6
Program Priorities, Balance, and Oversight

The committee’s statement of task requires it to evaluate the process for establishing program priorities and oversight for DOE’s nuclear energy programs, including the method for determining the relative distribution of budgetary resources. Managing budget priorities is a challenging task for DOE’s Office of Nuclear Energy (NE), particularly because of the disconnect between the annual federal budget process and the long-term nature of NE’s research programs. The committee’s evaluation of NE’s programs stresses the need for managing programs consistently over time. For example, the committee has recommended approaches for the Generation IV reactor development program, the Advanced Fuel Cycle Initiative (AFCI), and the fast reactor fuels qualification program that aim at creating solid information for decisions on technology selection that may be taken 5 to 10 years from now. NE is the program secretarial office (PSO) for the Idaho National Laboratory (INL) site, and that responsibility requires a steady effort over a similar period of time.

As noted in Chapter 1, however, the NE budget has experienced wide swings in both size and content over the past 10 years. The nature of the federal budget process is at least partly the cause of this problem. The committee reviewed the current NE budget process for annually allocating limited resources among programs. Like the federal budget process in general, the NE process tends to subordinate long-term commitments to more immediate needs. The committee is under no illusion that the pressures created by this annual process will abate. For that very reason, however, it is convinced that NE should set up an internal system to allocate resources consistently over time and among programs. Such a system should have the following characteristics:

  • Be robust with respect to policy and technological variables—that is, offer timely science and technology options that will be useful across a range of possible futures and research outcomes.

  • Possess a rigorous and independent evaluation process that reexamines the program as policy and technological variables change and focuses available resources on the most promising options.

  • Maintain continuity of programs to achieve the desired goals, thereby supporting the bases on which the nuclear industry plans its direction.

  • Commit to the construction of a major demonstration or facility only when there is a clear economic, national security, or environmental policy reason for doing so.

  • Limit the NE role to activities that the private sector cannot reasonably be expected to undertake.

  • Plan to live within a reasonable federal budget constraint, recognizing that some fluctuation is inevitable but that major facility construction should not crowd out ongoing research activities.

  • Maintain a balance among programs with near-term and longer-term research objectives.

  • Take into account the risks and opportunities created by technological developments in other countries.

In this chapter the committee proposes the major priorities among NE’s programs, suggests how they might be applied in a constrained budget environment, and describes the elements of a system to provide independent oversight of the NE research portfolio.

PROGRAM PRIORITIES

To assess the overall priorities among NE programs, the committee examined their relevance to NE’s mission goals in light of the committee’s recommendations for each program. The mission goals, as developed in Chapter 1, are these:

  • Assist the nuclear industry in providing for the safe, secure, and effective operation of nuclear power plants already in service, the anticipated growth in the next generation of light water reactors, and associated fuel cycle facilities.

  • Provide for nuclear power at a cost that will be competitive with other energy sources over time.



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6 Program Priorities, Balance, and oversight The committee’s statement of task requires it to evaluate variables change and focuses available resources on the most the process for establishing program priorities and oversight promising options. for DOE’s nuclear energy programs, including the method • Maintain continuity of programs to achieve the desired for determining the relative distribution of budgetary re- goals, thereby supporting the bases on which the nuclear sources. Managing budget priorities is a challenging task for industry plans its direction. DOE’s Office of Nuclear Energy (NE), particularly because • Commit to the construction of a major demonstration of the disconnect between the annual federal budget process or facility only when there is a clear economic, national and the long-term nature of NE’s research programs. The security, or environmental policy reason for doing so. committee’s evaluation of NE’s programs stresses the need • Limit the NE role to activities that the private sector for managing programs consistently over time. For example, cannot reasonably be expected to undertake. the committee has recommended approaches for the Genera- • Plan to live within a reasonable federal budget con- tion IV reactor development program, the Advanced Fuel straint, recognizing that some fluctuation is inevitable but Cycle Initiative (AFCI), and the fast reactor fuels qualifica- that major facility construction should not crowd out ongoing tion program that aim at creating solid information for deci- research activities. sions on technology selection that may be taken 5 to 10 years • Maintain a balance among programs with near-term and from now. NE is the program secretarial office (PSO) for the longer-term research objectives. Idaho National Laboratory (INL) site, and that responsibility • Take into account the risks and opportunities created by requires a steady effort over a similar period of time. technological developments in other countries. As noted in Chapter 1, however, the NE budget has expe- rienced wide swings in both size and content over the past In this chapter the committee proposes the major priorities 10 years. The nature of the federal budget process is at least among NE’s programs, suggests how they might be applied partly the cause of this problem. The committee reviewed in a constrained budget environment, and describes the ele- the current NE budget process for annually allocating limited ments of a system to provide independent oversight of the resources among programs. Like the federal budget process NE research portfolio. in general, the NE process tends to subordinate long-term commitments to more immediate needs. The committee is ProGram PrioriTies under no illusion that the pressures created by this annual process will abate. For that very reason, however, it is con- To assess the overall priorities among NE programs, the vinced that NE should set up an internal system to allocate committee examined their relevance to NE’s mission goals in resources consistently over time and among programs. Such light of the committee’s recommendations for each program. a system should have the following characteristics: The mission goals, as developed in Chapter 1, are these: • Be robust with respect to policy and technological vari- • Assist the nuclear industry in providing for the safe, se- ables—that is, offer timely science and technology options cure, and effective operation of nuclear power plants already that will be useful across a range of possible futures and in service, the anticipated growth in the next generation of research outcomes. light water reactors, and associated fuel cycle facilities. • Possess a rigorous and independent evaluation process • Provide for nuclear power at a cost that will be competi- that reexamines the program as policy and technological tive with other energy sources over time. 

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 PROGRAM PRIORITIES, bALANCE, AND OVERSIGHT • Support a safe and publicly acceptable domestic As a second priority, a focus on fast reactors is appropriate. waste management system, including options for long-term The committee would like to see NE sustain a balanced R&D disposal of the related waste forms. (The principal DOE portfolio in these advanced reactor development areas. responsibility for this function lies with its Office of Civilian • AFCI. This is the AFCI program with some modifica- Radioactive Waste Management.) tions as called for by the committee in Chapter 4 but not • Provide for effective proliferation resistance and physi- including construction of large demonstration facilities or cal protection of nuclear energy systems, both at home and in commercial-scale facilities. support of international nonproliferation and nuclear security • Major fuel cycle facilities. The committee recognizes regimes. that major engineering and/or commercial-scale facilities • Create economical and environmentally acceptable will ultimately be required to test and deploy fuel cycle nuclear power options for assuring long-term nonelectric en- technology. However, it concludes that the Global Nuclear ergy supplies while displacing insecure and polluting energy Energy Partnership (GNEP) has not made a persuasive case sources; such options include electricity production, hydro- for the early deployment of such facilities. gen production, process heat, and water desalinization. • Idaho National Laboratory. NE has PSO responsibility for INL, and this responsibility has a large impact on the NE Each chapter in this report contains findings on program budget. design and budget implications. In summary, the committee’s programmatic recommendations that have budget conse- Based on its understanding of NE’s mission and the crite- quences are these: ria for management of NE research programs, the committee views the relative priority of these programs as presented in • Nuclear Power 00. DOE should augment this pro- Table 6-1. gram to ensure the timely and cost effective deployment of the first new reactor plants. Of particular importance is the ProGram BalaNce need to address industrial and human resource infrastructure issues. The NP 2010 program will end upon completion of The committee has evaluated the overall balance among U.S. Nuclear Regulatory Commission (USNRC) certifica- these programs within the scope of available resources. tion and finalization of the AP1000 and ESBWR designs, The committee cannot, of course, predict what budgetary issuance of the first combined construction and operating resources will be available in future years. However, the bud- licenses (COLs) to the lead companies in the Nustart and gets for NP 2010, Generation IV, NHI, and Idaho Facilities Dominion consortia, and implementation of the standby Management totaled between $220 million and $240 million support and loan guarantee financial incentives of the Energy from FY 2005 to FY 2007. The GNEP/AFCI budget has been Policy Act of 2005 (EPAct05). rising, and the university infrastructure budget—while not in • Research in support of the commercial fleet. The com- the FY 2008 NE budget request—received appropriations of mittee does not suggest a large federal research program, $16 million to $26 million (Box 6-1). If these trends persist, because most of this research should be industry-supported. they suggest an overall NE research budget of about $700 However, some specific projects have sufficient public ben- million annually. The committee has used these parameters efit to warrant federal funding. as a basis for evaluating program balance in a constrained • Uniersity infrastructure support. A major buildup in budget environment. The committee’s judgments are pre- nuclear energy production, research, and development re- sented in Table 6-2. quires expanding university capabilities to educate a growing number of young professionals and scientists in the relevant ProGram oVersiGhT areas. DOE should maintain programs specifically designed Recommendation 6.1. As a counterbalance to the short-term to support university research reactors and educational infra- structure. The American Nuclear Society has recommended nature of the federal budget process, NE should adopt an over- that NE should retain a separate funding line for university sight process for evaluating the adequacy of program plans, programs in the Energy and Water Appropriations Bill for assessing progress against these plans, and adjusting resource FY 2007 and future years. The committee agrees with that allocations as planned decision points are reached. conclusion and urges that NE fund a separate program as outlined in EPAct05. The oversight process should have the following • Generation IV. This is principally the Next Generation attributes: Nuclear Power (NGNP) program aimed at electricity and process heat applications, such as hydrogen production (as • Strategic. The focus of the process should be overall in the Nuclear Hydrogen Initiative program) and desaliniza- program progress in the light of NE’s overarching goals and tion. It is designed so that by 2012 NGNP can be evaluated balancing resources across programs. It does not take the against other technologies directed toward similar outcomes. place of detailed technical and peer review, nor should it.

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 REVIEW OF DOE’S NUCLEAR ENERGY RESEARCH AND DEVELOPMENT PROGRAM TABLE 6-1 Relative Priorities of NE R&D Programs and INL Priority Program Comments High NP 2010 and research in support of the Unless the commercial fleet of LWRs grows, nuclear power will be a diminishing commercial fleet energy resource for the United States and there will be little need for all of NE’s longer term research programs. NP 2010 and selected commercial research projects should be fully funded as a matter of highest priority. High University infrastructure support University support is largely a government responsibility in the committee’s view. Medium Generation IV, NGNP, NHI, and AFCI These are all longer term research programs with defined downselect decision points that could change the course of research as more is learned. These programs will perform best if research budgets are consistent with steady progress toward these decision points. Medium INL programs to reduce deferred maintenance These activities require steady progress but can evolve over a reasonable time. and to build a capacity that will sustain a useful Construction of user facilities and/or program facilities should be carefully scientific capability evaluated on a case-by-case basis to validate the need and to avoid duplication with facilities at other national laboratories. Low Major facility deployment (large demonstration U.S. industry does not urgently require the construction of such facilities. plants or initial commercial plants) in GNEP NOTE: LWR, light water reactor. BoX 6-1 University Programs1 The DOE-NE university program has been in existence for almost 10 years in support of university reactor basic research, undergraduate scholar- ships, graduate fellowships as well as university research reactor fuel assistance and instrumentation and infrastructure. In August 2005, EPAct05 authorized its continuance and expansion; however, DOE discontinued the program. The Congress appropriated funds over this DOE elimination in FY 2006 and FY 2007. The American Nuclear Society (ANS) appointed a special committee of individuals from industry, the national laboratories, and universities and carried out an in-depth review of the program in the fall of 2006. One of the major conclusions of the ANS review and report is that a clear national interest exists for the federal government, primarily DOE, to con- tinue and expand its stewardship of the U.S. nuclear science and engineering (NSE) education enterprise. Simply put, university-based NSE programs can continue to be leaders in the field only if there is an active, identifiable university program at DOE. The ANS report recommended that NE retain a separate funding line for university programs in the Energy and Water Appropriations Bill for FY 2007 as well as future years. The committee agrees with that conclusion and urges that NE should fund a separate program, as outlined in EPAct05. 1Information based on American Nuclear Society, Nuclear’s Human Element: A Report of the ANS Special Committee on Federal Investment in Nuclear Education, 2006. For this reason, the process should be in the hands of indi- erable weight to the information produced by the process. viduals with high-level research, government, and industry Therefore, the composition and organizational position of experience. the oversight body should reflect a substantial degree of in- • Independent. Because it is strategic, the oversight dependence. A clear policy for handling conflicts of interest process should be designed to serve not just NE but also and ensuring balance among the members will be essential. DOE management. Ideally, the Office of Management and • Transparent. The topics studied by the oversight body Budget and the Congress would be willing to give consid- and the reports it issues should be made public.

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 PROGRAM PRIORITIES, bALANCE, AND OVERSIGHT TABLE 6-2 Budget Recommendations for NE R&D Programs and INL Program Budget Issue Recommended Action NP 2010 Current funding is as much as a third less than Although increases in the NP 2010 budget are likely, they do not make up a needed to maintain program momentum, and large fraction of the total NE funding. The NP 2010 requirements should be funding is likely to be needed for longer than the fully supported. current program plan estimates. Research in support of Not presently funded, although some DOE DOE should provide cost sharing in the 20 percent range and support user the commercial fleet support of continued research on existing and new facilities at incremental cost. These elements of the program should be fully reactors in the commercial fleet is appropriate. funded when the NP 2010 licensing and design completion efforts come to an end. University Funding at (recent) FY 2006 appropriated levels DOE should include this program explicitly in its budget at the levels infrastructure support is appropriate. authorized by EPAct05 (see Box 6-1). Generation IV and Current funding is considerably less than that The program requires predictable and steady funding, but its goals can NHI required to meet stated goals, especially for be more modest and its timetables stretched. A revised program can be NGNP. Full funding would mean ~$50 million to conducted within levels recently appropriated for Generation IV and for 60 million more annually. SFR-related R&D under GNEP. AFCI and fast reactor Recent proposals for GNEP have substantially The committee recommends a more modest and longer-term program of fuel qualification increased the NE budget. applied research and engineering, including new research-scale experimental capabilities as envisioned for the Advanced Fuel Cycle Facility, although the design of the program would differ somewhat from the AFCI program before GNEP. INL programs to Current budgets for INL deferred maintenance It is essential to provide reasonable and predictable funding to support the reduce deferred and other landlord demands are substantially PSO responsibility for site condition and capacity building. However, the maintenance and to below optimal levels. Using the Ten-Year Site funding required for managing the site infrastructure can be reduced by build a capacity that Plan as a basis, the shortfall could be on the order giving priority to mission-critical facilities. Both infrastructure support will sustain a useful of $50 million per year. The capacity-building and capacity-building measures can be supplemented by indirect cost and scientific capability strategy at INL has not yet been agreed on or contributions from non-NE programs (such as the large U.S. Department of costed out. Homeland Security program at INL). Finally, care should be taken to avoid duplication of capabilities at other national laboratories. A strategic plan based on these concepts is needed to establish the target funding level for the Idaho Facilities Management account. Major facility The current GNEP concept envisions major These facilities should be funded only when clearly needed, and then as deployment demonstration or precommercial facilities. The increases to the NE base budget. Generation IV program, if successful, could require an NGNP demonstration plant. The senior advisory body for NE has been the Nuclear En- In recent years, however, NERAC has not been effec- ergy Research Advisory Committee (NERAC). This review tive, for reasons that are not entirely clear. It was largely committee was formed about 10 years ago when the nuclear inactive during the year or so when the director of NE left, energy research budget began to grow beyond facilities and the directorship of the Office was elevated to the assistant infrastructure support. From 1998 through 2005, NERAC secretary level, and the new assistant secretary was in place. gave NE advice on a range of matters, among them: The upshot was that neither NERAC nor any other external body was much consulted for strategic oversight or advice • Infrastructure for nuclear energy research, during a time when the NE program was undergoing major • The education of future nuclear engineers, change. • The Generation IV Technology Roadmap, NERAC seems the obvious starting point for reestab- • Assessment of technology for advanced nuclear lishing oversight of the NE programs. In the committee’s processes, opinion, the key will be to ensure NERAC’s independence • Review of the Next-Generation Nuclear Plant (NGNP), and transparency, and allow it to focus on important strategic and issues. The committee has not attempted to recommend for • A roadmap for deploying new nuclear power plants in NERAC a specific oversight capability, but the oversight the United States. body has in mind that it would:

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0 REVIEW OF DOE’S NUCLEAR ENERGY RESEARCH AND DEVELOPMENT PROGRAM • Encourage objectivity by recognizing that knowledge- zations likely to be affected by study results. Persons directly able persons have different points of view and that balance funded by sponsors are rarely appointed to such bodies. is therefore best achieved by diversifying the membership of • Ensure transparency by requiring that both the state- the oversight body. ment of task and the final report for each project are routinely • Avoid conflicts of interest by requiring public disclo- made public in a timely fashion. sure of members’ connections with study sponsors or organi-