Taking a Long-Term View on New Reactor Licenses

Scott Burnell
Public Affairs Officer

Since 2012, the NRC has licensed 11 new reactors in the United States. The first four of those are under construction, two in Georgia and two in South Carolina.

The other seven? Their licenses are ready to go whenever the companies involved choose to start building them, and here’s why.

These new reactors are authorized through the NRC’s Combined License process. Under this approach the license includes permission to both build a reactor and operate it later, as long as a detailed list of completion requirements are met.

A Combined License includes the same 40-year operating period as the licenses for today’s reactors. Those 40 years start when the NRC concludes the reactor has been built according to its license and can operate safely. The construction portion, on the other hand, is set up without a definitive expiration date.

We base our permission to build the reactor on our review of technical and environmental information the applicant provided. Issuing a license means we found all that information acceptable.

Let’s imagine Company X receives a Combined License and waits 10 years before deciding to start construction. If the original information is still valid, the project could get underway. Most categories of information won’t change in that time. The license includes provisions where the company must account for new information when it decides to start construction.

All of this means that companies with a Combined License can therefore take additional time to consider those issues affecting the business decision to construct or not that fall outside the NRC’s jurisdiction. For example, a state’s utility agencies can create or revise policies on how the state obtains and pays for electricity. Changes in interest rates, prices for other electricity sources and even the makeup of regional electricity markets can affect the company’s overall business case.

Once a company concludes conditions are right for using a Combined License, the utility will give the NRC advance notice of its intent to start construction. The NRC will inspect construction activities and otherwise ensure the company meets relevant requirements for protecting the public.

Counting the Costs on Advanced Reactor Reviews

Anna Bradford, Chief
Advanced Reactors and Policy Branch
Office of New Reactors

We’re continuing to examine topics from the recent two-day public workshop we jointly hosted with the Department of Energy regarding non-light water reactor designs. One topic getting a lot of attention is the possible costs for NRC reviews of applications for these designs.

Last month’s workshop included presentations on the NRC’s experience licensing non-light water designs, as well as discussions of proposed advanced reactor designs.
Last month’s workshop included presentations on the NRC’s experience licensing non-light water designs, as well as discussions of proposed advanced reactor designs.

For instance, some people interpreted a DOE presentation on the Next Generation Nuclear Plant project as saying it costs $800 million to receive a final certification or license from the NRC. The bulk of that $800 million, however, falls outside of NRC fees and would be made up of the designer’s costs to develop and test its design to ensure that it works as planned.

In other words, the designer does not pay the NRC $800 million to review a reactor design. Looking at recent reviews of large light-water reactors, we see designers spent approximately $50 – $75 million for NRC fees to certify their designs.

A recent Government Accountability Office assessment, “Nuclear Reactors: Status and Challenges in Development and Deployment of New Commercial Concepts” says costs can be “…up to $1 billion to $2 billion, to design and certify or license the reactor design.” A different portion of the GAO report, however, pointed out most of these costs aren’t attributable to the NRC review. The largest part of the price tag would be research, development, and design work to develop and test a new reactor design.

We can also examine information from the public workshop on design development costs versus NRC review costs for the developer of a new small modular reactor design. The company said that of approximately $300 million in design investment to date, only $4 million of that amount (or slightly more than 1 percent) is from NRC fees for several years of pre-application interactions with the agency.

Here’s something to keep in mind: NRC review costs depend on the quality and maturity of the applicant’s information. The NRC always aims to efficiently and effectively review designs. Incomplete or inadequate information will very likely increase costs, however, since the NRC will spend more time and effort getting the data necessary to determine whether the reactor could operate safely and securely.

Everyone benefits from a common understanding of NRC costs as we discuss the next generation of reactor designs. The NRC’s website has more information on how the agency is approaching advanced and small modular reactor designs.