Order Code IB88090
CRS Issue Brief for Congress
Received through the CRS Web
Nuclear Energy Policy
Updated April 26, 2005
Mark Holt
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress

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CONTENTS
SUMMARY
MOST RECENT DEVELOPMENTS
BACKGROUND AND ANALYSIS
Overview of Nuclear Power in the United States
Nuclear Power Research and Development
Nuclear Power Plant Safety and Regulation
Safety
Domestic Reactor Safety
Reactor Safety in the Former Soviet Bloc
Licensing and Regulation
Reactor Security
Decommissioning
Nuclear Accident Liability
Nuclear Waste Management
Federal Funding for Nuclear Energy Programs
LEGISLATION

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Nuclear Energy Policy
SUMMARY
Nuclear energy policy issues facing
force security exercises at nuclear power
Congress include whether to provide federal
plants, the establishment of federal security
incentives for a new generation of commercial
coordinators, and the fingerprinting of nuclear
reactors, radioactive waste management,
facility workers.
research and development priorities, power
plant safety and regulation, terrorism, and the
Disposal of highly radioactive waste has
Price-Anderson Act nuclear liability system.
been one of the most controversial aspects of
nuclear power. The Nuclear Waste Policy Act
The Bush Administration has stressed the
of 1982 (NWPA, P.L. 97-425), as amended in
importance of nuclear power in the nation’s
1987, requires DOE to conduct detailed physi-
energy policy. For nuclear energy research
cal characterization of Yucca Mountain in
and development, the Administration is re-
Nevada as a permanent underground reposi-
questing $389.9 million for FY2006, about
tory for high-level waste.
$14.7 million above the FY2005 appropria-
tion. In addition to that funding, the Depart-
Upon releasing the civilian nuclear waste
ment of Energy (DOE) Office of Nuclear
program’s FY2006 budget request, program
Energy, Science, and Technology would
officials announced that the opening of DOE’s
receive $120.9 million for defense-related
planned nuclear waste repository at Yucca
management and security at the Idaho Na-
Mountain, Nevada, would be delayed at least
tional Laboratory (INL). The Nuclear Energy
two years from the previous goal of 2010.
office’s total FY2006 funding request of
The waste program’s funding request of
$510.8 million is 5.2% above the comparable
$651.4 million is about 14% above the
FY2005 level, according to DOE.
FY2005 level but only about half the amount
that last year’s budget justification said would
Nuclear provisions are included in energy
have been needed to open the repository by
legislation approved by the House April 21,
2010. DOE officials also announced that a
2005 (H.R. 6). The bill would extend Price-
Yucca Mountain license application to the
Anderson coverage for new commercial reac-
Nuclear Regulatory Commission (NRC) will
tors and new DOE nuclear contracts through
be delayed by at least a year, to the end of
the end of 2025. The bill would also autho-
2005.
rize a hydrogen-producing demonstration
reactor at INL and five other nuclear hydrogen
Whether progress on nuclear waste
demonstration projects.
disposal and other congressional action will
revive the U.S. nuclear power industry’s
The September 11, 2001, terrorist attacks
growth will depend primarily on economic
on the United States raised questions about
considerations. Natural gas- and coal-fired
nuclear power plant security. Reactor security
power plants currently are favored over nu-
provisions are in the energy bill approved by
clear reactors for new generating capacity.
the House, including a presidential study of
However, some electric utilities are seeking
security threats to nuclear facilities, force-on-
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MOST RECENT DEVELOPMENTS
Several nuclear provisions are included in energy legislation approved by the House
April 21 (H.R. 6). The measure would extend Price-Anderson Act nuclear liability coverage
for new commercial reactors and new Department of Energy (DOE) nuclear contracts
through the end of 2025. The bill would also authorize a DOE hydrogen-producing
demonstration reactor at the Idaho National Laboratory (INL) and five other nuclear
hydrogen demonstration projects. A number of nuclear facility security provisions are
included as well. The House bill’s nuclear provisions are similar to those of the conference
report on an omnibus energy bill in the 108th Congress (also H.R. 6).
The Bush Administration on February 7 released its FY2006 budget request for nuclear
energy programs. For DOE nuclear research and development — including advanced
reactors, fuel cycle technology, and nuclear hydrogen production — the Administration is
requesting $389.9 million, about $14.7 million above the FY2005 appropriation. In addition
to that funding, the DOE Office of Nuclear Energy, Science, and Technology would receive
$120.9 million for defense-related management and security at the Idaho National Laboratory
(INL), which has been transferred to the nuclear energy program from DOE’s environmental
management program. The Nuclear Energy office’s total FY2006 funding request of $510.8
million is 5.2% above the comparable FY2005 level, according to DOE.
Upon releasing the DOE civilian nuclear waste program’s FY2006 budget request,
program officials announced that the opening of a planned nuclear waste repository at Yucca
Mountain, Nevada, would be delayed at least two years from the previous goal of 2010. The
waste program’s funding request of $651.4 million is about 14% above the FY2005 level but
only about half the amount that last year’s budget justification said would have been needed
to open the repository by 2010. DOE officials also announced that a Yucca Mountain license
application to the Nuclear Regulatory Commission (NRC) will be delayed by at least a year,
to the end of 2005.
A preliminary commitment to provide almost $5 billion in financial support for a
proposed sale of four Westinghouse reactors to China was approved February 18 by the
Export-Import Bank of the United States. The proposed deal, if approved by China, would
be Westinghouse’s first opportunity to construct its advanced AP-1000 reactor design, which
received final design approval from NRC in September 2004. However, the Ex-Im financing
decision has been criticized for potentially subsidizing the nuclear power industry and
transferring U.S. nuclear technology to China.
DOE announced November 4, 2004, that it would award $13 million to help two
industry consortia pursue combined construction and operating licenses for new nuclear
power plants. The proposed license applications would be the first for new U.S. nuclear
power plants in more than 25 years. However, the consortia are not committing to construct
the plants if the licenses are granted.
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BACKGROUND AND ANALYSIS
Overview of Nuclear Power in the United States
The U.S. nuclear power industry, while currently generating about 20% of the nation’s
electricity, faces an uncertain long-term future. No nuclear plants have been ordered in the
United States since 1978 and more than 100 reactors have been canceled, including all
ordered after 1973. No units are currently under active construction; the Tennessee Valley
Authority’s (TVA’s) Watts Bar 1 reactor, ordered in 1970 and licensed to operate in 1996,
was the most recent U.S. nuclear unit to be completed. The nuclear power industry’s
troubles include high nuclear power plant construction costs, public concern about nuclear
safety and waste disposal, and regulatory compliance costs.
High construction costs are perhaps the most serious obstacle to nuclear power
expansion. Construction costs for reactors completed since the mid-1980s ranged from $2-
$6 billion, averaging more than $3,000 per kilowatt of electric generating capacity (in 1997
dollars). The nuclear industry predicts that new plant designs could be built for less than half
that amount if many identical plants were built in a series, but such economies of scale have
yet to be demonstrated.
Nevertheless, all is not bleak for the U.S. nuclear power industry, which currently
comprises 103 licensed reactors at 65 plant sites in 31 states. (That number excludes TVA’s
Browns Ferry 1, which has not operated since 1985; the TVA Board decided May 16, 2002,
to spend about $1.8 billion to restart the reactor by 2007.) Electricity production from U.S.
nuclear power plants is greater than that from oil, natural gas, and hydropower, and behind
only coal, which accounts for more than half of U.S. electricity generation. Nuclear plants
generate more than half the electricity in six states. The record 824 billion kilowatt-hours
of nuclear electricity generated in the United States during 20041 was more than the nation’s
entire electrical output in the early 1960s, when the first large-scale commercial reactors
were being ordered.
Average operating costs of U.S. nuclear plants dropped substantially during the past
decade, and costly downtime has been steadily reduced. Licensed commercial reactors
generated electricity at an average of 89.6% of their total capacity in 2004, according to
industry statistics.2
Thirty commercial reactors have received 20-year license extensions from the Nuclear
Regulatory Commission (NRC), giving them up to 60 years of operation. License extensions
for 18 more reactors are currently under review, and many others are anticipated, according
to NRC (see website at [http://www.nrc.gov/reactors/operating/licensing/renewal/
applications.html]).
1 Margaret L. Ryan, “World Nuclear Output, and U.S., Set Records in 2004,” Nucleonics Week,
February 10, 2005, p. 1.
2 Ibid.
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Industry consolidation could also help existing nuclear power plants, as larger nuclear
operators purchase plants from utilities that run only one or two reactors. Several such sales
have occurred, including the March 2001 sale of the Millstone plant in Connecticut to
Dominion Energy for a record $1.28 billion. The merger of two of the nation’s largest
nuclear utilities, PECO Energy and Unicom, completed in October 2000, consolidated the
operation of 17 reactors under a single corporate entity, Exelon Corporation, headquartered
in Chicago. Exelon and New Jersey-based Public Service Enterprise Group announced a
merger on December 20, 2004, that would boost the combined firm’s reactor fleet to 20.
Existing nuclear power plants appear to hold a strong position in the ongoing
restructuring of the electricity industry. In most cases, nuclear utilities have received
favorable regulatory treatment of past construction costs, and average nuclear operating costs
are currently estimated to be competitive with those of fossil fuel technologies.3 Although
eight U.S. nuclear reactors were permanently shut down during the 1990s, none has been
closed since 1998, and recent reactor sales could indicate greater industry interest in nuclear
plants that previously had been considered marginal. Despite the shutdowns, annual U.S.
nuclear electrical output increased by more than one-third from 1990 to 2004, according to
the Energy Information Administration and industry statistics. The increase resulted
primarily from reduced downtime at the remaining plants, the startup of five new units, and
reactor modifications to boost capacity.
The good performance of existing reactors and the relatively high cost of natural gas —
the favored fuel for new power plants for the past 15 years — have prompted renewed utility
consideration of the feasibility of building new reactors. That apparently growing interest
has helped intensify congressional debate about the federal role, if any, in encouraging the
construction of new nuclear power plants.
Entergy, Dominion Resources, and Exelon have chosen sites in Mississippi, Virginia,
and Illinois, respectively, for possible future nuclear units and filed early site permit
applications with NRC (see [http://www.nrc.gov/reactors/new-licensing/esp.html]) in fall
2003. As discussed in the next section, the Department of Energy (DOE) is assisting the site-
selection efforts and new reactor license applications as part of a program to encourage
construction of new commercial reactors by 2010. However, none of the utilities
participating in the DOE site selection and licensing program have committed to continuing
to the construction stage. EIA projects that, without federal assistance, no new reactors will
be built by 2025.4
A conference agreement on omnibus energy legislation in the 108th Congress (H.R. 6)
would have provided tax credits for electricity produced from as much as 6,000 megawatts
of new nuclear generating capacity and authorized about $1.1 billion for a demonstration
reactor in Idaho to produce both electricity and hydrogen. The House approved the
conference report November 18, 2003, but a Senate filibuster blocked further action.
3 Energy Information Administration, Nuclear Power: 12 percent of America’s Generating Capacity,
20 percent of the Electricity, July 17, 2003, at [http://www.eia.doe.gov/cneaf/nuclear/page/analysis/
nuclearpower.html].
4 Energy Information Administration, Annual Energy Outlook 2005, DOE/EIA-0383(2005), February
2005, p. 6.
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A DOE advisory group recommended in January 2005 that the federal government
provide up to $4.2 billion in loan guarantees, power purchase agreements, accelerated
depreciation, and investment and production tax credits to persuade the industry to build new
U.S. nuclear plants.5
Global warming that may be caused by fossil fuels — the “greenhouse effect” — is
cited by nuclear power supporters as an important reason to develop a new generation of
reactors. On May 19, 2003, New Hampshire became the first state to provide emissions
credits for incremental nuclear generating capacity. But the large obstacles noted above must
still be overcome before electric generating companies will risk ordering new nuclear units.
(For more on the outlook for nuclear power, see CRS Report RL31064, Nuclear Power:
Prospects for New Commercial Reactors.)
Nuclear Power Research and Development
For nuclear energy research and development — including advanced reactors, fuel cycle
technology, and nuclear hydrogen production — the Administration is requesting $389.9
million for FY2006, about $14.7 million above the FY2005 appropriation. In addition to that
funding, the DOE Office of Nuclear Energy, Science, and Technology would receive $120.9
million under Other Defense Activities for defense-related management and security at the
Idaho National Laboratory (INL), which has been transferred to the nuclear energy program
from DOE’s environmental management program. The Nuclear Energy office’s total
FY2006 funding request of $510.8 million is 5.2% above the comparable FY2005 level,
according to DOE.
“The benefits of nuclear power as an emissions free, reliable, and affordable source of
energy are an essential element in the Nation’s energy and environmental future,” according
to DOE’s budget justification. However, opponents have criticized DOE’s nuclear research
program as providing wasteful subsidies to an industry that they believe should be phased
out as unacceptably hazardous and economically uncompetitive.
President Bush’s specific mention of “safe, clean nuclear energy” in his most recent
State of the Union Address indicates the Administration’s interest in encouraging
construction of new commercial reactors. DOE’s efforts to restart the nuclear construction
pipeline are focused on the Nuclear Power 2010 Program, which will pay up to half of the
nuclear industry’s costs of seeking regulatory approval for new reactor sites, applying for
new reactor licenses, and preparing detailed plant designs. The program is intended to
provide assistance for advanced versions of existing commercial nuclear plants that could
be ordered within the next few years.
The Nuclear Power 2010 Program is helping three utilities seek NRC approval for
potential nuclear reactor sites in Illinois, Mississippi, and Virginia. In addition, three
industry consortia in 2004 applied for a total of $650 million over the next several years to
5 Elaine Hiruo, “Special DOE Task Force Recommends $4.2-billion in New Reactor Aid,”
Nucleonics Week, January 13, 2005, p. 1.
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design and license new nuclear power plants and conduct a feasibility study. The budget
request includes $56.0 million for the program in FY2006, a 12.9% boost over FY2005.
The nuclear license applications under the Nuclear Power 2010 program would test the
“one step” licensing process established by the Energy Policy Act of 1992 (P.L. 102-486).
Successful applicants would receive combined construction permits and operating licenses
(COLs), which would allow a completed reactor to operate if it were found to be properly
constructed. Even if the COLs are granted by NRC, the three industry consortia have not
committed to building new reactors.
! Dominion Resources is leading a consortium that is seeking $250 million
over six years for a COL for an advanced General Electric reactor (after
originally considering a Canadian design). The proposed reactor would be
located at Dominion’s existing North Anna plant in Virginia, where the
company is seeking an NRC early site permit with DOE assistance. The
$500 million total cost would include “first of a kind” design and
engineering work, to the level of detail necessary for firm construction cost
estimates.
! A consortium called NuStart Energy Development, which includes Exelon
and several other major nuclear utilities, is requesting $400 million from
DOE over seven years for a COL for “passively safe” Westinghouse or
General Electric reactor designs. Various sites are under consideration,
including two in the ESP program. First-of-a-kind design cost are included
in the total $800 million estimate. NuStart member Duke Power announced
in February 2005 that it was considering submitting its own application for
a COL.
! TVA is leading a consortium that requested $2 million to study the
feasibility of building a General Electric Advanced Boiling Water Reactor
(ABWR) at the site of TVA’s uncompleted Bellefonte nuclear plant in
Alabama. Because the ABWR already has received NRC standard design
certification and has been constructed in other countries, first-of-a-kind
design work would not be needed.
According to news reports, the Dominion team will receive an initial DOE award of $9
million, NuStart will be granted $4 million, and, for the ABWR feasibility study, TVA will
receive more than $2 million.6
The advanced Westinghouse reactor under consideration by NuStart, the AP-1000, is
also competing for a contract in China. If Westinghouse were to prevail over designs being
offered by France and Russia, the four-reactor contract could help demonstrate the
commercial viability of the new design, which received final design approval from NRC in
September 2004. A preliminary commitment to provide almost $5 billion in financial
support for the proposed China reactor sale was approved February 18, 2005, by the Export-
6 Tom Harrison, “Two Reactor Consortia Awarded DOE Funding,” NuclearFuel, November 8, 2004,
p. 1.
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Import Bank of the United States. Critics contend that the tentative Ex-Im financing could
provide unwarranted subsidies to the nuclear power industry and unwisely transfer U.S.
nuclear technology to China.
Advanced commercial reactor technologies that are not yet close to deployment are the
focus of DOE’s Generation IV Nuclear Energy Systems Initiative, for which $45.0 million
is being requested for FY2006, about 12.5% above FY2005.
The Generation IV program is focusing on six advanced designs that could be
commercially available around 2020-2030: two gas-cooled, one water-cooled, two liquid-
metal-cooled, and one molten-salt concept. Some of these reactors would use plutonium
recovered through reprocessing of spent nuclear fuel. The Administration’s May 2001
National Energy Policy report contends that plutonium recovery could reduce the long-term
environmental impact of nuclear waste disposal and increase domestic energy supplies.
However, opponents contend that the separation of plutonium from spent fuel poses
unacceptable environmental risks and, because of plutonium’s potential use in nuclear
bombs, undermines U.S. policy on nuclear weapons proliferation.
The development of plutonium-fueled reactors in the Generation IV program is closely
related to the nuclear energy program’s Advanced Fuel Cycle Initiative (AFCI), for which
the Administration is requesting $70.0 million — 3.8% above the FY2005 level. According
to the budget justification, AFCI will develop and demonstrate nuclear fuel cycles that could
reduce the long-term hazard of spent nuclear fuel and recover additional energy. Such
technologies would involve separation of plutonium, uranium, and other long-lived
radioactive materials from spent fuel for re-use in a nuclear reactor or for transmutation in
a particle accelerator. The program includes longstanding DOE work on electrometallurgical
treatment of spent fuel from the Experimental Breeder Reactor II (EBR-II) at INL.
In support of President Bush’s program to develop hydrogen-fueled vehicles, DOE is
requesting $20.0 million in FY2006 for the Nuclear Hydrogen Initiative, an increase of 124%
from the FY2005 level. According to DOE’s FY2005 budget justification, “preliminary
estimates ... indicate that hydrogen produced using nuclear-driven thermochemical or high-
temperature electrolysis processes would be only slightly more expensive than gasoline” and
result in far less air pollution.
An advanced reactor that would demonstrate co-production of hydrogen and electricity
— the Next Generation Nuclear Plant (NGNP) — was allocated $25.0 million from DOE’s
Generation IV program by the FY2005 omnibus appropriations conference report. “The
conferees expect the Department to submit a budget in fiscal year 2006 that is consistent with
the goal of demonstrating hydrogen production and electricity generation by 2015 at the
Idaho National Laboratory,” according to the statement of managers. DOE’s FY2006 budget
justification for Generation IV says the research to be undertaken by the program “will help
inform a decision on whether to proceed with a demonstration of the Next Generation
Nuclear Plant.”
Nuclear hydrogen provisions are also included in energy legislation approved by the
House on April 21, 2005 (H.R. 6). The bill would authorize $1.3 billion through FY2015
for a hydrogen-producing demonstration reactor at INL and five other nuclear hydrogen
demonstration projects.
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DOE is again seeking no new funding specifically for the Nuclear Energy Research
Initiative (NERI), which provides grants for research on innovative nuclear energy
technologies. Instead, according to the budget justification, NERI projects will be pursued
at the discretion of individual nuclear R&D programs. NERI received an appropriation of
$2.5 million for FY2005. New funding also is not being requested for the Nuclear Energy
Plant Optimization program (NEPO), which received $2.5 million in FY2005. The program
supports cost-shared research by the nuclear power industry on ways to improve the
productivity of existing nuclear plants.
Nuclear Power Plant Safety and Regulation
Safety
Controversy over safety has dogged nuclear power throughout its development,
particularly following the March 1979 Three Mile Island accident in Pennsylvania and the
April 1986 Chernobyl disaster in the former Soviet Union. In the United States, safety-relat-
ed shortcomings have been identified in the construction quality of some plants, plant
operation and maintenance, equipment reliability, emergency planning, and other areas. In
a relatively recent example, it was discovered in March 2002 that leaking boric acid had
eaten a large cavity in the top of the reactor vessel in Ohio’s Davis-Besse nuclear plant. The
corrosion left only the vessel’s quarter-inch-thick stainless steel inner liner to prevent a
potentially catastrophic loss of reactor cooling water. Davis-Besse remained closed for
repairs and other safety improvements until NRC allowed the reactor to restart in March
2004.
NRC’s oversight of the nuclear industry is an ongoing issue; nuclear utilities often
complain that they are subject to overly rigorous and inflexible regulation, but nuclear critics
charge that NRC frequently relaxes safety standards when compliance may prove difficult
or costly to the industry.
Domestic Reactor Safety. In terms of public health consequences, the safety record
of the U.S. nuclear power industry in comparison with other major commercial energy
technologies has been excellent. In more than 2,500 reactor-years of operation in the United
States, the only incident at a commercial power plant that might lead to any deaths or injuries
to the public has been the Three Mile Island accident, in which more than half the reactor
core melted. Public exposure to radioactive materials released during that accident is
expected to cause fewer than five deaths (and perhaps none) from cancer over the following
30 years. A study of 32,000 people living within 5 miles of the reactor when the accident
occurred found no significant increase in cancer rates through 1998, although the authors
note that some potential health effects “cannot be definitively excluded.”7
The relatively small amounts of radioactivity released by nuclear plants during normal
operation are not generally believed to pose significant hazards, although some groups
7 Evelyn O. Talbott et al., “Long Term Follow-Up of the Residents of the Three Mile Island Accident
Area: 1979-1998,” Environmental Health Perspectives, published online October 30, 2002, at
[http://ehp.niehs.nih.gov/docs/2003/5662/abstract.html].
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contend that routine emissions are risky. There is substantial scientific uncertainty about the
level of risk posed by low levels of radiation exposure; as with many carcinogens and other
hazardous substances, health effects can be clearly measured only at relatively high exposure
levels. In the case of radiation, the assumed risk of low-level exposure has been extrapolated
mostly from health effects documented among persons exposed to high levels of radiation,
particularly Japanese survivors of nuclear bombing in World War II.
The consensus among most safety experts is that a severe nuclear power plant accident
in the United States is likely to occur less frequently than once every 10,000 reactor-years
of operation. (For the current U.S. fleet of about 100 reactors, that rate would yield an
average of one severe accident every 100 years.) These experts believe that most severe
accidents would have small public health impacts, and that accidents causing as many as 100
deaths would be much rarer than once every 10,000 reactor-years. On the other hand, some
experts challenge the complex calculations that go into predicting such accident frequencies,
contending that accidents with serious public health consequences may be more frequent.
Reactor Safety in the Former Soviet Bloc. The Chernobyl accident was by far
the worst nuclear power plant accident to have occurred anywhere in the world. At least 31
persons died quickly from acute radiation exposure or other injuries, and thousands of
additional cancer deaths among the tens of millions of people exposed to radiation from the
accident may occur during the next several decades.
According to a 2002 report by the Organization for Economic Cooperation and
Development (OECD), the primary observable health consequence of the accident has been
a dramatic increase in childhood thyroid cancer. About 1,000 cases of childhood thyroid
cancer were reported in certain regions surrounding the destroyed reactor — a rate that is as
much as a hundred times the pre-accident level, according to OECD. The death rate for
accident cleanup workers also rose measurably, the organization reported. The OECD report
estimated that about 50,000 square miles of land in Belarus, Ukraine, and Russia were
substantially contaminated with radioactive cesium from Chernobyl.8
Licensing and Regulation
For many years a top priority of the nuclear industry was to modify the process for
licensing new nuclear plants. No electric utility would consider ordering a nuclear power
plant, according to the industry, unless licensing became quicker and more predictable, and
designs were less subject to mid-construction safety-related changes required by NRC. The
Energy Policy Act of 1992 (P.L. 102-486) largely implemented the industry’s licensing goals,
but no plants have been ordered.
Nuclear plant licensing under the Atomic Energy Act of 1954 (P.L. 83-703; U.S.C.
2011-2282) had historically been a two-stage process. NRC first issued a construction permit
to build a plant, and then, after construction was finished, an operating permit to run it. Each
stage of the licensing process involved complicated proceedings. Environmental impact
statements also are required under the National Environmental Policy Act.
8 OECD Nuclear Energy Agency, Chernobyl: Assessment of Radiological and Health Impacts, 2002.
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Over the vehement objections of nuclear opponents, the Energy Policy Act provides a
clear statutory basis for one-step nuclear licenses, which would combine the construction
permits and operating licenses and allow completed plants to operate without delay if
construction criteria are met. NRC would hold preoperational hearings on the adequacy of
plant construction only in specified circumstances. DOE’s Nuclear Power 2010 initiative
(discussed above) proposes to pay up to half the cost of at least one combined construction
and operating license for an advanced reactor.
A fundamental concern in the nuclear regulatory debate is the performance of NRC in
issuing and enforcing nuclear safety regulations. The nuclear industry and its supporters have
regularly complained that unnecessarily stringent and inflexibly enforced nuclear safety
regulations have burdened nuclear utilities and their customers with excessive costs. But
many environmentalists, nuclear opponents, and other groups charge NRC with being too
close to the nuclear industry, a situation that they say has resulted in lax oversight of nuclear
power plants and routine exemptions from safety requirements.
Primary responsibility for nuclear safety compliance lies with nuclear plant owners, who
are required to find any problems with their plants and report them to NRC. Compliance is
also monitored directly by NRC, which maintains at least two resident inspectors at each
nuclear power plant. The resident inspectors routinely examine plant systems, observe the
performance of reactor personnel, and prepare regular inspection reports. For serious safety
violations, NRC often dispatches special inspection teams to plant sites.
In response to congressional criticism, NRC has begun reorganizing and overhauling
many of its procedures. The Commission is moving toward “risk-informed regulation,” in
which safety enforcement is guided by the relative risks identified by detailed individual
plant studies. NRC’s risk-informed reactor oversight system, inaugurated April 2, 2000,
relies on a series of performance indicators to determine the level of scrutiny that each
reactor should receive.
Reactor Security
Nuclear power plants have long been recognized as potential targets of terrorist attacks,
and critics have long questioned the adequacy of the measures required of nuclear plant
operators to defend against such attacks. All commercial nuclear power plants licensed by
NRC have a series of physical barriers to accessing the operating reactor area, and are
required to maintain a trained security force to protect them. Following the terrorist attacks
of September 11, 2001, NRC began a “top-to-bottom” review of its security requirements.
A key element in protecting nuclear plants is the requirement that simulated terrorist
attack exercises, monitored by NRC, be carried out to test the ability of the plant operator to
defend against them. The severity of attacks to be prepared for are specified in the form of
a “design basis threat” (DBT). After more than a year’s review, on April 29, 2003, NRC
changed the DBT to “represent the largest reasonable threat against which a regulated private
guard force should be expected to defend under existing law.” The details of the revised
DBT were not released to the public.
The energy bill passed by the House on April 13, 2005 (H.R. 6), includes several
nuclear facility security proposals that are similar to those in the unpassed energy conference
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report in the 108th Congress (also H.R. 6). Security provisions in the House bill include a
presidential study of security threats to nuclear facilities, force-on-force security exercises
at nuclear power plants, authorization of firearms use by nuclear security personnel,
establishment of federal security coordinators, and fingerprinting of nuclear facility workers.
Senator Inhofe, Chairman of the Senate Environment and Public Works Committee,
introduced a nuclear plant security bill on April 20, 2005 (S. 864). The measure includes
similar provisions to those of the House-passed bill on firearms use, fingerprinting, and
several other provisions, but does not require a presidential security study, force-on-force
exercises, or federal security coordinators.
(For background on security issues, see CRS Report RS21131, Nuclear Power Plants:
Vulnerability to Terrorist Attack.)
Decommissioning
When nuclear power plants end their useful lives, they must be safely removed from
service, a process called decommissioning. NRC requires nuclear utilities to make regular
contributions to special trust funds to ensure that money is available to remove radioactive
material and contamination from reactor sites after they are closed. Because no full-sized
U.S. commercial reactor has yet been completely decommissioned, which can take several
decades, the cost of the process can only be estimated. Decommissioning cost estimates
cited by a 1996 DOE report, for one full-sized commercial reactor, ranged from about $150
million to $600 million in 1995 dollars. Disposal of large amounts of low-level waste,
consisting of contaminated reactor components, concrete, and other materials, is expected
to account for much of those costs.
The tax treatment of decommissioning funds has been a continuing issue. An energy
tax bill (H.R. 1541) approved by the House Ways and Means Committee April 13, 2005,
would provide favorable tax treatment to nuclear decommissioning funds, subject to certain
restrictions; similar provisions were included in the conference report on H.R. 6 in the 108th
Congress.
Nuclear Accident Liability
Liability for damages to the general public from nuclear incidents is addressed by the
Price-Anderson Act (primarily Section 170 of the Atomic Energy Act of 1954, 42 U.S.C.
2210). The act was up for reauthorization on August 1, 2002, and it was extended for
commercial reactors through December 31, 2003, by the FY2003 omnibus continuing
resolution (P.L. 108-7). Even without a further extension, existing reactors continue to
operate under the current Price-Anderson liability system, but new reactors would not be
covered. Price-Anderson coverage for DOE nuclear contractors was extended through
December 31, 2004, by the National Defense Authorization Act for FY2003 (P.L. 107-314).
A further two-year extension for DOE contractors was approved by Congress on October 9,
2004, as part of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year
2005 (P.L. 108-375). The energy bill approved by the House on April 21, 2005, would
extend Price-Anderson coverage for new commercial reactors and new DOE nuclear
contracts through the end of 2025. A bill introduced by Senator Voinovich on April 20,
2005, would provide the same extension (S. 865).
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Under Price-Anderson, the owners of commercial reactors must assume all liability for
nuclear damages awarded to the public by the court system, and they must waive most of
their legal defenses following a severe radioactive release (“extraordinary nuclear
occurrence”). To pay any such damages, each licensed reactor must carry financial
protection in the amount of the maximum liability insurance available, which was increased
by the insurance industry from $200 million to $300 million on January 1, 2003. Any
damages exceeding that amount are to be assessed equally against all covered commercial
reactors, up to $95.8 million per reactor (most recently adjusted for inflation on August 20,
2003). Those assessments — called “retrospective premiums” — would be paid at an annual
rate of no more than $10 million per reactor, to limit the potential financial burden on reactor
owners following a major accident. Including two that are not operating, 105 commercial
reactors are currently covered by the Price-Anderson retrospective premium requirement.
For each nuclear incident, the Price-Anderson liability system currently would provide
up to $10.9 billion in public compensation. That total includes the $300 million in insurance
coverage carried by the reactor that suffered the incident, plus the $95.8 million in
retrospective premiums from each of the 105 currently covered reactors, totaling $10.4
billion. On top of those payments, a 5% surcharge may also be imposed, raising the total
per-reactor retrospective premium to $100.6 million and the total available compensation to
about $10.9 billion. Under Price-Anderson, the nuclear industry’s liability for an incident
is capped at that amount, which varies depending on the number of covered reactors, the
amount of available insurance, and an inflation adjustment that is made every five years.
Payment of any damages above that liability limit would require congressional approval
under special procedures in the act.
The Price-Anderson Act also covers contractors who operate hazardous DOE nuclear
facilities. The liability limit for DOE contractors is the same as for commercial reactors,
excluding the 5% surcharge, except when the limit for commercial reactors drops because
of a decline in the number of covered reactors. Because the most recent adjustments have
raised the commercial reactor liability limit to a record high, the liability limit for DOE
contractors is currently the same as the commercial limit, minus the surcharge, or $10.4
billion. Price-Anderson authorizes DOE to indemnify its contractors for the entire amount,
so that damage payments for nuclear incidents at DOE facilities would ultimately come from
the Treasury. However, the law also allows DOE to fine its contractors for safety violations,
and contractor employees and directors can face criminal penalties for “knowingly and
willfully” violating nuclear safety rules.
Under the Price-Anderson extension approved by the House, the total retrospective
premium for each reactor would be set at the current level of $95.8 million and the limit on
per-reactor annual payments raised to $15 million, with both to be adjusted for inflation
every five years. For the purposes of those payment limits, a nuclear plant consisting of
multiple small reactors (100-300 megawatts, up to a total of 1,300 megawatts) would be
considered a single reactor. Therefore, a power plant with six 120-megawatt pebble-bed
modular reactors would be liable for retrospective premiums of up to $95.8 million, rather
than $574.8 million. The liability limit on DOE contractors would be set at $10 billion per
accident, also to be adjusted for inflation.
Although DOE is generally authorized to impose civil penalties on its contractors for
violations of nuclear safety regulations, Atomic Energy Act §234A specifically exempts
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seven non-profit DOE contractors and their subcontractors. Under the same section, DOE
automatically remits any civil penalties imposed on non-profit educational institutions
serving as DOE contractors. The House-passed bill would eliminate the civil penalty
exemption for future contracts by the seven listed non-profit contractors and DOE’s authority
to automatically remit penalties imposed on all non-profit educational institutions serving
as contractors. However, the bill would limit the civil penalties against a non-profit
contractor to the amount of management fees paid under that contract. If a DOE for-profit
nuclear contractor causes public injuries through intentional misconduct by a corporate
officer or executive, the Attorney General may recover up to the amount of the profit derived
from the contract. Except for the last provision, the Price-Anderson language in the House
bill is nearly identical to the H.R. 6 conference report in the 108th Congress.
The Price-Anderson Act’s limits on liability were crucial in establishing the commercial
nuclear power industry in the 1950s. Supporters of the Price-Anderson system contend that
it has worked well since that time in ensuring that nuclear accident victims would have a
secure source of compensation, at little cost to the taxpayer. However, opponents contend
that Price-Anderson subsidizes the nuclear power industry by protecting it from some of the
financial consequences of the most severe conceivable accidents.
Because no new U.S. reactors are currently planned, missing the deadline for extension
has had little immediate effect on the nuclear power industry. However, any new DOE
contracts signed during Price-Anderson expiration would have to use alternate
indemnification authority.
Nuclear Waste Management
One of the most controversial aspects of nuclear power is the disposal of radioactive
waste, which can remain hazardous for thousands of years. Each nuclear reactor produces
an annual average of about 20 tons of highly radioactive spent nuclear fuel and 50-200 cubic
meters of low-level radioactive waste. Upon decommissioning, contaminated reactor
components are also disposed of as low-level waste.
The federal government is responsible for permanent disposal of commercial spent fuel
(paid for with a fee on nuclear power) and federally generated radioactive waste, while states
have the authority to develop disposal facilities for commercial low-level waste. Spent fuel
and other highly radioactive waste is to be isolated in a deep underground repository,
consisting of a large network of tunnels carved from rock that has remained geologically
undisturbed for hundreds of thousands of years.
The Nuclear Waste Policy Act of 1982 (NWPA, P.L. 97-425) as amended, names
Nevada’s Yucca Mountain as the sole candidate site for a national geologic repository.
Following the recommendation of Energy Secretary Abraham, President Bush on February
15, 2002, recommended to Congress that DOE submit an application to NRC to construct
the Yucca Mountain repository. As allowed by NWPA, Nevada Governor Guinn submitted
a “notice of disapproval” (or “state veto”) to Congress April 8, 2002. The state veto would
have blocked repository construction at Yucca Mountain if a congressional resolution
approving the site had not been enacted within 90 days of continuous session. The House
passed a Yucca Mountain approval resolution (H.J.Res. 87) on May 8, 2002, by a 306-117
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vote. The Senate approved the resolution by voice vote July 9 (following a 60-39 vote to
consider S.J.Res. 34, the Senate version of the resolution), and the President signed it July
24, 2002 (P.L. 107-200).
Upon releasing the civilian nuclear waste program’s FY2006 budget request, program
officials announced that the opening of the planned Yucca Mountain repository would be
delayed at least two years from the previous goal of 2010. The waste program’s funding
request of $651.4 million is about 14% above the FY2005 level but only about half the
amount that last year’s budget justification said would have been needed to open the
repository by 2010. DOE officials also announced that a Yucca Mountain license application
to the Nuclear Regulatory Commission (NRC) will be delayed by at least a year, to the end
of 2005.
Last year, the FY2005 budget request for the nuclear waste program had assumed that
Congress would enact legislation to offset most of the program’s spending with revenue from
a longstanding fee on nuclear power, which currently is not available without appropriation.
Because last year’s net appropriations request was relatively small, congressional
appropriators had to scramble to find funding for the nuclear waste program when the
Administration’s fee-offset proposal was not enacted. For FY2006, the Administration is
again proposing that nuclear waste funding be offset by fees, but the budget request does not
assume the proposal will be enacted and therefore includes full funding through
appropriations.
The delays in the Yucca Mountain program follow a July 9, 2004, ruling by the U.S.
Court of Appeals for the District of Columbia Circuit that overturned a key aspect of the
Environmental Protection Agency’s (EPA’s) regulations for the planned repository. The
three-judge panel ruled that the 10,000-year compliance period was too short, but it rejected
several other challenges to the rules. EPA is currently revising the regulations to comply
with the court decision.
The quality of scientific work at Yucca Mountain was called into question by DOE’s
March 16, 2005, disclosure of e-mails from geologists indicating that some quality assurance
documentation had been falsified. DOE currently is determining whether the problems affect
the completeness and accuracy of information submitted to NRC in support of the planned
Yucca Mountain license application.
Further delays in the nuclear waste program could prove costly under a settlement
announced August 10, 2004, between the Department of Justice and Exelon Corporation,
which had filed a breach-of-contract suit over DOE’s failure to begin accepting spent fuel
by 1998 as required by NWPA. Under the settlement, Exelon is to be reimbursed from the
federal Judgment Fund for its spent fuel storage costs caused by the waste program delays.
Exelon estimates that it will receive $300 million if DOE begins accepting waste by 2010
as previously scheduled, and up to $600 million if waste acceptance does not begin until
2015. The waste program is run by DOE’s Office of Civilian Radioactive Waste
Management (OCRWM).
(For further details, see CRS Issue Brief IB92059, Civilian Nuclear Waste Disposal.)
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Federal Funding for Nuclear Energy Programs
The following tables summarize current funding for DOE nuclear fission programs and
NRC. The sources for the funding figures are Administration budget requests and committee
reports on the Energy and Water Development Appropriations Acts, which fund all the
nuclear programs. President Bush submitted his FY2006 funding request February 7, 2005.
For the current fiscal year, Energy and Water funding was included in the Consolidated
Appropriations Act for FY2005 (P.L. 108-447).
Funding for the Yucca Mountain program is provided under two appropriations
accounts. The Administration is seeking $300.0 million from the Nuclear Waste Fund,
which holds fees paid by nuclear utilities. An additional $351.5 million is being requested
under the Defense Nuclear Waste Disposal account, which pays for disposal of high-level
waste from the nuclear weapons program in the planned Yucca Mountain repository.
Table 1. Funding for the Nuclear Regulatory Commission
(budget authority* in millions of current dollars)
FY2004
FY2005
FY2006
Approp.
Approp.
Request
Nuclear Regulatory Commission
Reactor Licensing
198.7
263.3
274.9
Reactor Inspection
107.4
179.8
194.3
Fuel Facility Licensing and Inspection
21.7
38.5
36.6
Nuclear Materials Lic. and Insp.
45.3
63.6
65.9
High-Level Waste Repository
32.9
68.5
69.1
Decommission. and Low-Level Waste
19.4
24.1
28.1
Spent Fuel Storage and Transportation
19.7
23.9
24.6
Infrastructure and Support
173.2
—
—
Inspector General
7.3
7.5
8.3
TOTAL NRC BUDGET
625.6
669.3
701.7
AUTHORITY
Offsetting fees
545.3
540.1 567.1
Net appropriation
80.3
128.6
134.6
* For FY2005 and FY2006, management and support is divided among the functional program areas.
Table 2. DOE Funding for Nuclear Activities
(budget authority in millions of current dollars)
FY2004
FY2005
FY2006
Approp
Approp.
Request
Nuclear Energy
University Reactor Assistance
23.1
23.8
24.0
Nuclear Energy Plant Optimiz.
2.9
2.5
0
Nuclear Energy Research Initiative
6.4
2.5
0
Nuclear Power 2010
19.4
49.6
56.0
Generation IV Nuclear Systems
27.0
39.7
45.0
Nuclear Hydrogen Initiative
6.2
8.9
20.0
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FY2004
FY2005
FY2006
Approp
Approp.
Request
Advanced Fuel Cycle Initiative
65.8
67.5
70.0
Nuclear R&D Infrastructure
195.6
249.0
144.9
Program Direction
60.3
60.4
30.0
Defense-Related Infrastructure*
111.6
113.4
123.9
Total, Nuclear Energy
402.8
485.6
510.8
Civilian Nuclear Waste Disposal**
576.6
572.4
651.4
* Funded under “other defense activities.”
** Funded by a 1-mill-per-kilowatt-hour fee on nuclear power, plus appropriations for defense waste
disposal.
LEGISLATION
H.R. 6 (Barton)
Energy Policy Act of 2005. Omnibus energy legislation that extends Price-Anderson
nuclear liability system, authorizes nuclear R&D programs, and requires security measures
at nuclear facilities. Introduced April 18, 2005; referred to multiple committees. Passed
House April 21 by vote of 249-183.
H.R. 526 (Berkley)
Redirect the Nuclear Waste Fund established under the Nuclear Waste Policy Act of
1982 into research, development, and utilization of risk-decreasing technologies for the
onsite storage and eventual reduction of radiation levels of nuclear waste, and for other
purposes. Introduced February 2, 2005; referred to Committees on Energy and Commerce;
Science; Ways and Means.
H.R. 895 (Berkley)
Provide for interagency planning for preparing for, defending against, and responding
to the consequences of terrorist attacks against the Yucca Mountain Project, and for other
purposes. Introduced February 17, 2005; referred to Committees on Energy and Commerce
and Homeland Security.
H.R. 966 (Saxton)
Require the Nuclear Regulatory Commission to consider certain criteria in relicensing
nuclear facilities, and to provide for an independent assessment of the Oyster Creek Nuclear
Generating Station by the National Academy of Sciences prior to any relicensing of that
facility. Introduced February 17, 2005; referred to Committee on Energy and Commerce.
S. 387 (Hagel)
Amend the Internal Revenue Code of 1986 to provide tax incentives for investment in
greenhouse gas intensity reduction projects, including a production tax credit for nuclear-
generated electricity. Introduced February 15, 2005; referred to Committee on Finance.
S. 388 (Hagel)
Amend the Energy Policy Act of 1992 to direct the Secretary of Energy to carry out
activities that promote the adoption of technologies that reduce greenhouse gas intensity,
including advanced nuclear power plants, and to provide credit-based financial assistance and
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investment protection for projects that employ advanced climate technologies or systems.
Introduced February 15, 2005; referred to Committee on Energy and Natural Resources.
S. 858 (Voinovich)
Reauthorizes Nuclear Regulatory Commission user fees. Introduced April 20, 2005;
referred to Committee on Environment and Public Works.
S. 864 (Inhofe)
Nuclear Safety and Security Act of 2005. Authorizes use of firearms by nuclear plant
security personnel and requires fingerprinting of nuclear personnel for criminal background
checks. Introduced April 20, 2005; referred to Committee on Environment and Public
Works.
S. 865 (Voinovich)
Price-Anderson Amendments Act of 2005. Extends nuclear accident indemnification
authority through 2025. Introduced April 20, 2005; referred to Committee on Environment
and Public Works.
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