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[Senate Report 111-314]
[From the U.S. Government Publishing Office]

                                                       Calendar No. 600
111th Congress                                                   Report
                                 SENATE
 2d Session                                                     111-314

======================================================================

 
                         NUCLEAR POWER 2021 ACT

                                _______
                                

               September 27, 2010.--Ordered to be printed

                                _______
                                

   Mr. Bingaman, from the Committee on Energy and Natural Resources, 
                        submitted the following

                              R E P O R T

                         [To accompany S. 2812]

    The Committee on Energy and Natural Resources, to which was 
referred the bill (S. 2812) to amend the Energy Policy Act of 
2005 to require the Secretary of Energy to carry out programs 
to develop and demonstrate 2 small modular nuclear reactor 
designs, and for other purposes, having considered the same, 
reports favorably thereon with amendments and recommends that 
the bill, as amended, do pass.
    The amendments are as follows:
    1. On page 2, between lines 14 and 15, insert the 
following:
                  ``(C) Early site permit.--The term ``early 
                site permit'' has the meaning given the term in 
                section 52.1 of title 10, Code of Federal 
                Regulations (or a successor regulation).
    2. On page 2, line 15, strike ``(C)'' and insert ``(D)''.
    3. On page 3, line 8, strike ``and''.
    4. On page 3, line 17, strike ``2021.'' and insert ``2021; 
and''.
    5. On page 3, between lines 17 and 18, insert the 
following:
                  ``(C) a program to obtain an early site 
                permit for 2 sites for 1 or more small modular 
                reactors.
    6. On page 4, line 10, strike ``(2) (A)'' and insert 
``(2)(A), and each early site permit under paragraph (2)(C),''.

                                Purpose

    The purpose of S. 2812 is to require the Secretary of 
Energy to carry out programs to develop and demonstrate 2 small 
modular nuclear reactor designs.

                          Background and Need

    The first nuclear power plants built in this country were 
small. The first, Shippingport, which was built by the Atomic 
Energy Commission and began generating power in 1957, could 
generate 60 megawatts of electric power. The second, though 
first privately financed nuclear power plant, Dresden, which 
began operating in 1960, could generate 180 megawatts of 
electricity. The third, Yankee Rowe, which began commercial 
operation in 1961, could generate 140 megawatts of electricity.
    From these modest beginnings, the nuclear industry scaled 
up the size of nuclear power plants rapidly. The four reactors 
that began operating in 1969 ranged in size from 581 to 867 
megawatts of electric capacity. Five years later, four reactors 
with a rated capacity of more than 1,000 megawatts electricity 
were in commercial service.
    Larger reactors offered utilities economies of scale, 
reducing the cost-per-kilowatt-hour of the electricity they 
generated. But increasing plant size also increased problems. 
Greater size increased capital costs, lengthened construction 
times, compounded financing expenses, added to design 
complexity and safety concern, and contributed to regulatory 
delay and uncertainty. These problems pose a substantial 
barrier to the deployment of new nuclear power plants, and they 
have led to a reexamination of the use of small modular 
reactors.
    The term ``small modular reactor'' is generally understood 
to refer to a reactor with a rated capacity of less than 300 
megawatts electric, which can be linked together with other 
small modular reactors, which can then be operated in 
combination. Small modular reactors offer several advantages 
over large nuclear power plants. They would have a lower 
capital cost, and thus would pose less financial risk, carry 
lower financing charges, and be more affordable to smaller 
utilities. They could also be used in smaller markets, which 
might not otherwise be able to support a large base-load 
nuclear power plant, or for industrial applications other than 
electric power production. Small modular reactor designs may 
also offer significant environmental and safety advantages and 
nonproliferation benefits. Importantly, they may also be 
fabricated in a factory, then transported and assembled onsite, 
improving quality control and significantly reducing the cost 
and schedule uncertainty of onsite construction.
    Legislation is needed to increase research, development, 
and demonstration of small modular reactors in order to make 
nuclear power safer, more affordable, and more secure, and to 
remove barriers to its deployment.

                          Legislative History

    S. 2812 was introduced by Senator Bingaman on November 20, 
2009. Senators Murkowski, Udall, Pryor, Landrieu, Risch, and 
Crapo are cosponsors. Similar legislation, H.R. 5164, was 
introduced in the House of Representatives on April 28, 2010.
    The Committee on Energy and Natural Resources held a 
legislative hearing on S. 2812 on December 15, 2009. S. Hrg. 
111-375. The Committee ordered S. 2812 favorably reported, with 
amendments, at its business meeting on July 21, 2010.

                        Committee Recommendation

    The Senate Committee on Energy and Natural Resources, in 
open business session on July 21, 2010, by voice vote of a 
quorum present recommends that the Senate pass S. 2812, if 
amended as described herein.
    Senator Sanders asked to be recorded as voting no.

                          Committee Amendments

    During its consideration of S. 2812, the Committee adopted 
an amendment to require the Secretary to conduct a program to 
obtain an early site permit for two sites for one or more small 
modular reactors, an amendment to add a definition of the term 
``early site permit,'' and to make four technical or conforming 
changes.

                      Section-by-Section Analysis

    Section 1 provides a short title.
    Section 2 amends section 952 of the Energy Policy Act of 
2005 (42 U.S.C. 16272) by adding at the end a new subsection 
(f), which establishes a new Nuclear Power 2021 Initiative.
    Paragraph (1) of the new subsection (f) defines terms used 
in the subsection.
    Paragraph (2) directs the Secretary of Energy to carry out 
three programs, through cooperative agreements with private 
sector partners to develop and demonstrate small modular 
reactors.
    Paragraph 2(A) requires the Secretary to carry out a 
program to develop a standard design for each of two small 
modular reactors, at least one of which has a rated capacity of 
not less than 50 electrical megawatts, and to obtain a design 
certification from the Nuclear Regulatory Commission for each 
of the two standard designs by January 2018.
    Paragraph 2(B) requires the Secretary to carry out a 
program to demonstrate the licensing of small modular reactors 
by developing applications for a combined license for each of 
the designs and obtaining a combined license from the Nuclear 
Regulatory Commission for each design by January 1, 2021.
    Paragraph 2(C) requires the Secretary to carry out a 
program to obtain an early site permit for two sites, each for 
one or more small modular reactors.
    Paragraph (3) requires the Secretary to select proposals 
for cooperative agreement on the basis of an impartial review 
of their scientific and technical merit, and through the use of 
competitive procedures.
    Paragraph (4) requires the Secretary to take into account 
the efficiency, cost, safety, and proliferation resistance of 
competing reactor designs in evaluating proposals.
    Paragraph (5) requires that at least 50 percent of the cost 
of developing small modular reactor designs and early site 
permits under subparagraphs (A) and (C) of paragraph (2), and 
at least 75 percent of the cost of the licensing demonstration 
of each small modular reactor design under paragraph (2)(B) be 
provided by a non-Federal source.

                   Cost and Budgetary Considerations

    The following estimate of costs of this measure has been 
provided by the Congressional Budget Office.

S. 2812--Nuclear Power 2021 Act

    Summary: S. 2812 would authorize appropriations for the 
Department of Energy (DOE) to enter into cooperative agreements 
with private-sector entities to develop and license standard 
designs for small modular nuclear reactors with capacities of 
up to 50 megawatts. CBO estimates that implementing S. 2812 
would cost $407 million over the 2011-2015 period, assuming 
appropriation of the necessary funds. Enacting S. 2812 would 
not affect direct spending or revenues; therefore, pay-as-you-
go procedures do not apply.
    S. 2812 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would impose no costs on state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary impact of S. 2812 is shown in the following table. 
The costs of this legislation fall within budget function 270 
(energy).

----------------------------------------------------------------------------------------------------------------
                                                               By fiscal year, in millions of dollars--
                                                    ------------------------------------------------------------
                                                       2011      2012      2013      2014      2015    2011-2015
----------------------------------------------------------------------------------------------------------------
                                  CHANGES IN SPENDING SUBJECT TO APPROPRIATION

Estimated Authorization Level......................        35       125       100       100       100        460
Estimated Outlays..................................        21        85        99       102       100        407
----------------------------------------------------------------------------------------------------------------

    Basis of estimate: S. 2812 would direct the Secretary of 
Energy to enter into cooperative agreements with private-sector 
entities to develop standard designs for small modular nuclear 
reactors as well as processes for licensing such reactors with 
the Nuclear Regulatory Commission (NRC). The bill would 
authorize appropriation of the necessary sums for DOE to cover 
up to 50 percent of the cost of developing designs for such 
reactors and up to 25 percent of the cost to demonstrate 
licensing processes and would specify a final deadline for all 
work to be completed by January 1, 2021.
    CBO estimates that fully funding S. 2812 would require 
appropriations totalling $460 million over the 2011-2015 period 
and an additional $100 million in 2016. That estimate is based 
on information from DOE about the agency's costs to develop 
facilities and demonstrate licensing processes for new, large-
scale nuclear reactors and takes into account the cost-share 
requirements specified in the bill. Assuming appropriation of 
those amounts, CBO estimates that resulting outlays would total 
$407 million over the 2011-2015 period.
    The NRC also would incur costs to certify designs and 
develop licensing procedures for small reactors under S. 2812. 
However, according to the NRC, the agency already plans to 
develop its capacity to support regulatory processes for small 
modular nuclear reactors. As a result, CBO estimates that 
implementing S. 2812 would not significantly affect net 
spending by that agency; any such spending would be subject to 
appropriation and would be largely offset by fees that the NRC 
is authorized to collect from regulated entities.
    Pay-As-You-Go considerations: None.
    Intergovernmental and private-sector impact: S. 2812 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would impose no costs on state, local, or 
tribal governments.
    Estimate prepared by: Federal costs: Megan Carroll; Impact 
on state, local, and tribal governments: Ryan Miller; Impact on 
the private sector: Amy Petz.
    Estimate approved by: Theresa A. Gullo, Deputy Assistant 
Director for Budget Analysis.

                      Regulatory Impact Evaluation

    In compliance with paragraph 11(b) of rule XXVI of the 
Standing Rules of the Senate, the Committee makes the following 
evaluation of the regulatory impact which would be incurred in 
carrying out S. 2812.
    The bill is not a regulatory measure in the sense of 
imposing Government established standards or significant 
economic responsibilities on private individuals and 
businesses.
    No personal information would be collected in administering 
the program. Therefore, there would be no impact on personal 
privacy.
    Little, if any, additional paperwork would result from the 
enactment of S. 2052.

                   Congressionally Directed Spending

    S. 2812, as ordered reported, does not contain any 
congressionally directed spending items, limited tax benefits, 
or limited tariff benefits as defined in rule XLIV of the 
Standing Rules of the Senate.

                        Executive Communications

    The testimony on S. 2812 given by the Assistant Secretary 
for Nuclear Energy at the Committee's December 15, 2009 
hearing, and the written comments of the Nuclear Regulatory 
Commission submitted following the hearing follow:

  Statement of Warren F. Miller, Jr., Assistant Secretary for Nuclear 
                      Energy, Department of Energy

                              introduction

    Thank you, Chairman Bingaman, Ranking Member Murkowski, and 
Members of the Committee. I appreciate the opportunity to 
appear before you and comment on legislation under 
consideration by the committee, as well as to provide 
information on where small modular reactors fit in the 
Department of Energy's portfolio.
    Let me start by saying clearly that the administration 
views nuclear power as an important element in its strategy to 
increase energy security and combat climate change. As the 
President said in Prague, ``[w]e must harness the power of 
nuclear energy on behalf of our efforts to combat climate 
change, and to advance peace and opportunity for all people.''
    Secretary Chu and I are working hard to advance nuclear 
power in the United States, and we expect the Department of 
Energy to award the first conditional loan guarantee for new 
nuclear plant construction soon.
    In the Office of Nuclear Energy, we have developed five 
imperatives to guide our activities.
    First, we are working with industry and the Nuclear 
Regulatory Commission to extend the lifetime of the existing 
reactor fleet. The 104 NRC-licensed commercial nuclear reactors 
produce roughly 20 percent of our nation's electricity but 70 
percent of our carbon-free electricity. Whether those plants 
retire at 60 or, for example, 80 years of age could greatly 
affect our carbon emissions profile in the future. Research is 
needed to answer outstanding questions about how long these 
reactors can safely be operated.
    Second, we are engaged with industry to enable new plant 
builds and improve the affordability of nuclear energy. I 
mentioned our efforts with respect to loan guarantees, but also 
some of our research, such as the soon-to-be-implemented 
Modeling and Simulation Hub, we expect will also help reduce 
costs.
    Third, we are working to reduce the carbon footprint of the 
transportation and industrial sectors. Nuclear power can supply 
more low-carbon electricity for increased electrification of 
the transportation sector, and provide low-carbon process heat 
for a range of industrial applications.
    Fourth, we are researching ways to create a sustainable 
nuclear fuel cycle. In particular, we are looking at ways of 
extending nuclear fuel supplies and reducing the amount and 
toxicity of waste requiring a permanent repository.
    And fifth, we are working to understand and minimize 
proliferation risks. All nuclear fuel cycles entail some amount 
of risk, but that risk can be reduced with appropriate 
technology applications and international guidelines and 
agreements.

                         small modular reactors

    With that, let me turn to the focus of today's hearing: 
small modular reactors (SMRs) and their potential benefits.
    Let me first define what we mean by ``small'' and 
``modular''.
    To begin with, there is no exact definition for what 
constitutes a ``small'' reactor. The International Atomic 
Energy Agency defines them to be less than 300 MWe as does 
S.2812. This boundary is based mainly on two factors: (1) 
Liability insurance, and (2) factory fabrication and 
portability to a site by rail or truck. For liability reasons, 
reactors above 300 MWe must carry separate indemnification 
insurance for each unit. Reactors modules that are sized 300 
MWe and below can be linked together to form one reactor unit 
for liability insurance. Reactor modules of this size are 
conducive to off-site fabrication prior to transportation by 
rail or truck, rather than by barge, to an approved site for 
assembly.
    The term ``modular'' implies several things that could 
create a potential advantage over larger plants. First, modular 
reactors can be linked together to create a larger power plant. 
This is potentially advantageous because it allows an owner the 
flexibility to incrementally increase the size of a plant. As 
demand increases, the owner can add more modules. Secondly, a 
smaller plant requires less initial capital outlay or 
investment. The existing operating modules can then be used to 
finance future additions. Multiple units are also important 
during refueling or maintenance because taking a single module 
offline does not require the shutdown of the entire plant.
    The term ``modular'' can also refer to potentially faster 
and more efficient construction techniques using factory 
fabrication. The U.S. defense nuclear shipbuilding industry is 
an excellent example where modular construction techniques have 
been proven to be highly successful. These same techniques can 
be applied to the commercial nuclear industry. This fabrication 
technique has the potential to make nuclear energy more 
economical and appealing to investors because it reduces the 
perceived ``risks'' associated with new nuclear builds such as 
construction delays and schedule uncertainty.
    There are several reasons why small modular reactors may 
prove advantageous compared to the Generation III+ nuclear 
plants in terms of economics, performance, and security.
    First, the high capital cost for new nuclear reactors has 
been a challenge for private entities to finance. Smaller 
projects would carry lower investment risk and could be more 
affordable to smaller utilities. This reduction in investment 
risk also provides an advantage in rate recovery, regardless of 
whether the licensee is regulated through state public utility 
commissions or whether it must sell the electricity in 
unregulated commercial markets.
    Second, there are areas in this country--and elsewhere in 
the world--where large plants are not needed or the existing 
infrastructure cannot support the larger capacity. Small 
modular reactors could be used to provide power to these 
smaller electrical markets, isolated areas or smaller grids. 
There is both a domestic and international market for small 
modular reactors and U.S. industry is well-positioned to lead 
and compete for these markets.
    Third, some of the SMR designs may offer significant 
environmental or safety advantages for siting in industrial 
settings or where, for example, water for cooling is a problem. 
Some reactor designs would produce a higher temperature outlet 
heat that can be used for either electricity or process heat 
for nearby industries while others use little or no water for 
cooling.
    Fourth, there are also some potential nonproliferation 
benefits to use of small reactors that could be designed to 
operate for decades without refueling. These reactors could be 
fabricated and fueled in a factory, sealed and shipped to the 
site for power generation, and then shipped back to the factory 
to be defueled. This approach could minimize the spread of 
nuclear material.
    Fifth, small reactors could also enter into traditionally 
non-nuclear energy markets for applications beyond electricity 
production. The possibilities include low carbon process heat 
for: fossil fuel recovery and refinement, synthetic or biofuel 
production, water desalination, hydrogen production, and a 
range of other petrochemical applications.
    Finally, while traditional economy-of-scale concepts favor 
larger nuclear plants, there are a number of reasons why SMRs 
may have some economic advantages.
    As mentioned previously, a sizeable portion of the cost and 
schedule uncertainty for building large nuclear plants is the 
amount of work that must be performed on site. Factory 
production and fabrication, and transport to and assembly 
onsite can significantly reduce that uncertainty.
    Research into small modular reactors could address several 
of the Office of Nuclear Energy's imperatives: improving the 
affordability of nuclear power; supplying low-carbon 
electricity and process heat to the transportation and 
industrial sectors; and minimizing proliferation risks. More 
importantly, the advancement of SMRs will respond to U.S. 
economic and environmental market conditions for low-carbon 
energy sources.

                    comments on s. 2052 and s. 2812

    It should be clear from the preceding comments that the 
Department believes that small modular reactors are an 
important area of research and development.
    The Nuclear Energy Research Initiative Improvement Act of 
2009, S. 2052, gives broad authority to conduct research into 
small modular reactors, as well as other related issues. The 
Department is still evaluating the details of the bill.
    S. 2812, the Nuclear Power 2021 Act, would require the 
Department of Energy to carry out a program to develop and 
demonstrate two small modular reactor designs. The Department 
is still evaluating the details of the bill.

                               conclusion

    In considering a small modular reactor program, a variety 
of factors need to be assessed, including issues such as 
reactor size, industry readiness and responsibilities, and 
research and development needs.
    That concludes my formal remarks. Thank you for the 
opportunity to testify and I look forward to answering your 
questions and working with the Committee to achieve the 
administration's goals of energy security and reducing the 
nation's carbon emissions.
                                     United States,
                             Nuclear Regulatory Commission,
                                 Washington, DC, December 10, 2009.
Hon. Jeff Bingaman
Chairman, Committee on Energy and Natural Resources,
U.S. Senate, Washington, DC.
    Dear Mr. Chairman: As requested in your letter dated 
December 1, 2009, I am submitting, on behalf of the U.S. 
Nuclear Regulatory Commission (NRC), the following comments 
regarding S. 2052, the ``Nuclear Energy Research Initiative 
Improvement Act of 2009,'' and S. 2812, the ``Nuclear Power 
2021 Act.''
    Because of our role as a regulator, the NRC offers no 
comments on whether, as a policy matter, small modular reactors 
or other new nuclear reactor technologies should or should not 
be pursued. The NRC's role would be limited to ensuring that 
any reactors utilizing new technologies will be constructed and 
operated in a manner that will provide adequate protection of 
public health and safety and the common defense and security. 
Accordingly, the NRC's comments relate to the NRC's regulatory 
role.

                                S. 2052

    S. 2052 would require the U.S. Department of Energy (DOE) 
to ``conduct research to lower the cost of nuclear reactor 
systems.'' This language would not, though, expressly direct 
the DOE to conduct research on safety in conjunction with its 
research related to cost reduction for nuclear reactor systems. 
Such safety research could be valuable in supporting the NRC's 
role in determining whether particular cost-saving measures are 
consistent with public health and safety--a determination the 
NRC would need to make before making any licensing decisions. 
Accordingly, the NRC suggests adding the words ``consistent 
with protection of public health and safety'' after the words 
``lower the cost of nuclear reactor systems'' in the provision 
of Section 2 of S. 2052 that would add a new paragraph (2) to 
section 952(a) of the Energy Policy Act of 2005.
    To the extent that the research into nuclear reactor 
systems leads to submission to the NRC of applications based 
upon new technologies or designs, the NRC may need to conduct 
infrastructure development and confirmatory research before 
receiving applications in order to ensure an efficient and 
effective review process once applications do arrive. To 
facilitate efficient licensing reviews, Congress would 
therefore need to provide the NRC with adequate appropriations 
to cover this pre-application work.

                                S. 2812

    S. 2812 requires the DOE to obtain two small modular 
reactor design certifications from the NRC by January 1, 2018, 
and to obtain two NRC combined licenses--one for each certified 
design--by January 1, 2021. As the NRC staff has indicated in 
prepared written testimony for the Committee's December 15, 
2009 hearing, the NRC has already begun conducting preparatory 
work on various matters related to small modular reactors. 
However, the amount of additional work that the NRC must do to 
prepare itself for efficient reviews of the small modular 
reactor design certification and combined license applications 
described in S. 2812 will vary based upon the technologies 
ultimately chosen. For example, the NRC expects that it is much 
closer to being able to efficiently evaluate applications for 
small modular reactors that would utilize light water reactor 
technology--the same technology employed in the existing fleet 
of large commercial nuclear plants--than applications reliant 
on technologies with which the NRC has much less experience.
    Thus, while the NRC is not contending that the deadlines in 
S. 2812 are unattainable, and while the NRC would make a 
concerted effort to make licensing decisions within any 
statutory timeframe, the NRC emphasizes that the time and 
resources it will need to develop the appropriate 
infrastructure and conduct any necessary confirmatory research 
could vary substantially depending upon which small modular 
reactor technologies are ultimately pursued. S. 2812 does set 
target dates for ultimate receipt of NRC licenses, but it sets 
no deadline for determining which technologies will be chosen 
as the basis for the designs that the DOE and its private-
sector partners would seek to have licensed. Therefore, it is 
not clear how much advance warning the NRC would have about 
which technologies the license applications will reference.
    In addition, pursuant to its Atomic Energy Act 
responsibilities, the NRC will not grant a license if the 
applicant does not demonstrate to the NRC that public health 
and safety and common defense and security will be adequately 
protected. Therefore, for the deadlines in S. 2812 to be met, 
the NRC would need to receive appropriations adequate to 
support any necessary infrastructure development and 
confirmatory research as well as the application reviews 
themselves, and applicants would need to submit high quality 
applications in a timely manner.
    In light of the considerations described above, the NRC 
suggests adding language to the deadline provisions of S. 2812 
to ensure there is no undue pressure on the DOE or the NRC to 
compromise on safety or security because of impending statutory 
deadlines. Section 645 of the Energy Policy Act of 2005 
provides an example of possible alternative language. That act 
established the Next Generation Nuclear Plant Project, and 
Section 645(c) sets forth a specific date by which the DOE is 
to complete construction and begin operations of a prototype 
nuclear plant and associated facilities. But Section 645(c) 
also gives the DOE the option--in the event it cannot comply 
with the statutory deadline--of ``submit[ting] to Congress a 
report establishing an alternative date for completion.'' The 
NRC believes that similar safety-valve language would be 
appropriate for S. 2812 to account for any complications 
related to safety or security that might arise as new small 
modular reactor technologies are developed and assessed.
    If you have questions about these views, please do not 
hesitate to contact me.
            Sincerely,
                                         Gregory B. Jaczko,
                                                          Chairman.

                        Changes in Existing Law

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill S. 2812, as ordered reported, are shown as follows 
(existing law proposed to be omitted is enclosed in black 
brackets, new matter is printed in italic, existing law in 
which no change is proposed is shown in roman):

                       ENERGY POLICY ACT OF 2005

                           Public Law 109-58

   AN ACT To ensure jobs for our future with secure, affordable, and 
reliable energy.

           *       *       *       *       *       *       *

TITLE IX--RESEARCH AND DEVELOPMENT

           *       *       *       *       *       *       *

Subtitle E--Nuclear Energy

           *       *       *       *       *       *       *

SEC. 952. NUCLEAR ENERGY RESEARCH PROGRAMS.

    (a) Nuclear Energy Research Initiative.--The Secretary 
shall carry out a Nuclear Energy Research Initiative for 
research and development related to nuclear energy.

           *       *       *       *       *       *       *

    (e) Reactor Production of Hydrogen.--The Secretary shall 
carry out research to examine designs for high-temperature 
reactors capable of producing large-scale quantities of 
hydrogen.
    (f) Nuclear Power 2021 Initiative.--
          (1) Definitions.--As used in this subsection--
                  (A) Combined license.--The term `combined 
                license' has the meaning given the term in 
                section 52.1 of title 10, Code of Federal 
                Regulations (or a successor regulation).
                  (B) Design certification.--The term `design 
                certification' has the meaning given the term 
                in section 52.1 of title 10, Code of Federal 
                Regulations (or a successor regulation).
                  (C) Early site permit.--The term `early site 
                permit' has the meaning given the term in 
                section 52.1 of title 10, Code of Federal 
                Regulations (or a successor regulation).
                  (D) Small modular reactor.--The term `small 
                modular reactor' means a nuclear reactor--
                          (i) with a rated capacity of less 
                        than 300 electrical megawatts; and
                          (ii) that can be constructed and 
                        operated in combination with similar 
                        reactors at a single site.
          (2) Duty of secretary.--The Secretary shall carry 
        out, through cooperative agreements with private sector 
        partners--
                  (A) a program--
                          (i) to develop a standard design for 
                        each of 2 small modular reactors, at 
                        least 1 of which has a rated capacity 
                        of not more than 50 electrical 
                        megawatts; and
                          (ii) to obtain a design certification 
                        from the Nuclear Regulatory Commission 
                        for each of the 2 standard designs by 
                        January 1, 2018;
                  (B) a program to demonstrate the licensing of 
                small modular reactors by--
                          (i) developing applications for a 
                        combined license for each of the 
                        designs certified pursuant to 
                        subparagraph (A); and
                          (ii) obtaining a combined license 
                        from the Nuclear Regulatory Commission 
                        for each of the designs by January 1, 
                        2021; and
                  (C) a program to obtain an early site permit 
                for 2 sites for 1 or more small modular 
                reactors.
          (3) Merit review of proposals.--The Secretary shall 
        select proposals for cooperative agreements under this 
        subsection--
                  (A) on the basis of an impartial review of 
                the scientific and technical merit of the 
                proposals; and
                  (B) through the use of competitive 
                procedures.
          (4) Technical considerations.--In evaluating 
        proposals, the Secretary shall take into account the 
        efficiency, cost, safety, and proliferation resistance 
        of competing reactor designs.
          (5) Cost-share requirements.--
                  (A) Design development.--Notwithstanding 
                section 988, the Secretary shall require that 
                not less than 50 percent of the cost of the 
                development of each small modular reactor 
                design under paragraph (2)(A), and each early 
                site permit under paragraph (3)(C), be provided 
                by a non-Federal source.
                  (B) Licensing demonstration.--Notwithstanding 
                section 988, the Secretary shall require that 
                not less than 75 percent of the cost of the 
                licensing demonstration of each small modular 
                reactor design under paragraph (2)(B) be 
                provided by a non-Federal source.
                  (C) Calculation of amount.--Non-Federal 
                contributions shall be calculated in accordance 
                with section 988(d).

           *       *       *       *       *       *       *

                                  
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