Posted on February 15, 2023 by Nicholas McMurray and Natalie Houghtalen
Consensus is building around the need for more nuclear energy to achieve America’s energy goals, play a key role in the global energy market, and lower global emissions.
Bipartisan wins in Congress and support from the Trump and Biden Administrations have created and solidified a clear path for more nuclear energy in America and abroad. Moonshot deployment goals, the development of a new regulatory framework, cross-governmental nuclear energy interest, and the need for a domestic fuel supply have laid the foundation.
Today, the nuclear industry is heading towards a more optimistic future, but the next few years are crucial to enable wide-scale deployment. America should not quit while it's ahead, which is why continued legislative action is needed to complete these foundational infrastructure investments and allow the nuclear industry to continue to grow through the end of this decade and skyrocket in the 2030s.
The Energy Act of 2020 (EACT) refocused the Department of Energy’s (DOE) research and development programs toward supporting demonstration projects. Crucially, the law set up a moonshot of more than 20 commercial-scale, clean-energy demonstrations by the mid-2020s, including the Advanced Reactor Demonstration Program (ARDP). In 2021, the bipartisan Infrastructure Investment and Jobs Act (IIJA) invested $62 billion into next-generation technologies, electricity grid improvement, energy efficiency, and more at DOE. Nearly half of that total was direct, off-year appropriations for the energy-related research, development, and demonstration programs authorized in the EACT. Notably, roughly $2.5 billion directly funded the two largest demonstrations in the ARDP, which are aiming to come online in 2028. Such significant off-year funding shows Congress’ confidence in the impact of these programs, providing a strong signal to private investment.
The advanced reactor market is at an inflection point. Investors and end-users are closely watching these first-of-a-kind projects for crucial market signals. ClearPath has identified four areas to focus federal policy to provide the boost of confidence necessary for investors and end-users to scale from building one reactor at home to building hundreds both domestically and internationally.
There must ultimately be steel in the ground. While the bipartisan IIJA provided a major downpayment into the ARDP, additional appropriations are necessary to fill the remaining gap and help these projects remain on track. In addition, the availability of High Assay Low Enriched Uranium (HALEU) is essential to the success of these projects. The completed plants can’t operate without fuel. Although the ARDP teams are responsible for fuel fabrication, the HALEU material is meant to be made available through the Advanced Nuclear Fuel Availability program, which also passed in the EACT. Today, HALEU is only available from Russia, and it is imperative to our national security that the U.S. can provide a supply for itself and its allies without relying on our foreign adversaries. In addition to the ARDP, Congress and DOE must work together to execute the EACT policies that support private industry in creating a domestic HALEU supply chain. If not, the billions of dollars invested in the ARDP and other innovative nuclear projects could be squandered by the lack of a reliable fuel supply.
For U.S. nuclear companies to rapidly scale their technologies, there must be predictability and certainty in the regulatory process. Nuclear projects require a license from the U.S. Nuclear Regulatory Commission (NRC), but many customers see this undertaking as nearly impossible to navigate and too costly. This regulatory uncertainty deters investors and end-users from pursuing new nuclear technologies. In addition to the timely review of a single new design, the NRC must be prepared to handle the anticipated number of applications that will result from the success of the first demonstration projects. Once projects are already NRC-approved, built, and operating, there should be confidence that additional builds can be licensed rapidly. Congressional direction on a holistic review of the NRC’s structure and procedures should incentivize the modernization of the licensing process. Modernizing the NRC as soon as practical will increase predictability for investors and end-users by reducing regulatory uncertainty while maintaining safety since the NRC staff can focus on their important safety and security mission rather than red tape.
New end-users, including industrial heat users and smaller utilities, are closely watching and are poised to place large orders once the demonstration projects are successful. Even though there is incredible momentum, more than these first demonstration projects are needed to establish the robust workforce and supply chains required for these orders. Additional policy support can accelerate this timeline while decreasing the burden on early movers. Recent tax incentives, if implemented correctly, will provide an important market signal for end-users to pursue innovative, clean technologies in their decarbonization portfolios. Furthermore, DOE can help by educating end-users unfamiliar with new nuclear technologies. For example, the recently enacted Fission for the Future Act can support utilities to redevelop retired or retiring power plants in a way that leverages existing infrastructure, employs the existing workforce, and provides 20% higher wages on average.
Over the past few decades, the U.S. has ceded its global nuclear energy leadership. It has only built two new plants domestically and directly supported a few international projects, such as in the UAE. Although America’s international presence has waned, the desire for nuclear energy abroad has not. Many countries are desiring nuclear energy for the first time. Unfortunately, China and Russia have filled this supply gap and are building dozens of new reactors domestically and internationally. Partnerships formed from nuclear energy exports can last for a century, locking in trade and national security dynamics. A perfect example of this was presented to our team at The 27th Conference of Parties (COP27) in Sharm El-Sheikh, Egypt — where members of the Egyptian Parliament expressed regret for signing a long-term agreement with Russia’s Rosatom, the Russian nuclear power company, to construct the El-Dabaa plant sited northwest of Cairo. Thus, the United States and its allies must be the ones to establish these new international partnerships. However, nuclear energy exports require coordination between multiple federal agencies. The U.S. government must create an interagency strategy capable of engaging with partner nations to develop financing packages that are competitive with Russia and China’s growing influence. Recently introduced legislation, like the International Nuclear Energy Act, looks to strengthen the United State’s nuclear export role.
There is incredible momentum behind the next generation of nuclear technologies, and the American nuclear industry is well-positioned to demonstrate and deploy the first wave of new reactors in decades. These few targeted areas can ensure that the recent momentum continues to accelerate, moving nuclear energy along the deployment curve and enabling the commercialization of new nuclear technologies.
Key Policies for Broad Deployment
