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Monday, November 8, 2010

Nuclear Energy Policy

Mark Holt
Specialist in Energy Policy

Nuclear energy issues facing Congress include federal incentives for new commercial reactors, radioactive waste management policy, research and development priorities, power plant safety and regulation, nuclear weapons proliferation, and security against terrorist attacks. Significant incentives for new commercial reactors were included in the Energy Policy Act of 2005 (EPACT05, P.L. 109-58). These include production tax credits, loan guarantees, insurance against regulatory delays, and extension of the Price-Anderson Act nuclear liability system. Together with higher fossil fuel prices and the possibility of greenhouse gas controls, the federal incentives for nuclear power have helped spur renewed interest by utilities and other potential reactor developers. Plans for as many as 31 reactor license applications have been announced, although it is unclear how many of those projects will move forward under current economic conditions.

In his January 2010 State of the Union Address, President Obama called for “building a new generation of safe, clean nuclear power plants” as a key component of his “clean energy” program. Financing for new reactors is widely considered to depend on the loan guarantees authorized by EPACT05 Title XVII, administered by the Department of Energy (DOE). The total amount of loan guarantees to be provided to nuclear power projects has been a continuing congressional issue. Nuclear power plants are currently allocated $18.5 billion in loan guarantees, enough for three or four reactors. President Obama’s FY2011 budget request would nearly triple the loan guarantee ceiling for nuclear power plants, to $54.5 billion. However, opponents of nuclear power contend that the Administration’s proposed increases in nuclear loan guarantees would provide an unjustifiable subsidy to a mature industry and shift investment away from environmentally preferable and more cost-effective energy technologies.

DOE’s nuclear energy research and development program includes advanced reactors, fuel cycle technology and facilities, and infrastructure support. The Obama Administration’s FY2011 funding request for nuclear energy research and development totals $824.1 million—4.8% above the FY2010 appropriation. The Senate Appropriations Committee recommended $775.8 million for nuclear energy R&D, while the House Appropriations Committee’s Subcommittee on Energy and Water Development recommended the full request. FY2011 funding is currently being provided under a continuing resolution pending final congressional action.

Disposal of highly radioactive waste has been one of the most controversial aspects of nuclear power. The Nuclear Waste Policy Act of 1982 (P.L. 97-425), as amended in 1987, required DOE to conduct a detailed physical characterization of Yucca Mountain in Nevada as a permanent underground repository for high-level waste. DOE submitted a license application for the Yucca Mountain repository to the Nuclear Regulatory Commission (NRC) on June 3, 2008, with the repository to open by 2020 at the earliest.

The Obama Administration has decided to “terminate the Yucca Mountain program while developing nuclear waste disposal alternatives,” according to the DOE FY2010 budget justification. Alternatives to Yucca Mountain are to be evaluated by a “blue ribbon” panel of experts convened by the Administration. President Obama’s FY2011 budget request would provide no further funding for the Yucca Mountain project, and DOE filed a motion with NRC to withdraw the Yucca Mountain license application on March 3, 2010. However, the motion to withdraw has prompted substantial opposition, including lawsuits in federal court.

Date of Report: October 21, 2010
Number of Pages: 38
Order Number: RL33558
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