The Report was prepared by INL’s Stephen Burdick (Senior Counsel), John Wagner (Director), and Jess Gehin (Associate Laboratory Director for Nuclear Science & Technology). INL functions as the nation’s nuclear energy research, development, and demonstration laboratory providing and directing resources and capabilities to support nuclear energy, national security, and other applied energy missions. The Report is expected to be publicly available on the INL Research Library. However, as it is not yet posted, we have provided a detailed summary herein.

Background on the Report. According to the Report, “while acknowledging the important nuclear safety role provided by the NRC, it is apparent that one of the most significant time and resource intensive activities for developers of new nuclear systems, including advanced nuclear reactors, is the NRC licensing process.” Report at 1. The Report also notes that “the time and cost to obtain NRC licenses represent significant fractions of the total time and cost for new nuclear projects and may result in abandonment of projects or failure to even begin new projects. The challenge is particularly acute for advanced reactors which may raise unique or new regulatory questions and may be smaller in size, resulting in a much higher proportional impact from the time and costs associated with NRC licensing.” Id.

The good news, the Report continues, is that “reforms to the NRC licensing process have the potential to greatly increase efficiency and predictability and support the successful progress of new reactors.” Id. The Report recommendations are a set of independent or collective options for consideration, and if implemented, the Report notes, “the NRC can retain its world-class nuclear safety reputation while becoming a world leader for regulatory efficiency and a critical enabler to the clean energy transition.” Id.

Summary of the Report. Below is an overview of the recommendations for NRC reform contained in the Report.

• Reforms to streamline NRC hearings. The Report recommends changing three aspects of NRC hearings: (1) remove the mandatory hearing required for certain license applications under the Atomic Energy Act (“AEA”), which would likely shave approximately 6 months off a license review schedule and save significant resources; (2) remove the ability to challenge environmental topics in an NRC contested hearing, which would streamline the NRC’s environmental reviews and better align the NRC with other agencies implementation of the National Environmental Policy Act (“NEPA”); and (3) require the use of simplified and less formal hearing procedures in NRC contested hearings, which would reduce burden and costs for the NRC staff, applicants, and intervenors. We walk through these each in more detail below.

• Remove the requirement for the NRC to hold a mandatory hearing. For background, the AEA, requires that the NRC hold a “mandatory hearing” for certain types of licensing activities. Specifically, AEA Section 189a.(1)(A) states: “The Commission shall hold a hearing after thirty days’ notice and publication once in the Federal Register, on each application under section 103 or 104b. for a construction permit for a facility, and on any application under section 104c. for a construction permit for a testing facility.” This means that the Commission must hold a mandatory hearing for a range of reactor-related approvals, including construction permits, combined operating license, early site permit, and limited work authorizations.

A mandatory hearing is a non-contested proceeding in which only the applicant and the NRC Staff participate. The Commission is the presiding officer or delegates the responsibility to the NRC’s Atomic Safety and Licensing Board, an internal court within the NRC. The mandatory hearing process commences once the NRC staff completes its review of the application—i.e., issues the final Safety Evaluation Report or Environmental Impact Statement, whichever is later—and publishes a staff information paper (a so-called “SECY”) to the Commission describing its review. Past mandatory hearings have taken 4-7 months to complete, directly adding this delay to the licensing action. Report at 3-4.

As noted in the Report, the mandatory hearing is very time intensive for the NRC staff, as well as for the NRC Commissioners and applicants, but has little impact on the license under consideration—and, in fact, mandatory hearings have not resulted in any substantive changes to a project’s licensing review. Report at 4-5. This makes sense, as by the time of the mandatory hearing portion of the licensing review occurs, the application would have already been subjected to:

• A complete NRC staff review, resulting in thousands of hours of in review time by hundreds of NRC staff members with specific subject matter expertise;
• Months of Advisory Committee on Reactor Safeguards (“ACRS”) reviews;
• Challenge by anyone interested—e.g., states, local governments, Tribes, or any member of the public; and
• Subject to a number of public meetings and opportunities for public comment.

The Report further notes that the mandatory hearing does delay the issuance of a license under consideration by, on average, 6 months. Id. The Report recommends removing the AEA requirement for the NRC to hold an mandatory hearing—as they have little if any benefit and only serve to introduce substantial delay into a license issuance. Moreover, the Commissioners would still be able to conduct informational meetings during the NRC’s review of the application, would still provide guidance on novel legal and policy issues to the staff, and would still function in an adjudicatory capacity over contesting hearing matters. Report at 6.

• Eliminating the contested hearing opportunity for environmental topics. The Report recommends reforming the NRC hearing process to remove the NRC contested hearing opportunity on environmental topics, which the Report notes would more closely align the NRC with other agencies’ public comment and challenge process under NEPA. The AEA states at Section 189a.(1)(A) that “in any proceeding under this Act, for the granting, suspending, revoking, or amending of any license or construction permit. . .the Commission shall grant a hearing upon the request of any person whose interest may be affected by the proceeding, and shall admit any such person as a party to such proceeding.” The NRC interprets this provision of the AEA as affording a hearing opportunity for all aspects of an application review, including the environmental portions of the application prepared under NEPA. As a result, members of the public have the opportunity to raise NEPA concerns related to a specific license application twice—first, under the NRC’s public scoping and comment process required under NEPA, and second, as part of the NRC’s contested hearing procedures. The Report notes that this results in a broad and duplicative opportunity for persons to raise NEPA concerns related to an NRC application. Id. at 6. In the latter case, challenges to environmental issues as part of a contested hearing process have the potential to cause significant delay to the NRC’s review of an application. As the Report further explains, the NRC hearing on NEPA-related issues exceeds the typical practice for NEPA reviews performed by other agencies. Id. at 7.

Removing the ability to challenge NEPA issues in the contested hearing process would remove redundancy and minimize potential for delay during application reviews while retaining public participation opportunities. Report at 7. With the proposed change, the public would still have an opportunity to raise NEPA related concerns during the numerous opportunities for public participation under the NRC’s current NEPA implementation process and outside the contested hearing process, including through the courts. Id.

• Simplified hearing procedures. The Report recommends the NRC switch from the current hearing procedures, which result in lengthy and costly hearings, to a simplified legislative hearing process for any NRC contested hearing. Report at 7. While the AEA provides the opportunity for a contested hearing, the NRC determines the procedures for the hearing, which it sets forth in 10 C.F.R. Part 2 of the NRC regulations.

While the specific process for most hearings, including hearings on reactor applications, are called the “Simplified Hearing Procedures for NRC Adjudications” (set forth in 10 C.F.R. Part 2, Subpart L) they are anything but—as the Report outlines (and as we can confirm in practice). Report at 8. In fact, these regulations are more akin to a formal trial before a court, requiring formal pleadings, an extensive hearing file that must be continuously maintained and updated and privileged log (for privileged documents), oral arguments for pleadings and a hearing, which itself can last over several years based on the number of topics and complexity at issue, and subject to extensive rules of practice and procedure (somewhat akin to the Federal Rules of Civil Procedure), and place significant burden on all parties involved—the NRC staff, the applicant, and an intervenor participating in the contested hearing process. Hearings with multiple issues can take several years to complete, and can involve several rounds of evidentiary proceedings.

The Report recommends conducting the contested hearing under a legislative hearing process, which is already set out for certain proceedings in 10 C.F.R. Part 2, Subpart O. These hearings are intended to be simplified with less discovery, simpler paper filings, and a limited oral hearing. Report at 9. The Report further recommends that the mandatory disclosures be eliminated altogether, and that the NRC commence legislative hearings on topics during the NRC staff’s review rather than awaiting conclusion of the review. Id.

• Reforms to expedite NRC safety and environmental reviews.

• Clarify the NRC mission statement to include timely and efficient licensing of new nuclear projects. When the NRC was created from its predecessor agency the Atomic Energy Commission in the 1970s, it was not give a clear mission statement, other than to note that the NRC is responsible for "licensing and related regulatory functions” and that it was an
• independent regulatory commission.” Report at 10 (citing the Energy Reorganization Act). These limited statements have resulted in the NRC now being solely focused on licensing and regulatory issues from a safety standpoint with no direction on how these activities should be conducted. Report at 10. In fact, the NRC’s own mission statement states: “The NRC licenses and regulates the Nation’s civilian use of radioactive materials to provide reasonable assurance of adequate protection of public health and safety and to promote the common defense and security of the United States.” As the Report notes, while this statement appropriately focuses on health and safety, it does not focus on other also important issues, such as enabling this technology, efficiently licensing reactors, the importance of carbon free power, or other important elements of the NRC’s mission. Report at 10.

The Report recommends a slight modification to the statutory mission of the NRC to include a timeliness and efficiency focus. Id. This approach would be similar to the mission of other safety-focused agencies like the Federal Aviation Administration (“FAA”) and Food and Drug Administration (“FDA”). For example—

• The FAA mission statement provides: “Our continuing mission is to provide the safest, most efficient aerospace system in the world,” and the FAA’s vision states: “We strive to reach the next level of safety and efficiency and to demonstrate global leadership in how we safely integrate new users and technologies into our aviation system. We are accountable to the American public and our aviation stakeholders.” As the Report explains, this mission and vision is consistent with the FAA statutory obligations, which repeatedly refer to conducting its activities efficiently. Id.
• The FDA states the following as part of its mission: “FDA is responsible for advancing the public health by helping to speed innovations that make medical products more effective, safer, and more affordable and by helping the public get the accurate, science-based information they need to use medical products and foods to maintain and improve their health.” Report at 11. The need for speeding innovations at the FDA to support public health is similar to the need for speeding innovations at the NRC to support public health related to the provision of carbon-free baseload power sources. The FDA’s mission is consistent with statutory obligations which also address timely and efficient action. Id.

• Reduce the excessive burden of the Advisory Committee on Reactor Safeguards (“ACRS”) reviews by limiting ACRS reviews to unique or new safety issues referred by the Commission as having a significant hazard potential. The ACRS serves as an advisory committee to the Commission for a variety of topics identified in the AEA. Report at 11. The ACRS performs a detailed review of safety issues in every new reactor application, which includes meetings with the NRC Staff and applicants and development of reports on those reviews. In some busy licensing years, this can result in approximately 80 meetings and 70 reports by the ACRS—and the workload could increase significantly if there is a wave of new advanced reactor application submitted to the NRC. Report at 12. As the Report explains, these ACRS reviews have “become burdensome and time-consuming for industry and regulators alike and have resulted in essentially a new review of safety issues, redundant with the NRC Staff’s review.” Id. The Report refers to one example, where NuScale noted that the ACRS conducted some 40 meetings, totaling approximately 440 hours of in-person meeting time during its design certification review. As part of its lessons learned from that review, NuScale recommended that the NRC clarify the role of the ACRS including to ensure its review is not “unnecessarily broad and burdensome” as it was for the NuScale review. Id.

​​​​​While the Report notes that it is challenging to determine the specific cost and delay due to excessive ACRS meetings, as those meetings are intermingled with the NRC staff review, it nonetheless notes that the delays must be significant given the need to submit information to the ACRS, prepare for formal meetings with the ACRS, participate in those meetings, and address feedback from the ACRS. This process requires significant effort by both the NRC staff and the applicant, diverting those resources away from the Staff’s application review and the applicant’s support of that review. Id. at 12.

The Report recommends, among other things, that the relevant statutory language in the AEA should be revised to establish a new charter for the ACRS directing the appropriate scope and level of review for new reactor applications. This scope would instruct the ACRS to only review items the Commission refers to it and that the Commission should only refer safety topics which are new or unique and present a potential significant hazard. Id. at 12-13.

• Allow non-public meetings between the NRC staff and applicants to facilitate the efficiency of licensing reviews, while retaining extensive information process otherwise available to the public. Under current NRC practice, applicants can only have limited interaction with the NRC outside a public meeting. In 2021, the NRC issued a policy statement on public meetings and has interpreted it in a way that almost all substantive verbal interactions between an applicant and the NRC Staff must occur in a public meeting. Id. at 13.

The NRC states the purpose of the policy statement is “to conduct business in an open manner, and to balance openness and transparency with the need to exercise regulatory and safety responsibilities without undue administrative burden.” Report at 13. However, as explained in the Report, the NRC provides limited exceptions to making interactions between NRC staff and applicants on substantive application topics subject to a public meeting. This prevents the free flow of information and requires the scheduling of public meetings—which require a minimum 10-day notice period before they can occur--to address topics which would be resolved in a brief conversation between the applicant and NRC staff. Id. Additionally, the current practices are also inconsistent with the current technology-driven and faster pace of communication in today’s society. Report at 14.

While the Report notes that the transparency of the NRC is to be commended, the use of these extensive and delayed public meetings is not the only means for transparency on these application topics—especially when members of the public have full disclosure of application documents, including all revisions to the application during the licensing review. They also have access to NRC Requests for Information, responses to those requests, other public meetings, etc. If needed, the NRC also could prepare summaries of communications held between only the NRC staff and the applicant and make those summaries publicly available through the NRC website. Report at 14.

The Report explains that Congressional direction to the NRC about more flexibility to engage with applicants outside of formal public meetings would greatly streamline this portion of the NRC Staff review. Id.

• Exclude small (<20 megawatt thermal) non-commercial reactor projects on DOE sites from NEPA, whether subject to DOE authorization or NRC licensing. The Report provides that the NEPA review requirement can be particularly frustrating for projects which have very low likelihood of any significant environmental impact, such as smaller non-commercial reactor projects on existing DOE sites. Id. at 14. These projects typically will only impact existing facilities/buildings, previously disturbed land, and/or well characterized areas. Depending on other circumstances, these projects could be subject to either DOE authorization or NRC licensing. Id.

The Report explains that recent experience with NEPA reviews for small reactors at INL has shown very low potential environmental impacts for these projects, citing the June 2021 DOE Environmental Assessment for the Microreactor Applications Research, Validation, and Evaluation (MARVEL) 100-kilowatt thermal microreactor. Id. Another example is the February 2022, DOE and Department of Defense Strategic Capabilities Office issuance of an Environment Impact Statement for Project Pele to construct and demonstrate a prototype mobile microreactor. As reviewed, Project Pele would be capable of producing 1 to 5-megawatts electric and would be a small, advanced gas-cooled reactor using high-assay low-enriched uranium tristructural isotropic (“TRISO”) fuel and air as the ultimate heat sink. Report at 15. Following the environmental review, the agencies concluded: “The impacts of Project Pele activities . . . would be a small fraction of the impacts of current operations . . . and would be an even smaller fraction when the impacts from other reasonably foreseeable actions are considered . . . . Therefore, . . . the incremental impacts for all resource areas from Project Pele activities would be very small and would not substantially contribute to cumulative impacts.” Id. (citations omitted).

The Report provides that a threshold of 20 megawatts thermal is an appropriate cut-off for a small project as this should encompass projects intended for research, development, and demonstration and should ensure that the environmental impacts are kept small. Removing the NEPA requirements for these small projects on DOE sites or NRC licensing would significantly improve the ability to provide access to capabilities in a timely manner to support new nuclear development. Report at 15.

• Formulate an external review team to shadow an entire NRC licensing review from start to finish and provide recommendations to further streamline the licensing process, including appropriate application of the reasonable assurance standard. Although there are good opportunities to make the NRC new reactor licensing process more efficient with the statutory changes identified, the Report states that these do not directly address all of the day-to-day delays during a licensing review that contribute to the overall long duration to obtain a new reactor license. Report at 16. Many of those delays appear to involve “excessive reviews of non-safety significant topics, a rigid interpretation of what constitutes reasonable assurance, excessive ‘confirmatory’ analyses performed by NRC staff, process challenges, etc.” Id.

As one example, the AEA and NRC mission focus on whether activities provide a “reasonable assurance” of adequate protection of public health and safety. The reasonable assurance standard for licensing actions has been applied too rigidly, resulting in a standard of essentially perfection and zero risk, which has also resulted in excessively lengthy licensing reviews. Report at 16. Based on recent new reactor licensing experience, the NRC’s review standards must be finetuned further to allow for the more efficient review of new reactor applications. Report at 17.

According to the Report, one option to support this refinement is to establish a team of experts on the NRC review process without any responsibilities for a particular licensing review to shadow the review process and identify process improvements. Id. To ensure a sufficient level of independence, the review team should be composed of outside experts rather than internal NRC employees. This independent assessment team could then provide reports to Congress and identify improvements by the NRC. This review should be performed in parallel with other changes discussed herein, so the time for the review does not hold up other improvements. Report at 17. Further, this review must ensure that the reasonable assurance standard is further clarified to account for an acceptable level of risk and to ensure that NRC decision-making is risk-informed. Id.

• Reforms to otherwise improve NRC licensing.

• Strengthen the requirements for NRC milestones for new reactor licensing activities, including shorter timelines, more rigid reporting requirements, and accounting for the full duration of licensing activities. The NRC licensing process for advanced reactors includes many different steps, starting with the pre- application activities (i.e., meetings, draft application review), followed by docketing and NRC Staff reviews and issuance of the SER and EIS, and concluding with issuance of a license. Report at 17-18. Further, Section 102(c) of the Nuclear Energy Innovation and Modernization Act (“NEIMA”) required that the NRC develop performance metrics and milestone schedules for “requested activities of the Commission.” Section 3 of NEIMA defines requested activity of the Commission to include the processing of applications for (i) design certifications or approvals; (ii) licenses; (iii) permits; (iv) license amendments; (v) license renewals; (vi) certificates of compliances; and (vii) power uprates, as well as any other activity requested by a licensee or applicant. The NRC developed generic milestone schedules of requested activities of the Commission and has posted them on its website. Report at 18. While these appear to generally be improvements over recent precedent for similar types of NRC licensing activities, the Report suggests opportunities exist to substantially shorten these timeframes, perhaps by half.

Further, the above milestones do not represent the total licensing timeframe between submittal of an application until the licensing action is final. In other words, these milestones only represent the time period between acceptance, or “docketing,” of an application and issuance of a final safety evaluation. That docketing typically will take a month or two, but can take many months if the NRC seeks additional information. Report at 19. Therefore, a risk exists that the clock for the above milestones will not start for months after an application is submitted to the NRC, and there is a risk that portions of the NRC review will drift to the docketing timeframe to ensure the NRC can meet the established milestones. Id. Although this may help from a reporting standpoint, it does not help reduce the overall licensing timeframe for a new reactor project. This docketing risk could be prevented by limiting the time for the NRC to docket an application, adding a statutory requirement for docketing new applications, or requiring reporting to Congress if certain docketing timeframes are exceeded. Id.

• Clarify which non-commercial demonstration nuclear reactor projects may be authorized by DOE versus licensed by the NRC. An issue that often comes up with advanced reactors is where the jurisdictional lines are established between DOE and the NRC. As a general matter the default position in interpreting the AEA is that construction and operation of nuclear facilities under contract with and for the account of DOE do not need an NRC license, and can therefore proceed under DOE authorization, and other facilities on DOE sites, including prototype facilities to demonstrate a commercial use, must be licensed by the NRC (unless subject to Department of Defense jurisdiction, as set forth in the AEA). The actual language of the AEA has created some confusion, particularly when it comes to prototypes built at a DOE site. Specifically, the provision of concern, as set forth in the Report (at 20-21), is the Energy Reorganization Act (“ERA”) Section 202, which identifies specific types of facilities that are subject to NRC licensing, even if located at a DOE site, including a “demonstration” reactor that is either (1) is operated as part of the power generation facilities of an electric utility (i.e., places power on the commercial grid); or (2) is operated to demonstrate the “suitability for commercial application. Id., citing 42 U.S.C. 5842.

While the first line of distinction is clear, the Report notes that the second part of the exception has presented some confusion due to the lack of definition of “demonstrating the suitability for commercial application.” Report at 21. For example, the Report notes that it could be argued that any demonstration project involving a private company has a “commercial application.” Conversely, prior to demonstrating suitability for commercial application, the project can also serve an R&D purpose. This confusion, the Report notes, has the potential to cause delays and may prohibit projects given the potential regulatory conflicts for individual facilities having both NRC licensed and DOE authorized projects. Id. Accordingly, the Report recommends that projects constructed and operated at a national laboratory site and which do not sell commercial power or any other commercial product (e.g., heat, hydrogen) should be allowed to proceed under DOE authorization rather than NRC licensing, and the AEA could be clarified to reflect this change. As the Report notes, “[t]here is no incentive for a private company to pursue a project at a national laboratory site without selling power or another commercial product, unless the project is needed for an R&D purpose.” Id. at 21.

• Reforms to provide financial benefits to new reactor projects.

  • Modify the NRC fee structure for the licensing of new reactors or otherwise provide financial support for those projects. The NRC charges applicants per hour/per person for applicants reviews, and application review fees are very high. The NRC is required by law to recover approximately 90% of its annual budget, which the NRC recovers through annual fees and hourly fees, and overall cost for preparing an application and supporting the NRC review of that application would be much higher. Report at 22. Any mechanism which would provide financial support to new reactor applicants would benefit the advancement of new nuclear projects. However, any changes should ensure that the costs are not shifted to existing licensees. Id.

The Report provides a number of options for addressing NRC review fees, including the following (1) not requiring the NRC to recover costs for new reactor application reviews; (2) removing fee requirements for certain types of applications (e.g., an Early Site Permit at a DOE site); (3) Congress covers the costs of certain applications; (4) the NRC could exclude fees for pre-application activities; (5) the NRC could provide fixed fees for reviews, based on the type of application and the size and type of reactor, (6) the NRC could provide a payback strategy based on a reactor subject to an application review entering operation; or (7) Congress directly appropriate funds to cover the licensing costs associated with projects that it encourages for the national good, such as advanced reactor demonstration projects that are fully or partially funded by appropriations to DOE. Report at 22-23.

• Permit foreign investment by U.S. allies in U.S. nuclear projects licensed by the NRC as long as the Commission determines that the entity is not inimical to common defense and security or the health and safety of the public. The Report recommends eliminating the foreign ownership and investment restriction for nuclear reactors set forth in the AEA. Known as the “foreign ownership, control, or domination (“FOCD”) provision, the Sections 103d and 104d of the AEA place significant restrictions on foreign investment in reactor projects by prohibiting the issuance of a license “if the Commission knows or has reason to believe it is owned, controlled, or dominated by an alien, a foreign corporation, or a foreign government.” Report at 23.

This provision was written at a time when reactor technology was tightly restricted and before the Committee on Foreign Investment in the United States (“CFIUS”) was established to review national security implications from certain types of investments, including foreign investments in nuclear projects. The FOCD provision has long been an unnecessary impediment to investment in U.S. nuclear projects, had led to significant litigation before the NRC, including the termination of one late-stage reactor application, and the NRC application of the restriction creates significant confusion and uncertainty.

Author Amy Roma has spoken extensively in support of elimination of this provision, including in a paper published by the Nuclear Innovation Alliance, titled “U.S. Nuclear Innovation in a Global Economy: Updating an Outdated National Security Framework,” available here, and in testimony before the Senate Energy and Public Works Committee, available here. Among other reasons, we have argued the provision is no longer needed given the establishment of CFIUS and due to the fact that the NRC still has the ability to decline to issue a license if it determines doing so would be inimical to the public health and safety or common defense and security of the United States—the so-called NRC “inimicality review”--especially when considered in light of the significant negative impact FOCD has had on licensees, applications, and potential investors. Others have advocated for this change as well, including in a paper authored by Dr. Matthew Bowen, “U.S. Nuclear: Change the Laws That Constrain Foreign and Domestic Investment,” and a number of former NRC Commissioners have also written a letter to Congress recommending the elimination of the FOCD provision. The Report authors echo these statements in advocating for changes to the FOCD provision.

A bill was introduced in April 2023, called the ADVANCE Act (which we previously wrote about here), which proposes to narrow down the FOCD restriction to exclude key U.S. allies. However, the Report notes that the list countries contained in the ADVANCE Act is quite narrow, and that perhaps the list could be flipped, broadened, or deleted entirely. Report at 23.

• Indefinitely extend the Price-Anderson Act (“PAA”) coverage for nuclear hazards indemnification for covered DOE contractors and NRC licensees. The nuclear industry is subject to the PAA, a broad nuclear liability framework that conforms to international standards for nuclear liability and the Convention on Supplementary Compensation for Nuclear Damages (“CSC”), an international treaty on nuclear liability to which the U.S. belongs. However, PAA needs to be continuously extended by Congress, and it is currently set to expire in 2025. It is expected that Congress will extend PAA, and both the NRC and DOE have submitted reports to Congress regarding the need for continuation of PAA authority after 2025. The Report recommends Congress indefinitely extend the PAA. Report at 25.

​​​​​​​We will update this post to include the link when it is posted on the INL website.