U.S. Nuclear Industry Seen Needing a Boost

A robust nuclear-energy industry should be a high priority for the country's energy and national-security policy given the importance of the sector to global nonproliferation, according to a new report released on Thursday by the Bipartisan Policy Center's Nuclear Initiative.

Specifically, the United States needs to lead in the licensing and development of new reactors and on safety reforms, management of spent nuclear fuel, the nuclear-export market, and research and development in the nuclear sector, according to the report led by former Sen. Pete Domenici, R-N.M., and former Energy Department Assistant Secretary for Nuclear Energy Warren (Pete) Miller.

But leadership on nuclear issues could prove to be a challenge for the United States. Although the country has long led the charge on civilian nuclear power, the combination of a slowed electricity market, the lack of sweeping climate legislation, a natural-gas boom, and last year's Fukushima Daiichi nuclear accident in Japan have created obstacles for the development of new nuclear power in the United States in recent years.

While the Nuclear Regulatory Commission this year has approved four new reactors for the Vogtle and Summer nuclear plants in Georgia and South Carolina, respectively, there are likely to only be a few more plants licensed in the United States in the near future.

The story is very different on the international level.

After Fukushima, countries such as Germany, Italy, Switzerland, and of course Japan have paused or slowed down their nuclear-energy development, but that hasn't stopped the rest of the world.

Many other nations such as China, India, South Korea, and Russia have reaffirmed plans to expand their fleets of nuclear reactors, while some countries in the Middle East have even announced plans to develop nuclear energy for the first time. China alone, which has 26 new reactors under development,  is expected to account for 40 percent of planned nuclear construction globally.

The United States might be a leader now, accounting for nearly one-third of global nuclear generation, but it won't be long before others come out ahead of us, especially given how long it takes to construct new reactors, Domenici and Miller explained. "It will be increasingly difficult for the United States to maintain its technological leadership without some near-term domestic demand for new construction," they write in the report.

In order to control the proliferation of nuclear weapons, the United States needs to remain involved in everything that happens to nuclear materials, from the export of nuclear fuel for energy use to the disposal of spent fuel. Given the global picture, Domenici and Miller suggest a shift in U.S. policies in order to ensure that the U.S. nuclear energy program is not stuck at a near-standstill.

"Market signals alone are unlikely to result in a diverse fuel mix, so helping to maintain and improve a range of electricity supply options remains a role for federal policy," the two write in the report. "In particular, U.S. policy should be aimed at helping to preserve nuclear energy as an important technology option for near- or longer-term deployment."

The vast shale-gas reserves in the United States and new technology to tap them will probably keep natural-gas prices low for the foreseeable future, making financing of more expensive nuclear power more difficult. Federal loan guarantees have long been viewed as crucial to growing the nuclear industry, but the Energy Department has dragged its feet on these conditional loans, especially after the bankruptcy of the federally funded solar firm Solyndra — so much so that some companies have decided not to wait around and see what happens.

Southern Company, which is building the first two new reactors to be approved in decades at its Vogtle nuclear plant in Georgia, on Thursday said that it is now considering doing so without federal support. The company had been waiting for an $8.33 billion loan guarantee to build the two new reactors, but Southern CEO Tom Fanning told Reuters on Thursday that talks with DOE were going slowly and they might not be willing to wait any longer.

On top of providing incentives, however, the United States needs to maintain an environment in which nuclear energy remains a viable option, Domenici and Miller explain in their report. This means addressing the safety concerns associated with nuclear plants and dealing with the ever-growing problem of nuclear waste.

The NRC, which oversees the nation's 104 commercial nuclear reactors, has long been seen as the international gold standard for safety and security regulation at nuclear plants; some countries have modeled their own nuclear regulations on the NRC. But as the NRC has been licensing new reactors and addressing safety reforms this year, it has also had internal turmoil that has threatened to undermine its work, leading to a change in leadership just this month.

On the waste front, the U.S. is still far from a long-term solution. The proposed Yucca Mountain disposal site in Nevada, while still a part of the conversation, has long been rejected. And while a presidential blue-ribbon panel has come up with suggestions on how to site a new permanent and interim location, the process hasn't moved much further than that.