Renewing America Series: A Nuclear Energy Comeback?

Panelists discuss the future of nuclear energy in the United States and Europe, including arguments for and against the increased use of nuclear power and its broader implications for combatting climate change.

With its Renewing America initiative, CFR is evaluating nine critical domestic issues that shape the ability of the United States to navigate a demanding, competitive, and dangerous world. This project is made possible in part by the generous support of the Bernard and Irene Schwartz Foundation.

VICTOR: Great. Well, thank you very much, Anne. And thanks to the Council on Foreign Relations for having this session today that’s part of the Renewing America Series, a set of discussions around nine major topics, including energy and climate. And today we’re talking about a nuclear energy comeback. A lot of talk about nuclear energy playing a bigger role in the energy system here and abroad. We’ll have a chance to talk about those issues.

I’m David Victor. I’m a professor of public policy—innovation and public policy at UC-San Diego. I’m also at the Scripps Institution of Oceanography and a CFR member. And it’s really my pleasure to introduce our three panelists today, and then we’re going to get right into the discussion.

We have with us, in alphabetical order, Dan Brouillette, who is the fifteenth secretary of the Department of Energy and has had a distinguished career in Washington, both on the Hill with Energy and Commerce Committee at the House and also at the Department of Energy, and then in the private sector at Ford and a few other places, and is currently president of Sempra Infrastructure, which is a clean energy infrastructure company.

We have with us Mark Hibbs, who’s joining us from Germany. So I want to thank you for beaming in from across the pond, Mark. Who’s a nonresident senior fellow at the Carnegie Endowment for International Peace in the nuclear policy program. And before that, a very distinguished observer and chronicler of many issues around nuclear power, especially in Europe, including through the organization called the nuclear suppliers group, which is one of the most important organizations dealing with fissile material and nonproliferation issues as they intersect with the nuclear power industry.

And then, third, we have Allison Macfarlane, who is currently the director of the School of Public Policy and Global Affairs at the University of British Columbia, a new school and a new position. And prior to that extensive experience in American academic institutions, including in Stanford, where we worked closely together, and as former chair of the U.S. Nuclear Regulatory Commission from 2012 to 2014. It is hard to imagine a better panel to talk about these topics.

We’re going to spend thirty minutes with a fireside chat. I don’t know if CFR has a fire blazing on the screen for this, but we’ll have a fireside chat for about thirty minutes, and then we’re going to open it up to your comments and questions, questions more than comments, for the second half of today’s meeting. But what I want to do first is get started with a kind of level setting. Where are we? We’ve been talking in the United States about a nuclear renaissance for a couple of decades. Now we’re calling it a nuclear energy comeback. An awful lot of that goes back to legislation in the early 2000s. the energy policy act of 2005—and Dan was part of the team on the Hill that was designing the Energy Policy Act of 2005.

So I’m curious—maybe we’ll start with you, Dan and then Allison. Tell us about where we are in the United States with regard to the comeback in nuclear power.

BROUILLETTE: Well, David, first, thank you and thank the Council for having me today. I look forward to the conversation. I think it’s a very timely conversation for us to have. With regard to the work we did in 2003/2004/2005, which ultimately became the 2004 Energy Policy Act, I think it started, in some respects, this renaissance that we’re seeing today. I don’t know that it was as quickly as I would have hoped when we were writing the laws, but some of the things we did there, I think, are starting to bear fruit today. We look at things like smaller modular reactors, for instance, which are a pretty hot topic in the marketplace today. What we did back then was to reauthorize Price-Anderson in the ’05 Act. And part of that reauthorization was to allow this very new, conceptual ideas to take hold. And what we did was we allowed smaller modular reactors to be considered one reaction—one reactor, for purposes of consideration under Price-Anderson. It was a small step, but I think an important one to take.

We also spent a lot of time thinking about what might be possible with regard to fusion energy, and I recall that we authorized, I think, roughly a billion dollars or so in new research along the lines of fusion energy. And you just saw we were able to reach ignition at the Lawrence Livermore Lab out in California, part of the DOE complex, one of seventeen national laboratories. So I think we had, you know, a part to play. I do think that we are experiencing now a renaissance that’s partly due to the fact that the public seems to be very concerned about climate goals, climate change goals, and our ability to beat them. The reduction of carbon emissions, the reduction of other types of emissions are very, very important in the public’s mind. And we’re starting to see an acceptance of nuclear technologies that, candidly, didn’t exist twenty, thirty, forty years ago. So I’m excited about the comeback, if you will.

VICTOR: Let me go to you now, Allison. You saw the beginning. I guess, the renaissance—the real renaissance took longer than I think maybe people expected. So I think we’re still on schedule here. I was curious, you were at the Nuclear Regulatory Commission just as the renaissance was unfolding. How do you see this? Are you as optimistic as the picture that Dan’s set up for us?

MACFARLANE: I think, you know, how the nuclear comeback is doing probably depends on what your metrics are. If you metrics are media attention and government support, maybe even some public support—though I don’t know that we really have a good handle on that yet—yep, I think it’s doing quite well. If your metrics are actually a product to build and sell, we’re really not there yet and it may take a while before we get there. Because right now in the United States, we have one licensed—new licensed light-water small modular reactor design, the NuScale. And, interestingly, that’s not what the vendor who builds NuScale wants to build. They want to build a different model that needs to be licensed itself. And so that licensing process is just beginning.

The other kinds of advanced reactors, if you will—whether they’re molten salt, or high-temperature gas reactors, or sodium-cooled fast reactors—they’re much further behind. They’re still in the conceptual stage. We don’t have demonstrations yet. So there’s a ways to go, I would say. Like, decades.

VICTOR: Let me just try to round out the picture a little bit with what’s happening in Europe. And maybe I’ll just say a couple words here, which is: Seems like the U.S. industry, we’re talking now about potentially new reactor designs, small modular reactors, maybe at some point down the road fusion reactors, although the experiment in Livermore lasted for much less than a second, so we got to kind of go from there—and it cost $2.3 billion. We got to go from there to projects.

But meanwhile, we’ve got a lot of reactors here in the United States that are open, that are generating power. And by many metrics, they’re performing better than at any time in their lifetime. We still see every year a couple of those reactors closing, but that’s kind of a long, slow senescence of an industry, but an industry that’s still playing a significant role and is 20 percent of the U.S. electric power supply.

So I’m curious, Mark, you live in Germany. At some point in the next ten days, the German government will get up to its deadline of closing all of its reactors by the fifteenth of April. It seems like that’s a one-way road. And help us understand how permanent is that picture, and how grim is the outlook for nuclear reactors in Europe?

HIBBS: OK. Thank you, David. The situation here has been dominated by bad news for quite a while because different colleagues at the industry, particularly in France which is the leading nuclear country in Europe, has encountered—and we can go into that in some detail during the rest of the meeting—but in a nutshell, there’s been quite a bit of sobering news about nuclear power here. But in fact, I would argue that the European Union, which is providing the context for policymaking in this area, the European Union is setting up a situation where they’re going to have to support nuclear power investments for decades to come in order to succeed in attaining the policy goals that they have been setting for the last five or six years.

Why do I say that? The Paris agreement on climate change mitigation from 2015, which is a global arrangement, in recent years has been made into EU law. This Paris agreement is aspirational. It basically says, we want to see the world’s economies to be carbon neutral by 2050. And that is an aspiration. It’s a tall order. But in fact, what’s happened here in Europe is that the—moving that into the legal framework of the European Union has essentially established this aspiration as the legal basis for policymaking in this area. So it basically means there’s going to be greater intervention by the European Commission, which is the executive organ of the European Union, in the decisions that are made by member states in the choice of energy sources and technology and deployment over the next several decades.

Up until now, it’s well established that nuclear decision-making—decisions that were made about the choice of technology for electricity generation in general—whether it’s fossil, whether it’s renewables, whether it’s nuclear—that these decisions are made by national governments. That the European Union does not aspire to inject itself into those decisions. But in fact, because, in part, of the decision that they made to incorporate the Paris agreement into European law, and its aspirations, and the things that will be coming forward in the same area in the next several years, what we’re going to see is a change where the European Commission and member states together are going to be making the decisions on deployment and support for energy technologies that they’ve never made before.

They’re already doing this. There are areas where they have already begun to manipulate the mechanisms and arrangements for making policy in the European Union in the direction of Paris. They’ve started to define technologies that would qualify for support, subsidy by the European Union in the decades ahead, toward a goal of decarbonization by 2050. There is a thing here called Net Zero Platform, which is discussed by European governments in the same breath as the Infrastructure Act in the United States, which President Biden has pushed through, which in Europe is seen as a platform to move Europe toward a carbon-free economy, including in the electricity area. And that means there’s going to be electrical power, market reform. There’s going to be the definitions which are going to include nuclear technologies, which will establish them as likely to be basically supported and showcased by the European Union to get subsidies, to get political attention.

And so they’re doing this because, in the final analysis, the numbers are what they are. If you’ll allow me just for a minute, in Europe the situation is such that the European Commission is operating on the assumption that by 2050 the demand for electric power in Europe will double. At the same time, they’re looking at the past and they’re seeing that over the first thirty years of decarbonization, the European community has succeeded in eliminating only 20 percent of the carbon that they would have to eliminate to reach that 2050 target, as I mentioned. Which means that 80 percent of the work they’re going to have to do over the next thirty years. And they’re betting that without nuclear power, they won’t be able to do it.

VICTOR: So, on one hand, the conditions—and I think this really relates to something Dan said in passing at the beginning of his remarks. Which is you’ve got a lot of growing concern about climate. There’s no place in the world that’s doing more on climate than the European Union, at least reliably. That may change. And so you’ve got these conditions in place that in principle should be really good for nuclear power, and yet kind of hard to figure out how the pieces put together.

So I want to ask all three of you about the bigger international picture, and then I want to come back to the United States. The bigger international picture is, while we seem to have still a significant decline in reactors in Europe, a few new reactors being built—one in Finland at enormous expense, some in France a little bit, some in the U.K., over the horizon. Overall decline—you see a decline in the United States. Two new reactors being built by Southern Company. Maybe new technologies eventually. We’ll have to see how that—how that pans out. But you have a lot of concern about climate.

In the rest of the world, the picture seems to be totally different. There are, I think, more reactors under planning or construction in China than the rest of the world combined. There has been a nuclear reactor export industry that Russia has dominated, perhaps until recently when they voted themselves off the island for bad behavior in other domains. There’s one big project going on in Abu Dhabi that’s Korean designed. Enormous project west of Abu Dhabi on the Saudi border.

And so I’m just curious, maybe starting with you, Dan, help us understand whether we should—we, as Americans, should be worried about the fact that while we’ve got a lot of rectors here, the industry seems to be moving very rapidly to Asian-dominated, Chinese-dominated industry, including possibly for exports of reactors to the emerging economies.

BROUILLETTE: Yeah. Well, David, I think there should be some concern, because those technologies are a bit aging, if you will, for lack of a better way to describe it. And they carry with it the nonproliferation risk around the world. And that’s why I’m excited about some of the newer technologies that are coming online. Some of the advanced reactors, the fuels that they use, for instance, much more difficult, if not impossible, to make a warhead out of some of these fuels. And I think to the extent that we can continue to incentivize and encourage the development of those technologies, it serves America’s energy interest, but also our national security interest as well.

The newer companies that are coming online, with people like X-energy, TerraPower, you can go through the list, these are American-made companies. These are American-based companies. These are American innovations. So, I mean, to the extent that we can continue to encourage that, I think it serves our energy security goals very, very well. But with regard to, you know, what’s happening across the world today, I mean, we’re balancing environmental stewardship and environmental concern around the missions in 2030 and 2050 goals with the simple fact that policymakers and the citizenry around the world want the lights to stay on. And today, you know, one of the only ways that you can do that is with some form of baseload power. Renewable technologies are coming online very fast. I mean, obviously, they’ve taken a bigger share, if you will, of the energy portfolio, which is great because we need them to do that.

But the challenge, obviously, is that they cannot provide electricity 24/7. So I think that’s where nuclear power still continues to have a bit of a competitive advantage, at least with regard to their emissions profile. Because one way or the other, we’re going to provide that baseload power. It’s either going to be through a fossil fuel like natural gas, which is very clean to the extent it displaces coal, adds to our environmental success. Or it’s going to be nuclear power, which is on 24/7 as you know it. Or, perhaps, you know, at some point in the future—and, again, that’s probably decades away, to Allison’s point—we’ll see some battery technology that allows us to do long-duration grid-scale storage.

VICTOR: Let me to go to you first, Mark, and then I want to follow up with Allison. But help us understand on the European side. On the one hand, you laid out this picture where the conditions seem to be right for a lot of nuclear power because of the difficulty of getting to the carbon goals without nuclear power. And indeed, they redefined—the EU has redefined clean energy to include nuclear power, also to include gas in the aftermath of what happened in Ukraine, is happening in Ukraine, and with the Russian supply. But how important are the considerations that Dan raised about protection against leakage of fissile material, new designs that are even more secure about nonproliferation? Do those weigh heavily in the European debate? Or is the European debate really about carbon and how to get to carbon—big reductions in carbon?

HIBBS: Well, there’s concern in Europe about the future of the shape of the industry. This is a matter that besets people when they start to think about how much nuclear energy they want to actually build and new build, and where they want to do it. Essentially, the situation in Europe is such that, you know, since the 1980s, national industries in Europe in the nuclear area have been phased out. There were strong nuclear industries in Sweden, Switzerland, United Kingdom, Italy, Belgium, Germany, Netherlands. Most of that activity has been rolled back. And right now, France is the only nuclear turnkey vendor country in Europe.

The French are moving forward because they say, in line with what I mentioned before about the views of the European Commission, that between now and 2050 the French are going to need 60 percent more electricity than they’re consuming today. That’s in part to replace gas and oil. And so they’re planning on going forward with their nuclear energy program. French industry, according to plans that have been put forth by the French president within the last twelve months, are calling for the French industry to build between six and eight new big reactors, and then an additional fourteen. The construction of the first unit would begin around 2028, and it would continue to be constructed into the 2040s. So in this situation, it’s not clear to people how much capacity the French are going to be able to have to spare. If they’re going to go and export power reactors elsewhere, where would they have the know-how and the industrial capacity to do it?

And what we’ve seen—I mentioned, you know, some disappointing news in the nuclear area here in Europe the last several years, which has been dominated by difficulties the French have encountered in basically what appears to be assuring the safety and maintenance stability of the nuclear plants into the future. They’re now undergoing maintenance inspections at a deep level to allow them to be operated for a longer lifetimes. And they’re finding that they have to make repairs and take actions which require expertise and know-how that over the period of years where they’ve not been building reactors they’ve been losing it.

So there’s questions about the industrial memory in Europe ask to how much the Europeans could actually do. And, you know, you mentioned that already, David, the reactor projects at Flamanville in France and in Finland, which resulted in very considerable cost overruns and delays. The French industry says it’s getting its act together to be able to overcome these things, but, you know, there’s a number of issues here about whether the capacity will suffice. There are going to be projects abroad. You mentioned foreign investment or investment outside of Europe and the United States.

And I think it would be fair to say that there will be some, but on the other hand I think it would be fair to say that it’s understood that there are requirements for successful nuclear investment. And, you know, it’s axiomatic that basically if a country is interested in nuclear power and it doesn’t have the infrastructure and the resources to support it, to be safe, reliable, and commercially successful, then these investments aren’t going to happen.

When Fukushima happened in 2011, that was a—basically a warning to many of the countries in the developing world that were thinking about moving into this technology. And that has remained to be the case. I would argue that, you know, the axiomatic logic remains the same if you’re a developing country and you don’t have the required infrastructure to go forward, including financing. It still is the case that you’re not going to succeed. But the real question then is that if some of these—or, many of these developing countries become developed countries, then they could do it. There’s no reason why. The nuclear field will expand the more the countries outside of the establishments acquire the assets they need to be able to do this.

But, again, you know, the question is whether there’s going to be enough there there to be able to move into that area, particular when you look at the situation—you mentioned Russia and China. The Russians are making investments in parts of the developing world, places like Bangladesh, Turkey, Egypt. These are locations which until recently have considered to be too risky from a project risk point of view from most Western vendor companies. And we’ll have to see what happens. If they succeed, then the field will open up more. But if there are problems there, then there will be another retrenchment and vendors will be more careful about where they decide to build outside of their home markets.

VICTOR: And I think that’s indeed one of the reasons why this country needs to pay close attention to the export capabilities, because they have been so traditionally dominated by the Russians, with them supplying reactors and fuel cycle, and so on.

I know, Allison, you’ve done a lot of work on these questions, including with capacity training programs around the world. I want to ask you, though, just I’m mindful of the time here, I want to make sure we at least talk about the backend of the fuel cycle, so nuclear waste. People often say, yeah, nuclear power, lots of electricity, low carbon, zero carbon. But what do you do about the waste, the spent fuel? You spent a lot of time working on that issue. And it seems like the picture here in the United States is not great. Yucca Mountain is all but dead. You’ve yourself done a lot of work showing that that probably wasn’t the best place to do this. Meanwhile, other countries—Finland, Sweden, even Canada, where you live now—seem to be making progress in identifying politically sustainable ways to deal with spent nuclear fuel. So I’m just curious, what should we—help us understand. What should we expect here in the United States as an actual strategy for dealing with the nuclear waste problem? Or is this just one of those problems we’re not going to deal with?

MACFARLANE: So I’ll talk about that in just a second, but just a couple points on the previous point. Hinkley Point. Mark, you forgot about Hinkley Point, another failure for the French—or, at least, slow movement. And, David, to push back against you, I don’t think that nuclear moves quickly anywhere. So I don’t think you’re seeing a completely different, rapid change in the rest of the world. Please don’t anybody out there think that nuclear is being built a lot anywhere, except maybe China. And a lot for nuclear is a few plants. It’s not hundreds of plants. So we need to have this in perspective.

And the other point that’s really important to make is that a number of the advanced reactor designs pose a much greater risk of proliferation of nuclear weapons than our existing light-water reactors. Our existing light-water reactors are much safer, in terms of nuclear proliferation threats, than a number of the advanced reactors. But that’s another topic.

Onto nuclear waste. Yes, David, the U.S. is now the poster child for how not to succeed in siting a nuclear waste repository, which is kind of sad because the U.S. was the leader for a long time in how to move forward. And am I optimistic that things will change anytime soon? Not really. As you point out, a number of other countries have already selected sites. Finland is already constructing their repository for their spent nuclear fuel. Sweden has selected its site. It’s been approved. They’re going to be constructing soon. Canada’s down to two. They’re going to select their site in 2024. France has selected a site already. As you can tell, lots of other countries making progress.

To move forward in the U.S., we need some significant structural changes, I would say. They include—and this is nothing new. The blue-ribbon commission said this in 2012, and a number of studies since have reiterated, the U.S. needs a functional implementor to manage the waste. The Department of Energy, sorry, with due respect, Dan, is not the place that should be doing this, for multiple reasons, including the fact that there’s a constantly changing guard at the Department of Energy and it’s really subject to political whims, with the different political appointees. So we need a new implementor.

We need a consent-based siting process. We need to fix the financing. That is a complete mess right now, and I’m happy to talk about it in detail. And, as you well know, David, having been deeply involved in this yourself, we now in the United States have 88,000 metric tons of spent fuel at seventy-seven sites in thirty-five states. So it affects most of us in the United States in some way, shape, or form. And leaving it where it is is absolutely not a solution. That’s a recipe for disaster in the future. So we do have to take responsibility for this material and move forward.

We can. There is a model in the United States of success. The Waste Isolation Pilot Project in Southeastern New Mexico is the only deep geologic repository in the world that’s operating for nuclear waste. Now, this waste is specific waste. It’s waste—intermediate-level waste from the nuclear weapons complex. Nonetheless, it is a success and it is a model for how to move forward.

VICTOR: Yeah, well, that’s—and just very quickly, Allison, then I’m going to ask one more question to Dan before we go to the open questions. There’s been a lot of noise on the Hill about potential bipartisan legislation that would change some of the laws in the country, the Nuclear Waste Policy Act of 1982, that would make it possible to have interim storage, for example, while reopening permanent storage. It seems like this is something Republicans and Democrats might be able to agree on—one of those rare things. I’m not sure Republicans and Democrats agree today is Wednesday. So I’m curious as to whether you see it so optimistically or even when it comes to congressional action on this topic. It seems like all of us have a collective interest in doing something about the nuclear waste problem. Do you see that as moving soon?

BROUILLETTE: I hope so. I really do. I do think—I’m more optimistic, perhaps, than Allison is that we can solve the problem of waste or interim storage. There’s a couple things you can do real quickly. I understand we want to get to questions, so I’m not going to belabor the point too much. But you could have the Department of Energy, who just received an enormous amount of money from the U.S. Congress under several pieces of legislation, perhaps put out a funding opportunity request to all the states and let them decide on their own whether or not they want to take on this project of interim storage. Senator Cortez Masto has been very eloquent in her desire for a consent-based process. And I know that that was part of the blue-ribbon commission as well.

Put it out there and let the governors decide. Let the people of individual states decide whether or not they want to store this in their backyard. Because when we talk about, you know, things like nuclear waste we tend to put it in terms that perhaps the public doesn’t understand. Yes, there are many, many metric tons of nuclear waste. But it still fits on one football field, approximately twenty to forty feet high. We’re not talking about enormous amounts of material spread out all around the world. Very small amounts, and we can consolidate it and put it in one place.

You know, and I would just add to Allison’s comments, yes, WIPP has been successful. And that is a different type of waste, obviously. But there is another example as well. And that’s the Naval Reactor Program, which is run, in part, by the U.S. Department of Energy. And, you know, we store those reactors that have been on the ships and in the submarines, I think, very effectively. And perhaps there is a model that we can use going forward as we think about nuclear waste.

VICTOR: Let me just—and, by the way, for all the listeners, this blue-ribbon commission that everyone’s talking about is a 2012 commission that Lee Hamilton and Brent Scowcroft co-chaired. Allison was a member of the commission and laid out a very thoughtful strategy for how to deal with spent nuclear fuel, you know, to keep perspective on it, and so on. And, Dan, the model that you laid out of, you know, request for proposals and so on is, I think, more or less the Canadian model. That’s what Canada’s done. There’s a couple dozen different communities that were competing, basically, for the right to host this. Now they’re down—as Allison says—down to two.

Let me just quickly get your reactions to that, Allison. I’m going to ask you one more question briefly, Dan. Allison.

MACFARLANE: We’ve sort of been down that road before with the request for proposals, and it didn’t work. The reason—the 1982 act was actually a good one. It got turned sideways in 1987 with the amendments. And so I’m wondering if what might work better in the U.S. is more of a Swedish model, where we approach—the implementor, whoever that is—not the Department of Energy—approaches communities that are already comfortable with nuclear facilities, which is what led to success in Sweden. I’m not sure that a volunteer system will work, but you could do both. Why be exclusionary? But I think we need to be—to be thinking pretty creatively about how to move forward.

The question I always have is, does anybody really have true impetus to move forward? And it seems to me, the only folks who really, really want to move forward are those who are hosting shutdown and decommissioning reactors.

VICTOR: Yeah. And I will say that as someone who chairs a panel at San Onofre in Southern California, which is a community that’s surrounding a nuclear reactor that’s now shut down, we have keen interest in that and we’re now hoping to mobilize some of the other communities and get them focused.

I’m going to ask one last quick question to you, Dan. It seems like you’re in a very special position to be able to talk about the new reactor technologies. And we talked about them, everybody’s talked about them in different ways, and a range of views. But, you know, we’re investing in them.

And I’m curious, since you are president of an infrastructure company that in the future will be in the position to be able to build these reactors, along with other kinds of community energy infrastructure, help us understand when the small modular reactors and other kinds of new designs, when are they commercially relevant to a company like yours? We’re seeing, you know, a few projects move forward. Allison mentioned NuScale project, a handful of others. Interesting design by GE, by Rolls Royce, a bunch of others. But it’s all kind of up in the air right now. And I’m curious, help us understand, Dan, from your perspective, what the timetable would be for this becoming relevant to community infrastructure in the United States.

BROUILLETTE: Yeah. Well, I don’t know that I have a specific answer or a precise answer for you on timetable. It’s very difficult to predict. But I can tell you, there’s a lot of interest in these smaller reactors for the possibility that they provide to do self-generation, for instance, at an LNG facility like ours in Port Arthur, Texas, or in Cameron Parish, Louisiana. We’re all working to provide the greenest molecules that we can possibly provide in the marketplace.

One of the things that we’ve done at our Cameron facility is file for permits at the FERC—Federal Energy Regulatory Commission—to utilize electric drives, for instance. Rather than using some of the gas that’s coming into the facility to drive the turbines, we’re going to use electric drives. So that places is an enormous load on the grid in that state in Louisiana. So, to the extent that we can work with small, modular reactor providers or designers, and work, obviously, with the utility there to provide carbon-free power to that facility, it allows us to put an even greener molecule into the marketplace. We just saw some announcements, for instance, big industrial companies and chemical companies, like Dow Chemical, announced a partnership with X-energy.

These heavy industrial users, I think, there is a play there for these smaller reactors. And, you know, while I don’t have an exact timetable, I do think within the next decade we will start to see more and more of that activity come to the marketplace.

VICTOR: Perfect. Thank you very much.

So I want to now bring in the Council members who are with us with questions. I’m going to give the floor back to Anne, who’s going to give you instructions. We’re going to have brief questions, brief answers, and hopefully we’ll get through as many questions as possible.

Anne, help us understand what we do next.

OPERATOR: (Gives queuing instructions.)

We will take our first question from David Ensor.

Q: Thank you. Hello. David Ensor. I consult for General Electric, Hitachi and Synthos Green Energy of Poland, which are in partnership working towards building small modular reactors in southern Poland and throughout Central Europe.

And I’d like the panel to focus a little more on SMRs. To us, they appear to be, you know, right for purpose for a lot of what Europe needs in terms of getting rid of coal usage. They’re smaller. They’re cheaper. They are arguably safer. Why are they—if they are the answer, great. Please say so. But if they’re not really the answer, what are the—what are the downside risks or concerns that panelists have about them?

VICTOR: Let me put that first to Mark, and I know Allison wants to say something about this. But maybe, Mark, help us understand. You laid out a building program that the French are going to do, which are big reactors. But what David Ensor is talking about is the opposite, smaller reactors in, frankly, markets that haven’t had reactors so far. Does that seem viable to you? And how will that land in Europe?

HIBBS: All right. Basically, I had a conversation with the people from the nuclear industry in Europe—European nuclear industry firms—back about a year ago. And they were looking at what to do about meeting this target challenge of eliminating all this carbon. And at least until a year ago—I was very convinced from this conversation that Europe’s nuclear power industry was not very interested in SMRs. They looked at the situation, the Commission—the European Commission told them how much carbon they were going to have to cut, and they looked at how much nuclear capacity the Europeans are going to lose.

If you look at the existing fleet in Europe, you’ve got a lot of reactors online. There’s a hundred reactors in Europe. Most of those were built quite a long time ago. And it basically means that between 2030 and 2040, the Commission was warning people that they would lose half their existing nuclear capacity if they didn’t extend their lifetimes and replace those units. And as a result of that, the industry, in my view, has been very, very best by replacing all of that capacity. So they’re looking at big reactors. And I think that really until only recently did the industry really get interested in SMRs. I was told a year ago that for many, many applications SMRs in Europe, because of this daunting challenge, were basically a niche market.

What I’ve since heard is that things are in flux. As I mentioned before, the European Commission has set up this Platform for Net Zero, net zero carbon. And this is an industrial policy platform which basically is going to reward certain technologies. And they made a decision, at least preliminary decision, not to identify existing big reactors—light-water reactors, the type that we are familiar with in Europe—not to identify that technology as strategic. But they did decide that SMRs and other advanced reactors that are on the drawing board would be strategic technologies.

And with the prospect that this technology would be favored by the European Union, what I’m seeing in the last several, say, six months to a year is more interest on the part of industrial firms in Europe to move into this territory and try to find a way of doing it. So there is an interest, but it’s growing, but it’s only begun.

VICTOR: So, I mean, that I think would be encouraging to David and sort of ask the question. And I think we know Dan’s answer to this question, because he gave it to us right before the break, which is these—the properties, the small size, high-power density and so on is very attractive. Allison, did you want to say something on this before we go to the next question?

MACFARLANE: Yeah. I mean, I guess my point is that it depends on how quickly you want to address the climate problem. Because these, for the most part, aren’t going to be available in any big way for decades. Now, maybe NuScale will get the new one licensed and so you’ll have at least that available. But I think it’s going to be a while. And the other big question mark, and therefore risk for investors, is you don’t know how much it’s going to cost. Vendors have—they throw out numbers. The numbers are largely irrelevant.

They’re highly uncertain because you don’t know how things are going to go. They appeal to modular construction in a factory, but we’ve actually seen modular construction in a factory with the Westinghouse’s AP1000. That’s now just being connected to the grid in Georgia. That did not go well. That is not a story of success. That’s a story of how Westinghouse went bankrupt, actually. So, you know. And then there are questions about can these reactors actually meet the electricity needs? Do they—can do they do load falling well enough, which is what is really needed now?

VICTOR: Yeah, no, just for the audience, load falling is where the reactor goes up and down during the day. This is actually one of the challenges that is besetting the French reactors right now, is there’s a lot of renewables interconnected with the French grid, and the reactors are being used in ways they were not originally designed, which has created all kinds of maintenance troubles. It’s one of the reasons the load factors on the French reactors are much lower than they should be.

Anne, let’s go back to you and get our next question.

OPERATOR: We will take our next question from Jared Chaffee.

Q: Yeah, thank you. Jared Chafee from Morgan Stanley. But also ex-submarine officer and product of the Navy Nuclear Power Program.

And so my question is more from an operational perspective. So when I think about developing nations—(coughs)—excuse me—building these power programs from scratch, do you see any resourcing challenges with licensing and training and now a team of people—you know, a brand-new team of people to actually operate these reactors? Or is the industry so slow moving that you have time to get these teams of people ready before the reactor’s actually online? Just curious for the panel’s thoughts on that.

VICTOR: Yeah. I think it’s going to be a huge challenge. The industry does have a lot of resources to help. I sit on an advisory board of an organization called INPO which was set up after Three Mile Island to oversee the safety of all the U.S. commercial reactors. There is an international version of that called WANO, which helps assure, frankly, higher levels of safety and liability in the fleet than would be otherwise. But I’m curious. Mark, did you want to say something very briefly on this, because I want to make sure we have time for—

HIBBS: Yeah, I mean, look, in the United States, this I do know, when the U.S. government begins a foreign nuclear project, it does this on the basis of making sure that there’s a lot of inputs that go into it from a lot of different people, to make sure that the country that takes the technology and builds the reactors and plants and operating these is going to be in the position to do that. So that, combined with activities at the INPO, activities at WANO, activities at the International Atomic Energy Agency, where the United States government is plugged in, they work 24/7 when they have a project to make sure that the operators are going to be able to do it, that the infrastructure there, and the maintenance people, and so on.

So, you know, when you start up the reactor, there is a long learning curve and a long startup period. And that’s not too much of a problem. I mean, there is a resource problem, but it’s not focused on any one problem—any one project. It’s whether there’s going to be enough of this expertise to go around. If there’s truly going to be a large number of reactors that are ordered and under construction, whether there’s enough of that expertise to support a sustainable program.

VICTOR: Let’s get another question. I just want to—Dan, did you want to say something? Dan and Allison, do you want to say something very briefly on this?

BROUILLETTE: I was just going to say, look, I think over the last twenty years or so we’ve lost quite a bit of talent in the nuclear field. We look at the nuclear engineering programs in the universities, and the pipeline has been pretty thin. But my son—thank you, sir, for your service. My son is also an instructor in the U.S. Navy down at the Nuclear Power School. And he tells me that the line is pretty long to get into that program. As long as we can continue those types of programs, we’ll be able to provide the engineers the operating talent, if you will, for this industry.

VICTOR: Yeah, for a modest scale up. I think the radical visions maybe have a different story.

Anne, next question, please?

OPERATOR: We will take our next question from Jeff Merrifield.

Q: Thank you very much. Jeff Merrifield, Pillsbury law firm, former commissioner of the U.S. Nuclear Regulatory Commission for almost nine years.

Dan, a couple of—a couple of real quick questions to you. You know, people do raise questions about the safety of used nuclear fuel. But my understanding is, you know, DOE and ensuring counterparts have done a great job protecting those. There’s not been a single person ever killed or injured from the civilian storage of used fuels. So I would think—like your thoughts on that track record.

And also, as an industry the utilities put about a thousand gigawatts of combined-cycle and simple-cycle plants in over about a decade. What can we learn from that, from modular construction and the fact that these small modular reactors will be much smaller and won’t have the same difficulties as, perhaps, the gigawatt-sized reactors that we have had previously?

VICTOR: OK. I think that goes to you, Dan, but then I want to ask Allison for her view. But Dan, first, can you—

BROUILLETTE: Sure. Yeah, no, absolutely.

I agree with you. There has been, I think, a very commendable track record for the industry as well as for the government agencies that are involved with storage. I think as we look down the road, as we develop even more safe fuels, that record only gets even better. It’s already stellar in my view, but it only gets better. So I feel very confident about the safety concerns that have been raised around the industry. I have no concerns, you know, really at this point about some of the newer fuels that I’ve seen.

You know, with regard to the modular construction, I think we already have a couple models in place. I mean, the industry that I’m in today, developing LNG export facilities, many of the manufacturers have moved to modular construction. Those are on time, they’re on budget, they’re very efficient, and I think the nuclear industry could serve itself very well by spending time with us.

There is a way to do this. We can do this. We can do it safely. We can do it effectively. More importantly, we can do it very efficiently and cost effectively, which is what the industry needs to do in order to get the price per kilowatt-hour they’re producing electricity onto the grid—we need to get it down.

VICTOR: Allison, did you want to say anything?

MACFARLANE: Yeah. I mean, I just—I think we should be cautious about modular construction. I would be—was wishing the nuclear industry would be paying more attention to what happened in the construction of the AP1000 and really trying to draw serious lessons learned from how not to do what Westinghouse and, as you well know, Jeff, its predecessor companies that ran the Lake Charles, Louisiana, plant where the modules were built, and not built well, and had to be rewelded continuously for many years. So I think there are still lots of lessons that need to be learned and internalized, and I don’t see that happening yet.

VICTOR: And I think, if I can just connect the dots here, clearly difference of views, but also one of the ways to connect the dots here is they only built two AP1000s, right? (Laughter.)

MACFARLANE: They were supposed to build four.

VICTOR: Right, I know. But they were—

MACFARLANE: In the U.S. There were some built in China.

VICTOR: But I mean, clearly, the promise here—we see the reality—is that you’re going to build a lot of them, the small modular reactors, and it really will become modular. But we—that’s a hypothesis, not yet a reality, and—

MACFARLANE: Yes. Correct.

BROUILLETTE: Well, but, David, I would slightly disagree. I mean, it’s more than a hypothesis. We’ve built many, many small modular reactors; they’re called submarines. We have them all over the world. They’re very safe. The Navy has an incredible record not only of performance, but of safety.

We ought to do this. And I think if we’re allowed to do it, if the regulatory regimes and whatnot will allow some of this, if the financing could come along, we can scale this up to a place where it really makes some sense not only for America, but for the rest of the world.

VICTOR: Bear with me, Mark. I want to get another question or two in. But just, Anne, back you again, another question. I know we’ve got a big queue. We’re not going to get through everybody, so my apologies in advance.

OPERATOR: We will take our next question from Albert Carnesale.

VICTOR: Al, the floor is yours.

OPERATOR: Mr. Carnesale, please accept the unmute now prompt. (Pause.) Looks like we’re having difficulties with that line.

We’ll take our next question from Adam Silverschotz.

Q: Thank you.

I’d love to hear the panel’s thoughts on what comes next, you know, after this whole debate on the small reactors, namely commercial fusion. There seems to be kind of an increasing pace both on the, you know, privately-funded company side in terms of the proof points—you know, whether the approach like what Commonwealth has taken or the approach that Helion is taking—as well as from the policy side in terms of starting to put together kind of a regulatory infrastructure, licensing process, you know, thought leadership from the government side, whether it’s the GAO report that came out last week or, you know, the different various panels and statements from the White House last year. And you know, this has clearly been an industry that’s always been ten years in the future, but I’m wondering if we’re finally at the kind of, like, last ten years before it’s like really real and what everyone sees, you know, as any kind of potential transformative impact from, you know, tokamaks being all over the world in fifteen years and obviating a lot of the arguments that we’re having now.

VICTOR: And let me just say, Adam, that it was always thirty years in the future, so now that it’s only ten years in the future, as always, is progress. And for our listeners, also, Commonwealth is Commonwealth Fusion. This is a spinoff of MIT, a Massachusetts-based fusion company. So-called tokamaks is magnetic confinement. Helion is a Washington-based company. And then the experiment that Dan mentioned earlier at Livermore is using lasers as a confinement mechanism, a different way of doing fusion. But lots of interesting ideas.

I don’t know if, Allison or Dan, you want to comment on—Allison, you want to talk about fusion?

MACFARLANE: Sure. I think that there are many similar questions that apply to fusion as apply to some of the advanced nuclear designs about how much the energy system would actually cost. Those are really, really uncertain. And I think fusion is still further behind fission, so what we’ve been mostly talking about today, and I don’t think it’s ten years in the future. I think it’s still decades, maybe even approaching four or five decades, into the future.

It’s going to take quite a leap to get to the point where you are producing much more energy out than you have put in, and what happened at the Livermore Lab with achieving ignition was certainly not that. They still put a hell of a lot more energy in than they got out.

VICTOR: I’m going to try and go back to Al Carnesale. Maybe, Anne, if you could get—see if we can get Al Carnesale’s question, and we’ll get one more question, and see if we have the lightning round of comments in the end. Al, the floor is yours.

Q: OK. Can you hear me now?

VICTOR: Yes, loud and clear.

Q: OK. Al Carnesale. I’m at UCLA. I, too, was, with Allison, a member of the blue-ribbon commission.

I want to address the question of economics. It seems to me that when people ask why aren’t there more nuclear power plants, the first answer from people in the electric power field is it costs more than does, for example, gas. And while climate change may be a very good reason for doing it, people don’t seem to be willing to pay a lot more for anything because of the threat of climate change.

So I’d like to hear a little more about the economics of nuclear power as it compares to gas, because we can no longer use the argument about security of supply. We’ve got lots of gas. We’re trying to sell it all over the place. We can’t use for modular construction that it’s efficient. The question is: Does it cost less than producing the same amount of power with large nuclear reactors, yet alone compared to gas? Using the Navy as an example is good for safety, bad for economics. Naval reactors are not famous for being cheap, nor is operating them famous for being cheap.

And finally, we have the problem with small modular reactors if we don’t have a place to put the waste and we have more places in the country that are going to have waste at them that we have to worry about.

So given—oh, by the way, and the question that it would be cheaper to produce them modularly rather than build large reactors, that’s been around for twenty years with no evidence that it’s true other than to show that there are some things that can be produced modularly that cost less. Well, that’s certainly true—and there are some that would cost more; that’s also certainly—so I’ll quit there. About the economics.

VICTOR: So a lot of rich content there, as is always the case, Al, when you ask questions.

We’ve got four minutes left, and so I’m going to just ask each of our panelists to say one minute. It’s a good way to end, to talk about the economics of the overall picture.

And let me just constrain the question a little bit. Let’s talk about new build. Clearly, the economics of an existing reactor, keeping it open, often are a lot more attractive than the question of building a new one. So let’s focus on the question of building new reactors.

One minute to you, Mark, and then I’ll go to Allison and Dan.

HIBBS: OK. The investment cost is not something which has been on the radar screen very much here because they’ve not been doing a lot of investing. There’s a shift toward refurbishing and extending the lifetimes of additional—of existing reactors. That’s seen as a cheaper way of going forward, at least in the short term.

Most of the attention to cost in Europe has been about eliminating the volatility in prices of the power that’s generated because that’s where the consumers are feeling it. There’s been very little attention here in Europe to getting the cost of the reactors down. If you look at the cost of the reactors, they’ve been increasing. And that has not been on the radar screen at the European Union, where the policy decisions are made.

VICTOR: OK. Thank you very much for that. I guess it’s easy to not pay attention to cost if you’re not building things. (Laughs.) That’s kind of the Catch-22 here, or chicken-and-egg, or whatever the metaphor is.

Allison, to you. One minute.

MACFARLANE: Yeah. Economics is always the Achilles’ heel of nuclear. It has been for decades. It will continue to be for decades. It will be the sticking point. The U.S. electricity market is set up right now to disadvantage nuclear because it is more expensive. It is—it values only price instead of valuing other aspects of the power that aren’t valued, like it being on twenty-four hours a day. That actually works against existing nuclear.

And third, the new advanced designs—seeing how you wanted to talk about those—all require, for the most part—except the light-water ones—all require different fuel that requires much higher enrichment, which will be more expensive. And it doesn’t exist yet. We can’t do that yet. So, again, there’s lots of factors that are going to make these new designs much more expensive. I don’t see it getting cheaper.

VICTOR: And I think a thread through your remarks, Allison, is that, you know, in the real world putting these projects together can often be a lot more complicated. And I think we haven’t had a chance today to talk about the fuel issue, but I know there’s a lot of concern about the HALEU fuel—special fuel—including removing the Russian supply from that fuel supply before putting it in advanced reactors.

MACFARLANE: Yes.

VICTOR: Dan, a minute to you and then I’m going to say one word at the end.

BROUILLETTE: Well, I don’t disagree. I mean, it was a long question and a broad question. Economics do matter. And I think, you know, if we look back at the history of energy production, you’ll see those challenges with every form of energy. Solar and wind were very expensive when they very first came onto the marketplace. Government policy, in some cases just scaling reduced the cost of those projects, reduced the cost of that electricity generation. I think if we allow it to go forward, advanced nuclear reactors, smaller modular reactors have the same opportunity that both solar and wind had call it thirty years ago, forty years ago. It will be a combination of the industry making itself more efficient and a combination of governmental policy that allows these things to scale up effectively, which will reduce the cost.

VICTOR: It’s a great question that’s been in front of us today. Because of climate and also, frankly, because of the concerns about Russian gas supply—particularly acute in Europe but not exclusively to Europe—to Europe—the question about nuclear is, you know, once again back on the table. The really important questions and concerns about what to do about the spent fuel, some possible solutions but they’re not trivial to implement. Some really big questions, also, for this country in the spirit of the Renewing America Series, not only about where we get our electricity but also how we build industries here in this country that are sustaining and can be sustained.

Hard to imagine a better panel to talk about this. So I think the Council thanks Dan Brouillette, Mark Hibbs, and Allison Macfarlane. And thanks to all you members who were with us this afternoon for this terrific discussion. And be safe.

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