Trio of New Reports Address Licensing, Fuel Cycle, and Resilience for Next-Gen Reactors

by Hogan Lovells
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The Department of Energy (DOE) and Nuclear Energy Institute (NEI) have issued a trio of reports touching on important issues for small modular and advanced reactors:

The debut of these three reports so closely apart highlights the variety of issues new reactor developers have to work through simultaneously, from licensing to fuel supply to market dynamics.

The first report recognizes a common industry complaint—that although the legal standard for issuing new reactor licenses has not changed, in reality “the [Nuclear Regulatory Commission] now requires more effort from applicants” to meet that same standard—even when new reactor designs are inherently safer.  The report recommends that the NRC:

  • Refrain from asking for design details that do not have a nexus to safety (shortening review times);
  • Modernize design requirements to “be more systematic, predictable and repeatable”;
  • Establish predictable staged licensing pathways; and
  • Reign in unnecessary detail in setting a plant licensing basis to allow for more flexibility to make changes during construction.

The second report tackles a sleeping giant, the lack of a pathway to high-assay low-enriched uranium (high-assay LEU) (that is, uranium enriched between 5% to 20% with fissile elements).  While there is no prohibition to commercial access to high-assay LEU, there is also currently no domestic source for this fuel type.  Current fuel cycle facilities are capped legally (and sometimes physically) to work with ~5% enriched LEU.  This is a bottleneck to realizing the promise of advanced reactors, as developing the infrastructure for this industry will require “a minimum of seven to nine years.”  The report recommends that DOE and NRC collaboratively:

  • Support development of new shipping packages capable of holding high-assay LEU;
  • Develop “criticality benchmark data needed” to enable the private sector to license high-assay LEU “facilities and transport packages”;
  • Directly support the design of high-assay LEU facilities and fuel types; and
  • Finalize guidance documents on Material Control and Accountability and physical security for “Category II” facilities that contain high-assay LEU.

The third report follows hot on the heels of the Federal Energy Regulatory Commission’s decision to terminate a rulemaking proposed by DOE Secretary Perry that would establish a resiliency pricing scheme for baseload generation sources, including nuclear.  The DOE-commissioned report provides additional evidence for the resiliency benefits of nuclear power, but is more focused on the benefits of small modular reactors (SMRs) to support federal and military facilities; in particular, forward operating bases that often rely on uncertain civilian grids and/or trucked in fuel.  The report notes that SMRs are naturally hardened due to their underground construction and passive safety systems, are designed to provide scalable power that is reliable and grid-independent, and can provide years’ worth of fuel security—making them ideal for many national security contexts.

Despite its national security theme, the DOE-commissioned report suggests a novel solution to support SMRs that is based on the civilian sector—by engaging DOE support as a customer for the Tennessee Valley Authority small modular reactor project at Clinch River.  According to the report, DOE’s Oak Ridge National Laboratory and related facilities could rely on SMRs’ unique, resilient power for their mission-critical activities, use the SMRs for nuclear research, and at the same time help bring first-generation SMR technologies to market.  The report details a hypothetical transaction structure to support DOE involvement in the Clinch River project, and closes with other policy initiatives to complement this effort.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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