Summary of Hearings on Nuclear Energy Policy (9-25-06)

  • September 19, 2006: Senate Committee on Foreign Relations, Hearing on "Responding to Iran's Nuclear Ambitions: Next Steps"
  • September 20, 2006: House Committee on Government Reform Subcommittee on Energy and Resources, Hearing on the Next Generation Nuclear Plant and Hydrogen Production.
  • September 14, 2006: Senate Committee on Appropriations Subcommittee on Energy and Water, Hearing on the Global Nuclear Energy Partnership (GNEP).
  • July 18, 2006: Senate Energy and Natural Resources Committee Hearing on U.S. - India Energy Cooperation
  • June 29, 2006: Senate Committee on Foreign Relations, mark-up of S. 2429, "To authorize the president to waive the application of certain requirements under the Atomic Energy Act of 1954 with respect to India."
  • June 27, 2006: House Committee on International Relations, mark-up of H.R. 5682, "To exempt from certain requirements of the Atomic Energy Act of 1954 a proposed nuclear agreement for cooperation with India."
  • June 21, 2006: Senate Environment and Public Works Committee, Subcommittee on Government Reform hearing on "Regulatory Processes for new and Existing Nuclear Plants"
  • May 25, 2006: Senate Energy and Natural Resources Committee, hearing on "Nuclear Power Plant"


Senate Committee on Foreign Relations
Hearing on "Responding to Iran's Nuclear Ambitions: Next Steps"

September 19, 2006

Panel I
The Honorable R. Nicholas Burns, Under Secretary for Political Affairs, Department of State

Panel II
Dr. Ray Takeyh, Senior Fellow for Middle Eastern Studies, Council on Foreign Relations
The Honorable Ashton B. Carter, Co-Director, Preventive Defense Project, Belfer Center for Science and International Affairs
The Honorable Martin S. Indyk, Director, Saban Center for Middle East Policy, The Brooklings Institution

After repeated attempts by the International Atomic Energy Agency (IAEA) to negotiate a cessation of nuclear arms development in Iran, the nation continues on its prescribed path to nuclear enrichment. In July and August, the Permanent Five (P-5) of the United Nations Security Council (UNSC) for the IAEA offered Iran an "incentive package" in exchange for a halt in nuclear weapons advancement. When Iran continued its nuclear program and did not respond to negotiation attempts, the UNSC adopted Resolution 1696 that required Iran to suspend all of its enrichment and reprocessing activities by August 31, 2006 or face sanctions. Iran finally responded on August 22 with a vague document which failed to address earlier attempts at negotiation and did not take any stance on the issue. Due to evidence that Iran has not halted nuclear arms development, sanctions will be passed according to UNSC Resolution 1696, Chapter 7, Article 41. The Senate Committee on Foreign Relations met on September 18 to discuss the nature and course of response strategies to Iranian nuclear ambitions.

Chairman Dick Lugar (R-IN) illustrated the "clear interest in preventing such an Iranian capability" echoing former Secretary of State Henry Kissinger who said, "Everything returns to the challenge of Iran." Lugar pointed to Iran's backing of terrorist regimes Hezbollah and Iraqi insurgents, as well as its continued nuclear enrichment program. In dealing with the situation, he discouraged a unilateral approach in which economic sanctions would target any foreign companies investing in Iran. Instead, Lugar called for "a more potent multilateral approach to Iran" in which "we should not take steps that undermine our prospects for garnering international support."

Ranking Member Joseph R. Biden, Jr. (D-DE) said, "We have to nuance here." He discouraged the use of "absolutes" when dealing with Iran. Although he agreed that the situation called for immediate action, a "take 'em out right now" method will not work in his opinion. Biden illustrated the difficulty in getting a nation to negotiate when it disagrees with the only approach the other party is wiling to offer.

Senator Chuck Hagel (R-NE) echoed Biden's concerns, declaring that Iran presents "the consummate example of what we did wrong in Iraq." He noted the dire need for a better comprehension of history and tribal distinctions "before we put ourselves in a corner and can't get out." Senator Russell D. Feingold (D-WI) also supported the need for calculated action and stated, "No option should be ruled out."

R. Nicholas Burns, Under Secretary for Political Affairs in the State Department, testified in the first witness panel to the 27 years of abysmal US-Iran diplomatic relations. Burns stated that recently Iran has begun a new course of aggression led by the nation's President Ahmadi-Nejad. "At home, Tehran renewed its campaign against journalists, intellectuals, and democratic activists, as President Ahmadi-Nejad tried to turn back the clock and re-impose the obsolete orthodoxies of Iran's revolution."

Burns called for international diplomacy in this situation. He outlined a year-long effort to build a coalition of the P-5, US, Britain, France, Russia, and China, as well as Germany to support IAEA inspections and suspension of enrichment activities. India, Egypt, Japan, Australia, and Brazil have also joined the coalition in pressuring Iran to meet its IAEA obligations. Burns hoped that during the upcoming UN Assembly meeting in New York, Iran might cooperate and come to the negotiation table. Secretary of State Condoleezza Rice and President Bush are prepared to begin negotiations if Iran is willing.

Three experts on Iranian nuclear policies Dr. Ray Takeyh, senior fellow for Middle Eastern studies on the Council on Foreign Relations, Ashton B. Carter, co-director of the Preventive Defense Project at the Belfer Center for Science and International Affairs, and Martin S. Indyk, director of Saban Center for Middle East Policy testified on the hearing's second panel. Dr. Takehy pointed to "India as a model for aspiring nuclear power" in which US repaired relations with India and is working on a civilian nuclear pact between the countries. Dr. Takehy called for the use of pragmatism.

Carter, responsible for designing "Plan B," to be used if diplomacy fails, noted the importance of not acting preemptively. Carter reported that Iran's known nuclear plan is 7 years away from development and its unknown plan is even slower. "There is time to let diplomacy take its course," he cautioned. "Plan B" entails three parts: first, direct contacts between Iran and the US, second, coercion to obtain objectives and third, a prescription of what the US will need to do if Iran succeeds.

Indyk seemed skeptical there was any hope that Iran would negotiate with Secretary Condeleeza Rice. Given that the former and more moderate Iranian President Khatami did not allow any negotiations to take place during his term in office, Indyk highly doubted that the US would have more luck with reactionary Ahmadi-Nejad. Also, the US and Iran have not met in almost thirty years which makes US familiarity and comprehension of Iran nearly impossible. Furthermore, Indyk disagreed with Burns' assertion that a framework for international diplomacy exists. Though Europe has "talked a good game" about imposing sanctions with, or without, Resolution 1696, Indyk said that our allies are clinging to Iran's ambiguous response of August 22 to avoid living up to UN resolutions.

For full testimony of this hearing click here.



House Committee on Government Reform
Subcommittee on Energy and Resources

"The Next Generation Nuclear Plant and Hydrogen Production: A Critical Status Report."

September 20, 2006

Mr. Jim Wells, Director, Natural Resources and the Environment, Government Accountability Office
Mr. Phil Hildebrandt, Idaho National Laboratory, Special Assistant to the Laboratory Director
Dr. Andrew Kadak, Professor, Nuclear Science and Engineering Department, Massachusetts Institute of Technology

The House Committee on Government Reform's Subcommittee on Energy and Resources held a hearing to correspond with the release of a Government Accountability Office (GAO) report on the development of the Next Generation Nuclear Plant (NEXTGEN or more commonly known as NextGen). The report was prepared at the request of Subcommittee Chairman Darrell Issa (R - CA), due to his concern that the Department of Energy would be unable to complete the project on time and within its budget. NEXTGEN was originally envisioned to meet two broad objectives: first, to develop a commercially-viable advanced nuclear prototype facility that would help satiate the nation's growing thirst for electricity; second, as a key component of the Administration's National Hydrogen Fuel Initiative. NextGen would efficiently produce large quantities of hydrogen for use in the transportation sector at a relatively low cost. The program, which is mandated to be complete by 2021, is being led by the Idaho National Laboratory and will cost an estimated $2.4 billion between 2006 and 2021.

Chairman Issa focused on two challenges facing NextGen. First, DOE's schedule may be too slow to be of use to the private sector. Even if NextGen is operational by September 30, 2021 as scheduled, other technologies developed more quickly may have already attracted industry investment away from the NextGen technologies. Such investments typically require at least a 40 to 50 year commitment (i.e., the lifespan of a nuclear plant), and therefore even if NextGen's technology is superior, it would come too late for private investors. The second concern is that NextGen is competing for funding with three other major DOE undertakings: the Global Nuclear Energy Partnership (GNEP), the Nuclear 2010 Program, and the Yucca Mountain Waste Repository. Unless NextGen produces results more rapidly than anticipated, it is likely to be eclipsed by these other programs.

Ranking Member Diane E. Watson (D - CA) expressed concern that the 2021 deadline could even be met. She compared the need to stay on schedule and on budget to the plight of the taxpayer who must pay by April 15 or face consequences. Representative Dennis Kucinich (D - OH) was indignant that promoting a hydrogen economy has become wrapped up in nuclear energy. Replacing petroleum with hydrogen will result in cleaner air and freedom from foreign oil, but producing that hydrogen with nuclear technology is "antithetical." We cannot trust the Nuclear Regulatory Committee (NRC) to protect American citizens when their health and safety is in conflict with industry's profit margin, and instead should turn to renewable sources of energy for hydrogen production, he argued. Chairman Issa agreed that in the long run, we should look to renewables for all of our energy generation.

Mr. Wells summarized the findings of the GAO report on DOE's progress. While they had met their stated goals thus far, Wells expressed concern about the future of the project and rejected the possibility of pushing forward the completion date. DOE has been on a high-risk management list for the past 16 years, signifying an apparently endemic culture of mismanagement and failure to meet deadlines or budget forecasts. Moreover, the team responsible for NextGen has no experience with projects of this scale. Wells recommended against an accelerated timeline, not based on the scientific or economic merits of the issue, but based purely on an analysis of the management's ability to get the job done.

Mr. Hildebrandt testified on behalf of the Idaho National Laboratory, which is leading the R&D for NextGen and which will be the site of its construction. He emphasized to the committee that the NextGen would be able to do more than just produce electricity and hydrogen. Heat from the very-high temperature reactor could be used to produce hydrogen, but could also be used in coal gasification, extracting oil from oil sands and other processes that have only begun to be conceived. Markets for this high temperature process already exist, and DOE is hopeful that a public-private partnership can move the project rapidly forward while sharing the risks and ideally having a commercially viable prototype ready by 2016 - 2018.

Dr. Kadak decried the overly-ambitious goal of producing a very-high temperature reactor by 2021. "This is beyond the next generation," he said, and we will end up sacrificing what could have been a very good, viable plant running at 850ºC for one that will never be built but would run at 1000ºC. In addition, the public-private partnerships envisioned by Mr. Hildebrandt may never come to fruition, Kadak argued. The industry is fragmented, and some of the largest players are more interested in buying and operating existing plants than in developing new ones. Instead, Kadak advocated that NextGen be a national strategic project, not relying on industry and not based on the very-high temperature technology.

Chairman Issa attempted to analyze the available technologies from an economic perspective. According to government statistics, the current operating cost to produce a kilowatt hour of energy from a nuclear power plant is 1.7 cents, while the cost for coal is 1.9 cents. However, the government also pays for disposal of nuclear waste partly by charging companies fees for building a repository, which is not considered in the operating cost estimates, whereas there is no cost to companies for the ill effects of waste from burning coal. The operating costs for natural gas average about 5 - 7 cents, and estimates for clean coal are at 5.1 cents. If NextGen came online as envisioned, current estimates put the cost at ~3 cents per kilowatt hour, making it cost-competitive with other low-emissions or non-emitting technologies. Dr. Kadak agreed that this might be the case, and that the government, which should be paid back from industry's profits, would see a rapid return on its investment.

The panelists disagreed on the issue of a high versus very-high temperature reactor. Dr. Kadak and Mr. Hildebrandt agreed that the increased efficiency at 1000ºC would be ideal, but that the timeframe in which the technology could be developed made it unviable from an industry perspective. Mr. Wells reminded the subcommittee that DOE's mandate was to create a nuclear plant that could ignite the hydrogen economy, and that the very-high temperature reactor could produce hydrogen inexpensively enough to compete with $3 per gallon gasoline.


Senate Committee on Appropriations
Subcommittee on Energy and Water

Hearing on the Global Nuclear Energy Partnership (GNEP)

September 14, 2006

Dennis Spurgeon, Assistant Secretary, Office of Nuclear Energy
Dr. Alan Hanson, Executive Vice President, Technology and Used-Fuel Management, AREVA NC, Inc.
Kelly Fletcher, GE Global Research, Sustainable Energy Advanced Technology Leader
Matthew Bunn, Harvard University, Belfer Center for Science and International Affairs, John F. Kennedy School of Government

A small contingent of Republicans on the Senate Committee on Appropriations Subcommittee on Energy and Water convened on September 14 to discuss policy and technology options for the Global Nuclear Energy Partnership (GNEP). Subcommittee Chairman Pete V. Domenici (R - NM) outlined a three-tiered approach to solving the nation's nuclear waste problems. In the short term, the federal government must established regional interim storage facilities to fulfill its contractual obligation to remove waste currently being stored on-site at reactor facilities around the country. In the mid-term, GNEP's waste recycling technology will allow the U.S. to reduce the volume and toxicity of spent fuel. Ultimately, the Yucca Mountain waste repository must be completed to provide permanent storage for nuclear waste. The Department of Energy's (DOE) recent announcement that they intend to move forward with development of a commercial recycling facility came as a surprise to Congress, and represents a "major departure" from DOE's original roadmap. Domenici warned that the Department must act with due diligence to ensure sound decisions regarding the risks of nuclear materials proliferation.

Mr. Dennis Spurgeon described the importance of GNEP and nuclear waste recycling in a variety of ways. For one thing, it has reinvigorated the U.S. nuclear power industry. Utility companies may begin construction on as many as 30 new plants in the next decade, after 33 years without a single new facility. The expansion of nuclear power will reduce U.S. emissions of greenhouse gases and other pollutants and secure greater independence from foreign oil. The expansion of nuclear power usage worldwide will improve the environment while providing widespread energy security. Finally, GNEP will reduce the volume, heat capacity and toxicity of materials bound for Yucca Mountain, thus preventing or postponing the necessary construction of a second repository. In his written testimony, Mr. Spurgeon offered a brief summary of DOE's vision for GNEP. The program is designed to address the two main issues that have suppressed advancements in nuclear power technology: the risk of proliferation of fissile materials and the need for safe, secure waste disposal. At its heart, GNEP appears to be a fairly elegant solution to a complex problem. Along one track, the Department will work in partnership with industry to develop the infrastructure and technology necessary for cost-effective, proliferation-resistant recycling of nuclear waste materials. Ultimately, private industry will run one or more facilities capable of separating usable materials in spent fuels from the unusable waste, consuming the usable products while producing electricity and storing the waste as needed before it is sent to Yucca Mountain. This could reduce the amount of material bound for geological storage by a factor between 50 and 100, thus prolonging the useful life of the repository. On the second track, DOE will work with industry and/or academia and the national laboratories to continue R&D for nuclear waste disposal and recycling technology. DOE issued two requests for interest in GNEP to industry and received 18 responses from domestic and international companies. The Department also issued a funding opportunities announcement to host a GNEP facility and received 14 positive responses, including several that indicated local political support for the projects.

Dr. Alan Hanson spoke on behalf of AREVA NC Inc., one of the 18 respondents to DOE's requests for interest. AREVA, he testified, would be an excellent candidate to work with DOE to develop the new GNEP facilities because they have proven expertise in the areas that GNEP is designed to address. AREVA is an international corporation that operates some of the largest used-fuel treatment facilities in the world and therefore already possesses commercially-available technology that could be implemented quickly. AREVA's COEX™ technology does not separate out pure plutonium, as do other recycling technologies, and therefore, Hanson argued, is more proliferation-resistant. Moreover, a study by the Boston Consulting Group (BCG), which was commissioned by AREVA, suggests that the cost of operating a used-fuel nuclear power generator would be comparable to the costs of once-through technology when the difference in repository costs is factored in. Chairman Domenici gently suggested that Congress and this subcommittee would not be quite as optimistic in their estimates.

Mr. Kelly Fletcher testified on behalf of General Electric (GE), another respondent to DOE's requests for interest. GE's Power Reactor Innovative Small Module (PRISM) technology is able to generate electricity while consuming transuranic radioactive isotopes from nuclear waste. Unlike the more "monolithic" design of AREVA's system, PRISM is based on a small, encapsulated design and can be manufactured within a GE factory and transported to the site of the reactor. The technology is ready to be deployed and its safety and viability have been demonstrated through coordination with the national laboratories.

Mr. Bunn, though expressing his support for growth in nuclear energy in general, testified against the deployment of recycling technologies. The process of recycling and the rapidity with which DOE is moving will make consumers and investors even more wary of nuclear energy than they currently are, ultimately hampering growth in the industry. Moreover, recycling will be expensive. A recent Harvard study, co-authored by Mr. Bunn, found that conservative estimates put the increase in spent fuel management costs associated with recycling at 80% over once-through processes. These findings contradict those of the BCG study, cited by Dr. Hanson. Mr. Bunn attributes the large difference to "unreasonable assumptions" made by the BCG study, including that the reactor would operate at capacity 24/7 and would not have to allow for on-site storage. Dr. Hanson retorted that the BCG study had used classified industry data that Mr. Bunn and his colleagues had not had access to. Moreover, Bunn argued, any of the proposed recycling technologies pose a significant proliferation risk, not only because of the fate of materials generated and recycled in the U.S., but because of the example set for other nations. The U.S., Mr. Bunn argues, cannot continue to insist that other nations do not reprocess spent fuel (a process that can generate weapons-grade materials) while indicating that we see a need for reprocessing for ourselves. Any suggestion that the U.S. may import spent fuel from other nations is a fantasy that should simply be dismissed. In contrast to the other two witnesses, Mr. Bunn testified that there is no need for fuel recycling. Uranium ore is not in short supply and not likely to become scarce in the next several centuries. Recent estimates of storage capacity for Yucca Mountain place its potential between 260,000 and 570,000 tons, as compared to the administratively-set cap of 70,000 tons used in current estimates. Mr. Bunn also pointed out that DOE does not have a history of successfully building and operating similarly complex facilities. "In fact," he said, "I believe DOE has a record unblemished by success." Rather than waste time, leadership and money on recycling, DOE should focus on interim storage, pursue further research and development on nuclear waste, move forward with Yucca Mountain and build political sustainability. As a first step, the Subcommittee should join the House in calling for an in-depth peer review of the nuclear fuel recycling plan carried out by the National Academies.

Chairman Domenici admitted that he does not see eye-to-eye with Mr. Bunn, and asked the panelists to address the issue of the public's willingness to expand the nuclear energy industry. Mr. Bunn testified that the pubic is not enthusiastic about expanding our nuclear energy infrastructure and therefore finding locations to operate GNEP facilities will be costly and problematic. Mr. Spurgeon disagreed, saying that people seem to want the facilities in their communities, and that the reactors can be good neighbors. Senator Robert F. Bennett (R - UT) expressed concern that the U.S. lacks the technological capacity to deploy these facilities, and that they will have to rely on foreign expertise. Mr. Spurgeon agreed that the industry had atrophied in the past 30 years, and would need to rebuild its nuclear energy infrastructure and its human capacity.


Senate Energy and Natural Resources Committee
Hearing on U.S. - India Energy Cooperation

July 18, 2006

Panel I
Mr. David Pumphrey, Deputy Assistant Secretary for International Energy Cooperation, U.S. Department of Energy
Mr. Paul Simons, Deputy Assistant Secretary for Economic and Business Affairs, U.S. Department of State

Panel 2
Dr. David Victor, Director, Program of Energy and Sustainable Development, Stanford University
Mr. Daniel Poneman, Principal, The Scowcroft Group
Mr. Michael Gadbaw, Vice President for International Law and Policy, General Electric Company

Several weeks ago, committees in the House and the Senate passed legislation that would allow the Bush administration to proceed with an agreement to enable civil nuclear energy cooperation between the U.S. and India (See previous hearing summaries on these bills, S. 2429 and H.R. 5682, given below).

On July 18, the Senate Committee on Energy and Natural Resources held a hearing to explore energy cooperation issues between the U.S. and India. Chairman Pete V. Domenici (R - NM) emphasized the role that cooperative efforts--including a wide range of technology transfers, research related to India's domestic energy resources and facilitation of private investment--will play in the future energy security of both nations. The Chairman outlined three broad topics for the panelists to address: the role of the energy industry in ensuring clean, diverse, proliferation-resistant energy resources; the concern among Americans about climate change; and the importance to the U.S. of a strategic relationship with India.

Dr. David Victor, who spoke on the second panel, took pains to provide an overview of India's current electric power system and some of the problems that it faces. He reminded the committee that there are no easy alternatives for fossil fuels: other energy resources have positive and negative trade-offs. Currently, India relies on coal for approximately 53% of its total energy production, with the balance of production resting mainly on oil and natural gas. India is the world's third largest coal producer, but its coal has twice the ash content of U.S. coal, making it a serious problem for the environment and public health. Cooperation with the U.S. could make nuclear energy cost-competitive with coal, thus reducing these health risks and reducing India's impact on global climate change. According to Dr. Victor's testimony, decreasing India's reliance on fossil fuels and replacing it with 20GW of nuclear energy capacity by 2020 could prevent the release of as much as 145 million tons of carbon dioxide over the next 15 years.

Mr. Pumphrey outlined several priorities for coping with India's rising demand for energy. These included the development of new energy technologies and infrastructure to utilize domestic coal, natural gas and offshore gas-hydrate reserves; finalizing an agreement for nuclear energy cooperation with the U.S.; and developing an emergency response strategy to cope with fluctuations in energy supplies. Focus also must be placed on the role of private investment in India's infrastructure. Mr. Gadbaw, testifying on behalf of GE, added that each new 1.5 GW nuclear power plant built by GE would represent $1 billion of U.S. exports, which he points out would equate to supporting 10,000 U.S. jobs. In addition, the presence of U.S. companies will facilitate the establishment of international safety and operational standards in India's bourgeoning nuclear energy infrastructure.

Senator Jeff Bingaman (D - NM) questioned the panelists about the impact that an agreement for nuclear cooperation will have on nuclear weapons proliferation. In concurrence with many of the statements made during the House Committee on International Relations and the Senate Committee on Foreign Relations hearings on the U.S. - India civilian nuclear energy agreement, Mr. Simons assured the committee that engaging in civilian nuclear technology transfer with India would result in a net benefit to non-proliferation efforts. Bringing India "into the tent" or "into the nuclear mainstream," he stated, brings their interest in line with our own and in line with non-proliferation. Despite additional questions from Bingaman about how this agreement would enhance non-proliferation, Mr. Simons was unable to provide any specific reasons for his assessment. In reference to this issue, Chairman Domenici noted that a fissile material treaty (FMT) is currently being developed by the United Nations Conference on Disarmament and that India, a non-signatory to the Nuclear Non-proliferation Treaty, may sign this treaty. Mr. Simons also emphasized that the civilian nuclear agreement would enhance the energy security of the U.S. and India, improve the environment by reducing greenhouse gas emissions and create a large number of U.S. jobs. On the second panel, Mr. Daniel Poneman suggested that Bingaman's non-proliferation concerns may be addressed if India agrees to lease nuclear materials so that spent nuclear fuel would be the responsibility of the leaser (which is likely to be the U.S.). Congressman Bingaman, though agreeing with this option in principle, questioned the feasibility of such a plan.


Senate Committee on Foreign Relations
Mark-up of S. 2429
"To authorize the president to waive the application of certain requirements under the Atomic Energy Act of 1954 with respect to India."

June 29, 2006

On June 29, the Senate Committee on Foreign Relations met to mark-up S. 2429, a variation on a bill previously sent to Congress by the Bush administration that would allow the U.S. to exchange nuclear technology and materials with India. This agreement would reverse decades of policy and legal precedent that have prevented such commerce since India tested a nuclear weapon in the 1970's, a time when India was not aligned with the U.S. politically.

Chairman Richard G. Lugar (R - IN) declared the bill to be agreeable on several counts: it strengthens the long term geo-strategic position of the U.S.; it rewards India for being a good steward of nuclear technology and for supporting the U.S. position on key votes before the IAEA; it encourages India to continue to be conscientious in their use and development of nuclear technology and it serves the national security interests of both nations. Like the administration's bill, S. 2429 would lift restrictions on nuclear commerce put in place by the Atomic Energy Act of 1954 on the condition that India places its civil nuclear reactors under IAEA surveillance and places a voluntary moratorium on nuclear weapons testing. Unlike the bill sent down by the administration, S. 2429 explicitly states that exceptions to the AEA are being made only for India and only for civil uses. It also reinstates Congressional oversight, which had been largely circumvented in the original bill, and adds provisions to end the agreement should India test another nuclear weapon.

Ranking Member Joseph R. Biden, Jr. (D - DE) added that this is a historic agreement, and as such must achieve a broad, bi-partisan consensus in order to go forward. Senator Biden also echoed the Chairman by saying that he felt good about the agreement because of his profound trust in the Indian people and their democratic government. Senator Paul S. Sarbanes (D - MD) shared these sentiments, and added that the agreement would also serve the interests of Indian-Americans, who have made "outstanding contributions" to the U.S. society and economy. As a point of clarification, Mr. Sarbanes also pointed out that the U.S. and India must also reach an agreement with the IAEA and Nuclear Suppliers' Group (NSG) before the bill could go into effect.

Senators George F. Allen (R - VA), Lamar Alexander (R - TN) and Norm Coleman (R - MN) emphasized the environmental importance of this bill. India is a huge and ever-increasing consumer of fossil fuels. Energy use to fuel their expanding economy drives up the price of oil, causes pollution from the burning of domestic coal supplies and contributes to global warming. Nuclear technology will provide a cleaner alternative while supplying inexpensive energy to millions of low-income people.

Senator John F. Kerry (D - MA) countered the arguments of skeptics who worry that the agreement will set off a nuclear arms race in south Asia, saying that the supply of inexpensive, carbon-free energy would serve to stabilize the region, and that India would prove to be an invaluable ally in future non-proliferation efforts.

Senator Barbara Boxer (D - CA) conceded that S. 2429 was a vast improvement over the administration's bill, which "showed contempt for the role of Congress." However, she expressed concern that the bill did not do enough to ensure U.S. compliance with obligations enumerated in article 1 of the Nuclear Non-Proliferation Treaty (NPT). The bill states as policy that none of the materials exported by the U.S. are to be used for military purposes, but does not address the fact that these supplies would allow India to divert all of their domestic uranium production to military uses. Since only half of those reserves are currently being used for weapons production, this agreement could potentially result in at least a doubling of military nuclear activities, or the production of approximately 50 nuclear bombs per year. This would not only violate the principle of non-proliferation, but would create difficulty for future U.S. attempts to gain international support to reign in the nuclear ambitions of more hostile regimes.

Senator Lincoln D. Chaffee (R - RI) offered a non-binding amendment to express the sentiment of Congress that India should not use imported uranium for weapons programs. The amendment was passed unanimously. Senator Barack Obama (D - IL) offered an amendment stating that if actions taken by India, including testing a nuclear weapon or selling nuclear technology, triggered a U.S. action to cease all nuclear cooperation, other countries should be discouraged from continuing to cooperate as well. The amendment passed unanimously. Senator Russell D. Feingold (D - WI) offered an amendment to require an annual presidential certification that the use to which India puts U.S. materials and technology is consistent with our obligations under the NPT. The amendment was defeated 5 - 13.

S. 2429 was passed by the Senate Committee on Foreign Relations with Senators Feingold and Boxer voting against it. The bill will be combined with H.R. 5682, which was passed by the House Committee on International Relations on June 27, and then sent to Congress for a vote.


House Committee on International Relations
Mark-up of H.R. 5682
"To exempt from certain requirements of the Atomic Energy Act of 1954 a proposed nuclear agreement for cooperation with India."

June 27, 2006

The House Committee on International Relations convened on the morning of June 27, 2006 to discuss H.R. 5682. The bill comes after more than a year of discussions between the governments of the U.S. and India that ostensibly began with the Next Steps in Strategic Partnership (NSSP) Initiative announced by President George W. Bush and former Prime Minister Atal Bihari Vajpayee in January of 2004. The initiative was meant to expand bilateral cooperation in civilian nuclear activities, civilian space programs and high-tech trade. After the election of Prime Minister Manmohan Singh on May 22, 2004, the President and Prime Minister reaffirmed their nations' commitment to building a stronger international partnership. In March of 2006, President Bush and Prime Minister Singh signed a U.S. - India nuclear agreement that would allow the U.S. to circumvent existing non-proliferation laws--including the Non-Proliferation Treaty (NPT) and Atomic Energy Act of 1954--such that the U.S. may provide technology and materials for India's civilian nuclear energy program.

Chairman Henry Hyde (R - IL) began with an admonition against the Bush administration, whose original bill he deemed "profoundly unsatisfactory" because of the way in which it side-stepped congressional approval and "[waived] almost wholesale existing laws regarding civilian nuclear commerce." The bill drafted by the administration would have required a majority 'no' vote by Congress, which the President could then veto so that the bill would take effect despite congressional disapproval. Congress would then have to override the veto with a 2/3 majority if members wanted to prevent the agreement from going forward. H.R. 5682 reinstates traditional congressional oversight and adds a "sense of Congress" and a statement of US policy regarding the NPT and goals for South Asia. The bill also requires India to comply with several certification standards and to allow their civilian (but not their military) reactors to be placed under IAEA supervision. Unlike the administration's bill, H.R. 5682 allows the agreement to be revoked if India tests a nuclear weapon or violates non-proliferation policies.

Ranking Member Tom Lantos (D - CA) justified the India-specific legislation, which allows the U.S. to follow a different set of rules governing nuclear relations with India than with, for example, Pakistan or Iran. "India has no A.Q. Kahn" he argued: they do not participate in the spread of nuclear technology to hostile nations or organizations and they do not support militant Islam. Congressman Gary Ackerman (D - NY) added that Pakistan and Iran should now realize that, "If you want to be treated like India, be like India: [a] responsible international actor." Lantos also pointed out that India has supported the U.S. with key votes before the IAEA and are an increasingly important, democratic and benevolent ally. Congressman Dana Rohrabacher (R - CA) emphasized the strategic importance of alliance with India: "I do not believe our European allies are reliable, as they were in the Cold War." NATO, he argued, is no longer able to lead, and should be supplanted by a coalition between the U.S., Russia, India and Japan.

Representative James Leach (R - IA) concurred that a case could be made for making exceptions for India, but felt it set a dangerous precedent and would result in a massive arms race between India, Pakistan and China. "This is a new day for U.S. - India relations," Leach stated, "but it is also a sad day [for] arms control."

Congressmen Howard Berman (D - CA) and Bradley Sherman (D - CA) offered a variety of amendments imposing conditions designed to prevent India from increasing their military nuclear arsenal. All such provisions failed. An amendment offered by Congressman Edward Royce (R - CA) added a non-binding policy statement that no assistance provided to India's civilian nuclear program should be used for military production, in accordance with U.S. obligations under the NPT. Royce's amendment was passed unanimously. Congresswoman Shelley Berkley (D - NV) proposed two amendments: one to require reporting on the status of spent nuclear fuel and one to prevent its import from India to the U.S. for disposal. The former passed unanimously while the latter failed 15 - 19.

The committee voted to favorably recommend H.R. 5682 to the full House by a vote of 37 - 5. The five representatives in opposition were James Leach (R - IA), Ted Poe (R - TX), Christopher Smith (R - NJ), Barbara Lee (D - CA) and Diane Watson (D - CA).


Senate Environment and Public Works Committee
Subcommittee on Government Reform
Oversight Hearing on the Regulatory Processes for New and Existing Nuclear Plants

June 21, 2006

Nils J. Diaz, Chairman, U.S. Nuclear Regulatory Commission
Edward McGaffigan, Jr., Commissioner, U.S. Nuclear Regulatory Commission
Jeffrey S. Merrifield, Commissioner, U.S. Nuclear Regulatory Commission
Gregory B. Jaczko, Commissioner, U.S. Nuclear Regulatory Commission
Peter B. Lyons, Commissioner, U.S. Nuclear Regulatory Commission
J. Barnie Beasley, President and CEO, Southern Nuclear Company
David Lochbaum, Nuclear Safety Engineer, Union of Concerned Scientists
Kevin Book, Senior Analyst and Vice President, Friedman Billings Ramsey & Company, Inc.

The Subcommittee on Government Reform of the Senate Environment and Public Works Committee held a hearing to review the effectiveness of current nuclear power plant regulations. Chairman James Inhofe (R-OH) began the hearing by stressing the importance of creating effective policy to stimulate the expansion of nuclear power. "The U.S. needs to move in a timely fashion to update [nuclear regulatory] processes…without stifling the growth of nuclear power," said Inhofe.

Several senators were concerned that the Nuclear Regulatory Commission (NRC) would not be able to review power plant building and operating licenses as fast as the industry submits them. The NRC is expecting about 17 new plants to file for licensure in the next couple of years. Nils Diaz, NRC Chairman, addressed these concerns in his testimony to the committee. "I believe our staff can handle the tasks that lie ahead," he said. Elaborating on the NRC's strategy to approve the licenses in a timely fashion, Diaz said that the NRC is heavily recruiting new scientists and reviewing inspection programs to increase capacity.

Senator Hillary Clinton (D-NY) criticized the NRC for not adequately tracking nuclear fuel. Clinton co-sponsored the Dirty Bomb Protection Act (DBPA) which requires the NRC to monitor the location and use of radioactive material "from cradle to grave" to prevent terrorists from building a radioactive weapon (dirty bomb). Most of the provisions in DBPA were added to the Energy Policy Act of 2005 and enacted into law. Clinton accused the NRC of not fulfilling the requirements of DBPA. "You have not nearly followed legislative intent," she said. "By passing the requirements on to states, you have burdened them without any resources or expertise, putting the people of New York in danger." Diaz responded that the NRC was receiving public comment for that program.

Senator James Jeffords (I-VT) stated that the NRC needs to focus on currently operating nuclear power plants. The expected influx of new reactor building and operating applications should not shift attention away from current safety problems. "We are boosting the power output of existing plants and extending the terms of their licenses. The public needs to be confident that the current fleet operates well, or they will be unlikely to accept a new generation of plants," said Jeffords. Senator Frank Lautenberg (D-MI) raised a concern that NRC comment periods were too short. "The NRC should welcome public input about nuclear power plant projects…because of the safety and security implications," he said. Clinton and Senator Pete Voinovich (XXX) agreed.

Witness testimony form the private sector was brief because of an upcoming vote. J. Barnie Beasley, President and CEO of Southern Nuclear Company, stressed the need for timely and smooth application approval to ensure that the nuclear industry can keep up with the public demand for energy. "While efficiency has increased at the NRC, significant progress is needed," said Beasley. While she understands the need for safety precaution and public input, she noted that the proposed reactors are much safer than those currently in operation.

David Lochbaum, a Nuclear Safety Engineer with the Union of Concerned Scientists, was impressed with the NRC's record of enforcing nuclear safety standards. "The NRC deserves credit for avoiding band-aid fixes and allocating the necessary resources to address safety issues with the nation's nuclear power plants," he said. Even with the NRC's good record, Lochbaum indicated that safety problems have resulted in numerous shutdowns, sometimes for over a year.

The last witnesses spoke about the importance of stable regulations to encourage investing in the nuclear energy industry. Kevin Book, Senior Analyst and Vice President for Friedman Billings Ramsey & Company, Inc., stated that "Project delays, the lack of a permanent waste repository and shifting regulations all result in reduced cash returns," he said. Combining the construction and operating licenses at the NRC had helped, but the processes needs to be streamlined and made permanent.



Senate Energy and Natural Resources Committee
Hearing on "Nuclear Power Plant Development"
May 25, 2006

Dennis Spurgeon, Assistant Secretary for Nuclear Energy, Department of Energy
Nils Diaz, Chairman, Nuclear Regulatory Commission
James Asselstine, Managing Director, Lehman Brothers, Inc.

The Senate Energy and Natural Resources Committee held a hearing on May 22 to discuss nuclear power plant development. The Energy Policy Act of 2005 expanded the role of nuclear power in the U.S by providing financial incentives and protections against delays and litigation. "I'm sure Congress did the right thing to provide nuclear power incentives," said Chairman Domenici in his opening statements. Domenici continued to say that he hopes to review the successful implementation of the Energy Policy Act through hearings such as this one. He also reflected on the President's nuclear power initiatives in the FY 2007 budget. "The nuclear renaissance is here," said Domenici, and mentioned that the President was smart to encourage the use of more nuclear energy in India and around the world.

Witnesses testified that nuclear power was an important part of a comprehensive energy policy. Dennis Spurgeon, Assistant Secretary for Nuclear Power at the Department of Energy, said nuclear power was not the only source of energy needed to meet the nation's growing demand, but no energy plan would be complete without it. Nuclear power currently generates about 20% of U.S. electricity, from 103 nuclear power plants. He also emphasized the reliability and safety of nuclear power. Nils Diaz, Chairman of the Nuclear Regulatory Commission, explained that excluding the initial cost of construction, the cost of nuclear power for generating electricity was comparable to the cost of a coal-fired power plant. Because of this low cost, he sees nuclear power as a reliable source of energy in coming decades. James Asseltine, managing director of Lehman Brothers, reflected on the effectiveness of the Energy Policy Act of 2005. He said it was having the intended effect of encouraging new nuclear plant development. Asseltine also address the Yucca Mountain project, which is proposed to be a nuclear waste repository, by saying new plant development does not need to wait for Yucca Mountain construction to be complete.

Senator Thomas (R-WY) also had several comments about nuclear power in the United States. He mentioned the relatively large amount of uranium in his state, and how this resource has actually seen a decline in price. Thomas also reflected on a lack of public knowledge about the nuclear power industry. "People don't understand the opportunities of nuclear power," he said, and reiterated the importance of understanding the investment in nuclear power.

For the full text of witness testimony, click here.


Sources: Hearing testimony, Environment & Energy Daily.

Contributed by Carrie Donnelly, 2006 AGI/AIPG Summer Intern, Timothy Donahue, 2006 AGI/AIPG Summer Intern, Rachel Bleshman, 2006 AGI/AAPG Fall Intern, and Linda Rowan, Director of Government Affairs.

Please send any comments or requests for information to AGI Government Affairs Program.

Last updated on September 25, 2006.