RESTORING THE PROMISE OF NUCLEAR ENERGY IN AMERICAHOW TO UNLEASH AMERICA'S NUCLEAR POWER POTENTIAL - AND WHY WE MUST

ANDREW BARNESSJACOB DUBBERTJIMMY SENGENBERGER

POLICY WHITE PAPER DECEMBER 5, 2019

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Millennial Policy Center Policy Paper December 5 | 2019

RESTORING THE PROMISE OF NUCLEAR ENERGY IN AMERICAHOW TO UNLEASH AMERICA'S NUCLEAR POWER POTENTIAL - AND WHY WE MUST

ANDREW BARNESSJACOB DUBBERT JIMMY SENGENBERGER

ABOUT THE AUTHORS

A special thanks is due to Mr. Keith Nobles, National Security Policy Advisor, and Major Clifford Andersen, U.S. Army Special Forces Ret., for their input and time in reviewing and offering suggested revisions for this paper.

Andrew Barness is an Energy and Environment Fellow at the Millennial Policy Center. The primary author of this paper, Andrew is currently preparing to enter law school. Andrew interned for MPC in 2018, and in 2019 he received his Bachelors in Political Science from the University of Northern Colorado with a minor in Legal Studies and Public Policy and Administration.

Jacob Dubbert is an Economic Opportunity and Fiscal Policy Fellow at the Millennial Policy Center. He also works as an economist in Denver, Colorado, Jacob received his Masters in Global Finance, Trade, and Economic Integration from the University of Denver and his Bachelors in Finance from Colorado State University.

Jimmy Sengenberger serves as Chairman, President, and CEO of the Millennial Policy Center. Jimmy is also a seasoned radio talk show host on Denver's News/Talk 710 KNUS and has been published in a number of national and Colorado-based publications. He is a 2011 graduate of Regis University, Summa Cum Laude, with a degree in Politics and a minor in Economics, and also spent nearly three years as a legal assistant.

The Millennial Policy Center is a research and educational institute (a think tank) dedicated to addressing public policy issues that affect the Millennial Generation (born 1981-1998) and to developing and promoting policy solutions that advance freedom, opportunity, and economic vitality for Millennials throughout the United States.

In collaboration with our policy advisors and policy fellows, the Center generates and shares knowledge, and it fosters public debate and understanding through various mediums.

For more information please visit our website: WWW.MILLENNIALPOLICYCENTER.ORG

ABOUT THE MILLENNIAL POLICY CENTER

ACKNOWLEDGMENTS

Page | 1

On December 8, 1953, President Dwight D. Eisenhower addressed the United Nations General

Assembly on the issue of nuclear arsenals. In his “Atoms for Peace” speech, Eisenhower

acknowledged that creating an atomic bomb had become mainstream, and the United States no

longer had a monopoly on the technology to create a nuclear arsenal. Though at the time this may

have been a dark and gloomy speech on the prospect of nuclear war, it is far from it. Eisenhower

called on bright young minds to harness the power of the atom for civilian use in what he described

as “the day when fear of the atom will begin to disappear from the minds of people.”1

Flashforward to August 1954. The U.S. Atomic Energy Act not only solidified America’s monopoly on civilian reactor usage, but it also enabled the International Atomic Energy Agency (IAEA) to

allow technology and material exports to allied nations if they promised the technology would be for

civilian use. This sparked America’s golden age in civilian nuclear energy, which was triggered by

Eisenhower’s aspiration to create a world where nuclear energy would not be viewed as a menace

but would be seen as a friend to advance a nation’s socioeconomic goals. Between 1954 and 1968,

the U.S. built 32 reactors, starting with one at Shippingport, Pennsylvania. From 1967 to 1972,

another fleet of 48 reactors was completed, boasting an impressive wattage of 880-1200MW output.

This would be used by both homes and businesses as the main source of electrical energy. However,

this golden age would come to a grinding halt, as Josh Freed puts it, “thanks to a bizarre confluence

of Hollywood and real life.”2

Freed’s “bizarre confluence” referred to the coincidence of having the 1979 movie The China Syndrome – which depicted a reactor meltdown that could the size of Pennsylvania permanently uninhabitable – debuting simultaneously with accident at Three Mile Island (TMI) in Pennsylvania.

This stoked public fear of nuclear energy, which was reinforced in 1986 when a Soviet nuclear plant

at Chernobyl melted down and exploded, releasing deadly radioactive material into the air. This

made the city uninhabitable still to this day. After witnessing both events, the new Nuclear

Regulatory Commission (NRC) took full control over the licensing, construction management, and

approval process of new reactors built after 1986.

Since then, the NRC has made nuclear energy so unaffordable that the whole market relies on

subsidies to keep it afloat. According to the World Nuclear Association, despite nuclear energy

generating more than 20 percent of American electricity, the U.S. seems to be working to scrap

existing forms of cheap, reliable energy for heavily-subsidized and less-reliable forms of energy

(renewables). “While wind and solar power are available only when they are available, and thus

require substantial backup generation capacity in order to avoid power outages…such backup power

is very expensive—my own estimate of those backup costs is $368 per megawatt-hour.”3

Consequently, many academics and even some climate experts pondered, “How could the nation

that pioneered the nuclear age after World War II allow itself to lag behind many European and

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Asian countries in supplying electricity?” The simple answer is the federal government. The complex

answer is a cruel trilemma of misconceptions about nuclear energy in the public, NRC’s chokehold

on nuclear energy, and too many regulatory hurdles for research and development.

This paper’s goal is to present a three-step plan to reverse America’s current course so that nuclear

energy can both be affordable in the energy market and a reliable interim source of energy until solar

and wind technology become better in their storage and delivery. This plan includes:

1. Reeducating the public about how nuclear energy works and why it is a safe and reliable

source of clean energy;

2. Limiting the NRC’s regulatory oversight on nuclear construction and transfer some

federal power to states and private businesses; and

3. Stopping the federal government from picking winners and losers by giving companies

in the energy sector special subsidies and tax benefits.

By taking these three steps, the American nuclear industry will have its renaissance by making the

industry self-sufficient again and by unleashing new innovations in nuclear technology, thus offering

the U.S. a cheaper and cleaner energy future.

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The combination of nuclear meltdowns in the U.S. and abroad, coupled with the backlash from

environmentalists, has instilled an irrational fear in the public. This has been a root-cause for the

federal government’s increased regulation of the nuclear market, which has in turn rendered it

uncompetitive. Many skeptics of nuclear energy and its benefits have been trained to make broad

and factually-incorrect statements about nuclear energy. These assertions lack the basic

understanding of how a nuclear reactor works and the plethora of safety mechanisms that are

installed in U.S. reactors that make them safe and reliable sources of clean energy.

There are three common statements that the public frequently hears that are designed to cast doubt

on nuclear energy’s reliability and safety. First, opponents claim that nuclear energy produces a

carbon footprint and thus is not considered a clean source of energy. Concern over greenhouse gas

emissions is legitimate, and Millennials almost universally share some concerns over the role

humans play in climate change. Fortunately, this claim – that nuclear power contributes to climate

change – is an inaccurate representation of the facts about nuclear power plants.

All current Generation (Gen.) II and III+ light-water reactors (LWRs) and heavy-water reactors

(HWRs) emit only one type of exhaust during the nuclear process: steam. Heat from the reactor core

is turned into steam to power electrical generators. Then the steam is emitted from the plant via

exhaust vents. The visible steam is what gives off the impression that the reactor is “emitting”

something into the air. However, it is harmless water vapor. Environmental groups claim the nuclear

process and the refining process are the same, but they are not. As the USEIA explains, “Nuclear

reactors do not produce air pollution or carbon dioxide while operating…However, the process of

mining and refining uranium ore and making reactor fuel all require large amounts of energy.”4

As for other environmental benefits of reactors, reactors do not have to alter the existing ecosystem

to fit the plant. On the contrary, if a hydro-electric dam is built, there must be physical manipulation

of the surrounding landscape and water biome. This can cause eroding carbon sinks, depriving

ecosystems of water nutrients, and increasing water tables of which, if flooded, could cause extreme

risk to towns and cities downstream.5 Another benefit afforded by reactors is that nearby residents

do not have to worry about harmful chemicals being released into the air and the environment when

making facility upgrades. Contrary to popular perception, solar panels must use toxins such as lead

and cadmium (a known carcinogen) in order to capture the energy from the sun. If a panel is cracked

or broken, these toxins, if released into the air, can cause medical harm as well as environmental

damage to the surrounding area.6

Second, opponents stoke the popular notion that a nuclear reactor is akin to building a nuclear bomb

waiting to go off in a meltdown. This is also factually incorrect. “Nuclear plants are not bomb

factories, and the fuel they use is not directly usable in nuclear weapons.”7 Nuclear reactors and

nuclear bombs require two different types of enrichment levels of Uranium 235 (U235). Nuclear

SECTION ONESECTION ONESECTION ONESECTION ONE

Dispensing with Dispensing with Dispensing with Dispensing with CommonCommonCommonCommon Irrational FearsIrrational FearsIrrational FearsIrrational Fears

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reactors need enriched U235 to be at 5 percent or less. Nuclear bombs, on the other hand, require

enrichment to be at 90 percent and above.

Others claim that reactors can be used to create nuclear weapons because they produce a radioactive

waste called Uranium 238 (U238). However, U238 is merely a byproduct of reactors. It is then recycled

and reused as a “tamper” material to stabilize the Plutonium-239 inside a warhead, which is what

actually creates the explosion.

The third assertion is that meltdowns are problematic. This statement is true, but the chances of one

happening in the U.S. are slim. The NRC has developed guidelines that make U.S. reactors some of

the safest worldwide. This high emphasis by the NRC to make reactors safe was due to Three Mile

Island and Chernobyl. Both major meltdowns have generated most of Americans’ distrust in nuclear

energy for over 40 years. This is understandable, as no one should have to worry about being exposed

to toxic levels of radiation due to system malfunction or human error.

In fact, Ferdinand Banks claims that, in a study of all U.S. nuclear meltdowns, “Most of the danger

in nuclear energy resides on the human side: the machinery itself is probably intrinsically safe.”8

Banks can make that statement because all 99 reactors in the U.S. feature numerous safety layers:

core-catching, containment-building layers over the reactor core, staff discretion, control rods,

depressurization systems, charcoal filters, and generators to provide backup energy supply. These

measures have been tested and proven to work, and they are already the minimal safety regulations

that all reactor designs must have.

Before today’s NRC, the main government organization that ran America’s civilian nuclear program

was the Atomic Energy Commission (AEC). The task of the AEC was to foster and control peacetime

development of atomic science and technology. After the serious emissions releases in Cumberland,

United Kingdom in 1957 and the partial core meltdown of the Femi I reactor at Frenchtown Charter,

Michigan in 1966, the AEC was replaced with the current NRC. The NRC was tasked with protecting

public health and safety related to nuclear energy in reactor safety, administering reactor licensing

and renewals, and managing the safe storage of radioactive waste. Though the overall objective of

the NRC is admirable, the agency has since stunted its own efficiency and effectiveness in overseeing

development and expansion of the U.S.. nuclear industry.

There are three areas that the NRC fails at, thereby causing the nuclear energy industry to become

less competitive against alternative fuel sources for electricity generation. The NRC does not like to

implement new reactor technology other than LWRs and HWRs, it does not allow much state or

private construction oversight, and its licensing process is too slow and inefficient.

SECTION TWOSECTION TWOSECTION TWOSECTION TWO

Hurting the Nuclear Energy Industry Through RegulationsHurting the Nuclear Energy Industry Through RegulationsHurting the Nuclear Energy Industry Through RegulationsHurting the Nuclear Energy Industry Through Regulations

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The NRC’s Incompetence with New Reactor Technology The NRC’s Incompetence with New Reactor Technology The NRC’s Incompetence with New Reactor Technology The NRC’s Incompetence with New Reactor Technology The current 99 reactor plants in America are the same Gen II and Gen III LWR or HWRs that were

mostly built in the late 60s and early 70s (see Figure 1 below), which puts most current reactors in

service of over 40 years old. The problem is not that the building design is old, but the reactor

technology has become out of date. The outdated designs contribute greatly to less megawatt (MW)

output and less profitability for private energy companies, which need to meet their bottom lines to

stay open.

The lack of technological advancements has let the U.S. fall behind foreign competitors like France

and China, where the Chinese have already started construction on the first Gen IV CFR-600 nuclear

reactor in the Fujian province. But the U.S. not only fails in the generational reactor race; it also lags

behind in new reactor technology. For an example, “Perhaps the first commercially successful

reactor was the British made gas-cooled reactor (GCR). Unlike LWRs, it did not require enriched

uranium – nor do the HWRs, the Canadian CANDU reactor and the often-discussed MAGNOX

reactor.”9

It should not come as a surprise that America has fallen behind such advances in nuclear science

when the NRC has refused multiple times to permit a GCR to replace a LWR. Nor is it surprising

that the commission has dragged its feet to only recently (in 2018) approve uranium fuel kernels that

are designed to cut down fuel consumption and waste production.10 Likewise, the NRC approved

the first Fast Breeder Reactor (FBRs) at the Areva plant in just 2014. The inability of the commission

to authorize much-needed new technology to a century-old design has cost the nuclear industry

billions. Most importantly, this provoked the commission to pigeonhole itself from changing energy

demands. “The NRC must be flexible enough to accommodate technology that works differently

from the light water reactors it is familiar with.”11

Figure Figure Figure Figure 1111.... Lovering, Yip, and Nordhaus.

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ForbiddingForbiddingForbiddingForbidding State or Private OversightState or Private OversightState or Private OversightState or Private Oversight Another flaw of the NRC is its failure to allow state or private oversight on constructing nuclear

reactors. The NRC has a habit of only implementing federal oversight while disregarding private and

state interest in the licensing, construction, and operation of new reactors since TMI. This was the

focus of Heffron’s 2013 study, which concluded, “Through several examples at a Federal level that

the nuclear industry has evolved to a stage where it now requires a focus on the power of actions at

a more localized (state) level to reignite the industry.”12 His two biggest problems with federal control

are the lack of innovation to allow states to sponsor the industry and the failure of the NRC to prevent

cost overruns. We agree.

Cost overruns in the NRC are a product of its application and licensing process. According to an

interviewee in Heffron’s research, “Cost overruns were just enormous and the Nuclear Regulatory

Commission and the Department of Energy (DOE), they would have one formula to do criteria that

you needed to meet and you’d meet it, and they’d change their mind and you had to go in and tear

it out and start over again. Real expensive!”13 This ultimately means private contractors and states

are subject to the whims of the Commission whether their proposed reactor and plant designs

change or not. This can be particularly seen in the recent debate over Georgia’s Vogtle project to

install a new Westinghouse plant in 2009. The project got rolled back to 2016 due to the NRC not

yet approving of the plants’ design and purpose. This was estimated by Southern Company, a private

energy company in Georgia, to cost around $9 billion almost an increase of 100 percent from

estimated costs of installation.

This is further supported by Lovering, Yip, and Nordhaus’s analysis of Cantor and Hewlett’s 1988

study. “They found that individual firms experience learning, but the increased size of plants and

increased regulation led to longer lead times and higher overnight costs, thus offsetting any learning-

by-doing effect.”14 This means that the innovation and efficiency of the free market in the nuclear

industry was bogged down by over-regulation and refusing to implement a “cookie cutter” design.

With the increased cost of government oversight, many firms and states only produced a few Gen II

or Gen III reactors and then gave up, as they would later need government subsidies to keep the

plants running year to year.

For lack of innovation in the NRC, Heffron points to the federal government’s failed response in

creating new waste storage facilities to prevent over usage of the Waste Isolation Pilot Plant in New

Mexico. “State-led action on the nuclear waste issue has occurred with the development of a storage

facility for low level radioactive waste in Andrews County in Texas. This facility was given

permission in April 2012 and may accept low level nuclear waste from 36 states.”15

This state solution came after the Obama administration decided to stop funding the Yucca

Mountain storage facility, leaving the Government Accountability Office to concede that the

decision was for political and not technical or safety reasons. The administration’s verdict – which

was sponsored by the NRC – left Texas to develop its own storage facility to maintain its two 1,350

MW reactors. Overall, Heffron concludes, due to the federal government’s inaction, more licensing

and operating oversight should be given to private and state-sponsored entities. We concur.

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The NRC’s Site and Licensing ProcessThe NRC’s Site and Licensing ProcessThe NRC’s Site and Licensing ProcessThe NRC’s Site and Licensing Process The biggest hurdle for every new plant design and nuclear firm is to get both a site and licensing

permit approved by the NRC. Unfortunately, this is the most expensive and time-consuming phase

for nuclear development and is the main reason why the U.S. industry is losing to competitors.

First, as with any major construction project, there must be a site to place the plant that is approved

by the NRC. If firms decide to do the early site program, the NRC will conduct an analysis of the site

boundaries. This means government inspectors will go to the planned site and take seismic,

meteorological, hydraulic, and geological data to see if there are any potential environmental or

natural disaster concerns. Next, the firm must provide a description of any facilities that will be near

the plant and inspectors will need to evaluate, using existing and projected population growths,

whether the site will pose a risk to nearby towns and cities. These site evaluations are then compiled

into Draft and Final Environmental Impact Statements. If approved, the “site permit allows for a

limited work authorization to perform non-safety site preparation activities before a combined

license is issued.”16 This temporary license is only valid between 10 and 20 year,s and it is during this

time that most energy firms start the still-longer process of obtaining the combined license.

Second, if an energy firm makes it past the site permit phase, it can finally start applying for the

combined license that will eventually allow them to start doing test runs at a new nuclear plant.

However, this process takes even longer than the site permitting process because this stage of

construction takes an average of 84 months (see Figure 2 below).

Before the NRC can review a plant’s design and commence with the needed inspections, the firm or

state government must apply for a combined license within a 24-month period. If the NRC reviews

the application, the commission can either give a Generic Fundamentals Examination (GFE) or

continue with the application process. Since the NRC uses GFEs almost always only to renew current

licenses, it is safe to assume that new plant designs and new energy companies will still have to go

through the conventional application process. Then the NRC will conduct another safety review of

the site and require that all future plant employees take a 75-question multiple choice exam as well

as pass an Environmental Review training session. Once everyone has passed, the NRC will issue a

final safety evaluation report and a final environmental evaluation report to be submitted for public

hearings.

Figure Figure Figure Figure 2222.... Lovering, Yip, and Nordhaus released by the Department of Energy. Assuming a proposed plant starting in 2006.

Page | 8

The second half of the combined license process consists of public hearings, for which the NRC will

give notice that the public can join a hearing overseen by a board made up of one lawyer, as

chairman, and two “technically qualified”17 persons. This board will hear testimony from public and

private interest groups and will present the final safety and environmental evaluation reports.

Finally, the NRC will decide on the application based on the evaluations and the public hearing

before any construction may begin (see Figure 3 below). It is estimated by the NRC that this process

takes anywhere from 18 to 24 months to complete for the hearing alone. This long process left

Heffron to conclude, “The NRC has struggled in the past in taking a long time to approve projects,

and although it has undergone changes, there remains a need to improve.”18

Cutting Down Unnecessary RegulationsCutting Down Unnecessary RegulationsCutting Down Unnecessary RegulationsCutting Down Unnecessary Regulations To cut down the operating expense and construction costs of U.S. reactors – and thereby make them

more practical to build – there must be some reduction in the NRC’s red tape strangling the industry.

There are two key ways to cut the commission’s regulatory power without sacrificing the integrity of

U.S. reactors, which are still the safest in the world. Therefore, policymakers should streamline the

licensing process to allow America to once again lead the way with nuclear reactor construction and

operation. To achieve this, Congress must pull back the regulatory reins.

First, the reactor licensing process needs to be cut down to levels that are realistic with market

expectations. According to a 2009 study conducted by the Union of Concerned Scientists, “Nuclear

plant construction rose from between $2 billion and $4 billion per unit to $9 billion per unit.”19 They

attributed this mostly to nuclear energy’s expensive construction and operating costs. John F.

Ahearne observes, “Often the rising costs were attributed to regulatory delay caused by intervention

in the licensing hearings.”20 It is because of this 84-month licensing period that many are calling for

an end to America’s domestic nuclear program and for many energy firms to abandon the industry

altogether and instead revert to fossil fuels.

Figure Figure Figure Figure 3333.... The U.S. Nuclear Regulatory Commission’s combined license process.

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The U.S. should adopt an approach similar to Great Britain. The licensing time in the U.K. is nearly

half that of the U.S., averaging approximately 54 months to license and operate a new reactor.

Bridging the 2.5-year difference between the U.S. and U.K. approval times will not only save firms

and states a lot of taxpayer dollars, but it will permit more funding for R&D and necessary lifetime

upgrades for the reactors. An ideal licensing solution would be to just do one site evaluation instead

of two. The average Gen II or Gen III power plant only needs 1.3 mi2, and most are located in rural

areas in New York, Illinois, and the South. So, the threat to humans posed by a problem at a plant in

these regions is minimal. This helps render two site evaluations a redundant and unnecessary waste

of resources. Such minor changes in NRC policy will reduce construction expenses by not forcing

duplicate reviews and forcing NRC employees to be concise yet thorough with their first evaluations.

Second, the NRC needs to adapt and approve the development and implementation of new and safe

nuclear technology. The quickest way to ensure the NRC becomes “flexible” in permitting new

technology is to have Congress get involved. As Freed explains, “Then there is the federal

bureaucracy, which has failed even to acknowledge that a new generation of reactors is on the

horizon.”21 Currently, the NRC operates under the Department of Energy and receives about one

billion dollars in government funding each year. It would be encouraging if Congress limited

funding to both the NRC and the DOE to provide incentives for them to help meet American

consumers’ high demand affordable energy.

Congress should condition the NRC’s budget on provisions that require the commission to have a

standard model for reactor designs that will evolve with technological improvements in safety and

efficiency. Both measures would make the NRC more accountable by putting it on the hot-seat. The

“cookie-cutter” approach is designed explicitly to cut down the licensing period, as there will be a

standard blueprint. The principle behind production line reactors will remain the same, but the

criteria will be different for each generation and type of reactor – all designed to reduce costs. “How

can the brand new Flibe Energy liquid-thorium fluoride reactor technology be forced to meet the

same criteria as the typical light water reactor?”22

Compared with the rest of the world, America’s nuclear industry lags in technological advancements

that are designed to hold down operational costs. Still, operational costs for American reactors are

relatively low, but it is because the industry has been the beneficiary of large government subsidies.

This at first glance may appear to be a good thing for nuclear energy because, in theory, it should

make the industry more competitive with its coal and gas rivals. However, coal and gas also receive

large energy subsidies from the government, thus making their operational costs so low that other

industries such as nuclear cannot compete.

Another reason for a decline in America’s nuclear industry is the lack of research and development

of new technologies that can lower operational costs for nuclear energy. This will become more

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The Hurdles of Research & DevelopmentThe Hurdles of Research & DevelopmentThe Hurdles of Research & DevelopmentThe Hurdles of Research & Development

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problematic because it will force the industry – which is currently predicted to provide 30 percent of

the nation’s energy by 2050 – to significantly decrease production, causing potential electrical

shortages for millions of Americans. This makes it even more critical that proper R&D assets are

offered to the nuclear industry and are used effectively so as to maximize its potential to be one of

the biggest sources of energy to support a growing nation.

Stifling Innovation by Picking Winners and Losers Stifling Innovation by Picking Winners and Losers Stifling Innovation by Picking Winners and Losers Stifling Innovation by Picking Winners and Losers Two problems with R&D that prevent the nuclear industry from being competitive and innovative

are the continuation of old reactor designs from the 20th Century and the government choosing

winners and losers via energy subsidies.

As mentioned above, the nuclear industry is stuck in designing the same Gen. II and Gen. III reactors

that have been in service since the late 1960s. This is partially due to the NRC’s inability to approve

new reactor and safety technology developed abroad, but it’s also because of government subsidies.

Each year the nuclear industry gets subsidies from the DOE to run, maintain, and hold down

operating costs for all 99 reactors in service. This chronic subsidization – in the form of special loans

and tax breaks for nuclear plants – eats away at necessary assets that can be more efficiently spent in

R&D. This is because “80% of the overnight cost relates to EPC costs, with about 70% of these

consisting of direct costs and 30% indirect costs.”23

With so much of a plant’s expense coming from construction alone, more assets are devoted to

constructing and maintaining existing reactors than for deploying state-of-the-art nuclear

technology. These resources are further decreased as the NRC uses up most of the assets given from

the DOE to pay for regulation implementation, issuing site and combined licenses, and renewing

existing licenses. Therefore, there is little to no funding provided for scientific development for better

safety and reactor systems that can use less fuel and decrease operating costs. Instead, most of this

comes from private sector grants that are still not enough to finance nuclear plants due to the high

capital investment costs.

Altogether, this creates three major problems for the nuclear industry and subsequently makes it

uncompetitive against oil and gas. First, the lack of R&D funding provides no incentive for the more

than 1,700 nuclear and civil engineers to be employed by a nuclear energy company to design and

work on reactors. This can trigger adverse effects such as higher unemployment in the physics and

engineering community, but it can also cause a severe labor shortage for qualified plant employees,

which can lower safety standards during operating hours. Second, the lack of R&D provides no

incentive for new energy companies to invest in nuclear power because the 20th Century technology

is no longer economically viable with high capital and operating costs. This will inevitably turn away

private investment and state investment, leaving the industry to either waste away or increase the

need for further federal subsidies.

Third, the lack of R&D reinforced the abusive behavior of the NRC in only approving late technology

and further hurting the industry. Since the NRC uses most of the assets for regulatory processes, it

has solidified its power within the industry as the judge and jury in every plant design, technology,

Page | 11

and application. This behavior only proves to hamper the industry and is a big reason why America

has fallen behind foreign competitors – particularly China and Russia – in energy. As Freed explains,

“The NRC makes no pretense of being prepared to evaluate reactors cooled by molten salt or run on

depleted uranium.”24

In 2017, President Trump launched his Energy Dominance Plan to end the “war on coal” and

increase domestic energy output from nonrenewable and fossil fuels. Though this is a good way to

develop an economy, it does come at a price. According to Price of Oil, “U.S. taxpayers continue to

foot the bill for more than $20 billion in fossil fuel subsidies each year.”25 This phenomenon of having

taxpayers pay to subsidize energy bills is not just limited to oil and gas, but to nuclear and renewables,

at $29 billion and $10 billion respectively.

However, by subsidizing all energy sectors, the government creates a crowding-out effect in each

industry. The government is essentially picking winners and losers – the very definition of “crony

capitalism” – whereby one enterprise dominates or is dominated by competitors in the energy

market that are given preferential treatment by the government. Currently, the oil and gas companies

are at the top due to high production output at low costs, but they can crowd out the energy market

by having the government artificially lower their prices even further.

Ultimately, this forces consumers to choose coal, oil, and gas companies to power their electricity

and heat their homes, pushing nuclear and renewables out. Internally, subsidization forces job

shortages in industries that will inherently be more expensive than the competition. This happens

because employment in industries other than oil and gas are likely to have less job security and

advancement for new workers, and thus will not be appealing job prospects for future engineers and

plant technicians.

Promoting a Free Market by Eliminating Crony Capitalism Promoting a Free Market by Eliminating Crony Capitalism Promoting a Free Market by Eliminating Crony Capitalism Promoting a Free Market by Eliminating Crony Capitalism To improve R&D for the nuclear industry, the government must address both federal assets and the

chronic subsidization of the energy sector. Congress needs to eliminate all energy subsidies to create

a free market. At first, energy prices for Americans will increase due to the removal of the artificial

price ceiling on electrical and heating bills. This will happen because the current subsidies create

monthly energy bills that are below market equilibrium, creating demand or a supply shortage in the

market. Consumers will more than likely decide to use other forms or competitors for energy, which

will in return force energy firms to lower their prices to natural levels, thus reestablishing an

affordable and free market.

By doing this, America will witness an increase in efficiency and new technologies to provide better

energy quality to consumers. These measures benefit all energy industries because oil and gas will be

able to continue its dominance for a while. Nuclear energy can use new technology to lower

operating and capital costs to be on par with oil and gas, and renewable energy companies can

research technologies to effectively store and transport energy from wind and solar farms.

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Instead of subsidizing production, the federal government can – if at all – use some of the money to

provide research grants to the competing sectors. Taxpayer funding for the energy sector should

follow the NASA model, wherein the government provides financing only for scientific research and

development. Also, as with NASA, private firms and state governments should provide project

funding and have more oversight of future nuclear plants. This new system of funding will allow the

nuclear industry to harken back to its glory days where reactor testing labs and trial runs were

conduct regularly to find the best way to maximize energy output at low costs while also being safe.

Put simply, both government entities and private energy firms should reverse engineer Eisenhower’s

Atoms for Peace and apply 21st Century technologies and innovations to restore the nuclear industry

to renaissance. At a minimum, nuclear energy, if used properly, can serve as an interim fuel source

to cut down carbon emissions and to buy time for renewables to become the energy source of the

future.

America was once considered the gold standard for nuclear energy safety, innovation, and low

energy prices. That is no longer the case. With the nation’s population growth, scientists are hurrying

to figure out if coal, oil, gas, and/or renewables are adequate to sustain such rapid population growth

for future decades. It is essential that nuclear power generation be included in an “all-of-the-above”

mix. It is reliable, affordable, efficient, and low in carbon emissions. Congress must make the NRC

more efficient, unleash greater nuclear energy research and development, and properly educate the

public about the immense safety and reliability standards of nuclear energy. If done willfully and

strategically, we can truly have a clean and a very bright future in America.

1 International Atomic Energy. Atoms for Peace Speech . 2017. 22 May 2018. 2 Freed, Josh. "Back to the Future: Advanced Nuclear Energy and the Battle Against Climate Change ." The Brookings Essay (2014). 3 Zycher, Benjamin. "The High Cost of Unreliable Power ." 7 August 2014. American Enterprise Institute. 27 June 2018. 4 Administration, U.S. Energy Information. Nuclear Explained: Nuclear Power and the Environment . 30 April 2018. 22 May 2018. 5 Dams—Earth Law Center. 2017. Dams+Climate=Bad News. 12 17. Accessed 12 04, 2019. http://www.earthlawcenter.org/blog-entries/2017/12/dams-climate-change-bad-news/. 6 Solar—GreenMatch. 2014. Pros and Cons of Solar Energy. 5 08. Accessed 12 04, 2019. https://www.greenmatch.co.uk/blog/2014/08/5-advantages-and-5-disadvantages-of-solar-

energy#pollution/. 7 Ahearne, John F. "Prospecs For Nuclear Energy." Energy Economics (2011): 572-580. 8 Banks, Ferdinand E. "Economic Theory and Nuclear Energy ." Organization of the Petroleum Exporting Countires Review (2000): 1332-1334. 9 Ibid. 10 WNN. 2018. World Nuclear News. May 01. Accessed 12 03, 2019. http://www.world-nuclear-news.org/NN-US-federal-support-for-advanced-nuclear-technology-0105187.html/.

ENDNOTESENDNOTESENDNOTESENDNOTES

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11 Freed, Josh. "Back to the Future: Advanced Nuclear Energy and the Battle Against Climate Change ." The Brookings Essay (2014). 12 Heffron, Raphael J. "Nuclear Energy Policy in the United States 1990-2010: A Federal or State

Responsibility?" Energy Policy (2013): 254-266. 13 Ibid. 14 Lovering, Jessica, Arthur Yip and Ted Nordhaus. "Historical Construction Costs of Global Nuclear Power

Reactors ." Energy Policy (2016): 371-382. 15 Heffron, Raphael J. "Nuclear Energy Policy in the United States 1990-2010: A Federal or State

Responsibility?" Energy Policy (2013): 254-266. 16 Commission, United States Nuclear Regulatory. Backgrounder on Nuclear Power Plant Licensing Process. 13 June 2018. 19 June 2018. 17 Ibid. 18 Heffron, Raphael J. "Nuclear Energy Policy in the United States 1990-2010: A Federal or State

Responsibility? ." Energy Policy (2013): 254-266. 19 Schissel, David, Michael Mullett and Robert Alvarez. Nuclear Loan Guarantees . Cambirdge : Union of Concerned Scientists , 2009. 20 Ahearne, John F. "Prospects For Nuclear Energy." Energy Economics (2011): 572-580. 21Freed, Josh. "Back to the Future: Advanced Nuclear Energy and the Battle Against Climate Change ." The Brookings Essay (2014). 22 Ibid. 23 WNA. "Economics of Nuclear Power." May 2018. World Nuclear Association. 27 June 2018. 24 Freed, Josh. "Back to the Future: Advanced Nuclear Energy and the Battle Against Climate Change ." The Brookings Essay (2014). 25 Redman, Janet. "Report: Trump's "Energy Dominance" Plans Rely on Billions in Fossil Fuel Subsidies ."

Oil Change International (2017).

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