SMRs – lots of noise but DOE budget that’s 1% of annual wind tax credit

I’ve been spending some time watching, rewatching and clipping interesting excerpts from the Senate Appropriations Energy and Water subcommittee hearings on the FY2016 Department of Energy budget.

It’s not everyone’s idea of entertainment, but it’s fascinating to me to watch publicly accessible discussions about how our government makes decisions, sets priorities and spends the money that it collects each year from taxpayers — along with the money that it’s borrowing from future generations who are not yet represented in the decision process.

There is a growing library of clips on my YouTube channel. I’ll highlight some of them here over the next few days. Several major decisions in the lengthy budget process will be made during the next few weeks as the President’s budget is marked up by the Congress. The decisions are not final; sadly, it’s probable that we will have another year in which the budget never gets finalized and the programs muddle along under a continuing resolution.

Many Atomic Insights readers have a strong interest in developments in the smaller reactor — SMR — field, so I thought I would start this series with a video highlighting all of the instances during the hearing in which the topic was discussed or alluded to.

Senator Alexander (R-TN) has always expressed a strong interest in nuclear energy and has been keenly interested in SMRs for at least 6 years. He participated in the B&W mPower introduction event in June 2009, calling it a “truly historic occasion.”

One would have thought that Secretary Moniz would have been a little better prepared to answer questions about that topic; a proper staff briefing would have made sure he was aware that the chairman of the Appropriations subcommittee that reviewed his budget has a special interest in SMRs.

If developing smaller reactors as a tool in the battle against carbon dioxide emissions was as high of a priority for the Administration as one would believe based on the amount of talk given to the topic, it would be logical to have assumed that budget preparers at DOE and in the Office of Management and Budget would have made additional funds available for research to determine if there were barriers to entry that could be removed.

It might also have been expected that since one of the early pioneers in the effort had lost steam the Department would have suggested other ways to help speed the process. That is especially true since part of the reason B&W reduced funding was a recognition that being first with a “new” nuclear idea in the US is very expensive.

The company spent five years and several hundred million dollars with a major portion of that expenditure of time and money used to figure out its way through the 4500 pages of the NRC’s standard review plan and the tens of thousands of other pages of federal regulations, standards prepared by bodies like ASME and ANS, regulatory guidance, regulatory memorandums, and other helpful suggestions.

No, I have no references for that statement. I was the Procedure and Process Development Lead for the project from Sep 2010 – Sep 2013. I was there and have a pretty fair idea about the magnitude of the effort required, even for an improved light water reactor.

After watching Senator Alexander and Dr. Moniz discuss the misplaced priorities of an Administration that supports a tax credit for mature wind turbines that ends up costing about $6 billion per year while cutting the budget for SMRs by about 33% — from ~$90 million in FY2015 to ~$60 million in the FY2016 request — I recalled a similar “conversation” that I had with Dr. Moniz in November 2013.

I was fortunate enough to be selected as a participant in an annual conference called the National Academy Keck Futures Initiative (NAKFI). The topic for 2013 was the future of advanced nuclear technologies. Dr. Moniz, who had recently replaced Dr. Chu as the Secretary of Energy spoke to us via video conference about the DOE’s program.

He described the SMR program as a flagship endeavor for the DOE and then stated that its budget was $452 million spread out over six years, which is an average of $75 million per year split between two recipients. He said that the program was limited to light water reactors, even though there are a plethora of other options being seriously investigated. Here is a direct quote of that portion of the discussion.

Moniz: Our second major commitment is advance technology regime and here, probably the centerpiece is the small modular reactor technical licensing program. We have $452 million available over six years to advance small modular reactors to design/design certification stage. We think these technologies, and there are a multiplicity of them as you know, are very, very, very promising very interesting features, passive safety features, nice security features, underground siting, factory production, hopefully driving down costs, more flexibility including flexibility in financing inherent to the scale, but of course we won’t really know about the cost performance until we get small modular reactors out there.

We’ve given out one award so far, that’s to mPower, with the idea that there could be a reactor operating early in the next decade. We have a second procurement outstanding which we are working to finalize.

Adams: Good morning Dr. Moniz. This is Rod Adams and I am the owner and publisher of Atomic Insights. I’m interested to pursue a little bit your description of the small modular reactor program as a flagship program funded at $452 million six years. That’s roughly one percent of the amount of money that we are spending on the production tax credit for wind in 2013. Will you comment on that, please sir?

Moniz: (Dismissively) Yes. We’re spending 450 million dollars (laughter) to assist two designs, at least two designs to move forward to design certification. I don’t believe these kinds of comparisons are particularly helpful.

I’ve attached an audio file below that includes some additional commentary about the prioritization that is apparent from the fact that the Administration supports spending $6,000 million per year for 30% wind investment tax credits — often obscured as Production Tax Credits spread over a 10 year period — while asking to spend only $60 million for its “flagship” nuclear energy program.

Here is one more comparison that the Administration and the Congress might not like to emphasize. Some people interested in SMRs were excited to find out that they made the list of choices available to federal agencies in the President’s recent Executive Order Planning for Federal Sustainability in the Next Decade.

I’ll admit that I was happy about that selection myself. Then I read the list and noticed that it included something called “thermal renewable energy” as number 1 on the list where SMRs appeared in the number 4 position. That term was kind of new to me, but after watching the DOE budget hearing I found out that certain special interest groups were asking the federal government to both subsidize and promote — via an expensive educational program — the development of systems that burn wood for heat.

Here is the clip of that interaction between New Hampshire Senator Shaheen and Sec. Moniz.

PS – I learned something I didn’t know about Dr. Moniz while reading a March 28, 2015 New York Times article titled No. 2 Negotiators in Iran Talks Argue Physics Behind Politics.

Mr. Moniz, who was born in 1944 in Fall River, Mass., got hooked on science as a high school student in the post-Sputnik era of the late 1950s and early 1960s. After attending Boston College, he earned a doctorate in theoretical physics from Stanford and then he joined the faculty at M.I.T., where he fell in with a group of physicists who were active in the Union of Concerned Scientists and similar groups.

He soon found himself immersed in questions about managing the “nuclear fuel cycle” technology that was giving emerging nations the capability to build power reactors — and nuclear weapons. The spread of that bomb-making technology was an unintended consequence of President Dwight D. Eisenhower’s “Atoms for Peace” program. Mr. Moniz has spent the rest of his career trying to undo the damage.

“What couldn’t be realized back then,” he said, “was how fast the technology would create ‘threshold states’ ” on the verge of nuclear weapons. Iran is the classic example.
(Emphasis added.)

That explains a lot about his wishy-washy position on nuclear energy versus his strong support for unreliables like wind.

Update: (March 30, 2015 11:39) An Atomic Show subscriber living in Idaho Falls heard the audio extra in which Sec. Moniz sloughs off a question about the $6 billion per year spent on the wind tax credit. He was on a long bike ride through a wind farm located east of the city.

The clip inspired him to take a hard look at the turbines surrounding him. He noticed that only one of the many enormous machines he could see was turning. He thought that was odd considering how hard he was having to work as he rode into a stiff wind that was rolling tumbleweeds and making the tall grass lean over.

Then he remembered that turbines have upper wind limits and must be feathered when the wind exceeds its limits to protect them from damage. Here is the video he shot on March 29, 2015 in the foothills east of Idaho Falls.

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