Public Citizen | Energy Program | Energy Program - Energy Bill Offers Licensing Favors for Multinational Energy Consortium’s Proposed Uranium Enrichment Plant

On April 24, 2002, the multinational energy industry consortium Louisiana Energy Services (LES) submitted to the U.S. Nuclear Regulatory Commission (NRC) a series of memoranda, known as the “white papers,” brazenly asking the NRC to restrict consideration of six specific issues when it reviews the company’s application for a license to build and operate a uranium enrichment facility. In the late 1990s, LES ultimately withdrew its application for a similar facility in Louisiana after struggling through a licensing process protracted by the intervention of local residents who focused on precisely the same contentious issues for which LES now seeks immunity. The white papers basically request that the NRC lower the bar of its own licensing requirements, in effect limiting the public’s ability to intervene to raise important concerns about the proposed facility. Following a public comment period, the NRC issued a three-page letter summarizing the agency’s response to LES’s requests, tacitly accepting some and rejecting others.

Now, LES is getting much of what it asked for, but via a different avenue: the omnibus energy bill (S. 2095, the “Energy Policy Act of 2003” ). They have Republican Sen. Pete Domenici to thank, who courted the LES to his home state of New Mexico after the company’s second failed attempt to gain the support of citizens and local officials for the uranium enrichment plant—this time in Tennessee. Domenici was co-chairman of the energy conference committee for the last incarnation of the energy bill (H.R. 6), wherein the following provisions—designed to benefit LES by greasing the skids of the licensing proceeding—were clandestinely inserted.

1. Two-Year Limit on Licensing Decision
The NRC’s consideration of LES’s application to construct and operate a uranium enrichment plant in Louisiana was drawn out for nearly a decade—a delay caused partly by successful intervention from interested stakeholders. The company’s eventual withdrawal of its license application was due largely to the sheer exhaustion and expense of the prolonged licensing process.

But if the energy bill becomes law, the NRC’s final decision on the LES license (or, for that matter, any application for a uranium enrichment facility) must be made within two years of the company’s application submission, which would mean an extraordinarily expedited licensing process. Moreover, the NRC would be required to establish, within 30 days of receipt of the application, a strict schedule for the licensing hearing, including a bimonthly report to Congress demonstrating its progress. Such a requirement would markedly decrease the opportunity for interveners to submit contentions on licensing issues, especially if new issues arise during the course of the proceeding, which is likely.

2. NEPA Exemptions
In the first of the six white papers, LES requests an exemption from licensing requirements under the National Environmental Policy Act of 1969 (NEPA). Under NEPA, the NRC is required to consider both the need for the facility as well as a scenario in which no new plant is developed, known as the “no-action alternative.” But LES recommended that the NRC simply presume that “there is an established need for additional domestic uranium enrichment capacity, based upon Congressional policy pronouncements to this effect,” thereby eliminating the NEPA requirement. In its response, the NRC rejected the proposal and said it would consider both the need for the facility and the no-action alternative in its evaluation the company’s Environmental Impact Statement (EIS) for the project.

But the energy bill would override the NRC’s decision by limiting NEPA considerations to whether a new enrichment facility would “advance the national interest” by encouraging “additional, secure, reliable uranium enrichment capacity; diverse supplies and suppliers of uranium enrichment capacity; and the deployment of advanced centrifuge enrichment technology.” The LES plant, by definition, would do these things. Gone are the NEPA questions regarding the need for the facility, which might be difficult to demonstrate, since the sole operating uranium enrichment plant in the country, located in Paducah, Kentucky, runs nowhere near its capacity. Moreover, the operator of that plant, USEC, Inc., has recently announced plans to build its own centrifuge uranium enrichment plant in Piketon, Ohio, while phasing out its Kentucky facility. (Many of Domenici’s insertions in the energy bill would benefit the licensing of the USEC plant as well, but it is clear that the main beneficiary was intended to be LES, since its specific licensing requests are addressed in the bill.)

3. “Environmental Justice” Limitations
In the second white paper, LES complains of prolonged licensing proceedings due to consideration of environmental justice (EJ) issues and recommends that the NRC strictly limit the criteria considered in EJ evaluations. The EJ review is based on Executive Order 12898, “Federal Actions to Address Environmental Justice in Minority Populations and Low-Income Populations,” which was issued by President Bill Clinton in February 1994. The order directs each federal agency to make “achieving environmental justice” part of its mission by “identifying and addressing…disproportionately high and adverse human health or environmental effects of its programs, policies, and activities on minority populations and low-income populations…” The order further directs federal agencies to develop strategies for addressing environmental justice issues. Then chairman of the NRC, Ivan Selin, indicated his enthusiasm for the initiative, noting that the agency would “endeavor to carry out the measures set forth in Executive Order 12898.”

In its communications with the NRC, LES lamented its own drawn-out licensing process—in which the NRC’s Atomic Safety and Licensing Board found strong indications of environmental racism—as well as that of Private Fuel Storage, L.L.C., a consortium of electric utility companies seeking to build and operate a high-level nuclear waste storage facility on the reservation of the Goshute Indians in Skull Valley, Utah. LES requested that the NRC develop clear parameters for its treatment of EJ issues in licensing proceedings, recommending specific limitations on what the NRC may consider.

In its initial response to the LES white papers, the NRC declined to offer a specific response to LES’s EJ suggestions, but instead noted that NRC staff had been directed to develop a revision or clarification of the agency’s policy with regard to its treatment of EJ matters in licensing, rulemaking, and regulation. This directive was undertaken by the NRC at the behest of the Nuclear Energy Institute (NEI)[1], the nuclear industry’s lobbying arm, and has since resulted in a draft policy statement that sets limitations on the agency’s consideration of EJ issues. The statement claims that E.O. 12898 “does not establish new substantive or procedural requirements applicable to NRC regulatory or licensing activities.” The statement also delineates that “[r]acial motivation and fairness or equity issues are not cognizable under NEPA,” a key issue for LES.

The energy bill devotes a section to the NRC’s handling of EJ issues in the licensing of an unspecified uranium enrichment facility, directing the Commission to apply certain licensing guidelines on EJ matters developed by the NRC’s Office of Nuclear Material Safety and Safeguards (NMSS).[2]If the energy bill passes, thus giving the draft guidelines statutory weight, at least two of LES’s specific requests would be partially enacted:

Perhaps the most significant element of the NMSS EJ policy recommendation is its unambiguous statement that the treatment of EJ is not necessarily cognizable, rendering EJ reviews under NEPA virtually meaningless: “The Executive Order does not prohibit taking an action where there are disproportionate high and adverse impacts to minority and low-income populations.” Therefore, approval of licenses would be allowed even in cases where there is clear evidence of an environmental injustice, thwarting the explicit intention of the EO.

4. Radioactive Waste Disposition Deal
In its final white paper, LES cites Section 3113 of the USEC Privatization Act as providing the statutory basis for meeting its regulatory requirement to demonstrate a “plausible strategy” for the disposition of depleted uranium (DU) tails—a toxic and radioactive byproduct of the enrichment process. LES suggests that this section of the Act alone provides the requisite waste disposition strategy for the thousands of tons of DU its plant would produce each year. Section 3113 confers upon the Secretary of the U.S. Department of Energy the responsibility to “accept for disposal low-level radioactive waste, including depleted uranium if it were ultimately determined to be low-level radioactive waste, generated by…any person licensed by the [NRC] to operate a uranium enrichment facility” (emphasis added). LES argues that it is absolved from the regulatory requirement to develop a DU waste disposition strategy simply because the DOE is required accept low-level waste for disposal.

But in this request, LES makes an incredible leap in logic by assuming that DU tails may be considered low-level waste. In its response to LES, the NRC notes it has yet to deem DU tails as low-level waste, and without this designation, LES must offer a plan for storage and disposition of this waste.

But a provision in the energy bill makes this decision for the NRC by determining that Section 3113 of the Act constitutes a “plausible strategy” for the disposition of DU. The bill further directs the NRC to “treat any residual material that remains following the extraction of any usable resource value from depleted uranium as low-level radioactive waste,” thereby resolving the issue of whether DU tails may be considered low-level waste. This provision is particularly brazen, given that the matter of the waste classification status of DU remains an extremely contentious issue.

Conclusion
LES has been desperately trying to secure a site and license for its proposed uranium enrichment plant for more than a decade, and it has been forcibly expelled from communities in Louisiana and Tennessee. But Sen. Pete Domenici has come to the rescue, first courting LES to New Mexico and then surreptitiously inserting a section into the omnibus energy bill designed to ease the licensing process for LES. Many of LES’s specific requests for an expedited licensing process—which were offered rather insolently to the NRC—were granted in the energy bill. The result is an affront to the democratic process of lawmaking and a skirting of proper regulatory procedures in government licensing of nuclear facilities. Sen. Domenici’s shameful legislative manipulation in this instance is, unfortunately, indicative of the crafting of the energy bill at-large, the ultimate fate of which remains to be seen.

[1] In the NRC’s official response to the LES white papers—a March 24, 2003 letter from Robert C. Pierson of the NRC to Rod M. Krich, Director of Licensing for LES—it is noted that “[i]n light of the issues raised in the NEI letter, the Commission has directed the staff to develop and propose for the Commission’s consideration a draft policy statement on the treatment of environmental justice matters in NRC licensing.”

[2] “Environmental Review Guidance for Licensing Actions Associated with NMSS Programs (Final Report).” NUREG-1748. U.S. Nuclear Regulatory Commission, Office of Nuclear Material Safety and Safeguards. Appendix C. August 2003.

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