Up & Atom

The demand for energy is anticipated to rise significantly due to the increased deployment of artificial intelligence (AI) technologies, which are highly energy intensive. As we discussed in a recent thought leadership piece, there is a strong intersection between nuclear power and AI. Not only is nuclear power generation well-positioned to address the growing need for powering AI, but the nuclear power industry and its primary regulator, the US Nuclear Regulatory Commission (NRC) are looking to leverage AI to increase efficiency and strategic decision-making.

The US Supreme Court’s recent Loper Bright decision overturned its 1984 Chevron decision, which, over the last 40 years, had become a fundamental doctrine in administrative law. That doctrine, known as the “Chevron deference,” instructed reviewing courts to defer to agency interpretations of ambiguous statutory provisions if a permissible construction of the statute. While many agencies relied on Chevron deference to defend challenges to their rulemakings and other regulatory actions, the NRC has rarely needed to do so.

Morgan Lewis routinely assists licensees in connection with NRC allegations, investigations, and enforcement. The following are summaries of trends and findings in the NRC’s 2023 Allegation Program Annual Trends Report and Enforcement Program Annual Report.

The NRC’s Acting Executive Director for Operations recently issued the results from the NRC staff’s annual Reactor Oversight Process (ROP) self-assessment for calendar year 2023. Out of the 17 metrics it evaluated, the NRC staff found that two did not meet or exceed expected performance, resulting in “yellow” findings. This is an overall improvement from the 2022 self-assessment, which had two “yellow” and two “red” findings due, in part, to continuing challenges from the COVID-19 pandemic. Overall, the staff concluded that the “ROP remained effective in achieving its goals of being objective, risk-informed, understandable, and predictable, as well as in supporting the agency’s strategic goals.”

With the change of a single number, Congress has provided continued support for the nuclear power industry by renewing the Price-Anderson Act. Congress amended Section 170 of the Atomic Energy Act of 1954 (commonly known as the Price-Anderson Act or PAA) by changing its expiration date to December 31, 2065 from December 31, 2025. Congress also increased fourfold the liability coverage for DOE contractors for a nuclear incident occurring outside the United States to $2 billion from $500 million. Finally, Congress revised the definition of “nuclear incident” to remove requirements for the underlying nuclear material.

The NRC’s Office of Investigations (OI) recently published its Annual Report for fiscal year 2023, summarizing its activities from October 1, 2022 through September 30, 2023. According to the annual report, OI opened 82 new cases in FY 2023 compared to 70 in FY 2022, a 17% increase. It also closed 72 cases in 2023 compared to 67 in FY 2022, a 7.5% increase.

The US Nuclear Regulatory Commission (NRC) has issued a proposed rule to amend the licensing, inspection, special project, and annual fees charged to applicants and licensees. The proposed amendments are necessary under the Nuclear Energy Innovation and Modernization Act (NEIMA) to ensure the NRC recovers approximately its full annual budget, except funds for specific excluded activities. Among other changes, the NRC proposes decreasing the annual fee for the operating power reactors fee class by $4,000—approximately 0.07%—from $5.492 million in fiscal year 2023 to $5.488 million.

The Commissioners of the Nuclear Regulatory Commission (NRC) and Federal Energy Regulatory Commission (FERC) conducted a biennial joint meeting on January 25, 2024. The biennial meetings allow the Commissioners to hear presentations from industry experts, learn about the challenges facing the energy industry, and determine how the commissions can assist each other based on their respective regulatory authorities.

The US Nuclear Regulatory Commission (NRC) recently published its annual vendor newsletter, The Vendor Times, documenting findings of NRC vendor inspection staff and lessons learned related to the vendor inspection program. The newsletter follows the NRC’s November 20 vendor inspection program self-assessment for fiscal year 2023. Through these two issuances, the NRC noted an increase in enforcement findings and indicated that it will focus on 10 CFR Part 21 and supplier oversight compliance during future inspections.

The Advisory Committee on Reactor Safeguards (ACRS) recently endorsed the NRC Staff’s proposed alternative option for licensing microreactors in a letter submitted to NRC Chairman Christopher Hanson. In brief, the licensing option endorsed by ACRS would allow a factory-fabricated microreactor to be loaded with fuel having features to preclude criticality and undergo operational testing at the factory before being transported to an installation site. If approved by the Commission, such an approach would create a lower regulatory burden commensurate with the anticipated decreased potential safety hazards posed by microreactors.