News & Events
October 10, 2005
Frank L. "Skip" Bowman
President and CEO, Nuclear Energy Institute
World Association of Nuclear Operators
Biennial Meeting
Budapest, Hungary
October 10, 2005
Remarks as prepared for delivery
President and CEO, Nuclear Energy Institute
World Association of Nuclear Operators
Biennial Meeting
Budapest, Hungary
October 10, 2005
Remarks as prepared for delivery
Introduction
I want to tell you a story about two U.S. presidents, separated in time but joined by a common purpose.
In 1953, President Dwight Eisenhower spoke to the United Nations General Assembly about a vision he called “Atoms for Peace.”
The General Assembly was silent for the entire speech. Then, Eisenhower drew cheers with this line: “The miraculous inventiveness of man shall not be dedicated to his death, but consecrated to his life.” He was referring, of course, to moving nuclear energy technology away from weapons and to peaceful purposes.
Today, we have an American president who shares President Eisenhower’s vision. Like Eisenhower, President George W. Bush has demonstrated leadership and vision in articulating the promise—indeed, the imperative—of nuclear energy.
In the United States, we are re-launching the nuclear power industry to meet the baseload electricity needs that will exist after 2010.
Many of your countries are, like the United States, planning for the next nuclear plant construction cycle, or already embarked on it.
As we do so, we must recommit ourselves to the values upon which WANO was founded.
Today, I’m going to cover three topics that address this challenge.
First, as background and information, I’ll update you on the outlook for new-plant construction in the United States and the challenges that we still face.
Second, I want to discuss the importance of strengthening the international infrastructure that’s needed to support safe nuclear power plant operations.
Third, I want to emphasize how operational transparency and the sharing of information and best practices are vital to our self-interest. This is the bedrock principle on which our industry rests: Systematic programs to share lessons learned, accompanied by disciplined efforts to ensure that those lessons are applied.
The Prospects for New U.S. Nuclear Plant Construction
Earlier this year, the U.S. Congress followed President Bush’s lead and enacted energy legislation that includes measures to promote the construction of new nuclear power plants.
The Energy Policy Act of 2005, signed into law by President Bush in August, reestablishes nuclear energy as a cornerstone of U.S. energy policy.
For the nuclear energy sector, the legislation provides two building blocks:
First, limited investment stimulus for new nuclear power plants to offset the higher cost of the first new plant designs that we build. The investment stimulus includes a combination of limited tax credits and loan guarantees for a limited number of plants for a limited time.
And second, the legislation provides investment protection for the first six reactors to contain the risk of licensing delays that are beyond the industry’s control.
The policy initiatives in the energy legislation provide a powerful impetus for new nuclear plant construction. Two consortia are developing applications to the Nuclear Regulatory Commission for combined construction and operating licenses. Four other companies have announced their intent to apply for construction and operating licenses.
Three companies are seeking early site permits from the NRC, with others waiting in the wings. Three advanced reactor designs are in varying stages of the NRC’s design certification process. And we’re seeing new business ventures emerge—witness the joint venture between AREVA and Constellation announced in September.
We expect companies to break ground on new nuclear plants in the United States around 2010, with commercial operation beginning as early as 2014. Once those first plants are built and operating, as companies and investors gain confidence in the licensing process, we expect construction of significant numbers of new reactors after 2015.
As we set the stage for new nuclear plants in America, efforts continue toward establishing a national used fuel facility at Yucca Mountain in the Nevada desert.
The Department of Energy is preparing its license application for construction to submit to the Nuclear Regulatory Commission. That license application will reflect provisions for monitoring the repository for up to 300 years, and retrieving the used fuel if the U.S. government determines that other fuel treatment options, including reprocessing and recycling of unburned fissile material in advanced reactors, are cost-effective and desirable.
We are trying to cultivate a broader appreciation of several concepts that are already included in federal law but are not understood by some decision-makers and stakeholders. These include: monitoring and retrievability of spent fuel, requests for confirmatory R&D for disposal and periodic review of the license. We believe proper use of these concepts will engender greater public confidence in the facility.
We have never intended to dispose of the used fuel and walk away from Yucca Mountain. We expect science to evolve, and new technologies to emerge. We expect future experts to develop more sophisticated means of managing used fuel, and to incorporate those techniques into our used fuel management program.
One point is clear: New nuclear plant deployment, in the United States and around the world, must be combined with credible programs that instill confidence that we can safely manage radioactive byproducts for as long as is necessary.
A National Commitment
The U.S. Energy Information Administration projects that global electricity consumption will increase by 57 percent by 2025. Ninety percent of that growth will come in emerging economies, as our industry works to bring electricity to more than 1.5 billion people for the first time.
There are ambitious plans to expand nuclear energy production around the world. And that means we’re going to lean heavily on the companies that provide and bend the metal, pour the concrete and supply nuclear-quality components.
NEI is taking a close look at the global nuclear infrastructure, evaluating the administrative, personnel, financial and manufacturing resources to enable new-plant construction.
We must engage companies that may be considering the nuclear business and help them make the business case for doing so.
The renaissance of nuclear energy around the world represents tremendous earnings potential for suppliers of equipment, services and fuel. We must identify the weak links in our supply chain and turn them into business opportunities.
We are also devoting significant attention to workforce issues, ensuring that we will have the personnel necessary to design, build and operate new nuclear plants.
Our workforce is aging. We must move aggressively to resupply the pipeline of people. We also must address our other critical infrastructure needs—manufacturing of nuclear-grade forgings and reactor vessels and other components—with a similar sense of urgency.
Transparency and Information Sharing
Most importantly, as we go forward with a global nuclear resurgence, we also have a responsibility to ensure there is an open channel of communications across the global nuclear enterprise.
We recognize this responsibility. We believe we are discharging this obligation. But we cannot afford to grow complacent.
In a recent letter to the director general of the International Atomic Energy Agency, Richard Meserve, former chairman of the NRC and chairman of the International Nuclear Safety Group, said: “We are concerned that there are inadequate mechanisms to sort and analyze the information, to distill and prioritize the lessons that should be learned, and to propagate these lessons widely in a user-friendly fashion.”
If Dick Meserve is correct, we still have work to do in this area of information-sharing.
Remaining Challenges
Our conservative design approach of “defense in depth,” coupled with a risk-informed approach to safety, provides a high degree of confidence that we can protect public health and safety. But we must never forget that nuclear power can be an unforgiving technology.
We also operate in an unforgiving public environment where the penalties for mistakes are high and where credibility and public confidence, once lost, are difficult to recover.
Managing this technology successfully requires high standards and eternal vigilance. Put simply, safety is our highest priority.
In the United States, the nuclear power industry has achieved dramatic gains in productivity, reliability and safety over the last 15 years. The U.S. nuclear plant fleet has an average capacity factor around 90 percent, and our best plants are achieving three-year average capacity factors above 95 percent. The trend is apparent globally in all our countries.
We have achieved a high operational plateau, but we still must guard against complacency and remain mindful of our challenges.
As electricity markets are deregulated, we must resist pressures to shave investment in staff, in training, in equipment. Many companies rely increasingly on contractors to provide services and capabilities, and that is not necessarily bad—as long as we realize we cannot contract out responsibility for safe operations.
As plants age, we must devote more attention to materials issues, anticipate potential degradation mechanisms and manage them before they have an impact on plant performance or regulatory confidence. We have had a number of surprises in this area, and we cannot tolerate surprises.
We must, as I noted earlier, rebuild our infrastructure, starting with the work force, and then moving to the manufacturing base. The slowdown in nuclear plant construction over the last 20 years has reduced the cadre of qualified people, and those we have are—like our plants—aging. We must refresh that pipeline.
Conclusion
Many nuclear programs have achieved unprecedented levels of reliability because of our shared commitment to excellence in safety and plant operations. As long as we maintain this commitment, the question about new nuclear plants will not be if we can build them, but rather when.
We’ve learned what can happen absent this commitment. We’ve seen real impacts when we let our guard down: severe financial impacts, detrimental impacts to our work force and damage to the reputation of our industry internationally. I would urge you to give full support to WANO peer review. High levels of safety and low costs go hand in hand.
Many of you have been working to foster the success our industry is currently enjoying—success based on the principles embodied in WANO. But WANO needs our help to be successful.
To safeguard our gains, and capitalize on emerging opportunities, we must never forget the lessons of the past. The weakest among us will shape our fate. An incident anywhere is an incident everywhere.
Many of you remember the words of the late Bill Lee, the first president of WANO. He offered this caution: “Laurels wilt fastest when sat upon.”
It’s still relevant today. Let’s make a commitment here not to rest, or in the worst case, not to sit, on our laurels.
Thank you.
I want to tell you a story about two U.S. presidents, separated in time but joined by a common purpose.
In 1953, President Dwight Eisenhower spoke to the United Nations General Assembly about a vision he called “Atoms for Peace.”
The General Assembly was silent for the entire speech. Then, Eisenhower drew cheers with this line: “The miraculous inventiveness of man shall not be dedicated to his death, but consecrated to his life.” He was referring, of course, to moving nuclear energy technology away from weapons and to peaceful purposes.
Today, we have an American president who shares President Eisenhower’s vision. Like Eisenhower, President George W. Bush has demonstrated leadership and vision in articulating the promise—indeed, the imperative—of nuclear energy.
In the United States, we are re-launching the nuclear power industry to meet the baseload electricity needs that will exist after 2010.
Many of your countries are, like the United States, planning for the next nuclear plant construction cycle, or already embarked on it.
As we do so, we must recommit ourselves to the values upon which WANO was founded.
Today, I’m going to cover three topics that address this challenge.
First, as background and information, I’ll update you on the outlook for new-plant construction in the United States and the challenges that we still face.
Second, I want to discuss the importance of strengthening the international infrastructure that’s needed to support safe nuclear power plant operations.
Third, I want to emphasize how operational transparency and the sharing of information and best practices are vital to our self-interest. This is the bedrock principle on which our industry rests: Systematic programs to share lessons learned, accompanied by disciplined efforts to ensure that those lessons are applied.
The Prospects for New U.S. Nuclear Plant Construction
Earlier this year, the U.S. Congress followed President Bush’s lead and enacted energy legislation that includes measures to promote the construction of new nuclear power plants.
The Energy Policy Act of 2005, signed into law by President Bush in August, reestablishes nuclear energy as a cornerstone of U.S. energy policy.
For the nuclear energy sector, the legislation provides two building blocks:
First, limited investment stimulus for new nuclear power plants to offset the higher cost of the first new plant designs that we build. The investment stimulus includes a combination of limited tax credits and loan guarantees for a limited number of plants for a limited time.
And second, the legislation provides investment protection for the first six reactors to contain the risk of licensing delays that are beyond the industry’s control.
The policy initiatives in the energy legislation provide a powerful impetus for new nuclear plant construction. Two consortia are developing applications to the Nuclear Regulatory Commission for combined construction and operating licenses. Four other companies have announced their intent to apply for construction and operating licenses.
Three companies are seeking early site permits from the NRC, with others waiting in the wings. Three advanced reactor designs are in varying stages of the NRC’s design certification process. And we’re seeing new business ventures emerge—witness the joint venture between AREVA and Constellation announced in September.
We expect companies to break ground on new nuclear plants in the United States around 2010, with commercial operation beginning as early as 2014. Once those first plants are built and operating, as companies and investors gain confidence in the licensing process, we expect construction of significant numbers of new reactors after 2015.
As we set the stage for new nuclear plants in America, efforts continue toward establishing a national used fuel facility at Yucca Mountain in the Nevada desert.
The Department of Energy is preparing its license application for construction to submit to the Nuclear Regulatory Commission. That license application will reflect provisions for monitoring the repository for up to 300 years, and retrieving the used fuel if the U.S. government determines that other fuel treatment options, including reprocessing and recycling of unburned fissile material in advanced reactors, are cost-effective and desirable.
We are trying to cultivate a broader appreciation of several concepts that are already included in federal law but are not understood by some decision-makers and stakeholders. These include: monitoring and retrievability of spent fuel, requests for confirmatory R&D for disposal and periodic review of the license. We believe proper use of these concepts will engender greater public confidence in the facility.
We have never intended to dispose of the used fuel and walk away from Yucca Mountain. We expect science to evolve, and new technologies to emerge. We expect future experts to develop more sophisticated means of managing used fuel, and to incorporate those techniques into our used fuel management program.
One point is clear: New nuclear plant deployment, in the United States and around the world, must be combined with credible programs that instill confidence that we can safely manage radioactive byproducts for as long as is necessary.
A National Commitment
The U.S. Energy Information Administration projects that global electricity consumption will increase by 57 percent by 2025. Ninety percent of that growth will come in emerging economies, as our industry works to bring electricity to more than 1.5 billion people for the first time.
There are ambitious plans to expand nuclear energy production around the world. And that means we’re going to lean heavily on the companies that provide and bend the metal, pour the concrete and supply nuclear-quality components.
NEI is taking a close look at the global nuclear infrastructure, evaluating the administrative, personnel, financial and manufacturing resources to enable new-plant construction.
We must engage companies that may be considering the nuclear business and help them make the business case for doing so.
The renaissance of nuclear energy around the world represents tremendous earnings potential for suppliers of equipment, services and fuel. We must identify the weak links in our supply chain and turn them into business opportunities.
We are also devoting significant attention to workforce issues, ensuring that we will have the personnel necessary to design, build and operate new nuclear plants.
Our workforce is aging. We must move aggressively to resupply the pipeline of people. We also must address our other critical infrastructure needs—manufacturing of nuclear-grade forgings and reactor vessels and other components—with a similar sense of urgency.
Transparency and Information Sharing
Most importantly, as we go forward with a global nuclear resurgence, we also have a responsibility to ensure there is an open channel of communications across the global nuclear enterprise.
We recognize this responsibility. We believe we are discharging this obligation. But we cannot afford to grow complacent.
In a recent letter to the director general of the International Atomic Energy Agency, Richard Meserve, former chairman of the NRC and chairman of the International Nuclear Safety Group, said: “We are concerned that there are inadequate mechanisms to sort and analyze the information, to distill and prioritize the lessons that should be learned, and to propagate these lessons widely in a user-friendly fashion.”
If Dick Meserve is correct, we still have work to do in this area of information-sharing.
Remaining Challenges
Our conservative design approach of “defense in depth,” coupled with a risk-informed approach to safety, provides a high degree of confidence that we can protect public health and safety. But we must never forget that nuclear power can be an unforgiving technology.
We also operate in an unforgiving public environment where the penalties for mistakes are high and where credibility and public confidence, once lost, are difficult to recover.
Managing this technology successfully requires high standards and eternal vigilance. Put simply, safety is our highest priority.
In the United States, the nuclear power industry has achieved dramatic gains in productivity, reliability and safety over the last 15 years. The U.S. nuclear plant fleet has an average capacity factor around 90 percent, and our best plants are achieving three-year average capacity factors above 95 percent. The trend is apparent globally in all our countries.
We have achieved a high operational plateau, but we still must guard against complacency and remain mindful of our challenges.
As electricity markets are deregulated, we must resist pressures to shave investment in staff, in training, in equipment. Many companies rely increasingly on contractors to provide services and capabilities, and that is not necessarily bad—as long as we realize we cannot contract out responsibility for safe operations.
As plants age, we must devote more attention to materials issues, anticipate potential degradation mechanisms and manage them before they have an impact on plant performance or regulatory confidence. We have had a number of surprises in this area, and we cannot tolerate surprises.
We must, as I noted earlier, rebuild our infrastructure, starting with the work force, and then moving to the manufacturing base. The slowdown in nuclear plant construction over the last 20 years has reduced the cadre of qualified people, and those we have are—like our plants—aging. We must refresh that pipeline.
Conclusion
Many nuclear programs have achieved unprecedented levels of reliability because of our shared commitment to excellence in safety and plant operations. As long as we maintain this commitment, the question about new nuclear plants will not be if we can build them, but rather when.
We’ve learned what can happen absent this commitment. We’ve seen real impacts when we let our guard down: severe financial impacts, detrimental impacts to our work force and damage to the reputation of our industry internationally. I would urge you to give full support to WANO peer review. High levels of safety and low costs go hand in hand.
Many of you have been working to foster the success our industry is currently enjoying—success based on the principles embodied in WANO. But WANO needs our help to be successful.
To safeguard our gains, and capitalize on emerging opportunities, we must never forget the lessons of the past. The weakest among us will shape our fate. An incident anywhere is an incident everywhere.
Many of you remember the words of the late Bill Lee, the first president of WANO. He offered this caution: “Laurels wilt fastest when sat upon.”
It’s still relevant today. Let’s make a commitment here not to rest, or in the worst case, not to sit, on our laurels.
Thank you.