Regulators Are Charging $500K For Something The Government Admits Is Basically Pointless

The nuclear energy startup Kairos wants to build a small test reactor at a government laboratory. The Nuclear Regulatory Commission sees no problem with those plans. After months of poring over the California company’s application and holding a series of public hearings, the agency’s staff felt satisfied enough with the company’s environmental and safety reviews to formally recommend that the commissioners approve its construction permits.

In fact, the proposal has proved so uncontroversial that no opponents of nuclear energy are challenging the regulators’ decision. But there’s one more bureaucratic hurdle Kairos needs to clear: a single hearing that will cost the company almost $500,000 and delay any permits for at least six more months.

Some environmentalists who support nuclear power call it a “dog-and-pony show.” Past NRC officials say it’s basically pointless. The current NRC says nothing to defend it, only that it’s required by law. Federal scientists outside the regulatory agency say it should be abolished. Lawmakers from both parties have been trying to do that for decades.

The United States built too few new reactors in the past 40 years for the issue to gain much momentum in Congress, where lawmakers with a median age of 59 are more likely to have memories of hiding under school desks during Cold War-era nuclear bomb drills than anxieties about personal survival in the hotter and more chaotic world forecast for the coming decades.

But as the country turns to nuclear energy to replace fossil fuels and backup weather-dependent renewables, such as wind and solar power, experts say holding expensive, time-consuming hearings that make no difference on permitting outcomes other than delaying construction is a luxury the U.S. can ill afford.

“In the past, the implicit assumption is that it was OK to build energy projects slowly because the status quo was acceptable,” said Judi Greenwald, executive director of the Nuclear Innovation Alliance, a nonprofit think tank that promotes atomic power in the public interest. “We know now that the status quo is not acceptable. Time is of the essence.”

While progressive pro-nuclear advocates agree, the only bill to free the NRC of its legal duty to hold these so-called mandatory uncontested hearings was introduced in July by right-wing Rep. Byron Donalds (R-Fla.). The legislation so far has just one co-sponsor, Rep. Troy Nehls (R-Texas). A separate draft proposal in the House Committee on Energy and Commerce also calls for eliminating the hearing.

The looming legislative push comes as lawmakers across the political spectrum warm to nuclear power. The bipartisan infrastructure law President Joe Biden signed in 2021 contained billions of dollars in subsidies to keep existing nuclear power plants running, and the various clean-energy programs in the Inflation Reduction Act could potentially direct billions more to future atomic energy stations. In July, the Senate passed another bill ― this one authored by Republicans and some of the Democrats’ biggest climate hawks ― aimed at boosting U.S. exports of reactor technology and uranium fuel. Earlier this year, the NRC approved its first-ever design for a small modular reactor, and just this week gave a uranium enrichment company the green light to start producing a special type of nuclear fuel that hasn’t been commercially manufactured in the U.S. in years.

Support for nuclear energy is growing among voters, with 57% of Americans telling the Pew Research Center in August that they favor more nuclear power plants, up from 43% in 2020. Those results mirror similar findings from other surveys this year by the pollsters Gallup and Ipsos.

Voters’ willingness to relax regulations on clean-energy infrastructure is harder to pin down. Last September, 61% of voters backed making the government permitting process more efficient for clean-energy projects in a survey by the Bipartisan Policy Center and the pollster Morning Consult. In May, 76% of voters said they preferred to maintain current environmental and public health rules regardless of whether they wanted more low-carbon energy or fossil fuels, according to a survey that the Democratic pollster Data for Progress conducted on behalf of two environmental groups.

Loosening regulation isn’t always a political winner, especially on industries that voters may see as dangerous. From metropolitan New York and Boston to rural New Mexico, efforts to carry out routine and relatively harmless functions at defunct nuclear plants or build new facilities to store radioactive waste have been met with fierce local protests ― often from demonstrators whose rhetoric suggests a misunderstanding of the dangers associated with radiation.

But when Rep. Diana DeGette (D-Colo.) pressed the NRC’s executive director for operations at a July House hearing on whether eliminating mandatory hearings would reduce oversight or damage public confidence in a new nuclear facility, Dan Dorman said no.

“That would not in any way affect the interests of any party who would seek a hearing,” Dorman said, noting that those who wish to challenge a new nuclear plant could weigh in throughout the process and still trigger a mandatory meeting by contesting the NRC staff’s approval of a license. “I don’t believe it would significantly decrease public confidence.”

Asked by HuffPost to explain the value these hearings play in the licensing process, the NRC said only that it is “required by the Atomic Energy Act to hold” them and sent a link to the statute.

The requirement that the NRC hold a public hearing at the end of the permitting process even if no one contests it dates back to before the agency even existed. Until the NRC’s creation in 1974, nuclear energy was regulated by the Atomic Energy Commission. Unlike the NRC, whose sole responsibility is to safeguard the public against the potential dangers of nuclear power plants, the AEC had the dual mandate of watching over the industry and promoting the use of fission energy.

At that time, the bedrock federal laws that today mandate extensive scientific assessments, public hearings and access to federal documents did not exist.

In 1956, right as Congress was debating whether to give private industry a bigger role in developing new nuclear plants or focus funding on the government’s own efforts, a private utility in Detroit proposed building a novel kind of reactor. The design was what’s known as a “fast-breeder reactor.” Unlike the vast majority of reactors in the world then and now, which use water to cool the reaction, this design instead used liquid sodium metal and promised almost unlimited energy due to its ability to generate power from nuclear fuel that would qualify as waste in a traditional reactor.

As the AEC reviewed the proposal, various researchers warned of flaws in the design that could increase the risk of a meltdown. When word of those concerns reached Congress, AEC Chairman Lewis Strauss (recently portrayed by Robert Downey Jr. in the film “Oppenheimer”) let slip that he planned to attend the groundbreaking ceremony for the controversial new reactor before the final approval of its safety reviews took place, according to a book by the NRC’s in-house historians. Accused by a Democratic AEC commissioner of having already rubber-stamped the reactor, Strauss, a Republican, tried to keep the proceedings of the AEC’s meetings confidential.

In 1962, Congress updated the Atomic Energy Act to require public hearings at the end of the application review process, even if the license is not contested.

Since then, however, laws like the National Environmental Protection Act and the Freedom of Information Act have made the federal government far more open and transparent. Around the same time those statutes were enacted, Congress disbanded the AEC and established the NRC with the purpose of safeguarding the public from the potential dangers of radioactive materials, particularly from nuclear power plants.

At this point, the requirement to hold uncontested hearings “is duplicative, it’s redundant and it slows deployment, especially as the number of construction permits or applications before the NRC starts to increase,” said Nico McMurray, the managing director of public policy at the ClearPath Foundation, a think tank focused on cutting emissions from the energy sector.

“This is just an additional cost that the applicant will have to pay in order to get a license,” he said. “It’s not just the cost they have to pay to the regulator in the form of fees; it’s the internal cost they have just to prepare for the hearing as well.”

Kairos declined to comment on how much the hearing would cost internally, saying it’s “business-sensitive, and we do not broadly communicate about it.” But a letter the NRC sent the company in August shows the agency estimating that the process would require 1,500 hours of work from the regulators, which Kairos would need to pay. At the NRC’s current rate of about $300 per hour, that would come out to at least $450,000, not counting what the company pays its lawyers.

In an April paper examining ways to improve the nuclear licensing process, the Idaho National Laboratory looked at 13 mandatory hearings from 2009 to 2019 and found that only two led to any changes, and it was only to add new conditions based on the Fukushima disaster that unfolded months earlier, which like would have occurred regardless of the hearings.

The conclusion mirrors what an internal NRC task force looking at how to make licensing more efficient recommended in 2007.

“This is a dog-and-pony show,” said Adam Stein, the director of nuclear energy innovation at the Breakthrough Institute, an environmental think tank based in Berkeley, California, that supports nuclear energy. “It’s half a million dollars to pay the commissioners’ staff to write questions for the commissioners to ask. You don’t get much more ‘bureaucratic waste’ than that.”

A progressive pro-nuclear group, Good Energy Collective, agrees that the hearings are pointless even though it recently found itself opposite the Breakthrough Institute in recent debates over the NRC.

“It’s an anachronistic holdover,” said Jackie Toth, Good Energy Collective’s deputy director. “Anytime you hear that a regulatory body is considering removing a level of review and oversight, it’s natural to react. But because the mandatory uncontested hearing process is not the venue in which the public gets to hear about the action, Good Energy is not worried.”

Not everyone agrees. At a 2016 hearing of the Senate Committee on Environment and Public Works, Edwin Lyman, the director of nuclear power safety at the watchdog Union of Concerned Scientists, testified that “mandatory hearings provide an important independent review of uncontested issues addressed in new reactor license approvals.”

In an interview this week, Lyman dismissed the findings of the NRC task force and the national lab, insisting the agency’s staff “is not fully objective” because “it’s in their interest, or they see their interest, as supporting the applicant.”

“The staff tends to be biased in favor of approving the safety of applications, so they can’t be regarded as a completely objective scientific or technical body,” he said. Likewise, he said the Department of Energy and the Idaho National Laboratory “are not neutral observers in this, either, because unfortunately their mandate is [self-preservation], and that means getting funding for their nuclear power research, development and demonstration.”

At a mandatory hearing in 2006, the NRC’s Atomic Safety and Licensing
Board identified flaws in the agency’s review of a permit application for a nuclear plant in Illinois. The body said NRC staff “appeared to simply accept, without checking or verifying, the facts stated by the Applicant,” according to a transcript of the complaint quoted in a letter by Diane Curran, an attorney for the anti-nuclear group Mothers for Peace.

Lyman said that example shows “it’s more important than ever now to have additional levels of review, especially as the NRC itself is under pressure to speed things up.”

Asked whether the need to cut back on fossil fuels adds urgency to the construction of new nuclear power plants, he said other zero-carbon sources of energy are sufficient.

But as the cost of building renewables like offshore wind rises and the supply of minerals needed for solar panels and batteries falls short or concentrates too much power in the hands of producers such as China, nuclear energy is a vital tool for decarbonization, said Ryan Norman, the senior policy adviser on climate and energy at the think tank ThirdWay.

He admitted “it’s a fair point” that “even if a mandatory hearing at the moment is largely informational, there could be some value” in the commission being able to learn more about how the staff approaches questions that come up during the licensing process.

“But there’s nothing that precludes the NRC from having a hearing or getting a lot of this information at different points in the process,” Norman said.

If the U.S. is able to build multiple reactors of the same design each year in the next decade ― which is a key reason for making the machines smaller and modular ― mandatory hearings that add six months to each identical project are “not practical or reasonable,” according to Norman.

Still, Toth said there are steps the government could take to improve the licensing process and generate more engagement with the public.

“We would like to see Congress and the NRC put more resources toward ensuring that the agency is able and willing to conduct two-way, proactive outreach to prospective host communities,” she said. Doing so, she added, would identify early hurdles to licensing, hear out local concerns and improve the agency’s communication with the public to make sure the NRC is “able to answer questions from concerned citizens meaningfully and build trust from the ground up.”

Americans’ faith in the federal government has plummeted since the 1960s, when the public trust peaked at 77% before plunging to 16% in 2023, according to the Pew Research Center. But in a separate survey from 2021, the pollster found that a combined 77% of U.S. adults have “a fair amount” or “a great deal” of confidence in scientists “to act in the best interests of the public.”

That may put some weight on the opinion of the American Nuclear Society, a nonprofit made up of scientists, academics and industry professionals who work on nuclear technologies. In a statement, the group said the consensus among researchers has for years held that scrapping the hearings would do no harm. In a statement, the public-interest nonprofit representing academics and industry professionals said it supported the idea.

“Getting rid of unnecessary, uncontested hearings would improve the efficiency of NRC’s licensing process,” the American Nuclear Society said. “The benefits of eliminating uncontested NRC hearings are well understood and have been even considered internally within the Commission.”