DOE publishes details of $6 billion civil nuclear credit program

The NOI provides an opportunity for reactor owners and operators to submit a nonbinding notice of interest in submitting a confidential application for credits through the program. The DOE-NE is also seeking input through the RFI regarding the establishment of the credit program, including the application, certification, and selection processes.

The DOE-NE is requesting that written comments and information be submitted before March 17, 2022. The department said, however, that it strongly prefers comments on issues affecting certification to be submitted directly via email by March 8, 2022. The department intends to develop initial draft guidance for the certification applications during the NOI/RFI comment period, and comments relating to certification received after March 8 may not be included in the guidance.

The credits: The DOE was instructed to establish the civil nuclear credit program by the Infrastructure Investment and Jobs Act, also known as the Bipartisan Infrastructure Bill. The DOE said it intends, to the maximum extent practicable, to use the spending authority created by the act to allocate credits (defined as a claim to funds) to as many certified reactors as possible.

Congress has appropriated $6 billion to fund credits awarded under the program and has authorized the DOE to obligate up to $1.2 billion in fiscal year 2022. Amounts in excess of $1.2 billion required to fund awarded credits for subsequent fiscal years can be disbursed subject to the availability of funds, the DOE said.

The credits will be awarded over a four-year period beginning on the date of the selection, with funds distributed annually based on the allocation of credits. According to the DOE, nuclear reactor owners or operators may apply for recertification after that time, and additional credits may be allocated through September 30, 2031, subject to the availability of funds.

Certification criteria: The DOE said it will establish a certification process with certain criteria that applicants will need to meet to be eligible to bid for credits. As outlined by the Infrastructure Investment and Jobs Act, the DOE intends to evaluate the following seven certification categories:

1. Competitive electricity market: The applicant must demonstrate that the nuclear reactor competes in a competitive electricity market.
2. Economic factors: The applicant must demonstrate that the nuclear reactor is projected to cease operations due to economic factors. Applicants must include information on the operating costs necessary to make the certification determination, including, but not limited to, average annual operating loss per megawatt hour over the four-year period for which credits would be allocated.
3. Emissions impact: The applicant must estimate the potential incremental air pollutants that would result if the nuclear reactor were to cease operation. Applicants must demonstrate an increase in these emissions if the nuclear reactor ceased operations and its power generation was replaced with other types of generation.
4. Post-support operations plan: The applicant must provide a plan for sustaining operation of the reactor after the four-year award period, either without future credits or with a reduced level of credits.
5. Uranium and fuel source: The applicant must identify, to the extent known, where fuel for the reactor will be sourced over the four-year period for which credits may be allocated, including uranium, conversion, enrichment, and fabrication sources. In determining whether to certify a reactor, priority will be given to a nuclear reactor that uses, to the maximum extent available, uranium that is produced, converted, enriched, and fabricated into fuel assemblies in the United States.
6. NRC assurance: The DOE intends to rely on the Nuclear Regulatory Commission to indicate whether it has reasonable assurance that the reactor will continue to be operated in accordance with the current licensing basis and poses no significant safety hazards.
7. Other criteria: Other criteria to be considered in certification may be identified by the DOE.

Review process: To evaluate applications for certification, the DOE is proposing to establish a review process using a panel made up of department personnel. The panel will verify that the applicant has addressed each relevant aspect of certification.

The DOE is also proposing that an application for certification should be submitted for each individual power reactor, unless an applicant can show that a plant with multiple units faces substantially identical financial situations, operations structures, and costs. In such cases, a single application can be made for multiple reactors.