Academic journal article American University Business Law Review

Forward-Looking Improvements to Licensing the Next Generation of Nuclear Reactors

Academic journal article American University Business Law Review

Forward-Looking Improvements to Licensing the Next Generation of Nuclear Reactors

Article excerpt

Nuclear regulation has faced a variety of challenges since the Atomic Energy Commission first introduced the procedure of two-step licensing, in which construction and operational licenses are issued separately to nuclear reactor developers. Since 1974, and the establishment of the Nuclear Regulatory Commission, the process for licensing a nuclear power plant has changed dramatically. In addition to the two-step licensing process of old, developers now have the option of choosing a one-step combined license, which offers more flexibility in terms of developing technical specifications. The two-step and combined license options are codified under 10 C.F.R. §§ 50 and 52, respectively. Although intended to streamline the process and avoid expensive licensing periods that plagued plant development under the old regime, the newer combined license method is not being executed as planned and runs the risk of confronting developers with the same economic hurdles. This Note examines both licensing options and posits that a new strategy must be developed to efficiently license the next generation of nuclear power plants.


The success of the commercial nuclear industry has fluctuated significantly over the past several decades due to a wide variety of safety related, economic, and political developments.1 Recently, there has been a growing movement towards expanding nuclear power in the United States once again.2 Despite the renewed interest, support for nuclear power has also proven to be polarizing; concerns over improper nuclear waste disposal and plant safety are hotly debated issues.3 Public opposition to nuclear plants was propelled further following the accident at Three Mile Island in 1979, calling into question the desirability of large-scale nuclear power production.4 These concerns have been surfaced yet again following the recent developments at Japan's Fukushima Daiichi plant in 2011.5

Notwithstanding the myriad safety concerns, the economics of plant development remains perhaps the most significant barrier to nuclear production.6 The construction and operation of nuclear facilities is an expensive business, which must also factor in decommissioning and waste disposal costs, among others.7 Cost overruns and construction delays witnessed in the 1970s and 1980s remain a crucial issue today in the debate over the economics of nuclear power.8 Long construction periods tend to significantly increase financing costs and push overall project costs well beyond initial estimates.9 Furthermore, with abundant shale-gas deposits contributing to even lower electricity rates,10 the high cost of developing a plant due to extended construction and engineering time may easily "dampen enthusiasm for major nuclear expansion."11

At the nexus of these issues is nuclear regulation. The government oversees nuclear licensing and regulation in the United States and must balance the need for advancing economical electricity generation with public opinion and safety.12 This Note examines broadly the licensing options available to nuclear plant developers today and suggests that the regulations need to be adapted to avoid the economic pitfalls of costly design and engineering-related delays for the advanced nuclear systems known as Generation IV reactors. Part I describes the history of nuclear reactor licensing, provides background on the Generation IV initiative, and introduces the prototype being developed in the United States, known as the Next Generation Nuclear Power Plant ("NGNP"). Part II outlines the feasibility of licensing a Generation IV reactor under today's available alternatives, while Part III provides broad suggestions for improving these alternatives.


A. Historical Underpinnings of Nuclear Power Regulation

The Atomic Energy Act of 1954 ("1954 Act") governs the operation and regulation of nuclear energy13 and gave licensing and enforcement power to the Atomic Energy Commission ("AEC"), which previously maintained jurisdiction over both military and civilian applications of nuclear technology. …

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