When Foreign Countries Want to Buy into U.S. Nuclear Power Plants – What Then?

The United States has historically struggled to balance its commitment to economic openness and foreign investment with national security concerns. For example, U.S. national policy makers have worked to make sure sensitive military and defense technology and production remain with American companies.

After 9/11, concerns grew that foreign ownership of U.S. infrastructure could increase our vulnerability to terrorist attacks. One example is the heated debate triggered by the 2006 purchase of a company that ran U.S. ports by the United Arab Emirates-owned company Dubai Ports World. (Dubai Ports eventually sold its interests to a U.S. company.) More recently, globalization of the nuclear industry and the weak U.S. economy have attracted significant levels of foreign investment in the U.S. nuclear industry.

The Atomic Energy Act prohibits the NRC from issuing a license to any entity that the Commission believes is “owned, controlled or dominated by an alien, a foreign corporation or foreign government.” Broadly speaking, the foreign ownership prohibition protects the “common defense and security” of the United States, even though this may prevent some nations from participating in U.S. nuclear joint ventures.

However, the NRC can permit foreign investment in nuclear power reactors if certain conditions are met. What are these conditions?

The licensee must submit a plan that describes how it will mitigate foreign control issues. For example, the licensee could exclude foreign board directors from nuclear safety and security decisions or establish “Nuclear Advisory Committees” made up of U.S. citizens to oversee safety and security practices.

For any proposed foreign joint venture, the NRC staff reviews many aspects of the proposed corporate structures of the owners, including parent companies and subsidiaries, financial arrangements, operating agreements, voting requirements, and decision-making authorities. The staff can impose license conditions specific to the situation.

Foreign investment will continue to play a critical part in the U.S. nuclear industry. Through effective staff review and implementation of effective mitigation measures, the NRC can continue to protect the common defense and security regardless of ownership.

Anneliese Simmons
Nuclear Reactor Financial Analyst

Meeting the Challenge of Regulating New Reactors

As many of you are aware, the much-anticipated and often-written about global surge in interest in nuclear power is underway. Our agency is in the midst of this surge to safely meet the substantial challenge that many industry experts expect to continue in 2011 and well beyond.

In fact, we are actively reviewing 12 combined license applications that, if approved, could result in the construction and operation of up to 20 new reactors. A map of projected locations for new reactors can be found here: http://www.nrc.gov/reactors/new-reactors/col/new-reactor-map.html .

To meet this growing interest in commercial nuclear power, in 2006 the agency created the Office of New Reactors, or in agency-speak, ”NRO.” Located at NRC headquarters, near Washington, D.C., we work closely with a new agency inspection organization in our Region II Office in Atlanta, GA. This structure ensures that we are fully equipped and ready to address the renewed interest in nuclear energy.

Our mission is to serve the public by ensuring the safe, secure and environmentally responsible use of nuclear power in meeting the nation’s future energy needs. However, as federal regulators, it is important to point out that we are not advocates for or against commercial nuclear power.

Our responsibilities in this new office are divided into three subprograms or areas of focus – New Reactor Licensing, Construction Oversight and Advanced Reactors.

In addition, we are active in the international area, including significant participation in the Multinational Design Evaluation Program. This program develops innovative ways to leverage the resources and knowledge of international regulatory authorities to review new reactor power plant designs.

Please look for more detail on each of these areas in future posts. In the meantime, if you have any questions about new reactors, please let us know in the comments to this post.

Bob Jasinski
Senior New Reactors Communications Specialist