US Senate realignment leaves nuclear industry uncertain

29 June 2001

The USA has been going through a turbulent few months, and the news for the nuclear industry has been alternately good and bad. From optimistic pronouncements on the future of the nuclear industry, to pessimistic concerns over proposed budget cuts, the nuclear industry has enjoyed – if that is the right word – a rollercoaster ride since George W Bush became president.

The realignment of the US Senate on 5 June, giving Democrats effective control of the legislature’s upper chamber, left the nuclear industry uncertain whether, and how much of, the Bush administration’s plan to make nuclear power a major component of national energy policy can be achieved.

To the dismay of industry executives, the defection of Vermont Senator James Jeffords from the Republican Party, which left Democrats with a 50-49 Senate majority, came only days after they met in Washington to celebrate nuclear’s “flourishing renaissance.” This was the theme of the Nuclear Energy Institute’s (NEI) annual conference, held 22-23 May, which drew 400 attendees, including many senior industry executives. In an exuberant mood, they gave repeated standing ovations to US vice president Dick Cheney, the featured speaker, as he described the administration’s strategic energy plan which calls for nuclear plant relicensing, plant upratings, and new construction.

The conference also featured the first talk in decades about new plant orders, owing to recent public announcements by Entergy and Exelon. Both companies are members of an NEI task force looking into the actions needed to bring new nuclear units on line. Entergy Nuclear is considering using the Nuclear Regulatory Commission’s early siting process to “bank” one or two sites adjacent to the company’s existing reactors. Exelon plans to apply for an early site permit, possibly in preparation for building a pebble bed modular reactor plant.

NEI President Joe Colvin, meanwhile, outlined “a bold business initiative” to build 50,000 MWe of new nuclear capacity in the United States, and upgrade existing plants to supply 10,000 MWe more, by 2020. The goal would be to raise nuclear energy’s share of US electricity generation to 23%, from 20% today, Colvin said.

Then came the news of Jeffords’ defection and, with it, concern that the Bush administration’s strategic energy plan could be at risk. Prior to Jeffords’ defection, the 100-member Senate had been divided 50-50 between the political parties, giving Republicans effective control because of vice president Cheney’s tie-breaking vote.

It’s too early to tell exactly how, or by how much, the Senate realignment will affect Bush’s energy policy. The most troubling news for the industry was the announcement by new Senate Majority Leader Tom Daschle (Democrat – South Dakota) that “the Yucca Mountain issue is dead” as long as Democrats are in the majority. The White House is due to decide in 2002 whether to build the first US permanent repository for spent fuel and high level waste at Yucca Mountain in Nevada. But the 1987 Nuclear Waste Policy Amendments Act allows Nevada to exercise a veto if Yucca Mountain is chosen. An act of Congress would then be needed to trump Nevada’s veto.

Daschle’s comments sparked speculation over whether Yucca Mountain may have been part of a deal to entice Jeffords to defect. This is because the Vermont senator, now an Independent, has been offered the chairmanship of the Senate Environment and Public Works Committee – a post that otherwise would have gone via seniority to Senator Harry Reid (Democrat – Nevada), who agreed to step aside. Reid, the most vocal opponent of Yucca Mountain in Congress, has been promoted to Majority Whip, the Senate’s second most powerful post.

The US nuclear industry is hopeful that, with a majority of legislators favourable to a Yucca Mountain repository – including both Republicans and Democrats – Daschle and Reid will be unable to use Senate rules to bottle up legislation. While Democrats may have gained procedural control of the Senate, the upper chamber is still populated by the same lawmakers as before. Hence, once legislation reaches the Senate floor – if it reaches the Senate floor – it makes little difference which party controls the chamber.

Nevertheless, the Bush administration’s proposed energy legislation clearly will face a tougher test, especially with the Republicans’ loss of two key Senate committee chairmanships. Under the new alignment, Senator Frank Murkowski (Republican – Alaska) lost his chairmanship of the Senate Energy and Natural Resources Committee, while Senator Pete Domenici (Republican – New Mexico) lost the chairmanship of the Senate Budget Committee. Earlier this year, both men introduced legislation eagerly embraced by the nuclear industry.

Senator Jeff Bingaman (Democrat – New Mexico), the new chairman of the Senate Energy Committee, has questioned if, given today’s high electricity prices, the industry needs new tax incentives. Democrat Senate staff aides have suggested that Bush administration proposals to revive nuclear fuel reprocessing in the United States are dead.

On the other hand, industry watchers point out that the New Mexico Democrat represents a state with several major nuclear facilities, including the DoE’s Los Alamos National Laboratory and Waste Isolation Pilot Plant (WIPP), and supports increased funding for nuclear energy R&D. Earlier this year, Bingaman and Daschle co-sponsored legislation to increase supply of all domestic energy sources, including nuclear energy. The Bingaman bill, The Comprehensive and Balanced Energy Policy Act of 2001, would boost federal funding to support nuclear plant life extension, examine advanced proliferation-resistant reactor designs, attract new students and faculty to nuclear science and engineering, and maintain a national infrastructure to produce medical isotopes. But the Bingaman bill contains none of the tax incentives proposed by Murkowski to encourage expanded nuclear generation.

Meanwhile, the Bush administration may redouble its efforts on behalf of nuclear energy in light of a White House-commissioned National Academy of Sciences report, issued 6 June. The 24-page NAS report concluded that global warming is real and that burning of fossil fuels may be a leading cause.

In addition, the White House has begun to implement administratively those parts of its energy policy plan that do not require legislation. Bush issued an Executive Order in May requiring all federal agencies to issue energy impact statements in conjunction with major federal actions. The studies would be similar to Environmental Impact Statements that agencies by law are required to prepare. The Republicans still hold a healthy majority in the House of Representatives where Representative Billy Tauzin (Republican – Louisiana), chairman of the House Energy Committee, is a strong supporter of nuclear energy.

Finally, the industry can hope that Congress will note rising public sentiment for nuclear energy. In May, a survey by the Field organisation, an independent polling group, found that 59 % of Californians now favour construction of more nuclear power plants. In 1984, the last time Field polled Californians about nuclear power plants, 61% were opposed. As California struggles through a summer of blackouts, public sentiment in favour of nuclear energy is likely to continue to improve.



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