United States Nuclear Fuel Working Group (2020 Transition)

Book 2 - Issue Papers
Entire 2020 DOE Transition book As of October 2020

The Nuclear Fuel Working Group (NFWG) Strategy¹ is a holistic approach to address the challenge of restoring America’s competitive nuclear advantage, with four strategic priorities:

Provide Immediate Action to Support U.S. Mining and Restore the Viability of the Entire Front-End of the Nuclear Fuel Cycle.^[1]
Revitalize and Strengthen the Front-End of the Nuclear-Fuel Cycle and Domestic Nuclear Industry.
Lead the World in Technology and Standards.
Empower U.S. Export Competitiveness.

These recommendation measures, with corresponding implementation activities for each to be led by the appropriate Federal Departments and Agencies. The Strategy provides recommendations that, if fully implemented, will revitalize the domestic nuclear energy industry and reestablish America as the global leader in nuclear technology innovation. In turn, the United States will regain its influence to continue to ensure strong safety, security, and nonproliferation standards for the international nuclear regime, and will be well-positioned for future commercial opportunities for large light water reactors, as well as small modular reactors and advanced reactors. Importantly, the strategy recognizes that a strong nuclear energy industry supports both U.S. commercial and defense needs that the success of the uranium mining industry and of U.S. nuclear technology exports are inextricably linked.

Issue(s)

Pending Appropriations for the FY 2021 Proposed Uranium Reserve

Preventing the near-term collapse of the domestic uranium mining and conversion industries is considered the most immediate concern. If Congressional appropriations are provided for FY 2021, DOE could support and strengthen the front end of the domestic nuclear fuel cycle by establishing a DOE Uranium Reserve and re-establishing active domestic conversion capabilities. By initiating a 10-year program to purchase uranium and conversion services for the Reserve, DOE would support the restart of near-term uranium production and conversion services for that domestic uranium, where the risk of losing these capabilities is most immediate. The Reserve would also provide assurance of availability of uranium in the event of a market disruption, such as intervention by a foreign state, which prevents nuclear utilities from acquiring uranium to refuel their reactors.

Interagency Coordination

Although DOE led the publication of the Strategy, restoring America’s competitive nuclear advantage will require a complex, long-term interagency effort over the next 10 years. An interagency NFWG implementation plan would help to maintain alignment with the Strategy intent; incorporate new information; align resource requests and allocations; coordinate communications internally and externally; and inform adjustments, if needed. However, DOE does not have the authority to direct how, when, or if other Departments and Agencies implement the Strategy.

Senior Administration Position

The Strategy recommends the designation of a senior Administration official within the Executive Branch who will be tasked with leading nuclear exports in partnership with the private sector and all relevant agencies. DOE envisions a central, coordinated office, led by the senior Administration official, to coordinate nuclear exports and implementation—including promotion of nonproliferation, safety, and security norms—and assist emerging and expanding countries’ development and deployment of their nuclear energy programs. The position placement within the Executive branch, whether the official will hold White House authorities, and the specific responsibilities of this position have yet to be determined.

Nuclear Industrial Base Advisory Committee

The Strategy recommends the establishment of a Nuclear Industry Base Advisory Committee charged with making recommendations on the confluence of public and private investment and nuclear supplier base challenges pertaining to the national security considerations provided in the Strategy. DOE envisions an industrial group, modeled after the Defense Industrial Board, who would incorporate supplier needs into their recommendations. It has not yet been determined whether this committee would be related to the existing Nuclear Energy Advisory Committee, who the membership would include, or whether this board would report to DOE, nor at what level it would report.

Advanced Nuclear Technology Innovation, Development, Demonstration, and Export

The Strategy recognizes that innovation in the nuclear technology sector is crucial to the future of U.S. national security. The U.S. currently has zero new nuclear plant builds outside the U.S. while Russia and China currently dominate the nuclear power plant global marketplace for new-build nuclear power plants. The new builds currently underway will provide Russia and China with 100-year nuclear technology relationships with many strategic members of the global community. The U.S. must export its innovative nuclear power technology to ensure that U.S. norms for operation, safety, security, and non-proliferation are adopted worldwide.

Status

At present, DOE has drafted the DOE Implementation Plan and a whole-of-government NFWG Implementation Plan, pending formal concurrence within the Department and comment from the interagency, respectively.

Subject to the availability of appropriations, the Strategy calls for DOE to lead the creation of a national Uranium Reserve to provide immediate relief to the U.S. mining and conversion industries. DOE also supports innovative nuclear energy technology, including managing research, development, and/or demonstration programs for advanced nuclear reactors, accident tolerant fuels, and high-assay low enriched uranium. DOE will support the development of small modular reactors and microreactors, the Versatile Test Reactor, and the National Reactor Innovation Center. DOE is also the lead for investigating methods that continue to increase efficiencies in the 10 CFR Part 810 nuclear export process, as well as providing statutorily mandated technical support to the Department of State for the negotiation of 123 agreements.

Other Federal Departments and Agencies have also begun to implement recommendations and activities identified in the Strategy, when consistent with existing appropriations and authorities, which have created visible signals of American commitment to this strategy. The first near-term action by the U.S. International Development Finance Corporation (DFC) was to reverse a legacy policy limitation on financing for nuclear energy projects in emerging markets.^[2] As America’s development bank, DFC partners with private businesses to support investment in challenging frontier markets. By providing debt and equity financing; insurance; and technical assistance to projects that are unable to obtain sufficient support from private lenders, DFC helps mobilize additional private capital, resulting in projects that are financially viable and built to the highest standards. Together with the DOE’s support of innovative reactor technology, this critical policy change will help restore America’s global leadership in the civil nuclear sector, while increasing access to a safe and sustainable source of clean energy in the developing world.

Memorandum of Understanding (MOU) between the U.S. Environmental Protection Agency (EPA) and the U.S. Nuclear Regulatory Commission (NRC), “Concerning the Regulation of Uranium in situ Recovery Activities,” that entered into force on July 23, 2020. The MOU describes how the NRC and EPA will work with each other to accomplish their responsibilities under Title II of the Uranium Mill Tailings Radiation Control Act (UMTRCA) and supports the goal of re-establishing a robust domestic uranium industry. This MOU follows on to (but does not supersede) a 1992 MOU on general cooperation and, although not legally binding, is intended to support more timely, efficient regulation, and foster opportunities for communication and cooperation between the agencies.

DOE also established the Advanced Reactor Demonstration Program in FY 2020 with the publication of a competitive solicitation and a strong response from industry. This program will enable demonstration of up to two advanced reactor designs through partnerships with industry.

Consistent with the Strategy, the Department of Commerce recently announced a draft amendment to the Agreement Suspending the Antidumping Investigation on Uranium from the Russian Federation (“Russian Suspension Agreement”) to extend the Agreement to 2040 and reduce U.S. reliance on Russian enriched uranium.^[3]

Milestone(s)

See issues.

Major Decisions/Events

See issues.

Background

On July 12, 2019, President Donald J. Trump determined that “the United States uranium industry faces significant challenges in producing uranium domestically and that this is an issue of national security.” The President directed “a fuller analysis of national security considerations with respect to the entire fuel supply chain.”

The President created the NFWG to study the challenges facing the nuclear fuel supply chain in the United States, including identifying impediments to domestic industry competitiveness, exports, and technical development; strengths that could be enhanced to improve U.S. competitive advantage; and opportunities to reestablish American nuclear energy leadership.

The U.S. government, in consultation with stakeholders, identified a range of recommendations to revitalize and expand the U.S. nuclear enterprise, while maintaining American leadership in the nonproliferation arena.

A reliable supply of domestic uranium in the United States is critical for our national and energy security. The uranium industry has been decimated by reduced demand after the accident at the Fukushima Daiichi nuclear power plant and the low price of uranium in the international marketplace. State-owned and influenced companies did not cut production in response to the reduced demand, over-supplying the international market and driving the price of uranium down to the point that it is unprofitable for U.S. domestic mining, milling, conversion, and enrichment companies to operate.

The United States needs to revitalize its nuclear industry enterprise and enable the sale and export of U.S. nuclear energy technology to compete with state-sponsored and funded companies selling outdated technology and fuel at cut-rate prices. The next decade is critical to the United States re-establishing its participation in the global nuclear energy marketplace. The alternative is that once the competition has sold and deployed non-U.S. technology and fuel, the U.S. will have missed the procurement and deployment opportunities afforded by the expansion of global energy systems and the U.S. will be functionally excluded from those markets for the next 80 to 100 years. It is imperative that the actions detailed in this implementation plan occur over the next decade to ensure the U.S. is the dominant influencer in the global nuclear energy marketplace.