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Deputy Secretary Poneman's Remarks at the Nuclear Energy Assembly - As Prepared for Delivery

May 11, 2011 - 6:01pm

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Deputy Secretary of Energy Daniel Poneman

Remarks as Prepared for Delivery

Nuclear Energy Assembly

Wednesday, May 11, 2011

Washington, DC

 

Introduction

Good morning.  Thank you Jim for the introduction, and thank you for the invitation to speak here today.

I just got back last night from Savannah River Site, where I visited our nuclear facilities and found a community that is dedicated, capable, and energized by a vision to build their expertise in environmental remediation, national security, and clean energy into a dynamic future vision for the site and for the community.

It’s a great thing.  As soon as you pass through the gates, you find yourself surrounded by a lush forest of sweet gums, red maple, swamp tupelo and loblolly pines.  And the air is fresh with a scent of honeysuckle in the air.  And you learn that the site has nesting pairs of bald eagles and the rare red cockaded woodpecker.  And you think: boy, this is a long way from Washington.

So I asked my hosts what kind of animal life they have there.  And they said they had a lot of deer that was chewing the scenery, some wild turkeys, some fox and the occasional coyote and other predators, but mainly snakes since the climate is so swampy there.  And you think: boy, this is just like Washington.

There has been so much going on in the energy arena lately, that I do think it is useful to remind ourselves of what we are trying to do, from the level of first principles.  From the outset, President Obama has issued a clarion call to create a new energy economy and invest in clean energy technologies.  Why should we do this?

First, to strengthen our economic, environmental and national security;

Second, to maintain U.S. leadership in the global economy;

Third, to create new industries and new jobs here in America, vouchsafing prosperity for our families and our children.

As the President said in last year’s State of the Union Address:

“The nation that leads the clean energy economy will be the nation that leads the global economy.  And America must be that nation.”

That is why we’ve already taken unprecedented steps to invest in clean energy here in the United States, including:

 

  • $90 billion invested under the Recovery Act to lay the foundation for the clean energy economy of the future – ranging from weatherization of homes to the Advanced Research Projects Agency for Energy, or ARPA-E.  From carbon capture and sequestration to investment in wind, biomass, solar and geothermal.  From small research grants to billions of dollars in loan guarantees.

 

  • Those loan guarantees included over $8 billion for the Vogtle nuclear power station, the first commercial nuclear power plant to be launched in this country in three decades, as well as for a uranium enrichment facility in Idaho.

 

Following up that ambitious beginning, in this year’s State of the Union the President laid out an ambitious but achievable goal of doubling the amount of U.S. electricity from clean energy sources – from 40 percent to 80 percent – by 2035.

And he has challenged the Nation to cut our oil imports by a third by 2025.

Our goals are ambitious.  We seek to ensure American competitiveness; to boost our manufacturing; to cut air pollution.   Indeed we seek nothing less than the transformation of our Nation’s economy for the next generation, so that we leave our children with a stronger, better country than when we found it.

As you all know, the last few months have witnessed a number of dramatic events in the energy arena that have prompted us yet again to examine our energy policies in general, and our nuclear energy policy in particular.

The crisis in Libya offered a vivid picture of how America’s energy security can be affected abruptly by unexpected events and forces outside of our own control.

The devastating earthquake and tsunami in Japan, which led to the nuclear accidents at the Fukushima reactor, once again brought safety to the forefront of the discussion on nuclear energy.

Nuclear Safety

We have known for years that a nuclear accident anywhere is a nuclear accident everywhere.  So it is really not surprising that the international community rallied as one to support Japan in their moment of need.  I had a number of calls in the early days from my colleagues in other governments with significant nuclear programs, and the question was always the same: what can we do to help?

Of course, for Americans there was nothing new in this; either in our willingness to help a friend in need, or in our commitment to safety.  Nevertheless, it is essential that we reflect upon that commitment, and renew it, as we examine the path forward for nuclear energy. 

You see, safety has always been – and must remain – our preeminent concern.  If it is not, or if our performance does not reflect that fact, then we will lose the support not only of the communities neighboring nuclear facilities, but also of the broader public. 

That is why, over the past decades, we have continued to improve the safety and security of each of our facilities.

And without that support, nuclear energy will not be able to play the kind of role that many in this room have worked on for years or even decades to achieve.

That is why the President asked the Nuclear Regulatory Commission to do a comprehensive review of the safety of our 104 operating domestic nuclear power plants in light of the Fukushima accident.

As an independent regulator, the NRC is entrusted with the vital task of overseeing our nuclear facilities, to assure that safety remains paramount at each of our nuclear energy sites.

We will continue to incorporate the lessons learned from this accident into our approach to nuclear safety both for current generation facilities, as well as next generation reactors.

At the same time, the President also made clear that we still see nuclear as an important element of a diverse, clean energy portfolio and an important source of low-carbon, base-load electricity.

As a Nation, however, we must recognize that there is no major energy source that can be exploited without risk.  Our job is to analyze and weigh risks, along with the associated costs and benefits, and then to draw judgments about which risks are worth taking, and how to reduce and manage those risks.

Now, while safety is necessary for the success of the nuclear energy industry, it is not sufficient.

In order to succeed, nuclear power must address three other critical challenges: commercial viability, the back end of the fuel cycle, and the risk of nuclear weapons proliferation.

U.S. Nuclear Energy Policy

President Obama has laid out a three-phase approach to tackle these challenges facing America’s nuclear policy:

First – we must revive our domestic nuclear industry, which means we need --

 

  • To train the next generation of nuclear scientists and engineers;
  • To continue to improve our existing reactor fleet;
  • To invent the next generation of small and modular reactors; and
  • To attract private capital to finance construction of the next generation of nuclear facilities.

To help make this a reality, we have taken several steps:

 

  • We have offered loan guarantees for the first movers in the industry;
  • We have used supercomputers, as part of our Nuclear Energy Innovation Hub, to increase the safety and power output  of existing reactors;
  • We have invested in research and development efforts for SMRs and other advanced reactor designs.

Second - we must resolve the uncertainty surrounding the back end of the nuclear fuel cycle. 

 

  • Whatever path we choose must be technically sound.

 

  • And any policy the success of which can only be measured over decades if not scores of years must command broad support, across geographic divisions, and across party lines, to succeed.  This begins with the communities directly affected, and extends to the Nation.

 

  • It has been clear for many years that Yucca Mountain did not enjoy that kind of consensus.  To the contrary, the Yucca project produced years of continued acrimony, dispute, and uncertainty. 

 

  • That’s why Secretary Chu established the Blue Ribbon Commission on America’s Nuclear Future to conduct a comprehensive review of U.S. policies for managing the back end of the nuclear fuel cycle.

 

  • We are very much looking forward to receiving the initial recommendations from the Blue Ribbon Commission this July.  We hope that these recommendations will help give the President and Members of Congress from both parties a good basis from which to establish a lasting policy for our nuclear energy future.

The third element of the President’s nuclear framework requires that we minimize the threat of nuclear weapons proliferation. 

The stakes are high.  Regardless of what the U.S. does, the world is increasingly turning to nuclear energy as a low-carbon electricity source.  In fact, there are already over 60 new reactors under construction in more than a dozen countries around the world. 

And just as a safety accident anywhere is an accident everywhere, an incident involving the diversion of civil nuclear technology to use in the development of nuclear weapons would also undermine public confidence in the role that nuclear energy can and should play in the global energy future.

President Obama spoke directly to this issue in his Prague speech in April 2009.

Not only did he talk about building a world free of nuclear weapons.  Not only did he talk about maintaining a safe and effective deterrent until that day is possible. Not only did he talk about the need to advance the New START Treaty and other critical arms control objectives.  He also articulated the need for a new international framework for peaceful nuclear cooperation.

International Framework

In his words:

“… we should build a new framework for civil nuclear cooperation, including an international fuel bank, so that countries can access peaceful power without increasing the risks of proliferation. That must be the right of every nation that renounces nuclear weapons, especially developing countries embarking on peaceful programs. And no approach will succeed if it's based on the denial of rights to nations that play by the rules. We must harness the power of nuclear energy on behalf of our efforts to combat climate change, and to advance peace opportunity for all people.”

If we do this right, this new international framework can provide a mechanism to strengthen America’s national security, reduce proliferation and nuclear terrorism threats, and grow the U.S. economy.

The essence of that international framework is a mechanism to assure all nations that live up to international nonproliferation norms that they can rely on the commercial marketplace reliably to provide them with the fuel services they need to operate their nuclear power plants. 

We’ve seen this system work before in the past.  When I worked in government at the National Security Council under the first President Bush and President Clinton, we were faced with a vast amount of Soviet highly enriched uranium that presented a tremendous nonproliferation threat.  But we also saw a great opportunity.  We realized there was a market for low-enriched uranium that could be blended down from this stock of 500 metric tons of highly enriched uranium – enough for 20,000 nuclear weapons.

We get 20 percent of the electricity in this nation from nuclear energy, and we get half of the enriched fuel for those reactors from this HEU deal.  So 10 percent of U.S. electricity – one in ten light bulbs – is lit by material that used to be in the form of a warhead targeting an American city.

The genius of that deal is that we were able to harness our security objectives to the power of the commercial marketplace.  We can do that again.  Nuclear fuel leasing could provide that mechanism.

And if that were able to offer nuclear fuel services for both the front and the back ends, then companies or consortia could lease nuclear fuel to customers, just as companies now lease cars or airplanes to customers.

A successful mechanism that provides that reassurance would reduce the incentives for more nations to build enrichment and reprocessing facilities.

And since these are the facilities that create the greatest risks of nuclear proliferation, this framework could help achieve President Obama’s Prague vision.

Beyond the security benefits, an international framework would also strengthen America’s domestic nuclear industry by providing new markets for U.S. nuclear technology and innovation.

Indeed, this is a case where our economic and national security interests converge.  For a strong domestic nuclear industry is essential for the United States to continue to play a significant global role in promoting strong nonproliferation policies.

You can then envision a virtuous cycle in which our economic security is strengthened by our national security which, in turn, is strengthened further by our economic security. 

Nowhere is this more true than in the nuclear industry, where the United States combines its strong regulatory framework and safety culture, technology leadership, and commitment to national security and nonproliferation.

And what that means, finally, is that the United States must be a vocal and active advocate in describing this vision globally.

By working in partnership with the other countries of the world, we can build a clean energy future where nuclear plays a significant role in cutting air pollution, revitalizing American manufacturing, and protecting U.S. national security.

I look forward to working with all of you gathered here today to turn this vision into a reality.

Thank you and I’m happy to take some questions.

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