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THE ROLE OF NUCLEAR POWER GENERATION IN

A COMPREHENSIVE NATIONAL ENERGY POLICY

HEARING

BEFORE THE

SUBCOMMITTEE ON ENERGY AND RESOURCES

OF THE

COMMITTEE ON

GOVERNMENT REFORM

HOUSE OF REPRESENTATIVES

ONE HUNDRED NINTH CONGRESS

FIRST SESSION

APRIL 28, 2005

Serial No. 109–25

Printed for the use of the Committee on Government Reform

(

Available via the World Wide Web: http://www.gpo.gov/congress/house

http://www.house.gov/reform

(II)

COMMITTEE ON GOVERNMENT REFORM

TOM DAVIS, Virginia, Chairman

CHRISTOPHER SHAYS, Connecticut

DAN BURTON, Indiana

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

JOHN L. MICA, Florida

GIL GUTKNECHT, Minnesota

MARK E. SOUDER, Indiana

STEVEN C. LATOURETTE, Ohio

TODD RUSSELL PLATTS, Pennsylvania

CHRIS CANNON, Utah

JOHN J. DUNCAN, JR., Tennessee

CANDICE S. MILLER, Michigan

MICHAEL R. TURNER, Ohio

DARRELL E. ISSA, California

GINNY BROWN-WAITE, Florida

JON C. PORTER, Nevada

KENNY MARCHANT, Texas

LYNN A. WESTMORELAND, Georgia

PATRICK T. MCHENRY, North Carolina

CHARLES W. DENT, Pennsylvania

VIRGINIA FOXX, North Carolina

——— ———

HENRY A. WAXMAN, California

TOM LANTOS, California

MAJOR R. OWENS, New York

EDOLPHUS TOWNS, New York

PAUL E. KANJORSKI, Pennsylvania

CAROLYN B. MALONEY, New York

ELIJAH E. CUMMINGS, Maryland

DENNIS J. KUCINICH, Ohio

DANNY K. DAVIS, Illinois

WM. LACY CLAY, Missouri

DIANE E. WATSON, California

STEPHEN F. LYNCH, Massachusetts

CHRIS VAN HOLLEN, Maryland

LINDA T. SANCHEZ, California

C.A. DUTCH RUPPERSBERGER, Maryland

BRIAN HIGGINS, New York

ELEANOR HOLMES NORTON, District of

Columbia

———

BERNARD SANDERS, Vermont

(Independent)

MELISSA WOJCIAK, Staff Director

DAVID MARIN, Deputy Staff Director/Communications Director

ROB BORDEN, Parliamentarian

TERESA AUSTIN, Chief Clerk

PHIL BARNETT, Minority Chief of Staff/Chief Counsel

SUBCOMMITTEE ON ENERGY AND RESOURCES

DARRELL E. ISSA, California, Chairman

LYNN A. WESTMORELAND, Georgia

ILEANA ROS-LEHTINEN, Florida

JOHN M. MCHUGH, New York

PATRICK T. MCHENRY, NORTH CAROLINA

KENNY MARCHANT, Texas

DIANE E. WATSON, California

BRIAN HIGGINS, New York

TOM LANTOS, California

DENNIS J. KUCINICH, Ohio

EX OFFICIO

TOM DAVIS, Virginia HENRY A. WAXMAN, California

LAWRENCE J. BRADY, Staff Director

DAVE SOLAN, Professional Staff Member

LORI GAVAGHAN, Clerk

RICHARD BUTCHER, Minority Professional Staff Member

(III)

C O N T E N T S

Page

Hearing held on April 28, 2005 .............................................................................. 1

Statement of:

Jones, Donald, vice president and senior economist, RCF Economic and

Financial Consulting, Inc.; Marvin Fertel, senior vice president for

business operations, Nuclear Energy Institute; and Patrick Moore,

chairman and chief scientist, Greenspirit Strategies LTD ........................ 8

Fertel, Marvin ............................................................................................ 17

Jones, Donald ............................................................................................ 8

Moore, Patrick ........................................................................................... 42

Letters, statements, etc., submitted for the record by:

Fertel, Marvin, senior vice president for business operations, Nuclear

Energy Institute:

February 2005 public opinion ................................................................... 116

Prepared statement of ............................................................................... 22

Issa, Hon. Darrell E., a Representative in Congress from the State of

California:

Constituent survey .................................................................................... 105

Study of University of Chicago ................................................................. 63

Prepared statement of ............................................................................... 3

President Bush’s remarks of April 27, 2005 ........................................... 97

Jones, Donald, vice president and senior economist, RCF Economic and

Financial Consulting, Inc., prepared statement of ..................................... 11

Kucinich, Hon. Dennis J., a Representative in Congress from the State

of Ohio, prepared statement of .................................................................... 35

Moore, Patrick, chairman and chief scientist, Greenspirit Strategies LTD,

prepared statement of ................................................................................... 46

Watson, Hon. Dianne E., a Representative in Congress from the State

of California, prepared statement of ........................................................... 39

Westmoreland, Hon. Lynn A., a Representative in Congress from the

State of Georgia, prepared statement of ..................................................... 58

(1)

THE ROLE OF NUCLEAR POWER GENERATION

IN A COMPREHENSIVE NATIONAL ENERGY

POLICY

THURSDAY, APRIL 28, 2005

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON ENERGY AND RESOURCES,

COMMITTEE ON GOVERNMENT REFORM,

Washington, DC.

The subcommittee met, pursuant to notice, at 10:10 a.m., in room

2247, Rayburn House Office Building, Hon. Darrell E. Issa (chairman of the subcommittee) presiding.

Present: Representatives Issa, Westmoreland, Watson, Higgins,

and Kucinich.

Staff present: Larry Brady, staff director; Lori Gavaghan, legislative clerk; Dave Solan, Ph.D., Steve Cima, and Chase Huntley, professional staff members; Richard Butcher, minority professional

staff; and Jean Gosa, minority assistant clerk.

Mr. ISSA. Good morning. My opening statement always says, ‘‘A

quorum being present.’’ It takes two for a quorum here, so we will

skip that line. I have an opening, and I am going to put it in the

record and be very brief. If the ranking member arrives before we

begin testimony, that would be better. However, I don’t want to

abuse you of your time, and I definitely want to very much hear

what you have to say and get to questioning. I can assure you we

have had enough members respond that they will be here for Q&A,

which seems to be the direction that Members prefer. So we will

get to that as quickly as possible.

The reason for this hearing today is that our Nation’s electricity

demand continues to rise while, in fact, production from nuclear

sources does not. According to the Department of Energy, 41 new

1,000 megawatt nuclear plants will be needed by the year 2025 just

to maintain nuclear power’s 20 percent share of our Nation’s electricity generation. However, there hasn’t been a new nuclear power

plant built in three decades. There are none presently licensed to

be built, and without re-licensing, or essentially extensions of their

lives, a significant amount of capacity will go offline by 2025.

The growth in electricity demand, coupled with the retirement of

older generation plants, means the Nation will need 281 million

kilowatts, to put it in kilowatt terms, of new generation capacity—

enough to power the State of California, which, of course, is the

world’s sixth largest economy if it were a separate nation. I always

get that into every one of my opening lines, as a Californian.

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I think it is important that we hear from you today about the

role that nuclear power should play in America’s future because we

have oversight and because we are steering ourselves into a train

wreck. And I think if there is any message that I would like to

hear today, it would be what are the ramifications of our not acting. And as each of the distinguished individuals and I were talking about earlier, I think we also touched on the areas of global

warming and our participation in it, and I hope that that will also

come up.

[The prepared statement of Hon. Darrell E. Issa follows:]

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Mr. ISSA. Now, if I can just briefly introduce our guests. Donald

Jones is vice president and senior economist at RCF Economics, a

financial consulting firm in Chicago. In 2003 and 2004, he co-directed the study at the University of Chicago on the economic future of nuclear power in the United States. It couldn’t have been

more timely. Marvin Fertel is senior vice president of business operations and chief nuclear officer at the Nuclear Energy Institute.

Mr. Fertel has over three decades experience—which means you actually remember when they last built a nuclear power plant—in

consulting through electrical utilities on issues related to designing, siting, licensing, and managing both fossil fuels and nuclear

power plants.

Last, and very important to me personally, and I thank you for

being here, Dr. Patrick Moore has been a leader in the international environmental field for over 30 years. He is a founding

member of Greenpeace and served 7 years as a director of

Greenpeace International. In 1991, Dr. Moore founded Greenspirit

Strategies, a consultancy focusing on environmental policy and

communications.

With the indulgence of the minority staff, what we will do is return to the ranking member’s opening statement upon her arrival,

according to the rules.

With that, Mr. Jones, I would really appreciate if you would lead

off.

For all the witnesses, your testimony will be put into the record.

And as is this policy of this committee, if I could ask you each to

raise your hands and be sworn, if that is acceptable.

[Witnesses sworn.]

Mr. ISSA. Please indicate that all have said I do. Thank you.

Mr. Jones.

STATEMENTS OF DONALD JONES, VICE PRESIDENT AND SENIOR ECONOMIST, RCF ECONOMIC AND FINANCIAL CONSULTING, INC.; MARVIN FERTEL, SENIOR VICE PRESIDENT FOR

BUSINESS OPERATIONS, NUCLEAR ENERGY INSTITUTE; AND

PATRICK MOORE, CHAIRMAN AND CHIEF SCIENTIST,

GREENSPIRIT STRATEGIES LTD

STATEMENT OF DONALD JONES

Mr. JONES. Good morning, Mr. Chairman, members of the Subcommittee on Energy and Resources of the House Committee on

Government Reform. I am Donald W. Jones, vice president of the

RCF Economic and Financial Consulting, an economic research

firm in Chicago which conducts analysis of energy and environmental issues, as well as other economic topics. Together with Dr.

George S. Tolley, professor emeritus of economics at the University

of Chicago, I co-directed the University of Chicago study of the economic future of nuclear power in the United States. My comments

today are based on the findings of that study.

I have been asked to address the issue of policies that would be

needed to foster the development of nuclear power and maintain a

20 percent nuclear share of electricity generation by 2020.

Because no construction has begun on a new nuclear plant in the

United States since 1973, a number of uncertainties surround the

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construction of the first few new plants: the success of the new licensing procedure, the construction time, and the delivered cost of

the new reactor designs. Uncertainty in an investment raises the

cost of capital to a risky project so as to keep the expected rate of

return at a level required by the capital market.

These uncertainties raise the cost of generating electricity from

these plants above levels that would be competitive with electricity

generated by coal- and gas-fired plants. Our calculations indicate

that the first new nuclear plants could deliver electricity at costs

of $53 to $71 dollars per megawatt hour, depending on reactor design and capital cost, while coal- and gas-fired plants would cost

from $33 to $45 per megawatt hour.

The majority of these uncertainties could be resolved after the

construction of the first several plants, and assuming they are resolved satisfactorily, the nuclear costs would fall well within the

range of fossil-generated costs by the fourth or fifth new plant of

a given design.

Table 1, to my right front, shows the progress of nuclear generation costs over the first eight plants of a reactor design with a capital cost of $1,500 per kilowatt of capacity. Learning and construction is assumed to reduce capital costs by 3 percent for each doubling of plants built, which is a conservative estimate of this learning effect according to United States and international experience.

The generation costs in the right-most column of the table indicate

that by the fourth or fifth new plant of this design, generation costs

fall to $34 to $36 per megawatt hour, which is competitive with fossil-fired generation costs of $33 to $45 per megawatt hour. The nuclear plant’s cost reductions derive from pay-off of first-of-a-kindengineering [FOAKE], costs borne only on the first plant, shortening of construction time, investors’ gaining the confidence needed

to eliminate the risk premium and permit higher portions of debt

financing, and learning in manufacturing and construction.

The first problem to be solved is getting from the first plant to

the fourth plant. The Chicago study examined four financial assistance policies applied separately and in various combinations: a production tax credit equivalent to that currently offered to renewable

energy development, an investment tax credit, accelerated depreciation, and loan guarantees. Table 2, to my left, reports the generation costs on a first plant achieved by each of these policies.

An effective combination is a 20 percent investment tax credit

and a production tax credit of $18 per megawatt hour for 8 years

with a cap of $125 million per plant per year. These would bring

the cost of the first plants within the competitive range of coal- and

gas-fired plants. Policies such as these should be needed only for

the first four or five plants because of the cost reductions that can

be expected after the first plant.

An important policy influencing the cost of new nuclear plants is

the Nuclear Regulatory Commission’s licensing procedure. The new

process codified in 10 CFR Part 52 permits resolution of many of

the uncertainties surrounding the construction and commissioning

of a new nuclear plant prior to the times when major financial commitments must be made. Hopes are high for its successful implementation, but the system remains to be tested.

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Several comparisons of generation costs illustrate the importance

of this new procedure. Licensing that shortens construction time by

2 years and gives investors the confidence to reduce the risk premium on nuclear financing to the level on fossil-fired projects could

reduce the generation cost of eight plants by 25 to 48 percent.

Eliminating construction delays also has a significant effect on

costs: a 2-year delay in the middle of a construction period would

raise generation costs by 11 percent, while a similar delay at the

end of construction would raise costs by 23 percent. The methodology of these calculations is reported in detail in the published report of the study, the Economic Future of Nuclear Power; A Study

Conducted at the University of Chicago, dated August 2004.

Although it was not part of the formal study, our study team reviewed the subcommittee’s question regarding what would be required to maintain the 20 percent contribution nuclear energy

makes in meeting over electricity demand by 2020. According to

projections of the growth of electricity generation capacity needed

to satisfy demand growth, two to four new nuclear plants could

need to come on line each year between 2015 and 2020 if the nuclear share of electricity generation is to remain at 20 percent.

This could amount to a total of 15 to 24 new plants, of 1,000

megawatts each, over a period of 6 years. One important point

emerging from these numbers is that the number and pace of new

plants is large enough to permit 5 to 10 percent cost reductions

from learning by the fourth and fifth plants of a given type, which

would be of considerable value in making those plants competitive.

Thank you very much, Mr. Chairman and subcommittee members. This concludes my written statement, and I would be happy

to answer any questions you might have.

[The prepared statement of Mr. Jones follows:]

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Mr. ISSA. Thank you.

Mr. Fertel.

STATEMENT OF MARVIN FERTEL

Mr. FERTEL. Thank you, Chairman Issa. I am Marvin Fertel. I

am senior vice president and chief nuclear officer at the Nuclear

Energy Institute. And on behalf of our members, I thank you for

the opportunity to be here today.

NEI is responsible for developing policy for the U.S. nuclear industry. Our organization’s 270 member companies represent a

spectrum of interests, including every U.S. energy company that

operates a nuclear power plant.

America’s 103 nuclear power plants are right now the most efficient and reliable in the world. Our nuclear energy is the largest

source of emission-free electricity in the United States and our second largest source of electricity overall after coal. Nuclear power

plants in 31 States currently provide electricity for one of every five

U.S. homes and businesses.

Given these facts and the strategic importance of nuclear energy

to our Nation’s energy security and economic growth, NEI encourages Congress to maintain policies that ensure continued operation

of our Nation’s operating plants, and to provide an impetus required to expand emission-free nuclear energy as a vital part of our

Nation’s diverse energy mix.

Last week, the House of Representatives demonstrated strong

support for nuclear energy’s role when it passed H.R. 6.

This morning, I would like to address three major areas: first,

the strategic value of nuclear power plants as a source of safe, reliable, and stable electricity; second, industry initiatives to ensure

continued operation of today’s nuclear plants; and, third, the importance of strong congressional oversight to ensure effective and

efficient implementation of the Federal Government’s responsibilities that affect nuclear energy programs.

As I mentioned, nuclear power represents 20 percent of U.S. electricity power today. It did 10 years ago also. And basically over

that period we have increased demand for electricity in our country

by 25 percent.

We are able to maintain our market share thanks to dramatic

improvements in reliability, safety, and productivity of our current

fleet of plants, which today operate at about 90 percent capacity,

which means they are on line and operating 90 percent of the time,

24 hours a day, 365 days a year. Improved productivity at our

plants have satisfied 20 percent of the growth in electricity demand

over the last decade.

Nuclear power serves a number of other important national

needs. First, nuclear power plants contribute to the fuel and technology diversity that is the core strength of the U.S. electricity supply system. Our position is that we need nuclear, coal, renewables,

gas, and any other source, and you just have to have the right mix

and use them for the right purposes.

Second, nuclear power plants provide future price stability that

is not available from electric generating plants fueled, say, with

natural gas and, in today’s market, with coal. Intense volatility in

natural gas prices over the last several years is likely to continue

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thanks partly to unsustainable demand for natural gas from the

electric sector. Nuclear plants reduce the pressure on natural gas

supply, thereby relieving cost pressures on other non-electric uses

for natural gas where you don’t have alternative fuel sources.

Third, nuclear power plays a strategic role in meeting U.S. clean

air goals and the Nation’s goal of reducing greenhouse gas emissions. Without our current nuclear plants, greenhouse gas emissions from the electric sector would be 30 percent higher today.

New nuclear power plants reduce electricity that otherwise would

be supplied by oil-, gas-, or coal-fired generating capacity, and thus

avoid the emissions associated with that fossil-fueled capacity.

Overall, we believe nuclear power represents a unique value

proposition. It provides large volumes of electricity cleanly, reliably

and safely, and, most importantly, also affordably; it provides future price stability and serves as a hedge against price and supply

volatility; and nuclear plants have valuable environmental attributes and they help preserve our Nation’s energy security. These

demonstrated characteristics of why nuclear power has such strategic importance in our overall U.S. energy policy.

The 103 operating plants are valuable today. The chairman mentioned renewing licenses, and what I would like to say is we are

actually making very good progress on that. Two-thirds of the 103

units have either renewed their license, announced they are going

to renew their license, or are in the process of getting reviewed,

and our expectation is that every 1 of the 103 plants will renew

their license. They are licensed for 40 years. The NRC can renew

the license for another 20 years after their reviews, and, to be honest, they can renew it for 20 years after that if you wanted to do

that.

Despite the dramatic gains in reliability and productivity at our

operating plants, there are obvious limits to how much additional

electricity they can produce, so meeting the Nation’s growing demand for electricity, which according to the Energy Information

Administration will require between 230,000 and 330,000

megawatts additional by 2025, we believe will require the construction of new nuclear plants in this country.

New plants would provide Americans with low-cost, safe, and reliable electricity; would bring long-term price stability to electricity;

and prevent the emission of air pollutants and greenhouse gases.

In addition, new plant construction would create thousands of

skilled, high-tech jobs and help us rebuild our manufacturing facilities in this country, which we have lost.

A program of a new nuclear plant construction is absolutely necessary for the United States to regain its technological leadership

in this high-tech field. The nuclear energy industry and the Department of Energy launched a program several years ago that will

position the industry to build new nuclear plants when needed and

when the business conditions are right. This is a comprehensive

program designed to achieve the business issues, including licensing and regulatory issues mentioned by Dr. Jones, development of

new plant designs and financing that could be roadblocks to new

nuclear plant construction.

The overall objective for this joint industry-government initiative

is to ensure that new nuclear plants can be operational in the 2010

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to 2020 timeframe in this country. Industry and government will

be prepared to meet the demands for new emission-free base load

plants in that timeframe only through a sustained focus on the necessary programs and policies between now and then.

As it has in the past, strong congressional oversight will be necessary to ensure effective and efficient implementation of the Federal Government’s nuclear energy programs, and to maintain

America’s leadership in nuclear technology development and its influence over other important diplomatic initiatives like nonproliferation.

Nowhere is this more important than with the Department of

Energy’s program to manage the used nuclear fuel from our nuclear power plants.

Continued progress toward a Federal used nuclear fuel repository

is necessary to support nuclear energy’s vital role in a comprehensive national energy policy.

Since enactment of the 1982 Nuclear Waste Policy Act, DOE’s

nuclear fuel management program has overcome many challenges,

and challenges remain before the Yucca Mountain facility can

begin operations. But as we address these issues, it is important

to keep the overall progress of the program in context.

First, there is international scientific consensus that a deep geologic repository is the best solution for long-term disposition of any

waste from any nuclear power facility, that is, whether you recycle

it or you do a once-through fuel cycle. You still need a deep geologic

repository.

Second, the Bush administration and Congress, with strong bipartisan support, affirmed the suitability of Yucca Mountain for a

repository in 2002. Over the past 3 years, the Energy Department

and its contractors have made considerable progress providing yet

greater confirmation that Yucca Mountain is an appropriate site.

Third, during the past year, Federal courts have rejected significant legal challenges by the State of Nevada and others to the Nuclear Waste Policy Act and the 2002 Yucca Mountain suitability determination.

In the coming year, Congress will play an essential role in keeping this program on schedule by taking steps necessary to provide

increased funding for the project in fiscal year 2006 and years beyond.

The industry urges the Congress to support the administration’s

proposal to change the funding mechanism for the Yucca Mountain

program so that consumer payments to the Nuclear Waste Fund

can be used only for the project and excluded from traditional congressional budget caps. Although the program should remain subject to congressional oversight, Yucca Mountain appropriations

should not compete each year for funding with unrelated programs

when Congress directed a dedicated funding stream for the project.

Industry also believes that it is appropriate and necessary to consider alternative approaches to the Yucca Mountain project. These

alternatives could include an extended period for monitoring operation of the repository for up to 300 years or longer, other things

as far as retrievability, and concepts like waste treatment and conditioning. What should be done is what is necessary to enhance

safety and public confidence in the safety of the repository.

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Congressional oversight can also play a key role in maintaining

and encouraging the transparency and stability of the Nuclear Regulatory Commission’s regulatory process. Such stability is essential

for our 103 operating nuclear plants and equally critical in licensing new nuclear plants.

Congress played a key role several years ago in encouraging the

NRC to move toward a new oversight process for the Nation’s nuclear plants, based on quantitative performance indicators and

safety significance. Today’s reactor oversight process focuses industry and NRC resources on equipment, components and operational

issues that have the greatest importance to safety.

The need for regulatory stability is particularly acute today in

the area of nuclear plant security.

The NRC and the industry have worked hard to identify and implement new and extensive security requirements at our plants. In

the 31⁄2 years since September 11, the NRC has issued a series of

requirements to increase security and enhance training for security

programs. The industry has complied fully and rapidly.

The industry has spent more than $1 billion enhancing security

since September 11. We have identified and addressed potential

vulnerabilities. Today, 31⁄2 years after September 11, the industry

is at almost the practical limits of what a private industry can do

to secure these facilities. We need to fully incorporate the new significant changes into our operations and emergency planning programs, and increase our proficiency in executing the programs to

meet the high expectations of the NRC.

Both industry and the NRC need congressional oversight to support and encourage this kind of stability.

In conclusion, the public sector, including the oversight committees of the U.S. Congress, can help maintain the conditions that ensure Americans will continue to reap the benefits of nuclear energy

in the years ahead.

The passage of comprehensive energy legislation that recognizes

nuclear energy’s contributions to meeting our growing energy demands, ensuring our energy security, and protecting our environment is an important step.

Equally important, however, is the need to ensure effective and

efficient implementation of existing laws, like the Nuclear Waste

Policy Act, and to provide Federal agencies with the resources and

oversight necessary to discharge their statutory responsibilities.

The commercial nuclear power sector was born in the United

States, and nations around the world continue to look to the United

States for leadership in this technology and in the issues associated

with nuclear power. Our ability to influence critical international

policies in areas like nuclear nonproliferation depend on our ability

to maintain a leadership role in prudent deployment, use and regulation of nuclear energy technologies here at home, and on our ability to manage the technological and policy challenges, like waste

management, that arises with all advanced technologies.

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This is a broad responsibility and, in the case of nuclear energy,

rests equally on the shoulders of industry, government agencies

like the Department of Energy and the Nuclear Regulatory Commission, and the appropriate committees of Congress.

Thank you very much for the opportunity to say this.

[The prepared statement of Mr. Fertel follows:]

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Mr. ISSA. Thank you.

And, as promised, our ranking member and others have arrived,

so we will go to opening statements before Dr. Moore.

I would like to recognize Representative Westmoreland from

Georgia, who has arrived. Representative Kucinich had to apologize, he has left his opening statement, and it will be put in the

record. He had another conflict and will try to return.

[The prepared statement of Hon. Dennis J. Kucinich follows:]

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Mr. ISSA. With that, I would like to recognize our ranking member, Ms. Watson, for her opening remarks.

Ms. WATSON. I want to thank the Chair for holding this very important subcommittee hearing on the role of nuclear power. Most

importantly, I have with me a young student. It is bring your

daughter or son to work with you day. Megan Tarr is in the back.

And it is important for these young people—and I have some interns from my office—to hear a discussion on power use for the future; how we can generate it, how we can care for it, how we can

maintain it. So the subject of this hearing, the nuclear power generation, is a comprehensive national energy policy that is so essential, and I am very pleased that these young people will start getting themselves informed.

No nuclear plants have been ordered in the United States since

1978 and more than 100 reactors have been canceled. However, the

rising costs of electricity generated from natural gas and coal-fired

power plants may make nuclear power and renewable energy

sources relatively more competitive.

It has been argued that expanded nuclear generation could help

substitute for some of the demand for natural gas. Electricity is a

major contributing source to the increased demand for natural gas.

In contrast to oil, uranium, the key fuel source for nuclear reactors,

is domestically available and supplies are not vulnerable to disruption by political instability overseas. Is this a reasonable viewpoint?

In addition, a significant aspect of reduced fossil fuel consumption is a reduction in carbon dioxide emission. Nuclear energy does

not produce substantial air pollution; therefore, it could help reduce

air pollution problems such as smog, particulate matter, and global

warming. The United States is responsible for about one-fourth of

the world’s total greenhouse gas emissions. Americans must do better. How much fossil fuel electric generation must be replaced to

make a difference? Is nuclear generation the answer? I am hoping

that we will have the input so we can continue that dialog.

Nuclear power generation has many downsides. Nuclear power

produces large quantities of waste that remain highly radioactive

for thousands of years. The Nuclear Waste Policy Act of 1982, as

amended in 1987, requires the Department of Energy to manage

Yucca Mountain, NV, as a permanent repository for high-level

waste.

The United States must commit the scientific manpower and

monetary resources needed to educate the public and provide the

appropriate protection to the Nation’s environmental and physical

health. If the Government develops a high-level nuclear waste disposal site, then the proper precautions must be in place to safeguard the transportation of spent fuel from across the country and

to protect the area surrounding the repository from radiation exposure. What is the status of Yucca Mountain?

The over-arching issue of nuclear proliferation has been around

for decades. The United Nations and other world organizations

have been vigilant and aggressive in monitoring non-civil applications of nuclear energy. The United States should remain responsible and conscientious in this regard.

On another thought, this is an issue regarding uranium and plutonium in domestic use. What about the accidents that could come

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about or a terrorist attack? The potential catastrophic nature of an

accident at a nuclear power plant makes this a very serious concern and needs much debate. The last major accident in the United

States was at Three Mile Island, Pennsylvania, in 1979.

The general feeling of improved safety and acceptable standards

in current operations is commendable. However, in March 2002,

leaking boric acid produced a large hole in the nuclear reactor vessel head at the Davis-Besse nuclear plant in Ohio. The corrosion

left only a quarter-inch-thick stainless steel inner liner to prevent

a potentially dangerous loss of reactor cooling water. The Nuclear

Regulatory Commission must hold the nuclear industry to the

highest standards in order to prevent such problems. How safe is

the industry, especially with no new construction in the last 30

years? These are issues that have to be debated.

All commercial nuclear power plants licensed by the NRC have

a series of physical barriers to accessing the nuclear reactor area

and are required to maintain a trained security force to protect

them. America presents a prime terrorist target on a site that contains radioactive materials. Following the terrorist attack of September 11, 2001, the NRC began a review to improve defenses

against terrorist attack. What has been done to prevent terrorism?

And is it enough?

So, Mr. Chairman, it is very foresighted of you to call this hearing today, and I look forward to hearing from the rest of the witnesses. I am sorry I was late, but I am sure that you can address

some of the questions that I raise. Thank you very much.

[The prepared statement of Hon. Dianne E. Watson follows:]

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Mr. ISSA. Thank you.

And I would note that Representative Brian Higgins of New York

has joined us, and each has said that they will incorporate their

opening statements into the round of questioning.

So with that, Dr. Moore, we look forward to hearing your remarks.

And I will remind all the members, I guess for the next panel,

too, your entire written statement will be put into the record, so

you may use it or abbreviate it or add to it as you see fit. We know

that your wealth of knowledge is not on that piece of paper, but

in your years of experience.

Thank you, Dr. Moore.

STATEMENT OF PATRICK MOORE

Mr. MOORE. Thank you, Mr. Chairman and members of the subcommittee. I am a Canadian citizen born and raised on Northern

Vancouver Island, in a tiny fishing and logging village, and was

sent off to boarding school in Vancouver at age 14, where I soon

learned city ways, and ended up at the University of British Columbia eventually, studying the life sciences. I studied biology, biochemistry, genetics, forestry, agriculture. But then I discovered

ecology, a subject that not many people knew about at that time,

in the late 1960’s, and I realized that I had discovered something

that was going to change my life. And, as I put it, I became a born

again ecologist, because it taught me how all living things are

interrelated and how we are related to them.

While doing my Ph.D. in ecology in 1971, I joined a small group

of people in a church basement in Vancouver, and we planned a

protest voyage against U.S. hydrogen bomb testing in Alaska. The

United States was conducting underground hydrogen bomb tests at

Amchitka Island in the Aleutians.

We sailed a leaky old boat across the North Pacific and provided

a focal point for media attention to opposition to the tests. When

that H-bomb was detonated in November 1971 at Amchitka, it was

the last hydrogen bomb the United States exploded. There were

more atomic tests after that, but President Nixon, at the height of

the cold war and the height of the Vietnam War, canceled the remaining tests in the series due to overwhelming public opposition.

This was the birth of the organization Greenpeace.

I spent the next 15 years full-time in the top committee of

Greenpeace, as we took on campaigns around the world: against

French atmospheric nuclear testing in the South Pacific; we confronted the Soviet factory whaling fleets in the North Pacific; we

confronted the Canadian seal slaughter off the East Coast of Canada; we took on toxic wastes and nuclear wastes; and uranium

mining; and kangaroo slaughtering; an amazing number of issues

over a 15-year period, at the end of which, of the 15 years I was

in Greenpeace, we had grown from the church basement to a group

with $100 million a year coming in and offices in 21 countries. I

felt we had largely accomplished our task by this time, the mass

public awareness of the importance of the environment, and for me

it was time to make a change. I had been against about three or

four things every day of my life for 15 years. I decided I would like

to be in favor of something for a change.

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I made the transition from the politics of confrontation, telling

people what they should stop doing, to trying to figure out what we

should do instead, because, after all, over 6 billion of us wake up

every morning on this planet with real needs for food, energy, and

materials. Sustainability, which I believe is the next logical step

after environmental activism, is about continuing to provide for

those needs, maybe even getting some more things for the people

in the developing countries, while at the same time reducing our

negative environmental impact. I believe this is one of the most important points around how we move forward in continuing to provide our civilization with the things it needs to survive every day:

that we can continue to have civilization and reduce negative impacts.

A lot of environmental thinkers, Paul Ehrlich and his school of

thought, they contend that automatically the more people there are

and the more stuff they use everyday, the more negative impact

there will be on the environment. This is not the case. It is possible

to change the way we obtain the material and energy we need,

while at the same time reducing our negative impact. That is basically the definition of sustainable development in many ways.

Back in the mid-1980’s, not all my former colleagues saw things

that way as I moved into sustainability and consensus. Environmental extremism arose at that time for two distinct reasons. First,

because most of the public now agreed with all of the reasonable

things we were saying in the environmental movement, the only

way to remain adversarial and anti-establishment was to adopt

ever-more unreasonable positions, eventually abandoning science

and logic altogether in zero tolerance policies that we see today,

nuclear energy being one of them, genetically modified foods being

another one. Policies of zero tolerance in areas where there is actually tremendous potential for environmental and human welfare

improvement.

So I diverged from this approach, which ended up, in my estimation, with a movement that is, to a considerable extent, just

plain anti-civilization. They are anti-globalization; they are basically anti-capitalist; they are anti-business, anti-science, anti-technology. There is too many antis for me. As I say, I was against

things for a long enough time that I wanted to be in favor of something.

There is this kind of naive vision of returning to some kind of

utopian Garden of Eden, that actually never existed in the first

place, conveniently forgetting that just 100 years ago the average

person’s life was 35 years in this world. And the tremendous advances that have been made in all areas since then is why our life

span is so much longer now, and one of those, of course, is in energy.

What does environmental extremism have to do with nuclear energy? I believe the majority of environmental activists—and I

would include Greenpeace, the Sierra Club, the Rainforest Action

Network, the NRDC, and many of the others—have now become so

blinded by their extremist policies that they fail to consider the

enormous and obvious benefits of harnessing nuclear power to meet

and secure America’s growing energy needs. I believe these benefits

far outweigh the risks.

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As mentioned earlier, nuclear supplies 20 percent of U.S. electrical energy today. If no more nuclear plants are built, that will

be cut in half just in the next few years. And it is virtually certain

that the only technically feasible path, if nuclear is not built, is

greater reliance on fossil fuels than we have today. I can’t see any

analysis that shows any other way than that we would have more

reliance on coal, oil, and natural gas in the future than we do

today, and I believe it is becoming a rather untenable position even

at the present time.

In a ‘‘business as usual’’ scenario, that is, no more nukes, a significant reduction in greenhouse gas emissions would be impossible. An investment in nuclear energy could go a long way to reducing this reliance on fossil fuels, and could actually result in reduced CO2 emissions.

According to the Clean Air Council, annual fossil fuel-fired power

plant emissions are responsible for 36 percent of all the CO2 emitted in the United States, and coal-fired plants account for 88 percent of the CO2 being emitted from the entire power industry.

One of the most interesting events that is occurring now is that

a number of prominent environmentalists are changing their position on nuclear energy.

I have to say, Mr. Chairman, in my whole time in Greenpeace,

and since then to date, over 30 years, I have never changed my position on a single major policy area other than nuclear energy. I am

portrayed sometimes as someone that has gone over to the other

side, the dark side or whatever. It is not as if I am advocating the

resumption of hydrogen bomb testing or whale slaughtering. I still

hold true to all the positions I held when I was in Greenpeace.

Those positions that I disagree with them on today are either ones

that they have adopted since I left, in 1986, or they are nuclear

issues like this; it is the only one I really changed.

But I am not the only one who is changing their opinion. Stewart

Brand, a prominent philosopher and thinker, the founder of the

Whole Earth Catalog that we all used as a bible when we went

back to the land in the 1970’s, has come out with a very important

essay in the May 2005 issue of Technology Review, in which he

says the environmental movement has to change their position on

nuclear energy, among other things.

My acquaintance and friend, James Lovelock, the Gaia theorist,

has also come out saying that nuclear is the only solution to reducing CO2 emissions. He says, ‘‘Civilization is in imminent danger

and has to use nuclear, the one safe available energy source, or suffer the pain soon to be inflicted by our outraged planet.’’

While I might not be so strident as my friend, Lovelock, it is

clear that whatever risk there is from increased CO2 levels in the

atmosphere—and there may be considerable risk—it can be offset

by an emphasis on nuclear energy.

Nuclear energy is a proven alternative and now provides over 75

percent of the U.S.’ emission-free generation. The bulk of the other

emission-free generation is hydroelectric.

Again, back to environmental extremism. If you poll many of

these environmental groups, including Greenpeace, you will find

that they are against coal-fired power plants, they are against nuclear plants, and they are against building new hydroelectric

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projects, and are even proposing to tear some of the existing ones

down. If you take coal, nuclear, and hydro, and add them together,

you have nearly the whole energy supply for the United States. So,

therefore, it is completely unrealistic to be against all of these

things. We do have to choose winners.

I must say, just in concluding, that even though I have said and

have been quoted on numerous occasions, I believe this: ‘‘Nuclear

energy is the only non-greenhouse gas emitting energy source that

can effectively replace fossil fuels and satisfy global demand.’’ That

said, however, I want to make it very clear that there should also

be a much greater emphasis on renewable energy production.

I believe the two most important of these, along with hydro,

which is already established as an important source, are wind energy, which actually has far more potential than hydro on a global

basis for electrical production; and ground source heat pumps, also

known as geothermal or GeoExchange. In particular, when nonCO2-emitting electrical sources, such as wind, hydro, or nuclear,

are tied with ground source heat pumps for heating and cooling

and providing hot water in all of our buildings, tremendous reduction of CO2 and fossil fuel consumption can be realized.

A combination of nuclear, geothermal, and wind could actually

bring the United States in line with the Kyoto Protocol, whether

or not the United States signs that treaty.

I think that concludes my remarks.

Oh, just one more thing, if I may, Mr. Chairman.

Mr. ISSA. Absolutely.

Mr. MOORE. Just on the issue of accidents. It is true that

Chernobyl was a terrible accident, but I characterize it as the exception that proves the rule that nuclear energy is generally safe.

There are 434 reactors operating around the world as we speak.

Chernobyl is the only really bad accident that has ever happened,

and it was an accident waiting to happen. It had no containment

structure, it was badly designed, it was badly operated, and badly

maintained.

And Three Mile Island, which has been mentioned, I actually

consider a success story, because the radiation was contained even

in the event of what was nearly the worst possible thing that could

happen in there, which was a partial meltdown of the reactor core.

The radiation from the core was contained in that reaction and did

not come out like it did in Chernobyl. Of course, since Three Mile

Island we have learned even more. So I don’t think the safety issue

is an obstacle to moving ahead.

One other point: the nuclear proliferation point. These have to be

taken as two separate issues, the issues of nuclear energy and the

issues of nuclear proliferation. It is apparent that actually the

main technologies that have resulted in the most combat deaths in

this world in recent years are machetes, rifles, and car bombs. No

one would seriously suggest banning machetes, guns, cars, or the

fertilizer and diesel oil that are used to make the explosives in car

bombs. These have to be looked at as separate issues; we can’t simply say no nuclear power because the byproducts of it can be made

into deadly weapons.

Thank you very much, Mr. Chairman.

[The prepared statement of Mr. Moore follows:]

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Mr. ISSA. Thank you, Dr. Moore.

As is my policy, I will waive my opening questions until all the

other panel members have theirs, but I will tee up the discussion

with just two items: one, in concert with yours, Dr. Moore, no person in the United States has ever died in a civilian nuclear power

accident, period, including Three Mile Island, which cannot be said,

obviously, for everyone driving gasoline, oil, and all the other petrochemicals down the road; nor can it be said either of liquified natural gas or refineries, all of which have had fairly spectacular loss

of lives over the years.

Last, it is estimated that had the United States built all the nuclear power plants which were on order in the late 1970’s, when

they all became canceled directly as a result of Three Mile Island,

we would presently be in Kyoto compliance. And I personally

strongly suggest that had we already been in Kyoto compliance, the

willingness of Congress to ratify Kyoto might have been dramatically greater than when we were on a collision course for no such

opportunity.

With that, I would recognize the ranking member for her questions.

Ms. WATSON. Dr. Moore, I certainly appreciate your viewpoint

and your input. There are several questions that come up in my

mind. We certainly are interested in alternative energy power and

fuels. I just returned from Qatar a few weeks ago, the emir told

us that we have enough natural gas to furnish every single home

in America for the next 100 years. And I thought if they have our

natural resources, they have the power. And their question, the

week-long that we were there, was we want to be treated like

equals; and they were talking about democracy and so on and so

forth.

But what strikes me is that our energy needs rest in other

places. So I am very interested in what we can develop as energy

sources here that would not pollute our environment and destroy

our planet. I believe in global warming; I have seen the climate

change in Los Angeles, my home. We had the largest rainfall ever

in the last few months, larger than what we have in a cumulative

15 years or so.

In saying all that, I heard you speak of your background with

Greenpeace. I think what they do is one thing; what they believe

in is another. I don’t like their tactics; I don’t think you have to

destroy to get the point over. I am hoping that you can share with

us what they believe are other sources of energy, rather than the

fossil fuel that we have been so dependent on that comes from the

Middle East, where we are having tremendous problems at the current time, at a tremendous cost. What is it that we can use?

I heard you talk about wind power and so on. I really am looking

at nuclear energy and, as you say, it has been a real tsunami of

a change with you, and just by the fact that I am saying this it

is a real change with me too. But we are going to have to have

some source of energy where we don’t have to go change a whole

nation’s politics to get what we need. Then I look at Greenpeace,

who is trying to save the environment and save the planet.

What is it that you see, what is it that they see, what is it that

we can see as sources of fuel for the future? Can you go into that?

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What are their winning proposals? I don’t like their destructive

ones. What are their winning proposals?

Mr. MOORE. Thank you. Unfortunately, one of the great distractions in the debate around renewable energy is the focus on solar

voltaic panels, the solar panels that go on a roof. They are all show

and no go in many ways. They are very techy looking, they give

the impression that you are a green person. They show up because

they are on top of your roof.

Whereas, just to give a couple of facts, $20,000 invested in solar

panels in this part of the world brings about $100 to $120 worth

of electricity into your house per year. So you get a $120 return per

year on a $20,000 investment. This is why they have to be so heavily subsidized before anybody will put them on the roof.

If you invest that same $20,000 in a ground source heat pump

for your home, you get $1,300 equivalent worth of energy. But it

is in your basement, where nobody can see it, and the pipes that

it uses to get the energy out of the ground are buried in the ground

where no one can see them, so it is not a symbol of your commitment to renewable energy and it doesn’t have the same appeal. It

is sort of the same thing as with automobiles, where 90 percent of

it is psychological about what kind of car you want to drive.

So solar has really distracted people. I have a solar system in a

little place I go to down in Mexico because there is no electricity

into this little town, and it does make sense, when you are off the

grid, to use solar energy. But it costs about 10 times as much as

normal electrical power does; whereas, wind energy is now becoming reasonably close, in terms of competitiveness, with conventional

electrical production. So we should be focusing on wind.

Between the two of them, Germany and Denmark produce 50

percent of the world’s wind energy. Now, they certainly don’t have

50 percent of the world’s wind in those two little countries.

Now, some people would argue that they put too much of it in,

that it is not cost-effective, but General Electric is now making 5

megawatt wind turbines, individual turbines that produce 5

megawatts each. It doesn’t take that many of them to start producing a substantial amount of power. And a lot of coal-fired generation companies are actually investing in wind as a way of diversifying their energy portfolio. So there is tremendous potential there.

Back to ground source heat pumps. This is the key to making our

electricity more efficient in terms of heating and cooling our homes,

and getting rid of the peaks and valleys in our electrical requirements so you don’t need so much base load. See, ground source

heat pumps could heat, cool, and provide the hot water for every

single structure in the world. You can get heat out of permafrost

in Alaska in order to heat a building. This is stored solar energy

that is in the top of the earth.

Ms. WATSON. How far down do you have to go?

Mr. MOORE. You put pipe in the ground 8, 10 feet deep; sometimes, if you drill down, you go 50 feet or more. But basically you

put pipe in the ground, circulate water through it, and bring the

heat of the ground into your house and magnify it with a heat

pump. It is actually the same technology as is used in refrigeration

and freezing. Your refrigerator is a heat pump. I don’t know if you

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notice, when you put your hand at the back of it, there is hot air

coming out of it.

Most people don’t know where that hot air is coming from, they

think it is coming from the motor. It is actually coming from inside

the fridge. That is how the fridge gets the heat out of the inside,

is by pumping it out and pumping it into the room.

Whereas, if you think of your house as a big fridge, with ground

source heat pumps, you can take the heat out of the ground and

pump it into your house, or you can take the heat out of your house

and pump it back into the ground. It is available technology. Actually, many military bases are being retrofitted with this under the

mandate for the 10-year payback. Lots of people are installing it,

but it is nowhere near as large a program as it could or should be.

And combined with nuclear energy, wind energy, hydro energy,

and all the other non-CO2-emitting sources of energy, both renewables and nuclear, combined with that, we could cut CO2 emissions

by so much more than even Kyoto would require. And none of this

is pie-in-the-sky. There are two factories producing over 100 million—a conglomerate. Two factories, one in Fort Wayne, IN, which

is Water Furnace International, and one in Oklahoma City, Climate Master, producing these heat pumps on a mass scale in factories, and people are installing them.

I understand President Bush and Vice President Cheney both

have ground source heat pump systems in their homes. President

Bush’s ranch in Texas, I believe. I am told this by the heat pump

people, so I assume it is true.

I wish more emphasis would be put on these technologies which

are actually feasible, rather than so much emphasis—California

nearly passed a mandate for solar panels to be required on all new

residential construction. At least that got beat back. It is just a big

waste of money if you are on the grid. There are so many other

things you can do, whether it is insulating your home or putting

in a ground source heat pump. There are so many better ways to

invest that money—that is a real waste.

Instead, California has now got, what is it, the million solar

homes program? Now they are subsidizing putting the solar panels

on to such an extent that people will do it. You practically have to

buy these things for people to get them to want to put them on

their roofs. And that is the route they are going, instead of going

in a more cost-effective way.

As I say, solar panels are great for niche applications off-grid,

but I call them the world’s most expensive roofing tiles, and I believe that is a fair description.

Mr. ISSA. Thank you.

Ms. WATSON. Thank you.

Mr. ISSA. With that, I recognize Mr. Westmoreland for his round

of questioning.

Mr. WESTMORELAND. Thank you, Mr. Chairman. I would like to

thank you for holding this hearing. It is very timely that we just

got through passing the energy bill.

Let me say that, being from Georgia, we get 27 percent of our

power from nuclear plants, and it is not near that percentage of the

coal-fired, fossil fuel plants that we have in Georgia. And I hope

that 1 day, starting today, that we can look at—because our needs

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are going to be great. Our economy is growing, our State is growing. Our needs are going to greatly increase, and I hope that we

can look at doing some more nuclear facilities in Georgia.

Mr. Chairman, I would like to submit my opening remarks, if I

could, for the record.

Mr. ISSA. Without objection.

[The prepared statement of Hon. Lynn A. Westmoreland follows:]

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Mr. WESTMORELAND. Mr. Moore, I want to compliment you for

the things that you have said today about the nuclear power. I am

in the building business, and I do agree with you on the geothermal. But I promise you that before long the environmentalists

will be saying something about having that much pipe in the

ground. Trust me.

And I know we didn’t want to get into a geothermal discussion,

but you are dead on with that because of the energy savings, but

heat pumps are becoming more and more efficient. You can get an

17 to 23 SAER rating now on some of those heat pumps.

But the windmill, you know, they need to come up with some

other kind of design rather than the windmill type of design, because I don’t know that they would ever be aesthetically pleasing

to have as many as you would need to create the electricity to supply a neighborhood. I understand that they are doing it in other

countries, but I just don’t know if that would ever be possible, at

least in my area, coming from where I am from.

You are dead on on the solar panels also. That was a big thing

when we were in the building business 20 years ago, and it just

caused a lot of roof leaks is basically what those solar panels

caused.

But I would like to see us look at not only this nuclear option,

but look at doing, on a State-to-State basis—and it might be something for you to do—giving tax credits for people who will seal up

and use envelope type insulation packages, geothermal higher

SAER rating equipment to cool and heat these houses, because it

takes a tremendous amount of energy.

Mr. Chairman, my last comment is that I have been looking over

the cost of these nuclear plants, but with the amount of demand

that is going to be on electricity and the amount of increase it is

going to take in the infrastructure of our grid system right now—

because I think our grid systems are not in the best shape that

they could be, as evidenced by some of the blackouts that we had

up in the northeast—that when you look at the amount of work

and the new grid that would have to be put on, I think that we

are not that far out of line with the nuclear additions. And as you

have here, as the plants that we build, we become more and more

competitive with them.

Also, the ranking member was talking about the safety aspects

of it. We can learn a lot from the European countries as far as

what they are doing, but I think our technology is so far advanced

now from where it was when we built the original nuclear plants

that it is definitely something we need to do, and I hope, by the

chairman having this hearing, that we will not only sit here and

talk about these things, but we will actually do something to further the building of these nuclear power plants.

Thank you, Mr. Chairman.

Mr. ISSA. Thank you.

I have good news and bad news. The good news is it is only one

vote. The bad news is we will stand adjourned for about 15 minutes, until we go over and come back and renew questioning. I

know our committee structure will support any cost of coffee or soft

drinks you would like to have while we are gone.

With that, we stand recessed.

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[Recess.]

Mr. ISSA. One nice thing about being chairman, if you can be patient to get your questions in, you will get your questions in. I will

now recognize myself for as much time as I will consume—there

will be Members coming back here shortly—and I have a list of

them.

First of all, Mr. Jones, would it be all right for us to include your

entire study in the record? You have no objections? I would like to

have it submitted in the record.

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Mr. ISSA. Additionally, I would like to have yesterday’s remarks

by President Bush put in the record, since he helped set up our

meeting with his efforts.

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Mr. ISSA. I am not sure that officially we coordinated, but it certainly was timely.

With that, I would like to lead off with my first question. And

probably, Dr. Moore, I suspect I have a lot of questions for you, but

I am going to go to our other two from the standpoint of equal

time. You are looking a little lonely there. This is both for Fertel

and Jones.

The blend of financial incentives that you talked about in your

study that is up here, the President’s proposal was for four nuclear

power plants to be funded. When I look at the eight, I can certainly

see where you get down to eight, you are down to 3.2 cents per kilowatt hour, to put it in the ratepayer’s terms, which means it is

competitive with fossil fuel, without accounting for the advantages

to zero emissions generation.

It seems your study concluded that you needed to get to eight.

Are you and the President talking essentially two different visions

of the same thing, getting us through those what we used to call

non-recurring expenses?

Can you characterize where there may be common ground or

whether there is a difference of four power plants between the proposals?

Mr. JONES. Yes, sir. The President and I seem to be speaking off

the same page. In Table 1, right here to my right, your left, by the

time we get down to the fourth or fifth plant, we are well within

the competitive range with fossil generation. So the President and

the Chicago study are in perfect agreement on that number.

Mr. ISSA. Mr. Fertel.

Mr. FERTEL. I think, Mr. Chairman, first of all, the President’s

discussion yesterday, which we welcome—and this is about the

fifth time since the State of the Union he has spoken out positively

on nuclear energy, which is clearly very encouraging to us.

Mr. ISSA. The first time he did it timely for my hearing, though.

Mr. FERTEL. We thought he did it intentionally for your hearing.

We thought you had orchestrated that, and really appreciated the

timing.

What the President said yesterday, he actually talked less incentives for these four plants than a risk insurance, which is something that the chief executive officers, because of the experience

they had in the previous licensing process, have raised with Secretary Bodman and with the White House a number of times now

as something that they felt was very important. And to be honest,

if you demonstrated the licensing process worked on four plants—

put aside the economic incentives—we think that you would have

a track record that would give both the financial community and

the boards of directors the confidence that the licensing process is

disciplined.

We are actually pretty optimistic the licensing process, as it is

being reshaped, will be not only protective of health and safety, but

actually pretty reasonable in how you implement it. But it hasn’t

been demonstrated. So I think that four plants for that is clearly

a very adequate demonstration. And I think that as Don pointed

out, we think you get pretty economic pretty fast these days.

Mr. ISSA. Excellent. I will also ask that a poll done in my own

district, at government expense, which shows approximately 80

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percent of my constituents favor adding an additional reactor

where we have two working reactors at San Onofre. And I will provide that in the next 5 days so it gets in the record. That doesn’t

mean that there aren’t 20 percent who didn’t say yes, but certainly

I don’t get 80 percent in my district, so I always assume it is an

awfully good sign when something is more popular than I am.

Sticking to our nuclear experts, per se, on production, the President yesterday seemed to be talking about Generation 3.5, and not

Gen 4. Could you characterize the differences and the advantages?

Because I think you are talking Gen 3.5 here too.

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Mr. FERTEL. Our current reactors, if you sort of just baselined

them and said that the 103 operating reactors we have today are

Gen 3, if you just took that as a baseline—and let me go first out

to Gen 4, which is a program that the Department of Energy has

ongoing right now, and has been ongoing for probably about 5 or

6 years. It is looking at both new advanced fuel cycles, liquid metal

fuel cycles, high temperature gas fuel cycles, and reactors that will

be commercial. It may vary in people’s minds, but their commercial

timing is probably in the 2030, 2040 timeframe, for really commercializing the reactors.

So, for instance, our Nation is looking to move ahead in Gen 4

space to build a very high temperature gas reactor, helium being

the gas that they are talking about. And it has some very significant advantages if you make it work right. First, it is a high

enough temperature that you can actually produce hydrogen chemically with it, so it is a good source for producing hydrogen.

It also is very efficient because of the high temperature, so rather than the 30 to 32 percent efficiency for producing electricity

today, you might get as high as close to 50 percent. It also has the

potential, because of the way you would design your fuel, that you

could never melt the fuel, so you could never have the type of accident you protect against from our current reactors, so it moves

down that road. But that is a Gen 4 type reactor, and we are doing

that internationally with other folks.

Mr. ISSA. Is it also true—I am terrible with these leading questions—that helium type production would also be able to be put

completely underground?

Mr. FERTEL. Actually, the General Atomics design is below

ground, that is true. That is true. You could design it that way. Or,

again, you could design it aboveground, as they are looking at for

some of what they call pebble bed reactors.

Mr. ISSA. I only ask that because obviously in our other hearings

we are constantly dealing with the question of terrorism and airplanes strikes and so on.

Mr. FERTEL. The Gen 3.5 is actually—you can think of Gen 3.5

in two types of designs that basically exist today, and in fact are

operational in some countries. One design is what we call an evolutionary design; it is taking our current plants and moving them to

where technology is right now. So I have gone to digital systems

rather than analog systems. I have taken everything I have

learned on my current plants and moved it both from a technology

and operational perspective going forward. I have also done a

bunch of things that are smarter in how I am going to maintain

my plant for operational activities, so what I have learned when I

have run into interferences in lay-down areas, I have now built it

in so it is better.

So it is an evolutionary design. It doesn’t take the technology at

all, it is still a light/water reactor design, it works the same as my

current plants, it is just moved along in technology to where we are

today or where we think we can be, and it has taken up all the

lessons learned from the operation of current plants.

The other Gen 3.5 that we have is we have moved to what we

call passive designs. We call both of these advanced light/water reactors. We did message testing and passive designs, which the enVerDate 11-MAY-2000 09:12 Jun 07, 2005 Jkt 000000 PO 00000 Frm 00110 Fmt 6633 Sfmt 6633 D:\DOCS\21364.TXT HGOVREF1 PsN: HGOVREF1
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gineers thought was great. Passive design is if I can move the

water by gravity rather than a pump and motor, why don’t I do

that? So if I need water to get to here, rather than pumping it from

here to here, why don’t I have it flow downhill to that? Pretty simple.

Mr. ISSA. Meaning a pump failure is no longer a catastrophic

failure.

Mr. FERTEL. That is right. One, I eliminate equipment, so I save

some money because I don’t need as much equipment; and, two, I

decrease the failure modes from a safety standpoint. So basically

you have gone to passive designs for moving water around or for

heat convection.

Now, I was kidding on passive, because the engineers thought

passive was great. We did message testing with the public, and the

public’s reaction to passive was it sounded like it didn’t do anything when it got into trouble and, oh my God, that sounds terrible.

So we had to drop passive.

Mr. ISSA. So it is now called self-healing?

Mr. FERTEL. We will try that one. We just call it advanced. But

that is what you have in 3.5, you have an evolutionary design, then

you have a design that is basically trying to eliminate failure

modes and equipment if I can do it through any sort of natural

processes. And both of those designs right now are being licensed

or have been licensed by the Nuclear Regulatory Commission. The

evolutionary design is actually operating in Japan; they have two

large General Electric advanced boiling water reactors operating in

Japan right now.

Mr. ISSA. One followup question on that line, which is we are

known in America for being the most eclectic nuclear producer; we

have no two plants that you can walk into that look alike. And I

know from safety studies that has been one of the problems. You

train for the plant you are at because we built them one off in most

cases. Would this 3.5 provide, if you will—and this is terrible to

say—the airbus type cockpit, to where people and inspectors would

have significant improvement in the ability to learn one, inspect,

or operate all?

Mr. FERTEL. The very short answer is yes. The whole intent

going forward is to sort of implement the French model, which is

standardized families of plants, and basically say if I am going to

build the advanced boiling water reactor or, in this case, the economic simplified boiling water reactor, which is what they are marketing in our country, you would build a family of those, they

would be identical.

If I were an operator at one and the chairman was an operator

at another one, it wouldn’t matter which control room we walked

into. Same thing on maintenance, and even going down, if we

could, we would like to keep the equipment standardized, to the degree we could, so that you could basically have common inventory

and safe money on supplies.

Your observation on our industry, which I did grow up in in a

bit, it was sort of the American way, because in France they

had——

Mr. ISSA. The American way before Henry Ford.

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Mr. FERTEL. I mean, in France you had one electricity company,

you had one reactor supplier, you had one fuel supplier, and they

were all owned by the government. So when the government made

a decision you should do something, everybody kind of marched to

the same road. In our case, basically every utility wanted something slightly different than their brethren, and every supplier saw

those as out of scopes. So capitalism here created a myriad of different plant designs.

But, no, the answer to your question is going forward we are

doing to go with standardized designs.

Mr. ISSA. Excellent.

One more question that I had which was peripheral, but you

touched on it. The 2025, 2030, 2040, about the time we want to be

a hydrogen economy, the next generation, Gen 4, produces significant amounts of hydrogen. How significant is that? What does it

really relate to from a standpoint of providing it as a fuel or for

other industrial uses?

Mr. FERTEL. You mean as far as the nuclear role in that?

Mr. ISSA. Right. If we were to begin rolling out that next generation, let us just say in 2020, and ramp up to where, by 2050, that

was the standard, these more efficient, and it were producing our

entire base load, how much hydrogen would it produce that theoretically is going to be used for driving automobiles?

Mr. FERTEL. I don’t know quantitatively the answer, but what I

can tell you is you won’t use the plant for dual purposes, in all likelihood. You would probably build the high temperature gas reactors

that would produce hydrogen for you, and you would produce high

temperature gas reactors that are going to produce electricity.

There may be certain times where you might be able to use it

for a dual function, but in talking to at least the Department of Energy folks and the industry folks that are looking at it, they are

saying that if you really are going to produce hydrogen in the

quantities that you are going to need, you are going to dedicate the

plants to doing that.

Likewise, if you are using the plants for electricity, and the value

of the plants for electricity would be they are smaller; I can build

them in increments in a more competitive electricity market, as opposed to the large plants we build right now. But it sounds like you

would have separate plants. Though they would be capable of doing

both, you probably wouldn’t build them, or at least most of them,

to do both.

Mr. ISSA. Is there any other practical way to produce the quantity of hydrogen necessary to move our entire fleet of automobiles

and trucks on hydrogen? Is there any other practical way to do it?

Mr. FERTEL. The other practical way is you are basically using

fossil fuels to split them to get hydrogen, and then you are burning.

It is sort of counterproductive to produce emissions to reduce emissions. So we don’t think so. There are honestly people at the national labs who aren’t sure that even using nuclear to produce hydrogen is the right thing, that is the answer to our problem; not

the nuclear, but the hydrogen.

But clearly in talking with folks, if we are going to produce large

quantities of hydrogen, nuclear seems to be a way that we should

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ernment has decided that the Gen 4 reactor they want to look at

is the very high temperature, because they see the dual value, and

that is why the Idaho folks want to see a reactor built there to try

and begin to demonstrate its use in that mode.

Mr. ISSA. And, Dr. Moore, as an expert on this whole sustainability question, how do you see that playing, as far as looking, to

a great extent, beyond our careers, into the 2040 timeframe? Is this

sensible or, as you were so good in pointing out, if not this, then

what? Is there an ‘‘or what’’ that you can see on the horizon?

Mr. MOORE. Well, again, I haven’t done the math thoroughly on

it, but it is very obvious to me that there is no other non-CO2-emitting form of energy that you could make that much hydrogen with.

I mean, it would take a lot of nuclear plants to make enough hydrogen to replace all of the fossil fuel in the transport fleet.

The other option is that hybrid technology will come in and be

with us for 40 or 50 years before there is a change to another technology from that. That is another possibility. Another possibility is

that someone will eventually invent a battery or electrical storage

device where then you could use the nuclear energy to charge the

vehicle directly, rather than having to make hydrogen.

It is not just the making of the hydrogen that is technically difficult with the idea of going to a hydrogen fleet. Then you have to

distribute it. It is very corrosive. Then you have to figure out how

to get enough of it into an automobile to make it go 300 miles. And

they still haven’t figured that out yet. GM is experimenting with

10,000 psi tanks, and you still can’t get enough in there and still

have room for your suitcase in your car. So there are quite a few

technical obstacles besides the manufacturing of the hydrogen.

But once again, as with power generation, there is no other technology that we know of today that can make the kind of dent in

fossil fuel reliance that we are thinking about in terms of both CO2

emissions, air pollution, and energy security, reliance on offshore

sources. Nothing else that I know of could do that.

Actually, in the break we had a discussion about conservation. I

know that subject was mentioned fairly high up in the President’s

speech yesterday, and, of course, that has to be a central part of

a comprehensive energy policy. I know that is not what we are here

to talk about today, but just to go on record——

Mr. ISSA. Dr. Moore, we wouldn’t have invited you if we didn’t

want to be complete in dealing with nuclear versus alternatives, so

please feel free to elaborate.

Mr. MOORE. Conservation is an across-the-board thing, it doesn’t

matter how you are producing the electricity—and in all other energy areas as well—it doesn’t matter what your fuel is, the issue

of conservation has to do with efficient use. For example, we could

probably turn half the lights off in here, nearly all of them, and

open up the curtains and conserve the electricity that is being used

to light this room right now.

Mr. ISSA. They don’t trust Congressmen in the dark.

Mr. MOORE. They do in the light?

Mr. ISSA. Well, forewarned is forearmed.

Mr. MOORE. But suffice it to say that conservation is a very important part of this whole thing, and that the United States is not

exactly the world’s leader in conservation of energy.

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Mr. ISSA. Although I will mention that California is the Nation’s

leader in conservation of energy.

One question I have, nuclear is a great base load because, as we

all know, it doesn’t turn on and off quickly. Geothermal obviously

has a little more flexibility, but it is still inherently a base load.

Wind, you get it when you get it; solar, you get it when you get

it. If I go through all the zero emissions fuels, it would appear that

hydro is the only large-scale zero emissions that is demand-oriented, turns on and off very quickly.

And each of you could participate in this. If nuclear were the answer for 100 percent of what its capacity is, how do you see it fitting in? What is its maximum? We always hear about France, for

example, that believes they are at their maximum, which is about

80 percent. Where is the maximum for nuclear before you simply

are in that problem that it is a base load only and peak has to

come from some other source?

Mr. FERTEL. First of all, just to put our system in perspective

with the French system, the amount of generation we have from

nuclear power plants in this country, the kilowatt hours that keep

the lights on is larger than France and the next largest nuclear

country after them, Japan, combined. So going to what Patrick

said, we consume a lot of electricity in this country.

In France, they actually do load follow. Now, they follow a load,

they basically are either at full capacity or they will go down as

the load goes down. They also export a lot of electricity, their nuclear electricity, to make money off of it to other European countries.

I think, in our country, the strength of the system continues to

be the fact that you do have a different technology. I think you will

always—probably not always, but at least in my lifetime—have

combustion turbines for peaking. You operate them a couple percent a year. So they are there; they burn a lot of gas when they

operate.

I was telling Patrick during the break that if you take a 1,000

megawatt plant—we have built 280,000 megawatts of gas since

1992 in this country. That is why gas is such a problem. And we

built 14,000 megawatts of coal and nuclear since 1992. That gives

you a perspective of what we have been doing. And if you take a

1,000 megawatt gas plant, combined cycle, and say it operates its

base load, 1,000 megawatt plant uses as much gas as 1 percent of

the Nation’s residential use; 1 percent of the Nation’s residential

use. It sucks gas if you use it as a base load plant. But using it

for peaking, it only operates a couple percent.

So I think, Mr. Chairman, what you would have, at least in the

horizon we look out at—and we support conservation and efficiency. We as a Nation need to do more, and prices help us do more

in this country. Industry leads that and commercial follows it, and

residential customers lag it. But fundamentally high prices will

drive more conservation and efficiency.

But I think we are going to burn coal. We are going to need clean

coal. I mean, we have loads of coal, 250 years worth of coal, probably, so we will continue to do it. We have just got to do it smarter

and begin to do less of it.

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Nuclear is 20 percent right now. If I had my druthers, we would

grow to probably double that or more. But that is a long time to

do, because we have 900,000 megawatts on this grid. I mean, it is

a monster electricity system in this country. I mean, it is just huge.

And it is sort of the lifeblood of everything we do in the Nation.

So I think you are going to have, at least for the lifetime of most

of the people we care about and know about today, you are going

to need a mix, and you are going to still use gas, but you shouldn’t

use it for anything but peaking. And I wouldn’t even use it for intermediate down the road because I think it has other more important uses in other processes.

I think that we still need to use clean coal and I think we should

increase renewables and we should increase nuclear.

On renewables, I think the critical thing I mentioned to Patrick

is you need to develop storage. Your comment on wind is right; you

only get electricity when the wind blows. And if you had some storage techniques, you could have electricity longer. The only storage

technique we could come up with was pump hydro, which used to

be a storage technique if you looked it up with a hydro facility. But

we don’t have many new hydro facilities in this country. So I think

you still have a mix.

Mr. ISSA. Marvin, in the energy bill there is a pump storage station for 500 kilowatts.

Mr. FERTEL. It is probably megawatts.

Mr. ISSA. 500 megawatts, thank you. 500 megawatts twin turbine in my district. It is the fourth time that I have put it into a

bill. We are going to get there but, in fairness, the FERC has gone

through the process and is in a preliminary stage. But it is one of

those areas where I am very familiar that the 1,500 feet of rise

over a very short period of time doesn’t occur just anywhere.

So the ability to produce it in our Lake Elcinor area is a pleasant

opportunity. It happens to also be exactly the point where the

southern California power outage was caused by a lack of about

half of that much power to be available at peak. And I always try

to make that point.

Yes, please, Patrick.

Mr. MOORE. Just a couple points on the demand issue versus

intermittent. One of the problems with the word geothermal, geothermal refers to two completely separate technologies; it refers to

the type of geothermal you have in California, where you get down

into deep hot vents and you are basically producing steam to run

turbines. Iceland has a big system like that.

It happened when the Department of Energy in Washington decided to take on ground source heat pumps, and some people had

already started calling it geothermal or earth energy at that time.

They didn’t want to create a new department, so they lumped

ground source heat pumps in with the geothermal department, so

they are both called geothermal. And it was a big mistake in terms

of public understanding, because not only is all this stuff happening, it is invisible; it is in your basement and under the ground.

But now people are thinking geothermal, I thought that was what

they do in California or New Zealand or Iceland.

Mr. ISSA. Noted. I am going to force myself to change. I will tell

you that I was fortunate enough going to ANWR by ground vehicle

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at my own expense. We talked about travel earlier. I took my family up because I wanted to actually drive the Tundra and experience it and get a real feel, because it is a serious consideration to

expand into that wildlife and natural refuge.

But the strange thing is decades ago, when they were putting in

the pipeline above ground, they were faced with the fact that, with

heating and cooling, the pipe would have broken periodically, except they used ground source heat pumps, zero electricity consumed. I think it is ammonia-based in their case—don’t hold me to

that—but they came up with the whole concept that exactly when

they needed cooling for the ground, they had a heat source in the

air, and vice versa.

So they were able to maintain the permafrost year-round on the

Alaskan pipeline. And the environmentalists who took us on this

trip were very proud that this was a zero outside energy and environmentally probably the most responsible thing that they could

come up with, in addition to all the other success stories of the

pipeline.

If I can switch for a moment, one of the interesting things I discovered in preparing for this hearing was the old expression of

swords into plowshares, and how that could relate to next generation nuclear. I have estimates that just the weapons grade uranium, not plutonium, that is available and that the Russians would

be happy to sell us, would represent about 5 years of powering all

of our nuclear power plants at the present time, and obviously we

have the benefit of taking it offline.

And then a followup—since I see Marvin going, yeah, I can answer this one—if we had Gen 4, which can burn plutonium—and

General Atomics I believe is the one that has this—what would be

your estimate of the value based on the separate plutonium stockpile, that is also massive?

Mr. FERTEL. In 1992 President Bush signed an agreement with

the Russians to basically take 500 metric tons of high-enriched uranium that they had in warheads. This was not surplus sitting

somewhere, which they also have, apparently, but this was actually

coming out of warheads, so it was actually dismantling warheads

and taking high-enriched uranium out and blending it down. Basically what we use in power plants is low-enriched uranium, which

is somewhere less than 5 percent enrichment; it cannot blow up.

High-enriched uranium for weapons is well above 92 percent. So

you blend it down, you get a lot of nuclear fuel out of it.

Right now, 10 percent of the electricity in this country is generated as a result of weapons material in Russia being dismantled.

We get about half the fuel for our reactors coming from Russia, and

that has been going on now and it is going to go through 2013,

then this particular trench of 500 metric tons ends.

And the question from our industry standpoint is do we get another trench. We know they have much more weapons material.

They are getting paid for this, this is actually a system where initially, when it started, it was probably one of the largest revenue

sources Russia was getting. Now, they are a lot more commercial,

they are getting money for selling gas to Europe and oil to others.

But Megatons to Megawatts is a very successful program being

implemented by USEC, which is a Maryland company here that

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used to be part of the Department of Energy, and it is a really good

program. Now, we don’t know what they will do with the rest of

their material, whether they will sell it to us, whether they will use

it to sell reactors to other people and throw it in as a fuel deal——

Mr. ISSA. Comes with a full tank of gas.

Mr. FERTEL. Comes with a full tank of gas, right. Whatever they

can do. But we know they have a lot more stuff, and it is important

just commercially. And I know the chairman being a businessman

would appreciate this: on our side the industry that mines uranium, when you get weapons material, you are basically displacing

uranium, you are displacing the conversion to make it into something else, and then the enrichment part, because you are getting

it as a fuel, you are getting it as a final product.

Mr. ISSA. Kind of like emptying out Fort Knox could depress the

gold market.

Mr. FERTEL. That is right.

Mr. ISSA. If there was anything left at Fort Knox.

Mr. FERTEL. That is right. And also, if you were emptying it, you

probably wouldn’t be mining for gold, because you would know that

is coming on the market. Well, that is a problem for our side because the primary producers need to know if it is coming so they

know what kind of production facilities they need to build. It is a

real issue for making business decisions.

On plutonium——

Mr. ISSA. Marvin, I assume, then, your message for us is we

should be, as soon as possible making that commitment, but we

should also recognize that we wouldn’t want to provide 100 percent

for 5 years and thus lay off a whole industry.

Mr. FERTEL. To be honest, you could even do 100 percent for 5

years in this country. I wouldn’t recommend that. What you need

for the business decisions—and, again, I am sure you understand

this—is certainty. You need to know how much is coming when so

that the primary producers can make business decisions on when

they can finance stuff and build it. And we would advocate the

sooner we could get a decision from Russia, the better off we as a

Nation would be in not only getting rid of weapons material, which

is certainly the primary objective, but in assuring adequate fuel

supply.

On plutonium, right now there is a program that the U.S. and

Russia have agreed to to look at disposing of surplus weapons plutonium. And Duke Energy——

Mr. ISSA. That is the MOx program?

Mr. FERTEL. That is the MOx program.

Mr. ISSA. That is disposal, not power generation.

Mr. FERTEL. Well, it is power generation. MOx is mixed oxide

fuel, which is mixing plutonium and uranium to make the fuel so

that I use it in a reactor as fuel. The French use MOx fuel right

now; the Japanese are moving to use MOx fuel. And what we are

doing is have a deal with the Russians to get rid of weapons plutonium.

And actually, I think the last 2 weeks, what we call lead test assemblies—which are fuel assemblies with a new fuel that you

haven’t tried so you want to put it in a reactor and you want to

test its performance before you actually load a full core in the reacVerDate 11-MAY-2000 09:12 Jun 07, 2005 Jkt 000000 PO 00000 Frm 00117 Fmt 6633 Sfmt 6633 D:\DOCS\21364.TXT HGOVREF1 PsN: HGOVREF1
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tor—arrived at Duke’s Catawba plant, and they are going to be

testing the lead test assemblies, and if all goes right, they would

be licensing the facility to be able to ‘‘use MOx fuel,’’ which would

be getting rid of plutonium that the Russians have.

I think the bottom line, Mr. Chairman, is anything our country

can do to help get weapons material made more benign and then

put into reactors so you are actually getting rid of it is probably

a very, very good thing for not only our Nation, but for the world,

because it is getting rid of stuff that is not good stuff to have

around. And the more we can push it, the more better off we would

be.

The uranium is probably a bigger problem, to be honest with you,

than the plutonium, because there is more high-enriched uranium

around than there is plutonium.

Mr. ISSA. And more all the time being enriched, apparently, over

there.

Any other comments on that round of questions?

[No response.]

Mr. ISSA. The President, by talking about nuclear yesterday—

and, as you said, repeatedly since the State of the Union—is touching on an issue in which there may not be a majority opposed to

it, but the minority, including some of your old colleagues, Dr.

Moore, are pretty active.

Where do you think public opinion is on new nuclear power

plants? I have already stated the result of a professionally done

poll, but obviously only in a district that is familiar with nuclear.

Where do you think public opinion is and will education, properly

done—and I don’t mean propaganda, I mean fair education—would

it be helpful to move that to a point in which nuclear power would

be more doable?

And, actually, I would like to start with Dr. Moore, because you

obviously know enough about nuclear to have very strong opinions

on it.

Mr. MOORE. Yes. And I don’t think you can count on certain of

the environmental groups changing their minds on the subject. It

is a winner for them, for one thing, and it is along the lines of

many of the campaigns these days are unfortunately basically just

scare campaigns, and this is one that fits very neatly into that category of just making people afraid, whether it is a Frankenstein

foods or PCBs in their salmon or pesticides in their fruit, or all the

other things where there actually isn’t much of a basis to the concern, but it works to make people afraid. So I think you will see

the campaigns against nuclear energy continue.

But I think the key thing is the placement of the reactors. If they

are placed in existing nuclear facilities, I don’t think you are going

to see sufficient opposition to stop it from going forward, providing

everything else is in place to make it go forward. I don’t think it

will be stopped by public opinion. If you try and put in a greenfield

nuclear facility, that might be a different case, because there is a

whole new NIMBY comes into it then.

Mr. FERTEL. I agree with Patrick on it certainly being easier at

existing sites. I had mentioned two-thirds of the plants have either

gotten license renewal or filed for it, and the license renewal process involved public hearings at the site; and the opposition around

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sites is really very low. There is opposition at some sites, and you

could probably figure out where that might be, but most sites you

get very strong support because the people that work at the plant

live in the area, they have lived there for years, they know everybody and they have developed credibility; and also the political environment around there has gotten to know the plant.

Mr. Chairman, I have with me—just the stuff I had brought—

a February 2005 perspective on public opinion which I would——

Mr. ISSA. We appreciate it. We will include it in the record.

[The information referred to follows:]

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Mr. FERTEL. It supports basically—I had not heard the San

Onofree number that you mentioned, but we have been doing polling for a long time, and we ask the same questions, so you can either decide you like our question or you don’t like our question, but

we don’t gain the question each time we ask it, so you sort of do

get some trend. We have asked the question on ‘‘Do you agree or

disagree we should definitely build more nuclear power plants?’’

going back a long way, and just to show the public does change its

mind, back in the 1998–1999 timeframe, basically 49 percent said

no and 47 percent said yes.

When you are out in sort of the timeframe of the end of last year,

what you are getting is 60 percent say yes and 34 percent say no.

You see a big switch. And that is because energy was on their

screen for a while. Blackouts get people’s attention; high prices for

gasoline get their attention.

Or else, to be honest, I think we, as Americans, take energy for

granted. When we have done focus groups when energy isn’t on the

screen and you ask where electricity comes from, the two most

dominant answers are the switch and the outlet. So if I wanted

more energy, I used to have a slide that showed more switches and

outlets, and that is how you got it. Now, if you probe a little, you

do get answers, but the initial answer is that.

Mr. ISSA. My son once said if you want money, you can either

earn it or go to the bank.

Mr. FERTEL. That was better than go to dad.

Mr. ISSA. I am trying to keep it that way.

Mr. FERTEL. The other question—I think it goes to what Patrick

said on NIMBY—is since I think about 2000 we have been asking

a question which says ‘‘Given there was a need for more electricity,

would it be acceptable or unacceptable to you to build a new nuclear power plant at a site where one exists?’’ And what we find

on that is that you are in the 60’s to 70 percent acceptable, because

you have kind of dealt with NIMBY. If I don’t have a plant near

me, I can say yes, you should build it because it is not going to be

near me, and if I do have a plant near me, I am probably understanding of the value of it.

And I think Americans are pretty responsible when they understand a need. I think in the abstract we are maybe not as responsible. But I would put this in: I think, counterintuitive to what people think, there is a lot more support for nuclear than is generally

recognized.

Mr. ISSA. Excellent. I will mention that the nuclear power plant

does a whole lot better than existing or future airports in my district. For some reason, everyone does believe they can go somewhere else for an airport.

I want to close with just a question that I think tees up the question of do we need more nuclear or not. I was born and raised in

Ohio. Natural gas is the fuel of choice in Ohio for heating our

homes, as it is in much of the—well, not the northeast, but the

lands of the western reserve tend to be gas heavy. Ground source

heat pumps are very uncommon in that area. Electric heat pumps

are also considered to be losers, because electricity historically

costs more than just burning natural gas, even if it is in 17 percent

efficient furnaces.

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If natural gas continues to go up in price, then it is obvious. But

if we just take sort of the base today, if we achieve 3.2 cents per

kilowatt hour, high efficiency heat pumps, ground source heat

pumps, which always tend to be augmented with some electricity

consumption, does it represent a viable alternative to home heating

with natural gas or other fossil fuels?

Because we are looking today at a load based on the status quo,

which is Ohio heating with natural gas and using electricity for

lights and air conditioning. If we are looking at dramatically reducing our dependence on fossil fuel other than on mobile vehicles,

which we don’t have a great answer for today, the next greatest

use obviously is the home. In various heating systems it varies

from area.

So I will start with Mr. Jones, if you have an answer, and I will

finish up with Dr. Moore.

Mr. JONES. I don’t have an answer on natural gas versus heat

pumps.

Mr. ISSA. Marvin.

Mr. FERTEL. I think that to think about answering your question

you have to think globally. I mean, one of the things that we are

seeing happening is China and India driving the price for a lot of

things right now—oil, for instance; even we are concerned about

nuclear fuel. As China builds a big program, they are going to tie

up a lot of nuclear fuel.

And I think as the developing nations begin to use more gas, as

Japan uses more gas—it is all going to be LNG because they don’t

have any domestic supplies—I think what it is going to do is drive

up the price of gas, as the rest of the world does their thing. And

as you drive up the price for gas, what we are going to find is you

need to go—I mean, electricity and gas have always had this love/

hate relationship on home heating, and I think that it will probably

begin to favor electricity as the gas prices go up per use worldwide.

So that would be my guess.

Mr. ISSA. And, Dr. Moore, I must admit I teed this up for you

primarily because it is a question of sustainability.

Mr. MOORE. Well, one way of putting it is it doesn’t make much

sense to have a 1,200 degree Fahrenheit flame in your basement

to heat your house up to 72 degrees Fahrenheit.

Mr. ISSA. Touche.

Mr. MOORE. In other words, we are using a very high form of energy for what can be accomplished with low-grade energy, and the

energy that is in the surface of the earth around and under your

home is a low-grade energy which is there because 50 percent of

the sun’s energy is absorbed by the earth, and it is sitting there

waiting to be used; and there is 50 times as much energy under

your house than you are ever going to need to heat, cool, and provide all your domestic hot water.

So my friend David Hatherton, president of Next Energy Solutions in Ontario, is the largest distributor of ground source heat

pumps in Canada. He also built with his partner the Fort Wayne

Water Furnace International plant. And I have been working with

Dave for over 12 years on this subject now. There is no doubt now

that as gas prices are going up, more and more people are choosing

to put ground source heat pumps in their homes. His business is

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growing an average of 50 percent a year right now, and that is reflected across the board. So high gas prices are good for ground

source heat pumps.

One of the reasons ground source heat pump sales have been

centered in rural areas, and why the rural electrical co-ops have

been very much involved with ground source heat pumps, is because often there is no natural gas in these rural areas and people

are using propane and oil. And when you compare ground source

with propane and oil, there is just no comparison; the ground

source is more cost-effective. Compared with gas—until now at

least, as gas prices go up and up—ground source has had a hard

argument because the payback is so much longer, even 10 or 12

years, and the average homeowner won’t go for something like

that.

Now, in my estimation, this is purely an issue of human psychology and nothing to do with real economics, because you do get a

payback with ground source; it does reduce your energy cost tremendously, because you are getting most of your energy now more

or less for free out of the ground, and all you have to do is buy the

electricity that you need to pump that energy into your house.

For example, many of us will willingly pay $10,000 or $20,000

more for an automobile than we really need to in order to get all

of the functions of an automobile, if we want a BMW, for example,

instead of buying a Chevrolet. That happens all across the country

everyday; hundreds of thousands of people making that decision,

when there is absolutely no practical necessity for it, it is all psychological. People will pay $20,000, $30,000, $40,000 for a home entertainment system when an i-pod hooked up to a micro-stereo

would do just fine.

Mr. ISSA. Especially for those of us with older hearing.

Mr. MOORE. Right. But it is hard to get people to make the decision to invest an extra $10,000 in their home heating, cooling, and

hot water supply, even though that allows them to say I have a

CO2 emissions-free home. And what we have to do is get people to

be as proud of having a CO2 emissions-free home as they are of

having a pretty car. And I don’t know how you achieve that, whether it is just a fundamental problem with human psychology, but I

do know that it has nothing to do with economics.

Mr. ISSA. Well, thank you.

I will close by going on the record and saying that I have both

a Lexus and a Toyota Prius. I want to appeal to both voters any

chance I can.

Mr. MOORE. That is very political.

Mr. ISSA. Actually, I really love the Prius, it is the ideal car for

here in Washington, DC. All kidding aside, it is the statement—

and, Patrick, you alluded to this all throughout. We have to use all

these sustainable alternatives, nuclear being the subject du jour,

but no question at all that we can’t give up on any of these.

I look forward to having you back, if you will come back as we

progress through this process.

And with that, with unanimous consent, we are adjourned.

[Whereupon, at 12:13 p.m., the subcommittee was adjourned.]

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