US tackles limits on foreign-owned nuclear assets

OREANDA-NEWS. February 03, 2015. Experts are urging the Nuclear Regulatory Commission (NRC) to convince a suspicious Congress that foreign investment will help sustain a withering nuclear power industry.

Top hands from the nuclear and defense industries testified last week during a hearing at the agency's headquarters near Washington, DC, that Cold War-era regulations like the Atomic Energy Act are outdated, and that fractional ownership by foreign entities does not mean foreign control.

The 1954 law rules out foreign ownership, control and domination of commercial nuclear power plants.

But nuclear technology is increasingly modular, with a global supply chain, and developed by joint ventures of multinational entities.

Only a few new US nuclear generation projects show life, while two reactors recently closed because of poor market and regulatory conditions. An environmental group has consistently challenged the 10pc stake in a proposed expansion of the South Texas Project held by a subsidiary of Toshiba. NRG Energy owns the rest, but Toshiba has an option to increase its stake.

The NRC staff calls the structure a novel question of law and policy. So the commission sought outside advice.

Marquee witness Sean O'Keefe, former head of the National Aviation and Space Agency and of Airbus North America, said tight regulations assure technological obsolescence.

Experts from the defense industry, where foreign sourcing is the norm, explained how to strike a balance between security and meeting the Pentagon's needs. Paul Murphy, counsel to law firm Milbank, Tweed Hadley & McCoy, said nuclear technology vendors increasingly want plant equity, but restrictions limit the US options to deal with climate change and grid stability.

Discussion of the problem might make it worse, with those in Congress competing to invoke fears over foreign control of nuclear materials. John Hamre, a former top Pentagon official who heads the the Center for Strategic and International Studies, said Congress should hear from the US nuclear agency that it is "strengthening the law in a predictable way."