Nuclear Fuel Working Group Outlines How U.S. Could Regain Global Leadership

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The U.S. will attempt to regain its international standing as a world leader in nuclear energy through a three-pronged strategy that will essentially seek to strengthen the full domestic nuclear fuel cycle, possibly deny imports of nuclear fuel fabricated in Russia or China, and promote advanced reactor technologies.

The strategy is outlined in the White House's Nuclear Fuel Working Group's (NFWG's) long-awaited findings released on April 23 in its report, "Restoring America's Competitive Nuclear Advantage: A Strategy to Assure U.S. National Security." President Trump convened the group, which includes representatives from various executive branch agencies, in July 2019 after the Department of Commerce in May 2019 found that uranium imports posed a threat to national security. The NFWG was tasked with examining domestic nuclear fuel production and options to revive the entire nuclear fuel supply chain.

Strong Emphasis on the Front-End of the Nuclear Cycle

The NFWG report, which Energy Secretary Dan Brouillette described as a "roadmap" in a call with reporters on Thursday, sets out three key priorities. First, it envisions that the U.S. government would take "bold action to revive and strengthen the uranium mining industry, support uranium conversion services, end reliance on foreign uranium enrichment capabilities, and sustain the current fleet, removing strategic vulnerabilities across the nuclear fuel cycle and restoring a world-class workforce to provide benefits to the U.S. and to compete in the international market." A second aspect foresees a spate of U.S. government-leveraged efforts to advance nuclear research, development, and demonstration investment-including of the front-end of the nuclear fuel cycle, as well as of the domestic nuclear industry. And finally, the government plans to move into markets dominated by Russian and Chinese state-owned enterprises (SOEs), including as they relate to nuclear reactor technology and nuclear fuel.

But on its face, the strategy appears to be a concerted effort to revive the flailing domestic uranium mining industry. One policy objective is described as an effort to "triage the damage," and it calls for "immediate action to support domestic uranium miners and restore the viability of the entire front-end of the nuclear cycle. Over the next decade, it envisions that the government will provide funding for a competitive procurement for U.S. uranium mining and conversion services. After the government addresses "the existing pressure on the uranium mining sector," the report says it "will also consider enrichment needs."

The U.S. uranium reserve first announced in the Department of Energy's (DOE's) latest budget request will meanwhile provide "assurance of availability of uranium in the event of a market disruption and support strategic U.S. fuel cycle capabilities, and is not designed to replace or disrupt market mechanisms," it says. However, it adds that the reserve would directly support the operation of at least two U.S. uranium mines and establish active domestic conversion capabilities. Once the administration evaluates the impacts of the reserve and other measures, it may also consider expanding the existing American Assured Fuel Supply (AAFS), and merging it with the new Uranium Reserve to establish a "unified reserve." The AAFS, it notes, currently contains enough uranium for six reactor core reloads and a modified version could increase the number of reactor fuel reloads of enriched uranium substantially and could require those loads to contain a percentage of unobligated uranium, meaning uranium that is free of peaceful use restrictions established through international agreements.

For more on recent global nuclear fuel developments, see POWER's ongoing series: Part 1:A New Frontier for Nuclear Fuels(March 2020) Part 2:The Quest for Next-Generation Nuclear Fuels(April 2020)

Sustaining the Domestic Nuclear Power Sector

The report's emphasis on the importance of long-term competitiveness of the domestic civil nuclear industry-including its fleet of 96 reactors-is a big part of the group's efforts to prop up the front-end part of the industry. However, the report is vague in its objectives to achieve this.

As POWER reported last week, nuclear generators have embarked on a concerted effort to improve bottom lines as power markets are increasingly inundated with cheap gas and renewable power. Since 2013, eight reactors-with a combined 6.7 GWe of summer capacity-have been prematurely retired, generators whose fate was determined by market conditions, political pressure, or financial stresses assailing the sector. Another 25 units may be at risk of premature retirement, the NFWG's report suggests.

The NFWG specifically points out that most nuclear plants that are "under economic stress" are in the deregulated electricity markets that are overseen by the Federal Energy Regulatory Commission (FERC). But while it recognizes FERC's role in creating a level playing field "for all energy sources in power markets," it stops short of championing favorable treatment for nuclear power. "We're not intervening in the marketplace in the sense that we're helping to establish the price of electricity or subsidizing the generation of electricity or anything of that nature," Brouillette said, when asked about it on Thursday. "What we're attempting to do is to reestablish a very important component of the fuel cycle."

Vague on the Future of Advanced Nuclear Fuel

The report notes that for now, funding for research and development (R&D) for high-assay low-enriched uranium (HALEU) will be important to help the U.S. to reposition itself as a "global technology leader in nuclear energy." But though it lauds development that is ongoing on accident tolerant fuels (ATF) and advanced reactors (including small modular reactors [SMRs] and microreactors), it does not flesh out how or how long it will take the nation to leap ahead of international contenders in the race to establish a commercial supply of more efficient next-generation fuel.

According to the report, federal efforts appear currently fixed on the DOE's three-year $115 million demonstration of HALEU production using U.S.-origin enrichment technology, which it says "can be adopted by the private sector for commercialization and deployment after the three-year period, should the demonstration be successful and demand materialize." For now, the DOE continues work to complete its HALEU demonstration program by 2022 "to ensure that a technology is proven." The DOE "will also support HALEU infrastructure research and development to ensure that HALEU facilities and equipment are quickly licensed," it says.

Also highlighted in the report are the DOE's efforts to boost nuclear technology R&D through its National Reactor Innovation Center and Versatile Test Reactor (VTR). Funding for R&D and to support demonstration for advanced nuclear reactor technology will also be important to give the nation a competitive edge against Russia and China, whose SOEs are quickly forging ahead.

"In fact, [the Department of Commerce] estimates the global civil nuclear market to be valued at $500-$740 billion over the next 10 years. While U.S. private sector innovators have a massive opportunity to compete in these markets, the competition is a step ahead of the U.S. in demonstrating next-generation technologies," it says. "China, for instance, is currently operating a small-scale fast reactor and is starting a demonstration project. They are also operating a small-scale high temperature gas reactor. Russia meanwhile operates two commercial fast reactors and has a new fast test reactor under construction."

Compared to the two countries, the U.S. has also fallen behind on global sales of nuclear technology. "Civil nuclear reactor vendors from the United States have competed poorly in recent decades in the global new build market," it laments. "According to UxC, a nuclear industry market research and analysis company, of the 107 new nuclear reactors that will be completed around the world by 2030, 43 will be supplied by Chinese vendors, 29 by Russia, 10 by India, nine by South Korea, and four by France. Meanwhile, the performance of the United States is alarming-U.S.-based reactor vendors are expected to see only three units built by 2030, according to the same report."

Protectionism and International Expansion

Beyond recommending boosts in R&D, the group points out that the U.S. at least has the power to guard its domestic fuel fabrication subsector from erosion due to the strategic action of Russian or Chinese SOEs. In one part of the report, for example, the NFWG notes that the country faces rife competition with TVEL, Russian state-owned corporation Rosatom's nuclear fuel fabrication and supply arm.

As POWER has reported, TVEL, the world's largest supplier of fuel for Russian-designed VVERs (most of which are in Europe and require distinct hexagonal fuel assemblies), in 2016 began exploring developing fuel for "Western design" reactors with its TVS-K program in a bid to break into the pressurized water reactor market-which for years had only two suppliers: Westinghouse and Framatome. In July 2018, Exelon asked the NRC if it could install TVS-K at the financially flailing Braidwood plant in Illinois, but it withdrew its application about six months before the 2019 refuel outage began.

"The Russian state-owned enterprise, TVEL, began a project in 2008 to develop replacement fuel for U.S.-origin reactors operating in the United States. While this path is not currently being pursued, TVEL could develop such replacement fuel in the near future," the report notes. But if this occurs, the NFWG recommended "swift action, via Executive Order to limit or ban the import of nuclear fuel fabricated in Russia or China, on national security grounds, in so far as fuel imports adversely impact the physical and economic security of the United States."

Pure protectionism may not be entirely healthy for global competitiveness in the long-run, it acknowledges, however. Efforts to bolster future exports may require the expansion of civil nuclear international cooperation programs, including regulatory technical exchanges and assisting in the development of foreign nuclear regulatory frameworks to accelerate foreign licensing of U.S. nuclear technologies with existing NRC licenses, it says.

One global opportunity, for example, is to push for domestic origin commercial fuel (such as for ATF) replacements for use internationally in foreign-origin reactors. However, it notes, "In the global export market, U.S. nuclear companies have largely been precluded from selling products or services to reactors of foreign origin." Changing this paradigm could require establishing a "program to provide domestic-origin replacement fuel for foreign-origin reactors in international markets, especially in markets where U.S. allies and partner nations are solely reliant on adversarial state-owned nuclear corporations for supply," it says.

But as with all promising technology development, the future of such a program will be highly dependent on current R&D efforts, it concedes. The entire strategy will also rely heavily on budgetary, regulatory, and policy development processes "before adoption and execution," it notes, which is why the administration says it will "continue to monitor market conditions and track progress."

Among other "dynamic" challenges it faces are the intensifying pandemic, which has prompted workforce and supply chain uncertainties. But as Brouillette noted in his comments to reporters on Thursday, "With regard to the report itself and the recommendations that we're making, I don't see any delay or any specific impact on the implementation of the policies that we're recommending here. Some of the work, you will note if you read the report closely, is actually ongoing and is already in progress."

How the strategy unfolds may also depend on its political backing. The NFWG points out that Congress has signaled "broad bipartisan and bicameral support for U.S. nuclear energy." It adds: "It is within our power to pull America's nuclear industrial base back from the brink of collapse and restore our place as the global leader in nuclear technology-ensuring a strong national security position and buttressing our economic strength for generations."

-Sonal Patelis a POWER senior associate editor (@sonalcpatel,@POWERmagazine).

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