US NRC order could delay decision on new nuclear reactor licensing

Approval of Duke Energy's plans to build two nuclear reactors in Floridacould be delayed by the US Nuclear Regulatory Commission's decision Tuesdayto put on hold decisions on granting licenses to build new reactors pendingresolution of a court decision overturning NRC's waste confidence rule.

NRC has said it expects to finish the safety review of combinedconstruction permit-operating licenses, or COLs, for two AP1000 units at theutility's Levy County, Florida, site by October.

The agency was targeting February for a mandatory hearing on theapplication and said it would issue final licensing decisions within fourmonths of completing mandatory hearings.

The NRC commissioners, in an order issued Tuesday, said the agency willdefer final decisions on licensing new reactors, or issuing 20-year licenserenewals for existing ones, until it decides how to comply with a June 8decision by the US Court of Appeals for the District of Columbia Circuit thatstruck down NRC's updated waste confidence rule.

The court ruled that the NRC is required to conduct an environmentalassessment of the rule and "failed to properly examine future dangers and keyconsequences" of storing used commercial nuclear fuel at power reactor sitesfor decades.

The updated rule that NRC issued in 2010 says the agency has reasonableassurance utility spent fuel can be safely stored for at least 60 years aftera power reactor's operating license expires and then disposed of. Wasteconfidence is central to the agency's ability to license new reactors andrenew the operating licenses of existing reactors.

The order, issued in response to a petition by 24 anti-nuclear groups andactivists filed with the agency June 18, said NRC is "now considering allavailable options for resolving the waste confidence issue." It said thiscould include issuing a revised generic regulation, a regulation that wouldassess waste nuclear fuel on a site-by site basis, or a combination of both.

Duke is confident NRC will act "in a timely manner" to address theissues raised by the court decision and resume final licensing decisions,spokeswoman Rita Sipe said in an email late Tuesday. "We are encouraged thatthe NRC will continue to move forward with all licensing reviews andproceedings while it considers options for resolving the waste confidenceissues raised by the court's remand," Sipe said.

David McIntyre, an NRC spokesman, said Tuesday in an email that he couldnot estimate when NRC would promulgate a revised waste confidence rule, butsaid: "This is a matter of high urgency, so it is something that will be donesooner, rather than later."

Duke's application for COLs for two AP1000 reactors at its WilliamStates Lee site in South Carolina is scheduled for a mandatory hearing inMarch, according to NRC's website. An application for two new units at theShearon Harris site in North Carolina should have its safety review completeby September 2013, NRC said. It has not set a target for a final decision oneither of these applications.

Applications for COLs for 20 new reactors and license renewals for 13units have been filed with NRC, according to Tuesday's order. An additional14 license renewal applications are expected to be filed between October andearly 2017, according to NRC's website.

The Tennessee Valley Authority is reviewing the NRC order for itspossible impact on the Watts Bar-2 completion project now under way,spokesman Michael Bradley said in an interview Tuesday.

TVA is completing Watts Bar-2, in Tennessee, on which work had stoppedin the 1980s. The federal power producer has said it plans to restartcommercial operations of the unit around December 2015. NRC has not said whenit plans to complete its review of the application for an operating licensefor the unit.

Ellen Ginsberg, the Nuclear Energy Institute's general counsel, said inan email Tuesday: "Given the circumstances created by the court's decision,the agency reasonably permitted licensing reviews and adjudications toproceed while it addresses the remand. The commission appropriately used itsinherent supervisory authority to direct licensing boards to hold relatedcontentions in abeyance pending further agency action."

Edward Kee, a vice president with NERA Economic Consulting, which doeswork on nuclear economics issues for US and non-US companies, said in anemail Tuesday: "I see this order as a routine NRC housekeeping matter toreflect the court's decision. I expect that any delays in COL or licenserenewal decisions as a result of this order will have a minimal impact on thenuclear industry.

--Jim Ostroff, james_ostroff@platts.com--William Freebairn, william_freebairn@platts.com--Edited by Keiron Greenhalgh, keiron_greenhalgh@platts.com