including continued progress toward a federal used nuclear fuel repository.

While it is important to recognize that the industry and other key stakeholders are not satisfied with the extent of progress made by the federal government in meeting the requirements of the Nuclear Waste Policy Act as amended, progress has been made.

• There is longstanding international scientific consensus that a deep geologic repository is the best solution for long-term disposition of commercial used nuclear fuel and high-level radioactive byproducts of our nation’s defense programs
• The Bush administration and Congress affirmed the scientific suitability of Yucca Mountain for a repository in 2002 after nearly 20 years of scientific study. Over the past three years, DOE and its contractors have provided further confirmation that Yucca Mountain is an appropriate site for a national repository. Federal courts have rejected significant legal challenges by Nevada and others to the Nuclear Waste Policy Act and the 2002 Yucca Mountain site suitability determination. A federal court also affirmed that the Yucca Mountain Development Act is constitutional and that DOE’s repository system design, which incorporates both natural and engineered barriers to contain radioactive material safely, is consistent with the law.
• Suggestions that DOE postpone Yucca Mountain indefinitely and leave used fuel at reactor sites for a century or more while waiting for some “magic bullet” solution ignores the significant safety and security advantages of centralized storage at a federal facility and the monumental additional costs that taxpayers would ultimately bear waiting for this “solution.” Even if such a solution were found, there is still a near-term need for the repository to provide disposal of high-level radioactive waste from defense programs.
• The industry believes that DOE has the authority to take advantage of significant opportunities to advance its comprehensive used fuel management program and the Yucca Mountain project in particular. The industry also believes that S. 2589 best addresses many of the issues limiting progress at Yucca Mountain.

Progress Toward Licensing Yucca Mountain Must Continue
The industry is encouraged by the leadership and management provided to the program by Energy Secretary Samuel Bodman, Deputy Secretary Clay Sell and Acting Director of the Office of Civilian Radioactive Waste Management Paul Golan.

They are leading the transition from a purely scientific program, focused on site characterization and site approval at Yucca Mountain, to one that is preparing to enter a rigorous Nuclear Regulatory Commission licensing process. This progress has continued as the department addresses challenges, such as the revised Environmental Protection Agency radiation protection standard. DOE has made significant progress toward resolving key technical issues with the NRC before it submits a license application for Yucca Mountain. DOE also is adopting industry best practices to ensure that it will submit a quality application to the NRC. It plans to include in this application a revised surface facility design that will handle fuel in standardized multipurpose canisters. Using transportation, aging and disposal canisters in combination with associated surface facilities will reduce the need to handle used fuel at Yucca Mountain and increase safety. It is important that DOE complete these efforts, file a high-quality repository license application in a timely manner and, ultimately, complete the transition to a design, engineering and construction project.

The recently announced design changes involving use of standardized containers can assist the industry in meeting important goals for management of used fuel at a geologic repository with the potential to retrieve it if that becomes desirable. The industry is appropriately engaged with DOE to ensure that these standardized canisters can be loaded and transported from our facilities safely and efficiently. In addition, the industry is committed to helping DOE address technical issues at Yucca Mountain in the same effective, high-quality manner that has become the expected norm at the nation’s 103 reactors. The industry is encouraged by DOE’s recent progress toward the alignment of a rail spur to Yucca Mountain. The development of necessary transportation infrastructure and planning should continue to be a high priority.

As part of this committee’s ongoing review of the DOE repository program, the industry urges Congress to exercise careful oversight of the licensing process, starting with the quality and timeliness of the filing of the license application by DOE. This can ensure that the program is not delayed further. This committee should challenge DOE to show how it will incorporate the proposed design changes into the license application in a manner that will allow for its submission in a timely fashion. DOE should provide Congress detailed program milestones, a revised five-year funding profile for the program and an updated life-cycle cost estimate for the repository, in conjunction with the updated program schedule that DOE officials have promised this summer.

Legislative deliberations should not preclude DOE from filing a license application. The NRC should begin reviewing the repository license application when it is submitted with the knowledge that DOE can amend it to address changes, if any, resulting from new legislation.

The Yucca Mountain Licensing Process Provides Flexibility to Address Future Developments
DOE should incorporate, as provided by existing regulations, features into its repository development plans that maintain flexibility for future generations to make informed decisions based on operational experience, changing energy economic, and technological developments.

The nuclear energy industry supports enhancements to the Yucca Mountain repository that would provide greater long-term assurance of safety and permit DOE to apply innovative technology at the repository as it is developed. These enhancements include:

• extensive monitoring of the used nuclear fuel placed in the repository and its effects on the surrounding geology for 300 or more years
• the ability to retrieve the used nuclear fuel from the facility for an extended period
• periodic review of updates to the repository license that takes into account monitoring results and ensures that the facility is operating properly.

DOE already has committed to facilitate the use of these elements in its repository planning. For a period of 50 to 300 years, the federal government will “collect, evaluate and report on data” to assess the performance of the repository and the ability to retrieve the used fuel within the facility, if desired. In addition to monitoring material within the facility, DOE will conduct tests and analyses to ensure that the repository is constructed and operated according to strict guidelines. Although DOE is pursuing these elements, the proposed enhancements would provide greater scientific and regulatory oversight of long-term repository operation and the condition of the material stored there. Doing so would require no modification of the existing federal statutory or regulatory framework.

The Energy Department could include these enhancements as part of its license application, and the commitment to complete them should be incorporated as a condition of the NRC license.

These recommendations offer greater assurance to the public that long-term stewardship of used fuel at Yucca Mountain will be monitored carefully throughout repository operation. They also would allow DOE to take advantage of future technological innovations to improve the repository or provide for the potential reuse of the energy that remains in the fuel.

Challenges Remain for Meeting Federal Obligations
DOE must address a number of issues to provide stability, clarity and predictability of our national used nuclear fuel policy. Conditions must be in place to facilitate near-term movement of used fuel, assurance of transportation safety and security, licensing and construction of the repository, and permanent disposal of used fuel in the repository. The following are the industry’s priorities for meeting the federal obligation.

DOE Should Move Used Nuclear Fuel From Reactor Sites
The industry’s top priority is for the federal government to meet its statutory and contractual obligation to move used fuel away from operating and decommissioned reactor sites. The government already is eight years in arrears in meeting this obligation, and it will be at least another decade before the repository is completed. That failure is the subject of more than 60 lawsuits. Three of these suits, representing only a fraction of the reactor sites, have resulted in settlements or judgments totaling $340 million for costs incurred.

Further delays in federal receipt and movement of used nuclear fuel and defense waste products could cost taxpayers more than $1 billion per year in defense waste site life-cycle costs, operating costs at utilities and Yucca Mountain fixed costs, exclusive of litigation damages already incurred, according to DOE.

While DOE moves forward to license, construct and operate the Yucca Mountain repository, the government must take title to used fuel and move it to a secure federal facility as soon as practicable. The industry recognizes that there are different interpretations as to the department’s authority to undertake such an action. Therefore, Congress should work with DOE to take steps that will facilitate the movement of used fuel from utility sites.

Waste Confidence Should Be Affirmed
The nation’s policymakers must be confident that policies are in place to ensure the safe and secure storage and disposal of used nuclear fuel. This waste confidence determination is reflected in Nuclear Regulatory Commission rules that support various licensing actions. However, such an approach creates uncertainty, because NRC regulations and licensing decisions are subject to litigation.

Managing the nation’s used fuel is a firmly established federal obligation and, as such, is a matter of broad national policy. There is solid scientific and technical justification to affirm waste confidence. In 2001, the National Academy of Sciences confirmed four decades of international scientific consensus that geologic disposal is the best method for managing used nuclear fuel. Congress approved a geologic disposal site at Yucca Mountain in 2002.

In the Energy Policy Act, Congress included provisions that encourage the construction of new nuclear power plants, illustrating confidence in the nation’s ability to manage used reactor fuel in the future. In addition, the Energy Department has safely operated a geologic disposal site for transuranic radioactive waste near Carlsbad, N.M., and 34 temporary dry-cask storage facilities for used nuclear fuel have been licensed at nuclear power plants. The first such facility has been operating since 1986. Congress should codify “waste confidence” so that the NRC need not address this broad public policy matter as a routine regulatory matter.

Funding Predictability Should Be Established
Congress established the Nuclear Waste Fund to cover costs associated with disposal of commercial used nuclear fuel. This fund is paid for by a one-tenth-of-a-cent-per-kilowatt-hour fee on electricity used by consumers of nuclear energy. Initially, expenditures from the fund were not scored in the budget as part of the discretionary spending totals. This was similar to budget treatment of other user fees, including those for the NRC. More than a decade ago, Congress deviated from this principle and forced Nuclear Waste Fund expenditures for Yucca Mountain to compete in the federal budget with unrelated programs, despite this dedicated source of revenue.

As a result, Yucca Mountain budget requests have been cut by more than $1 billion over the last decade. Program funding requirements are forecast to increase substantially over the next few years. If overall spending totals remain flat, even more significant delays could result not because nuclear power consumers have not provided the funds necessary to support the program, but because of inappropriate federal budget accounting.

To date, consumers of nuclear power have committed more than $27 billion in fees and accrued interest into the fund, and continue to pay at a rate of $750 million each year. However, only some $9 billion has been spent on the project, leaving a balance in excess of $18 billion. In recent years, fee income has been five times as high as annual spending from the fund.

Artificial Constraints on Repository Operations Should Be Eliminated
Currently, there is a statutory limit of 70,000 metric tons on the amount of nuclear waste materials that can be accepted at Yucca Mountain. The environmental impact statement for the project analyzed emplacement of up to 120,000 metric tons of nuclear waste products in the repository. Additional scientific analyses suggest significantly higher capacity could be achieved with changes in the repository configuration that use only geology that has already been characterized and do not deviate from existing design parameters.

Decisions on licensing and operations of a deep geologic repository at Yucca Mountain should be based on scientific and engineering considerations through the NRC licensing process, not on artificial constraints. Given the decades of study and the billions of dollars invested in Yucca Mountain, it makes sense that we fully and safely utilize its potential capacity.

Clarity and Stability in the Licensing Process Should Be Provided
The NRC repository licensing process should be restructured to ensure that the proceedings are prioritized. First, there must be a reasonable, but finite, schedule for review of the authority to “receive and possess” fuel that would follow approval of the construction license. This would be consistent with an established schedule for the initial review of the construction license application and could avoid dilatory procedural challenges that would undermine the government’s ability to meet its contractual obligations and avoid the significant costs of delay.

Second, clarification must be provided as to what activities are authorized to develop used fuel management infrastructure prior to the NRC granting a construction license, including the construction of a rail line to connect the Yucca Mountain site with the national rail network.

Third, the hearing process for the authorization to receive and possess fuel should be simplified to provide for clear and concise decision making.

Finally, clarification is needed with respect to land management, what regulations will apply to repository construction and operations, and which agencies will administer those regulations.

Additional Factors for Consideration

Used Nuclear Fuel Recycling
The nuclear energy industry has shown consistent and strong support for research and development of advanced fuel cycle technologies incorporated in the Advanced Fuel Cycle Initiative (AFCI). In anticipation of a major expansion of nuclear power in the United States and globally, it is appropriate to accelerate activities in this program. The resurgence in development of nuclear energy is expected to require advanced fuel cycles. However, a repository will be necessary to handle defense wastes, legacy commercial used nuclear fuel and byproducts regardless of whatever fuel cycle is ultimately developed.

President Bush has presented a compelling vision for a global nuclear renaissance through the Global Nuclear Energy Partnership (GNEP). This initiative provides an important framework to satisfy U.S. and world needs for an abundant source of clean, safe nuclear energy while addressing challenges related to fuel supply, long-term radioactive waste management and proliferation concerns.

We recognize that the Congress has important questions regarding this program. The near-term focus for GNEP is for DOE to determine, by 2008, how to proceed with demonstration of advanced recycling technologies and other technological challenges. Consequently, the industry fully supports increased funding for AFCI in fiscal 2007. However, neither AFCI nor GNEP reduces the near-term imperative of developing the Yucca Mountain repository.

A Constructive Role for Nevadans
The nuclear energy industry supports an active and constructive role for Nevada in the development of Yucca Mountain to help ensure the safety of its citizens. The industry also supports compensation for the state to account for the program’s socioeconomic impact, as called for in the Nuclear Waste Policy Act. This model is consistent with the siting and operation of the Waste Isolation Pilot Project.

The industry is encouraged that Nevadans at the local level share a common goal with DOE, the NRC and industry to ensure safe development of Yucca Mountain and the related transportation infrastructure. One recent example of this activity is a cooperative agreement initiated in 2004 among three impacted counties, the city of Caliente and DOE. Another example is the coalition of Nevada business, labor and community leaders that formed “For a Better Nevada” to promote the interests of Nevadans with respect to the Yucca Mountain project. The coalition particularly has identified its interest in incorporating enhanced monitoring and retreivability into the repository program.

The work of this coalition is particularly important in view of Nevada public opinion. Most Nevadans believe that the facility will ultimately be built and that the governor and U.S. senators of Nevada should negotiate with the federal government so that the state can receive millions of dollars in special annual payments to reduce taxes, help expand the economic diversity of Nevada, improve education and the highways, if the Yucca Mountain project is approved for a disposal facility.

The industry is encouraged by the steps DOE has taken to work with affected local governments in the state, and we further encourage the department to expand its interactions with Nevadans interested in being constructively engaged in the project.

Conclusion
We must never lose sight of the federal government’s responsibility for civilian used nuclear fuel disposal, as stated by Congress in the Atomic Energy Act of 1954 and the Nuclear Waste Policy Act of 1982. The industry fully supports the fundamental need for a repository so that used nuclear fuel and the byproducts of the nation’s nuclear weapons program are safely and securely managed in a specially designed, underground facility. World-class science has demonstrated that Yucca Mountain is the best site for such a facility. A public works project of this magnitude—the largest ever of its kind—will inevitably face setbacks. Yet, none is insurmountable. DOE and its contractors have made significant progress on the project and will continue to do so as the department prepares to submit a license application to the NRC. However, DOE is eight years late in meeting its commitment to begin accepting reactor fuel and must proceed without further delay with an integrated used fuel management strategy.

A viable used fuel management strategy is necessary to retain long-term public confidence in operating existing nuclear power plants and build new facilities. The public confidence necessary to support construction of new nuclear plants is linked to successful implementation of an integrated national used fuel policy, which includes a continued commitment for the long-term disposition of used nuclear fuel. This requires a commitment from the administration, Congress and other stakeholders to ensure that DOE makes an effective transition from a scientific program to a licensing and construction program, with the same commitment to safety. New waste management approaches, including interim storage and nuclear fuel recycling, are consistent with timely development of Yucca Mountain.

The challenge before the administration and Congress is to implement our national policy for used fuel management, which includes resolving the near-term difficulties facing Yucca Mountain and setting the project on a path to success. The nuclear energy industry urges this committee to continue to work with the administration, the citizens of Nevada, the industry and other stakeholders as DOE continues its important work to develop a safe, secure repository for used nuclear fuel at Yucca Mountain. It is our responsibility to America today and to future generations to ensure timely, successful completion of Yucca Mountain.