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Atomic Insights

Atomic energy technology, politics, and perceptions from a nuclear energy insider who served as a US nuclear submarine engineer officer

New Nuclear

Can prototype nuclear reactors be licensed in the US under current rules?

December 15, 2022 By Rod Adams 13 Comments

Designers and developers of nuclear power systems that are substantially different from conventional light water reactors face a conundrum. They are required to provide sufficient information to regulators to allow them to confidently predict how the designs will behave under a comprehensive set of postulated operational and accident conditions. Proving their design is safe is a time-consuming, question-filled challenge that is even more difficult without an operating system on which to verify analysis assumptions.

STR-1 Prototype for USS Nautilus at INL

Modeling can only go so far without real data. Creating partial test loops or integrated system testing installations consumes substantial resources without exercising a supply chain useful for a full scale system. NuScale and former mPower employees can testify to the challenges.

In 10 CFR 50.2 Definitions: prototype reactor “means a nuclear reactor that is used to test design features, such as the testing required under § 50.43(e). The prototype plant is similar to a first-of-a-kind or standard plant design in all features and size, but may include additional safety features to protect the public and the plant staff from the possible consequences of accidents during the testing period.”

Aside: We’ll come back to paragraph 50.43(e) later. End Aside.

Using prototypes can be a way to accelerate development. They are common in a variety of industries that need approval from public safety regulators, most notably in the automotive and aviation industries. One might ask why it has been more than five decades since they were last used in atomic energy development in the United States.

Types of Atomic Energy Licenses

Chapter 10 of the Atomic Energy Act of 1954 (AEA) is titled Atomic Energy Licenses. Chap 10 Section 101 states that production or utilization facilities using special nuclear material need to have licenses issued under section 103 or 104. Section 103 is titled “Commercial Licenses” and its first sentence refers to a finding under section 102.

Section 102 imposes a practical value test which says that a facility that is sufficiently developed for industrial or commercial use should obtain a section 103 license.

Section 104 is titled Medical Therapy and Research and Development. Its initial three paragraphs describe different types of licenses, (a) medical therapy, (b) facilities that can provide the information required to support a finding of practical value required in Section 102, and (c) facilities that are useful for research and development but not expected to be useful in industrial or commercial purposes. University research reactors are examples of the types of facilities that obviously qualify under paragraph c.

But a prototype facility that is designed to be used to test reactor plant designs that are not familiar to either customers or the NRC is arguably not a facility that has proven that it has a practical value. Logically, it should not be required to be licensed as a commercial facility under Section 103.

Looking at just the Atomic Energy Act, it would seem that prototypes as defined in 10 CFR 50.2 should be licensed under Section 104(b) .

It’s not that simple.

10 CFR Part 50, which is the regulatory code enact the licensing provisions of the AEA, includes statements under “Classification and Description of Licenses” that indicate that a major change was put into effect on December 17, 1970. That change removed Section 104(b) as a licensing option. There are grandfather clauses and a clause that allows section 104(b) to be used if directed by a specific law.

The change also modified Section 104(c) in a way that allows prototype reactors. It says “(c) A production or utilization facility, which is useful in the conduct of research and development activities of the types specified in section 31 of the Act, and which is not a facility of the type specified in paragraph (b) of this section or in § 50.22.”

Paragraph 50.22 contains a definition of a commercial reactor that allows a full scale prototype to use Section 104(c) as long as it operates within given limitations. A production or utilization facility “is deemed to be for industrial or commercial purposes if the facility is to be used so that more than 50 percent of the annual cost of owning and operating the facility is devoted to the production of materials, products, or energy for sale or commercial distribution, or to the sale of services, other than research and development or education or training.”

If the sale of materials, products, energy or services does not produce more than 50% of the annual cost of the facility, it is not automatically considered to be an industrial or commercial facility.

The testing schedules of prototype reactors would almost certainly preclude those devices from being able to cover 50% of their annual costs – including amortization, interest and depreciation – by selling materials, products, services or energy. That is a common feature of prototypes: no airplane developer or automobile manufacturer expects their flight test and certification planes or concept cars to be commercially viable. They consider them to be part of the development expense enabling them to sell a series of products.

I’ve been discussing this potential path for licensing non-light water reactors for at least a decade with people inside the industry, starting with a paper I wrote for my former employer at B&W mPower. Those discussions revealed either skepticism that the effort would be accepted by the NRC, a concern that it would not be a valuable way to speed the licensing process, or a desire to follow through with the mandated development of Part 53 as a new licensing path for non light water reactors.

After the NRC staff released its proposed draft of Part 53, The Breakthrough Institute issued an analysis explaining why implementing a rule based on that draft without major changes will impede progress. BTI’s Ted Nordhaus and Adam Stein also published a blog post titled NRC Staff Whiffs On Nuclear Licensing Modernization that ends with a scary conclusion:

…there is little reason to expect that the first advanced reactors will be licensed and demonstrated by the end of this decade, nor that the US will have the nuclear technologies available at scale in the coming decades that the world will need to deeply decarbonize the US and global economies.

NRC Staff Whiffs On Nuclear Licensing Modernization

Since developing a new process seems to be too hard to do correctly, it’s time to invigorate older processes that already exist.

It might be useful to take a brief detour to explore the reasons why no one is pursuing this prototype path – yet.

History of nuclear power prototypes

The US Naval Nuclear Propulsion Program has long recognized the training, testing, supply chain and experience value of full scale prototype nuclear reactors, especially for system designs that are either completely new or a significant change from previously used designs.

Navy nuclear prototypes have been as much like the power plants installed in ships as possible. STR-1, the prototype for the USS Nautilus reactor, was so realistic that it was installed in a simulated submarine hull with a large tank full of water around the portion of the hull containing the reactor plant.

For about two decades after STR-1, the Navy continued building land-based prototypes for nuclear propulsion plants that were significant departures from proven designs.

Full scale prototypes can be just as useful for commercial nuclear plant vendors. The people who drafted and enacted the Atomic Energy Act of 1954 recognized the value of prototype reactors that were as close as possible to commercial designs. The Navy’s STR-1 had been operating for about a year by the time AEA 1954 was passed into law.

Until 1970, nearly all US nuclear power plants were licensed under Section 104(b) as “facilities involved in the conduct of research and development activities leading to the demonstration of practical value of such facilities for industrial or commercial purposes.”

The facilities were being purchased by utilities to produce industrially useful power stations without going through the antitrust provisions of Chapter 16 of the Atomic Energy Act. They were also qualified to receive substantial subsidies from the AEC under the theory that the new facilities would “lead to major advances in the application of atomic energy for industrial or commercial purposes.”

Part 104(b) also directed the Atomic Energy Commission, whose licensing responsibilities were transferred to the Nuclear Regulatory Commission in 1974, to “impose the minimum amount of such regulations and terms of license as will permit the Commission to fulfill its obligations under the Act to promote the common defense and security and to protect the health and safety of the public and will be compatible with the regulations and terms of license which would apply in the event that a commercial license were later to be issued pursuant to section 103 for that facility.”

Part 104(b) licenses were useful and helped jump start the American nuclear energy industry. One might legitimately wonder what happened to force a regulatory change to remove this type of license.

Soon after the Oyster Creek nuclear power station won a commercial bid without overt subsidies, atomic energy competitors, led by the National Coal Policy Conference (NCPC), claimed that the concentrated nuclear power industry was taking unfair advantage of Part 104(b) provisions. These atomic energy competitors engaged in strong, sustained political actions designed to push the AEC to make a “finding of practical value” for light water reactors that had been sufficiently well-developed to attract utility customers.

Their argument was simple and logical – if pressurized water and boiling water reactors were winning customers and were being built as facilities that would be operating for decades as baseload power plants, then any reasonable person would consider them to be of “practical value.”

In early 1964, Joseph Moody, President of the NCPC, stated his group’s position succinctly.

There can be no question that they are of “practical value” – or else they would not be used to supply commercial power.”

Balough. Brian “Chain Reaction” Cambridge University Press 1991. p. 208

The controversy over the AEC’s practical value determination lasted 6 years and involved a number of congressional hearings and court cases. The saga fills 13 pages in Brian Balough’s exceptionally well-researched book titled Chain Reaction: Expert debate and public participation in American commercial nuclear power. 1945-1975.

One reason that the “coal boys” (Balough’s term) ultimately won the war after losing several battles was that nuclear power plants had been scaled to such a large size that the Congressional overseers of the AEC (the Joint Committee on Atomic Energy) and responsible courts agreed there was a need to perform the Justice Department’s antitrust review required by Chapter 16 of the AEA for Part 103 commercial licenses and avoided under Part 104(b).

Even the most stubborn defenders of the AEC’s policy to avoid making a finding of practical value realized that their position was difficult to justify for large, light water reactors similar to those that were being ordered at a rate of dozens per year with a peak of 7 reactors in a single month (Feb 1967) .

Prototypes can be important for non-light water reactors and advanced reactors with uniquely new design features

Unlike the large light water reactors that were being constructed on a large scale by mid 1970, when the AEC made its practical value determination for pressurized and boiling water reactors, today’s advanced reactors are several steps away from a reasonable person’s definition of “practical value.” They still qualify as prototypes.

A prototype licensing process would follow the two-step (construction permit followed by an operating license) process defined in Part 50. It is more suited for projects with expected changes in detailed design during construction and which are are unlikely to be built in a repeatable series. It’s also the licensing process that recognizes the substantial value provided by prototype reactors in § 50.43(e).

(e) Applications for a design certification, combined license, manufacturing license, operating license or standard design approval that propose nuclear reactor designs which differ significantly from light-water reactor designs that were licensed before 1997. Or use simplified, inherent, passive, or other innovative means to accomplish their safety functions will be approved only if:

(1)(i) The performance of each safety feature of the design has been demonstrated through either analysis, appropriate test programs, experience, or a combination thereof;

(ii) Interdependent effects among the safety features of the design are acceptable, as demonstrated by analysis, appropriate test programs, experience, or a combination thereof; and

(iii) Sufficient data exist on the safety features of the design to assess the analytical tools used for safety analyses over a sufficient range of normal operating conditions, transient conditions, and specified accident sequences, including equilibrium core conditions; or

(2) There has been acceptable testing of a prototype plant over a sufficient range of normal operating conditions, transient conditions, and specified accident sequences, including equilibrium core conditions. If a prototype plant is used to comply with the testing requirements, then the NRC may impose additional requirements on siting, safety features, or operational conditions for the prototype plant to protect the public and the plant staff from the possible consequences of accidents during the testing period.

(Emphasis added)

10 CFR 50

Notice that there are two alternative paths for supporting the approval of the safety functions of reactors that are not light water reactors licensed before 1997. (There is a reason for using bold print to emphasize the OR between paragraphs (1) and (2). Developers need to firmly and effectively establish their chosen path and not allow anyone to attempt to impose additional elements from the alternative path.)

The second path involves a sufficiently designed test program of a prototype plant that has extra public protection features that might include using a remote site, adding special safety features (like an over-designed containment structure) or enhancing staffing requirements.

It is nice to know that the regulations for obtaining approval for a commercial license offer the opportunity to prove reactor safety using a prototype. Unfortunately licensing experts and regulators appear to be convinced that precedence demands that full scale prototypes need commercial reactor licenses.

Why haven’t reactor designers chosen the prototype path described here?

Decisions to avoid prototypes using Section 104(c) are reasonable in a paradigm applicable to extra large nuclear plants. Owners of projects that cost $5 to $10 billion or more would suffer unacceptable losses if they had a licensing provision that prohibited them earning more than 50% of their annual costs from selling materials, products, services or energy.

That provision isn’t an unaffordable barrier for small and very small reactors, especially if the cost accounting for the prototype is fully burdened with design and development costs plus a depreciation schedule that recognizes the abbreviated lifetime of prototypes.

The revenue limitations might be a significant barrier for some SMR designers if they overlook the fact that their prototypes would be allowed to produce unrestricted income from R&D and training. Prototype owners also have the option of applying for a commercial license after their plant proves itself to be of practical value during a testing, training and verification phase as a prototype.

Note: Vendors don’t have to use prototypes. They can choose to follow paragraph 50.43(e)(1) and find customers based on obtaining license approvals from component and system testing with detailed analysis. The prototype path is an alternative route that might avoid a significant portion of the overhead of proving that the analysis was sufficiently comprehensive. End Note.

Prototypes will be one of a kind, though some might be successful enough on the first try to eventually become FOAK commercial units holding Part 103 licenses. Limitations on earning income from sales of materials, products, energy or services contained in Section 104(c) are sufficient barriers to prevent applicants from repeating the mistake in the 1960s of creating justifiable animosity by overusing the special encouragements available for non-commercial plant licensees.

Even the US Navy eventually determined that it was no longer cost-effective to build complete prototypes for new reactors that were moderate extrapolations of existing reactors.

Note: When the Navy stopped building prototypes, their training and testing functions were deemed important enough to repurpose reactors that had served their time as ship propulsion plants but still had remaining useful life. Many of today’s nuclear sailors are trained on moored training ships (MTS) that were once active submarines. End Note.

In a period with multiple advanced reactors under development, none of which have proven that they are of practical value, a smoothed path towards full-scale prototypes could be immensely useful.

To achieve this desirable result, NRC regulators must fully accept their responsibility under Section 104(c) to “impose only such minimal amount of regulation of the licensee as the Commission finds will permit the Commission to fulfill its obligations under this Act to promote the common defense and security and to protect the health and safety of the public and will permit the conduct of widespread and diverse research and development.”

Congressional direction doesn’t necessarily need new legislation. It can come in the form of hearings and required testimony along with letters that direct the NRC to follow existing laws.

It’s not too late for today’s reactor designers to make a switch to Part 104(c) license applications if they determine it is advantageous and if the NRC regulators express their support for a path that would lead to more reliable safety determinations in a shorter period of time.

Filed Under: Advanced Atomic Technologies, New Nuclear, Nuclear regulations

Atomic Show #303 – Bret Kugelmass, CEO Last Energy

December 9, 2022 By Rod Adams 7 Comments

Rendering of Last Energy’s 20 MWe installations (Last Energy)

Last Energy is an innovative new company governed by a philosophy of avoiding the invention of anything that has not been done before. They have created a business that is laser focused on building, owning and operating small (20 MWe), modular pressurized water reactors and selling the electricity they produce under long term power purchase agreements.

On Atomic Show #303, Bret Kugelmass, the founder, president and CEO of Last Energy describes the path he took from earning a masters degree in robotics at Stanford, through the founding and operation of a successful drone company, to a highly respected podcast, through a non profit think tank and into a utility company that has designed a nuclear power plant that can begin operating as early as 2025 with commercial scale repetition starting almost immediately.

Where some believe that nuclear fission requires highly specialized equipment, Last Energy has found that pressure vessels, pumps, piping, heat exchangers and valves of similarly high quality standards are widely available from experienced, commercial suppliers. Their systems, structures and components (SSC) use well-accepted ASME codes and standards and are often identical to the SSC that have been used for decades in chemical processing, oil and gas, and other industrial applications.

Last Energy has chosen a small number of initial deployment locations, specifically in the UK, Romania and Poland. They are aiming to supply power to major industrial consumers that need somewhere between 20 and 100 MWe. They will connect to their customers “behind the meter”. From the customer point of view, Last Energy power will look and act like the electricity they currently purchase from their local utility company.

Last Energy systems will have approximately 2 m diameter pressure vessels that can accommodate full length fuel assemblies and standard control rods with proven drive mechanisms mounted on the reactor head. There will be fewer assemblies in the core, and they will be replaced as a whole unit every 6 years. Each plant will have a single steam generator and coolant pump.

Kugelmass explains the reasons behind the company philosophy and design choices. He provides a good summary of their business model and their driving motivations.

One aspect of Last Energy’s plans should motivate US politicians to modify our current export control regime. Even though their plants are designed to be well within the production capability of US manufacturers, the company is studiously avoiding the production of any nuclear component in the US. Export control processes are too burdensome to be economically justifiable.

I hope you enjoy the show and participate in the conversation.

https://s3.amazonaws.com/AtomicShowFiles/atomic_20221208_303.mp3

Podcast: Play in new window | Download (Duration: 53:06 — 32.1MB)

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Filed Under: International nuclear, New Nuclear, Podcast, Pressurized Water, Small Nuclear Power Plants, Smaller reactors

Atomic Show #302 – Dr. Sama Bilbao y Leon, Director General, World Nuclear Association

December 2, 2022 By Rod Adams 5 Comments

Dr. Sama Bilbao y Leon, the Director General of the World Nuclear Association, visited the Atomic Show to provide an international perspective on the revival in interest in nuclear energy deployment. As the head of the organization that represents the global nuclear industry, provides education about all matters related to using nuclear technologies, and lobbies […]

Filed Under: International nuclear, New Nuclear, Podcast, Politics of Nuclear Energy

Atomic Show #301 – Matt Crozat, Executive Director for Strategy and Policy Development, NEI

November 11, 2022 By Rod Adams 4 Comments

The nuclear energy policy landscape in the US has changed significantly during the past 5 years. Once seen as an issue with enormous differences between the political parties, it has become one of the few topics on which both parties can have a civil discussion and agree on many key provisions in supportive legislation. Matt […]

Filed Under: Advanced Atomic Technologies, Business of atomic energy, New Nuclear, Podcast

How Hot is Cold Fusion?

August 12, 2022 By Valerie Gardner 51 Comments

The 24th International Conference on Cold Fusion (ICCF24) was held at the lovely and spacious Computer History Museum in Mountain View, CA over four days in late July. As a venture investor looking at evaluating and investing in a wide range of advanced nuclear ventures, I was invited to participate and/or sponsor the event. While […]

Filed Under: Advanced Atomic Technologies, Alternative energy, Atomic Pioneers, Clean Energy, Climate change, Cold Fusion, Conferences, ICCF24, Innovation, International nuclear, Investing, Low Energy Nuclear Reactors, New Nuclear, Smaller reactors, Solid-State Energy, Venture Capital Tagged With: Anthropocene Institute, Carly Anderson, cold fusion, Florian Metzler, ICCF, ICCF24, LENR, low energy nuclear reactions, Matt Trevithick, multi-body interactions, Nucleation Capital, solid-state fusion energy

Why are smaller reactors attracting so much interest?

August 4, 2022 By Rod Adams 19 Comments

Small modular reactors (SMRs) are gaining increased attention as a major opportunity in clean power production. They are a welcome tool in the necessary transition from an energy system dominated by hydrocarbon combustion to one that produces more power for more people with dramatically reduced greenhouse gas emissions. As a partner in Nucleation Capital, a […]

Filed Under: Advanced Atomic Technologies, Atomic Entrepreneurs, Economics, New Nuclear, Small Nuclear Power Plants, Smaller reactors

Atomic Show #298 – Marcus Seidl – Researching small modular reactors near Hamburg, Germany

July 17, 2022 By Rod Adams 3 Comments

Marcus Seidl is a German nuclear professional who received his PhD in nuclear physics in 2002, a year after his home country decided that it would exit nuclear energy in favor of investing in a large roll out of renewable energy sources. He has worked for German utility companies, for a vendor erecting a state-of-the-art […]

Filed Under: Advanced Atomic Technologies, New Nuclear, Podcast, Smaller reactors

Nuclear energy growth prospects and secure uranium supplies

April 28, 2022 By Rod Adams Leave a Comment

The 121 Mining Investment event held in Las Vegas on March 30 and 31 included a panel discussion with leaders from three uranium mining companies, each of which has an asset base of potentially lucrative mining prospects mostly located in North America. The fourth member of the panel was a managing partner at Nucleation Capital, […]

Filed Under: 121 Mining Las Vegas 2022, Business of atomic energy, New Nuclear, Uranium mining

Atomic Show #296 – Julia Pyke, Director of Finance Sizewell C

March 12, 2022 By Rod Adams 41 Comments

Sizewell C is a project to build a 3,200 MWe power station consisting of two EPR units on the site that currently hosts a single large pressurized water reactor (Sizewell B). With the exception of site-specific foundations and structures, the new power station will be a copy of the station currently under construction at Hinkley […]

Filed Under: Business of atomic energy, International nuclear, Investing, New Nuclear, Podcast Tagged With: Atomic Show, clean energy policy, finance, Julia Pyke, nuclear finance, Sizewell C, United Kingdom

The Assay TV speaks with Rod Adams, Managing Partner of Nucleation Capital and Atomic Insights host

February 20, 2022 By Editor Leave a Comment

The Assay is a media project of the 121 Group, based in Hong Kong, that serves investors, fund managers and analysts who are involved with and/or investing in a wide range of mining ventures. As part of their efforts to bring a greater understanding of the complex markets that control the prospects of mining ventures, […]

Filed Under: Advanced Atomic Technologies, Atomic education, Atomic Entrepreneurs, New Nuclear, Nuclear Fuel Cycle, Nuclear Waste, Podcast, Pro Nuclear Video, Uranium mining Tagged With: 121 Group, Adam Thompson, The Assay, The Assay TV, uranium, uranium market

Catching Oklo — a rising star!

December 14, 2021 By Rod Adams 45 Comments

Update: On Jan 6, 2022, the NRC denied Oklo’s COA application “without prejudice.” Power published an article titled NRC Dismisses Application for Oklo Advanced Nuclear Reactor that provides a solid early summary of the action and its implications. A new generation of clean energy is on the horizon Oklo is a clean energy company that […]

Filed Under: Advanced Atomic Technologies, Investing, Liquid Metal Cooled Reactors, Micro Reactors, New Nuclear, Small Nuclear Power Plants

What makes smaller nuclear power systems so exciting?

September 21, 2021 By Rod Adams 27 Comments

Let me start by dispelling the notion that I think smaller, modular, manufactured nuclear power systems – often called SMRs or micro reactors – are the be all and end all solution to anything, including climate change or energy security. Though not THE solution, they have the potential to be a crucial, uniquely capable part […]

Filed Under: Advanced Atomic Technologies, Business of atomic energy, Clean Energy, decarbonization, Economics, Investing, New Nuclear, Small Nuclear Power Plants, Smaller reactors

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