NRC FY2016 budget hearing – Sen Alexander and Sen Feinstein

On March 4, 2015, the Senate Appropriations Subcommittee on Energy and Water Development held a hearing about the Nuclear Regulatory Commission’s FY2016 budget. The video archive is available for review.

The only senators from the subcommittee who took part in the hearing were Sen Lamar Alexander (R-TN) and Sen Dianne Feinstein (D-CA) with an invited guest appearance from Sen Lisa Murkowski (R-AK). Sen Alexander is the chairman of the committee, Sen Feinstein is the ranking member. With the small number of senators attending the hearing, the usual 5 minute time limit per senator for questions and answers was waived by the Chairman. That feature helped make this hearing more informative than usual.

All four current NRC commissioners — Stephen Burns, Jeff Baran, William Ostendorff, and Kristine Svinicki — testified at the hearing. Burns, Ostendorff and Baran submitted written statements.

Chairman Burns’s statement includes a comprehensive summary of the agency’s FY2016 budget request. In addition it provides two “good news” numbers related to FY2015 — annual license fee for operating reactors will be reduced by 5% from $5,223,000 to $4,750,000, and the professional staff hour rate will be reduced from $279/hr to $268/hr. These new rates will be published in the proposed FY2015 fee rule in the next few weeks for public comment. In the FY2015 enacted budget the number of full time equivalents (FTE) was reduced by 26.5 from the FY2014 number.

The FY2016 budget request reflects a $17.3 million reduction in total available resources and a 37.5 reduction in FTE. As explained by Chairman Burns’s testimony, the budget request is actually a few million dollars higher than the FY2015 appropriation, but the resources available in FY2015 included authorization to use $34.2 million in unobligated fee-based revenue carried over from FY2013.

There are small decreases in most budget lines, including oversight of operating reactors and new reactor licensing reviews that reflect both a reduced workload and an increase in the assumed productivity of the staff, which appears to be quantified as an increased number of billable, non-overhead hours.

Watching this hearing was a refreshing experience compared to watching Sen Boxer and Sen Markey grill the commissioners. As usual, Senator Alexander was strongly supportive of nuclear energy and reminded the commissioners that their job was to maintain safety, but not to strangle the valuable industry by byzantine, expensive rules.

He told them to diligently review their current practices and he expressed keen interest in the program that Chairman Burns described as a review of the cumulative effects of regulation.

Alexander took a little detour and used the example of a recent study conducted at Vanderbilt University to quantify the costs of complying with federal regulations. He stated that he was not terribly surprised by finding out that compliance added a substantial burden, but he was shocked to find out that it ended up adding the equivalent of $11,000/year in cost for each enrolled student. He told the commissioners that every regulatory agency exhibits the tendency to add rules without understanding how much they cost to follow and enforce.

Commissioner Svinicki mentioned that the NRC had recently been informed that they needed to improve their methods for cost analysis; evaluation of industry data revealed several orders of magnitude underestimations of the cost. As Svinicki pointed out, with errors that large in cost projections, it is virtually certain that some enacted regulations would not have been passed due to insufficient benefits to justify the expense.

Though much more polite and generally supportive of nuclear energy than her California senatorial colleague, Sen Feinstein spent a major portion of her time criticizing the fact that the NRC had determined that on site storage of used nuclear fuel was adequately safe for an indefinite period of time. She initially indicated that rule change had made her begin to question her support of nuclear power since it seemed like the NRC was going to allow used fuel to remain on site forever.

Commissioner Ostendorff patiently explained that the NRC does not believe that fuel should be left on site forever, but it does believe that it would be safe to continue keeping it where it is — in either dry casks or in spent fuel pools — for as long as necessary given the monitoring and security requirements that already exist. He also tried to gently remind Sen Feinstein that the NRC is not the responsible agency for establishing a site or a system of moving existing fuel. It is responsible for the safety oversight of that activity.

The commissioners and the senators discussed the near term prospect that an existing low level waste storage site in west Texas has announced plans to file a license application to convert part of its land into an interim used fuel storage site that could begin accepting shipments once the license has been approved. Chairman Burns reminded the senators that the NRC has experience reviewing such sites and has even issued a license for a facility that was never built. He did not mention that the Private Fuel Storage site was blocked by the Department of the Interior.

At the end of the hearing, there was an important exchange between Sen Alexander and Commissioner Ostendorff. Following that exchange, Sen Alexander did something unusual; he took his share of responsibility for the failure of the federal government to follow through on its contracted obligation to take used nuclear fuel away from licensees. I thought you might enjoy watching the final few minutes of the hearing, assuming that you did not invest the time to watch the full version linked above.

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