Federal Register / Vol. 70, No. 226 / Friday, November 25, 2005 / Notices 71107 

and activities; grounds are controlled by 

locked terminals and rooms, guards, 

personnel screening and visitor 

registers. 

RETENTION AND DISPOSAL: 

Destroy when no longer needed or 

after two years, whichever is later. 

SYSTEM MANAGER(S) AND ADDRESS: 

Commanding officer of the activity in 

question. Official mailing addresses are 

published in the Standard Navy 

Distribution List that is available at 

http://neds.daps.dla.mil/sndl.htm. 

NOTIFICATION PROCEDURE: 

Individuals seeking to determine 

whether this system of records contains 

information about themselves should 

address written inquiries to the 

commanding officer of the activity in 

question. Official mailing addresses are 

published in the Standard Navy 

Distribution List that is available at 

http://neds.daps.dla.mil/sndl.htm. 

The request should include full name, 

Social Security Number, and address of 

the individual concerned and should be 

signed. 

RECORD ACCESS PROCEDURES: 

Individuals seeking access to records 

about themselves contained in this 

system of records should address 

written inquiries to the commanding 

officer of the activity in question. 

Official mailing addresses are published 

in the Standard Navy Distribution List 

that is available at http:// 

neds.daps.dla.mil/sndl.htm. 

The request should include full name, 

Social Security Number, and address of 

the individual concerned and should be 

signed. 

CONTESTING RECORD PROCEDURES: 

The Navy’s rules for accessing 

records, and for contesting contents and 

appealing initial agency determinations 

are published in Secretary of the Navy 

Instruction 5211.5; 32 CFR part 701; or 

may be obtained from the system 

manager. 

RECORD SOURCE CATEGORIES: 

Individual; Defense Manpower Data 

Center; employment papers; records of 

the organization; official personnel 

jackets; supervisors; official travel 

orders; educational institutions; 

applications; duty officer; 

investigations; OPM officials; and/or 

members of the American Red Cross. 

EXEMPTIONS CLAIMED FOR THE SYSTEM: 

None. 

[FR Doc. 05–23267 Filed 11–23–05; 8:45 am] 

BILLING CODE 5001–06–M 

DEPARTMENT OF ENERGY 

Standby Support for Certain Advanced 

Nuclear Facilities 

AGENCY: Department of Energy. 

ACTION: Notice of inquiry, request for 

comments and public workshop. 

SUMMARY: The Department of Energy is 

seeking comment and information from 

the public to assist the Department in 

deciding how to implement section 638 

of the Energy Policy Act of 2005. That 

section authorizes the Secretary of 

Energy to enter into standby support 

contracts with sponsors of advanced 

nuclear power facilities to provide risk 

insurance for certain delays attributed to 

facility licensing or litigation. 

DATES: Interested persons must submit 

written comments by December 23, 

2005. Comments may be mailed to the 

address given in the ADDRESSES section 

below. Comments also may be 

submitted electronically by e-mailing 

them to: 

StandbySupport@Nuclear.Energy.gov. 

We note that e-mail submissions will 

avoid delay currently associated with 

security screening of U.S. Postal Service 

mail. A public workshop will be held on 

December 15, 2005 from 8:30 a.m. to 12 

p.m. and from 1 p.m. to 5 p.m. Requests 

to speak at the workshop should be 

made through the http:// 

www.Nuclear.gov Web site at least one 

week before the workshop. 

ADDRESSES: Written comments should 

be addressed to Kenneth Wade, Office of 

Nuclear Energy, U.S. Department of 

Energy, Forrestal Building, 1000 

Independence Avenue, SW., 

Washington, DC 20585. The Department 

requires, in hard copy, a signed original 

and three copies of all comments. 

Copies of the public workshop 

transcripts, written comments received, 

and any other docket material may be 

reviewed on the Web site specifically 

established for this proceeding. The 

Internet Web site is http:// 

www.Nuclear.gov. 

The public workshop will be held at 

the Marriot Residence Inn, 7335 

Wisconsin Avenue, Bethesda, MD 20814 

on December 15, 2005. 

FOR FURTHER INFORMATION CONTACT: 

Kenneth Wade, Project Manager, Office 

of Nuclear Energy, NE–30, U.S. 

Department of Energy, 1000 

Independence Avenue, SW., 

Washington, DC 20585 (202) 586–1889 

or Marvin Shaw, Attorney-Advisor, U.S. 

Department of Energy, Office of the 

General Counsel, GC–52, 1000 

Independence Avenue, SW., 

Washington, DC 20585 (202) 585–2906. 

SUPPLEMENTARY INFORMATION: 

I. Overview and Purpose of the Statute 

No new nuclear power electric 

generation facility has been ordered or 

licensed in the United States in almost 

30 years. Some utilities attribute their 

reluctance to invest in such facilities to 

potential or anticipated delays resulting 

from the Nuclear Regulatory 

Commission (‘‘Commission’’) licensing 

process or delays attributable to 

potential litigation. Recognizing the 

reluctance of utilities or other potential 

investors to order and construct new 

facilities, Congress, the Department of 

Energy (‘‘Department’’), the Commission 

and other governmental entities have 

attempted to facilitate and encourage 

the licensing and full power operation 

of new nuclear facilities. 

In 1989, the Commission promulgated 

10 CFR part 52 in order to establish the 

early site permit, design certification, 

and combined license processes to 

enhance the efficiency and effectiveness 

of the regulatory approval process for 

siting and licensing new plants. In the 

Energy Policy Act of 1992 (Title XXVIII 

of Pub. L. 102–486), Congress amended 

the Atomic Energy Act of 1954 (AEA) to 

further facilitate the standardization and 

streamlining of nuclear power plant 

licensing by providing explicit authority 

to the Commission for the issuance of 

combined construction and operating 

licenses (COL). An integral part of the 

COL process is the use of ‘‘Inspections, 

Tests, Analyses and Acceptance 

Criteria’’ (ITAAC) to serve as a basis for 

ascertaining, during plant construction, 

whether the licensee is meeting the 

requirements of the COL so that plant 

operations can commence predictably 

upon construction completion. 

However, since there has not been any 

application for a COL in the 16 years 

since the Commission published 10 CFR 

part 52, the efficiency and effectiveness 

of these processes have neither been 

demonstrated in actual practice nor 

tested in court. 

In February 2002, the Department 

established the Nuclear Power 2010 

program, a joint government/industry 

cost-shared effort to identify sites for 

new nuclear power plants, to develop 

and bring to market advanced nuclear 

plant technologies, evaluate the 

business case for building new nuclear 

power plants, and demonstrate untested 

regulatory processes leading to an 

industry decision in the next few years 

to seek Commission approval to build 

and operate at least one new advanced 

nuclear power plant in the United 

States. In 2003, as part of the Nuclear 

Power 2010 program, the Department 

funded a report titled, The Business 

Case for New Nuclear Power Plants (July 

71108 Federal Register / Vol. 70, No. 226 / Friday, November 25, 2005 / Notices 

2003) (see http://www.nuclear.gov/ 

home/bc/businesscase.html) which 

defined critical risks and investment 

issues. 

On April 27, 2005, in a speech at the 

National Small Business Conference, 

President George W. Bush called for 

‘‘changes to existing law that will 

reduce uncertainty in the nuclear plant 

licensing process, and also provide 

Federal risk insurance that will protect 

those building the first four new nuclear 

plants against delays that are beyond 

their control.’’ (see http:// 

www.whitehouse.gov/news/releases/ 

2005/04/print/20050427–3; see also 

http://www.whitehouse.gov/news/ 

releases/2005/06/print/20050622.html). 

Several months later, Congress passed 

and President Bush signed into law the 

Energy Policy Act of 2005 (the Act). 

Section 638 of the Act addresses the 

President’s proposal to reduce 

uncertainty in the licensing of advanced 

nuclear facilities. (42 U.S.C. 16014). The 

overriding purpose of section 638 is to 

facilitate the construction and full 

power operation of new advanced 

nuclear facilities by providing risk 

insurance for such projects. Such 

insurance is intended to reduce 

financial disincentives and 

uncertainties for utilities that are 

beyond their control so that they will 

invest in the construction of new 

nuclear facilities. By providing 

insurance to cover certain of these risks, 

the Federal Government can reduce the 

financial risk to project sponsors that 

invest in electric generation facilities 

that the Administration and Congress 

believe are necessary to promote a more 

diverse and secure supply of energy for 

the Nation. 

II. Discussion of Section 638 and 

Request for Public Comment 

A. Overview 

Subsection (g) of section 638 provides 

for regulations necessary to carry out 

section 638. This NOI discusses some of 

the major topics related to section 638, 

including the types of sponsors and 

facilities covered, the Secretary’s 

contracting authority, appropriations 

and funding accounts, covered and 

excluded delays, covered costs and 

requirements, and disagreements and 

dispute resolution. For some topics, this 

NOI indicates implementation 

approaches and interpretations that the 

Department is considering. It also 

identifies topics on which the 

Department specifically requests 

comments. The Department requests 

comments from the public about these 

topics and any other issues related to 

the implementation of section 638. The 

Department also welcomes comments 

about the extent to which potential 

sponsors may be interested in entering 

into standby support contracts with the 

Department, and how the authority in 

section 638 can be implemented most 

effectively to achieve the objective of 

reducing uncertainty in the nuclear 

plant licensing process and thereby 

facilitate the expeditious construction 

and operation of new nuclear power 

plants. 

B. Definitions 

Subsection (a) of section 638 defines 

the terms ‘‘advanced nuclear facility,’’

‘‘sponsor,’’ and ‘‘combined license’’ as 

follows. ‘‘Advanced nuclear facility’’ is 

any nuclear facility for which the 

Commission approves the reactor design 

after December 31, 1993, provided that 

the Commission has not approved such 

design or a substantially similar design 

of comparable capacity on or before that 

date. ‘‘Sponsor’’ is any person who has 

applied for or been granted a combined 

license. ‘‘Combined License’’ is a 

combined construction permit and 

operating license issued by the 

Commission for an advanced nuclear 

facility. While the Department believes 

these terms are clear, it requests 

comments as to whether the 

implementation of section 638 would be 

facilitated by the Department further 

clarifying, either in regulations or in the 

standby support contracts themselves, 

these terms or any other terms set forth 

in section 638 (such as ‘‘the fair market 

price of power’’ in subsection (d)(5)(B)). 

If a commenter believes that it would be 

more appropriate for certain 

clarifications and definitions to be 

provided in regulations instead of the 

contracts themselves, or vice versa, the 

commenter should explain why. 

C. Contract Authority 

Subsection (b) of section 638 

authorizes the Secretary to enter into 

standby support contracts with sponsors 

of advanced nuclear facilities that 

would provide risk insurance against 

certain regulatory or legal delays that 

are not the fault of the sponsors but 

which have the potential to dramatically 

increase the cost of bringing new 

nuclear power plants on line. 

Subsection (b) directs that sufficient 

funding to pay the covered costs under 

these contracts be placed in designated 

Departmental accounts when the 

contracts are entered into. Subsection 

(b) provides that only six reactors can 

receive benefits under these contracts. 

In addition, subsection (d) provides for 

different amounts of covered costs with 

respect to the initial two reactors that 

receive their COL and commence 

construction and the subsequent four 

reactors. 

Section 638 grants the Secretary 

considerable discretion as to when, how 

and with whom to enter into standby 

support contracts. The Department 

believes that the objectives of section 

638 are best achieved by maximizing the 

opportunities for sponsors to enter into 

standby support contracts as early as 

practical. The Department recognizes, 

however, that entering into a contract 

with a sponsor before the sponsor 

receives a COL and commences 

construction may raise a number of 

implementation issues. These issues 

arise from, among other things, the 

requirement to have adequate funding 

in the accounts before entering into a 

contract, the different treatment of the 

initial two facilities and the subsequent 

four facilities, and the disposition of 

funds received from a sponsor (see 

discussion in subsection D of this NOI). 

The Department’s initial view is that 

these considerations can be addressed 

best by the Department being willing to 

enter into binding agreements with 

sponsors that submit COL applications 

to the Commission, at any time on or 

after such an application is submitted. 

These agreements between the 

Department and project sponsors would 

not themselves be standby support 

contracts, but would commit the 

Department to enter into standby 

support contracts under section 638 

with the sponsors of the first six reactors 

for which a COL is granted and 

construction commenced. In 

commenting on this potential approach, 

consideration should be given as to 

what provisions might be included in 

the agreements to deal with issues such 

as calculating the amount of funding, if 

any, from the sponsors and taking into 

account the extent to which 

appropriated funds are available. The 

Department requests comments on 

whether, at the time the Department and 

the sponsors enter into the binding 

agreement or at any other specified 

time, the sponsors should be required to 

deposit funds in an escrow account to 

cover all or some of the anticipated 

funding requirements of the contract. 

The Department also welcomes 

comments on whether other options 

would be more effective in achieving 

the objectives of section 638, and, if so, 

what regulatory or contractual 

provisions would be useful in 

implementing these options. 

In a related matter, the Department 

requests comments on whether to utilize 

an application process. There are many 

contract process and implementation 

issues that may be addressed in an 

application process. For example, 

Federal Register / Vol. 70, No. 226 / Friday, November 25, 2005 / Notices 71109 

should the Department require a fee to 

accompany the application, and, if so, 

how much should the fee be and should 

it be refundable? Should the application 

process be used to assist in determining 

the amount of funding needed prior to 

entering into a contract? Should the 

applicant/sponsor be required to submit 

an analysis showing the proposed 

‘‘cost’’ of the standby support contract? 

Should the application process be open 

to all sponsors or should there be 

criteria to exclude certain entities or to 

select among applicants? What level of 

detail should the Department institute 

in any application process? The 

Department requests comments on the 

advantages and disadvantages of a 

detailed application process, including 

comments on the content and how best 

to implement such an application 

process. 

The Department also requests 

comments on whether the regulations or 

the contracts themselves should provide 

DOE with the right to cancel a contract 

should a sponsor not proceed diligently 

to construct a facility that has received 

a COL and on which construction has 

commenced. The Department believes 

that the objective of section 638 is not 

to simply encourage the licensing of 

facilities, but to see that they are 

successfully constructed and brought 

online. Yet it is possible that, for a 

variety of potential reasons, a sponsor 

might be unable or unwilling to proceed 

with expeditious construction and 

completion of a licensed facility. 

Because the Act only allows DOE to 

enter into standby support contracts 

‘‘that cover a total of 6 reactors,’’ should 

DOE be able to cancel a contract in 

certain circumstances, thereby 

potentially ‘‘freeing up’’ one or more of 

the authorized spots so that DOE could 

enter into a standby support contract 

with another sponsor? If so, what are the 

circumstances that should allow DOE to 

do so? DOE requests comment on all 

aspects of this issue. 

D. Appropriations and Funding 

Accounts 

Subsection (b)(2) establishes a 

funding requirement that must be met 

before the Secretary can enter into any 

standby support contract. Specifically, 

the Department must establish two 

separate accounts and have a specified 

amount of funds in the account before 

entering into a contract. The first 

account is labeled as a ‘‘Standby 

Support Program Account’’ (‘‘Program 

Account’’), and the second account is 

labeled as a ‘‘Standby Support Grant 

Account’’ (‘‘Grant Account’’). 

Subsection (b)(2)(C) specifies that the 

Program Account contains funds either 

appropriated to the Secretary in advance 

of the contract or a combination of 

appropriated funds and loan guarantee 

fees. This funding is required to be in 

an amount sufficient to cover loan costs. 

Subsection (b)(2) specifies that the term 

‘‘loan cost’’ has the meaning given the 

term ‘‘cost of a loan guarantee’’ under 

section 502(5)(C) of the Federal Credit 

Reform Act of 1990 (2 U.S.C. 

661a(5)(C)), which is ‘‘the net present 

value, at the time when the guarantee 

loan is disbursed,’’ of certain costs. The 

costs for purposes of subsection 

(b)(2)(C)(i) are identified by a crossreference to the costs described in 

subsection (d)(5)(A) which are the 

principal or interest on any debt 

obligation of an advanced nuclear 

facility owned by a non-Federal entity. 

Subsection (b)(2)(C)(ii) specifies that the 

‘‘Grant Account’’ contains funds either 

appropriated to the Secretary in advance 

of the contract, funds paid to the 

Secretary by the sponsor, or a 

combination of appropriations and 

payments. This funding is required to be 

in an amount sufficient to cover the 

costs described in subsection (d)(5)(B) 

which are the incremental difference 

between (i) the fair market price of 

power purchased to meet the 

contractual supply agreements that 

would have been met by the advanced 

nuclear facility but for the delay, and (ii) 

the contractual price of power from the 

advanced nuclear facility subject to the 

delay. 

Funding for both the Program 

Account and the Grant Account may be 

provided by either or both the Federal 

Government and sponsors of advanced 

nuclear facilities. In this regard, the 

Department notes that the provision in 

subsection (d)(4)(B) allowing acceptance 

of non-federal funds makes those nonfederal funds available to the Secretary 

only to pay covered costs. Because the 

funds are made available to the 

Secretary ‘‘for payment of the covered 

costs’’ and not for any other purpose, 

the Secretary is only able to use the 

funds for that purpose (see 31 U.S.C. 

1301(a)). If funds are not expended on 

covered costs, the Department 

anticipates that at the end of the 

program the government would move to 

close the account under 31 U.S.C. 1555 

and deposit the funds into the general 

Treasury (see 31 U.S.C. 1555, 31 U.S.C. 

3302(b)). The Department requests 

comment as to what extent, if any, these 

provisions will affect participation in 

the program. The Department also 

requests comment on what is the 

appropriate mix between government 

appropriations, sponsor payments, and 

a combination of both. 

Congress specified certain details of 

the methodology for calculating the 

funding that must be in the two 

accounts prior to entering into a 

contract. However, the Department has 

considerable discretion in the 

implementation of that methodology. 

The Department must decide whether to 

calculate the funding on a generic basis 

that would result in the same funding 

for each facility or on a facility specific 

basis that would result in different 

funding for each facility. The 

Department also must decide whether to 

differentiate between the initial two 

facilities and the subsequent four 

facilities. The Department requests 

comments on how it should exercise 

this discretion and, in particular, what 

factors it should consider in 

determining both the overall amount of 

funding and the portion, if any, required 

from the sponsors. 

In a related matter, the Department 

requests comments on whether, if a 

sponsor participates in the section 638 

risk insurance program, and any loan 

guarantee program for which the 

sponsor may be eligible pursuant to 

Title XVII of the Act, and/or the 

production tax credits for advanced 

nuclear facilities in section 1306 of the 

Act, there should be any adjustment in 

the amount paid to the Department by 

the sponsor to participate in more than 

one program or in the amounts that a 

sponsor can receive under more than 

one program. 

E. Covered and Excluded Delays 

Covered Delays. Subsection (c) 

specifies situations in which the 

Secretary will pay the ‘‘covered costs’’

and situations in which the Secretary is 

precluded from paying such costs. 

Among the situations set forth in 

subsection (c)(1) in which the Secretary 

will pay such costs are (A) ‘‘the failure 

of the Commission to comply with 

schedules for review and approval of 

inspections, tests, analyses, and 

acceptance criteria established under 

the combined license or the conduct of 

preoperational hearings by the 

Commission * * *’’ or (B) ‘‘litigation 

that delays the commencement of fullpower operations * * *’’. The terms of 

subsection (c)(1)(A) are closely related 

to the part 52 COL licensing process. 

The COL issued to the licensee specifies 

the inspections, tests, analyses and 

acceptance criteria (which are known as 

ITAACs) with which the licensee must 

comply. The Commission requires 

verification that the licensee has 

completed the required inspections, 

tests, and analyses, and that the 

acceptance criteria have been met before 

the reactor can operate. However, the 

71110 Federal Register / Vol. 70, No. 226 / Friday, November 25, 2005 / Notices 

Commission’s regulations do not set any 

schedules for completing ITAAC 

review. Rather, under the COL, the 

licensee sets the schedule for ITAACs 

and may change the schedule as 

circumstances warrant. Although the 

Commission may set informal, internal 

schedules for auditing the licensee’s 

performance of its ITAAC and will 

provide public notice upon completion 

of its review, there is no regulatory 

requirement for the Commission’s 

conduct or timing of such auditing. 

The part 52 regulations provide that 

the Commission give notice of intended 

operation not less than 180 days prior 

to the scheduled date for initial fuel 

load. During this time, the Commission 

intends to complete its review of the 

ITAACs and make a final determination 

whether the acceptance criteria have 

been met and reactor operations can 

begin. Given the complexity of the 

ITAAC review process, a back-loading 

of submissions to the Commission 

toward the end of the 180-day period 

might cause the Commission to be 

unable to complete its audit process 

prior to the fuel loading date. Thus, 

while a delay in operation might 

initially appear to be attributable to 

delays by the Commission, in fact the 

delay might be more attributable to a 

sponsor’s relatively late completion and 

submittal of the ITAACs. The 

Department notes that these issues 

likely could be satisfactorily addressed 

through Commission regulations, audit 

procedures or guidance as they 

currently exist, or modified as 

appropriate and necessary. If no changes 

were made to the Commission’s current 

regulations or procedures, however, the 

Department requests comments on how 

to address this situation either through 

the Department’s section 638 

regulations or through the standby 

support contracts. 

The Department also believes it is 

possible that even if there is an ITAACrelated delay attributable to Commission 

regulatory delays, such a delay in the 

regulatory schedule might not be the 

cause of any delay in the full power 

operation of a nuclear facility that does 

in fact occur. For example, other factors 

(such as construction or engineering 

delays) might contribute to or be the 

primary cause of the delay. The 

Department requests comment on how 

best to establish whether the 

Commission failed to comply with the 

ITAAC schedules and, if so, whether 

such delay by the Commission is in fact 

the cause of a delay in full power 

operation. Specifically, are there any 

objective, unambiguous triggers that the 

Department could include in a 

regulation or in individual contracts to 

better ascertain whether a delay should 

be attributable to the Commission and 

thus covered by the contracts. 

In addition, some delays may be 

caused by other governmental entities, 

including the Federal Emergency 

Management Agency (FEMA) and State 

and local governments. Before full 

power reactor operations may 

commence, the Commission must 

determine that the off-site emergency 

plans are adequate and in place. 

Specifically, under 10 CFR part 50, 

subsection 50.47(a) ‘‘Emergency Plans,’’

(which is also applicable to facilities 

licensed under part 52), the Commission 

will base its emergency planning 

findings on review of a related FEMA 

determination whether ‘‘State and local 

emergency plans are adequate and 

whether there is reasonable assurance 

that they can be implemented.’’

Similarly, under section 50.47(c), State 

and local governments may be 

responsible for some delays, if they 

decide not to participate in the 

emergency planning process with 

FEMA. The Department requests 

comment as to how best to treat delays 

that are caused by other governmental 

agencies and thus may be beyond the 

control of the Commission. 

Subsection (c)(1)(A) also refers to 

delays in full power operation of 

advanced nuclear facilities caused by 

‘‘the conduct of preoperational hearings 

by the Commission * * *’’ This section 

is susceptible of two different 

interpretations; it either can be 

interpreted to allow coverage only for 

delays associated with preoperational 

hearings where the Commission has 

failed to comply with applicable 

schedules, or it can be interpreted to 

allow coverage for delays associated 

with any preoperational hearings, 

regardless of who requested or caused 

the hearing and regardless of whether 

there was a ‘‘failure’’ of any kind by the 

Commission. 

After issuance of the COL, there is 

only one opportunity for a public 

hearing in part 52 (i.e., when a sponsor 

is ready to load fuel, it must notify the 

Commission and the Commission must, 

at least 180 days prior to the load fuel 

date, issue a public notice and 

opportunity for hearing on the proposed 

operation. See section 52.103.) The 

hearing may be held at the discretion of 

the Commission based on the showing 

by an outside entity that the acceptance 

criteria have not been met. There is no 

preset schedule for the conduct of the 

pre-operational hearing if it is granted, 

and the hearing may be formal or 

informal. If formal, the timing related to 

and the conclusion of the process is 

very uncertain. Given the undefined and 

untested process for a COL, it is not 

clear which party would be at fault for 

a delay caused by a pre-operational 

hearing, or even if ‘‘fault’’ is a relevant 

concept in holding another hearing to 

ascertain if the public’s overriding need 

for safety is satisfied. 

As a result, the Department is 

inclined to interpret subsection (c)(1)(A) 

as meaning that a ‘‘covered delay’’

includes any delay caused by the 

conduct of preoperational hearings by 

the Commission. The Department 

requests comments on this 

interpretation, how best to implement it, 

any alternatives, and all other aspects of 

subsection (c)(1)(A). In particular, given 

the potential interpretation that some 

portion of a delay caused by a 

preoperational hearing might not be 

considered a ‘‘covered’’ delay, the 

Department requests comments on 

whether a regulatory delay should only 

be considered a ‘‘covered delay’’ after a 

certain time period, as specified by 

contract or regulation. If so, what time 

period would be appropriate? 

Subsection (c)(1)(B) refers to 

‘‘litigation that delays the 

commencement of full-power operations 

***’’ Black’s Law Dictionary broadly 

defines the term ‘‘litigation’’ as ‘‘The 

process of carrying on a lawsuit,’’ and 

the term ‘‘lawsuit’’ is defined as: ‘‘any 

proceeding by a party or parties in a 

court of law.’’ In the context of the COL 

process, there may be litigation both 

before an administrative board to 

adjudicate claims in the Commission 

licensing process and in Federal court. 

The Act is silent as to what type of 

litigation section 638 refers. Because 

subsection (c)(1)(A) already refers to 

certain Commission proceedings that 

may delay full power operation, the 

Department is inclined to interpret the 

term ‘‘litigation’’ in subsection (c)(1)(B) 

as meaning only litigation in State, 

Federal, or tribal courts, including 

appeals of Commission licensing 

decisions, and excluding administrative 

litigation that occurs at the Commission 

as part of the COL process. The 

Department requests comment as to 

what type of litigation delays should be 

covered by the Program. 

Although the term ‘‘full power 

operation’’ is not defined in section 638 

or 10 CFR part 52, the Commission 

generally considers this to be operation 

at five percent or greater. (See 10 CFR 

2.340(g)(1); and Statement of Policy on 

Issuance of Uncontested Fuel Loading 

and Lower Power Testing Operating 

Licenses, 46 FR 47906, September 30, 

1981) The Department intends to follow 

the Commission practice but 

nevertheless requests comments on how 

to incorporate this interpretation of ‘‘full 

Federal Register / Vol. 70, No. 226 / Friday, November 25, 2005 / Notices 71111 

power operation’’ into the regulations 

carrying out section 638. 

Exclusions. Subsection (c)(2) 

expressly precludes the Secretary from 

paying costs resulting from three general 

areas: ‘‘(A) The failure of the sponsor to 

take any action required by law or 

regulation; (B) events within the control 

of the sponsor; or (C) normal business 

risks.’’ The Department requests 

comment on how best to interpret and 

apply this subsection, including 

examples of each category of exclusion. 

The Department particularly invites the 

public to respond to the following 

questions. What areas of laws and 

regulations are likely to be involved? 

What events should be considered 

within the control of the sponsor and 

what events should be considered 

beyond its control? What should be 

considered a normal business risk, and 

thus not coverable under the Program? 

How should these exclusions be 

implemented with respect to the 

expressly covered delay caused by the 

‘‘conduct of preoperational hearings’’? 

In other words, for example, if a 

sponsor’s alleged failure to take an 

action required by law is the reason that 

the Commission holds a preoperational 

hearing, is the delay caused by that 

hearing a covered delay or an excluded 

delay? For each of these questions, the 

Department requests that commenters 

provide examples. 

Due Diligence. Subsection (e) 

specifies that any standby support 

contract requires ‘‘the sponsor to use 

due diligence to shorten, and to end, the 

delay covered by the contract.’’ Black’s 

Law Dictionary defines ‘‘diligence as (1) 

a continual effort to accomplish 

something and (2) the attention and care 

required from a person in a given 

situation. In turn, Black’s Law 

Dictionary defines ‘‘due diligence’’ as 

‘‘[t]he diligence reasonably expected 

from, and ordinarily exercised by a 

person who seeks to satisfy a legal 

requirement or a discharge of an 

obligation.’’ The Department requests 

comments on how this term should be 

used in the context of a standby support 

contract, whether it should be further 

defined in the regulations or contracts, 

specific examples of situations that 

commenters believe should or should 

not come within the term, and how the 

Department should determine due 

diligence by the sponsor. 

F. Covered Costs and Requirements 

Subsection (d) provides for the 

coverage of costs that result from a delay 

during construction and in gaining 

approval for full power operation, 

specifically (A) principal and interest 

and (B) incremental cost of purchasing 

power to meet contractual agreements. 

The Department requests comments on 

how these costs should be documented, 

especially the extent to which they are 

used in calculating the funding needed 

prior to entering into a contract. 

In addition, while the Department 

anticipates only covering those costs 

specifically described in subsection 

(d)(5)(i) and (ii), it notes that subsection 

(d)(5) states that the covered costs shall 

be those that result from certain delays 

‘‘including’’ the costs specifically 

described in subsection (d)(5)(i) and (ii). 

As a result, it might be possible to 

interpret subsection (d)(5) as 

authorizing the Department to provide 

coverage for costs in addition to those 

specifically described in subsections 

(d)(5)(i) and (ii). The Department 

requests comment on whether those are 

the only costs that should be covered 

under the contracts and whether the 

Grant Account and the Program 

Account are restricted to covering a 

particular type of cost (i.e., the cost on 

which funding is based). 

Subsection (d) distinguishes between 

the ‘‘Initial Two Reactors’’ that receive 

combined licenses and on which 

construction is commenced and the 

‘‘Subsequent Four Reactors.’’ With 

respect to each of the Initial Two 

Reactors, the Secretary is required to 

pay 100 percent of the covered costs of 

delay, but not more than $500 million 

per contract. With respect to the 

Subsequent Four Reactors, the Secretary 

is required to pay ‘‘50 percent of the 

covered costs of delay that occur after 

the initial 180-day period of covered 

delay, but not more than $250 million 

per contract. The Department requests 

comment on the following issues: If 

there are two reactors being constructed 

by one sponsor at one location/facility, 

should there be two contracts in order 

for the sponsor to receive up to $500 

million in coverage per reactor? Should 

a sponsor be precluded from entering 

into a contract that includes more than 

one reactor? In addition, the Department 

requests comment about the term 

‘‘commencement of construction’’ given 

that neither part 52 nor section 638 

defines this term. The commencement 

of construction of a facility may be 

defined in several ways, including 

activities such as the planning and 

design of a reactor facility, a firm 

purchase order for a reactor facility, or 

preparation of a site in anticipation of 

facility construction. On the other hand, 

under part 52, the Commission will 

issue a COL only upon finding that 

applicable regulatory requirements have 

been met, and that ‘‘there is reasonable 

assurance that the facility will be 

constructed and operated in conformity 

with the license, the provisions of the 

Atomic Energy Act, and the 

Commission’s regulations.’’ 10 CFR part 

52.97. The Department believes it is 

reasonable to interpret ‘‘commencement 

of construction’’ in a manner consistent 

with Commission practice and requests 

comments on what would be the 

elements of such an interpretation. 

G. Disagreements and Dispute 

Resolution 

Just as with any commercial 

insurance contract, there may be 

potential areas in which a sponsor may 

disagree with the Department as to an 

interpretation of a section 638 risk 

insurance contract provision. The Act 

does not require any particular dispute 

resolution mechanism or procedure, and 

therefore the Department requests 

comment on how disputes between 

sponsors and the Department should be 

resolved, and what dispute resolution 

provisions should be included in the 

applicable regulations or contracts. 

The Department notes that an 

important consideration is to make the 

standby support regulations that 

implement section 638 workable, so that 

they can be readily administered in an 

efficient and effective manner. 

Specifically, the regulations may need 

to include a mechanism to resolve 

factual and legal disputes as to whether 

a delay is covered or excluded as well 

as which party is at fault for a particular 

delay or event. Other Federal agencies 

that provide financial assistance have 

established oversight offices to monitor 

the projects they fund. For instance, the 

Department of Transportation’s 

Transportation Infrastructure Finance 

and Innovation Act (TIFIA) program, 

which provides grants for surface 

transportation projects, has established 

a TIFIA Joint Program Office to 

coordinate and manage the 

implementation of the TIFIA credit 

program. (See ‘‘TIFIA Project Oversight 

and Credit Monitoring Guidance’’

(http://tifia.fhwa.dot.gov/oversight.htm)) 

Similarly, the Oversees Private 

Investment Corporation (OPIC), which 

provides political risk insurance to U.S. 

businesses that invest oversees, has 

established its Office of Accountability 

to monitor OPIC supported projects. (see 

http://www.opic.gov) Although these 

programs cover or potentially cover far 

more entities and projects than the finite 

number of projects that may be covered 

by the Standby Support Program, they 

may provide guidance as to how the 

Department should resolve disputes. 

71112 Federal Register / Vol. 70, No. 226 / Friday, November 25, 2005 / Notices 

H. Monitoring and Reporting 

Requirements 

Subsection (f) requires the 

Commission to report to the Secretary 

and Congress on a quarterly basis 

regarding the licensing status of 

advanced nuclear facilities covered by a 

standby support contract. Apart from 

the Commission’s statutory reports, the 

Department requests comments on the 

need to require any other reporting by 

the sponsor or others to the Department 

to assist the Department in its 

monitoring responsibilities, including 

the content, timing and impact of such 

reporting. Similarly, the Department 

requests comment on any other 

reporting or monitoring activities it 

should engage in to fulfill its 

responsibilities under the contract. 

III. Public Participation 

A. Attendance at Public Workshop 

The time and date of the public 

workshop are listed in the DATES section 

at the beginning of this notice of 

inquiry. Anyone who wants to attend 

the public workshop should register on 

the Web site (http://www.nuclear.gov) of 

the Department’s Office of Nuclear 

Energy, Science and Technology. 

B. Procedure for Submitting Requests To 

Speak 

Any person who has an interest in 

today’s notice or who is a representative 

of a group or class of persons that has 

an interest in these issues, may request 

an opportunity to make an oral 

presentation. Such persons may handdeliver requests to speak, along with a 

computer diskette or CD in WordPerfect, 

Microsoft Word, PDF, or text (ASCII) file 

format to the address shown in the 

ADDRESSES section at the beginning of 

this notice, between the hours of 9 a.m. 

and 4 p.m., Monday through Friday, 

except Federal holidays. 

Persons requesting to speak should 

briefly describe the nature of their 

interest in this public workshop and 

provide a telephone number for contact. 

The Department requests persons 

selected to be heard to submit an 

advance copy of their statements at least 

one week before the public workshop. 

At its discretion, the Department may 

permit any person who cannot supply 

an advance copy of their statement to 

participate, if that person has made 

advance alternative arrangements with 

the Office of Nuclear Energy. A person 

requesting to give an oral presentation 

should ask for such alternative 

arrangements. 

C. Conduct of Public Workshop 

The Department will designate a 

Departmental official to preside at the 

public workshop and may also use a 

professional facilitator to aid discussion. 

The meeting will not be a judicial or 

evidentiary-type public hearing. A court 

reporter will be present to record the 

proceedings and prepare a transcript. 

The Department reserves the right to 

schedule the order of presentations and 

to establish procedures governing the 

conduct of the public workshop. After 

the public workshop, interested parties 

may submit further comments on the 

proceedings as well as any aspect of 

section 638 until the end of the 

comment period set forth in this notice. 

The public workshop will be 

conducted in an informal, conference 

style. The Department will allow time 

for presentations by participants and 

encourage all interested parties to share 

their views on issues affecting this 

proceeding. Each participant will be 

allowed to make a prepared general 

statement (within the time limits 

determined by the Department), before 

the discussion of specific topics. The 

Department will permit other 

participants to comment briefly on any 

general statements. The presiding 

official will announce any further 

procedural rules or modification of the 

above procedures that may be needed 

for the proper conduct of the public 

meeting. 

The Department will make the entire 

record of this proceeding, including the 

transcript from the public workshop 

available for inspection at the U.S. 

Department of Energy, Forrestal 

Building, Room 1J–018, 1000 

Independence Avenue, SW., 

Washington, DC 20585 (202) 586–9127 

between the hours of 9 a.m. and 4 p.m., 

Monday through Friday, except Federal 

holidays. Any person may buy a copy of 

the transcript of the public workshop 

proceedings from the transcribing 

reporter. 

D. Submission of Comments 

The Department requests written 

comments from interested persons on 

all aspects of implementing the standby 

support program authorized by section 

638 of the Act. All information provided 

by commenters will be available for 

public inspection at the Department of 

Energy, Freedom of Information Reading 

Room, Room 1E–190, 1000 

Independence Avenue, SW. 

Washington, DC 20585 between the 

hours of 9 a.m. and 4 p.m. Monday 

through Friday, except for Federal 

holidays. 

The Department also intends to enter 

all written comments on a Web site 

specifically established for this 

proceeding. The Internet Web site is 

http://www.nuclear.gov. To assist the 

Department in making public comments 

available on a Web site, interested 

persons are encouraged to submit an 

electronic version of their written 

comments in accordance with the 

instructions in the DATES section of this 

notice. 

Because the Department intends to 

make all submissions publicly available 

on a Web site, the Department requests 

that commenters not submit information 

believed to be confidential and exempt 

from public disclosure. However, if any 

person chooses to submit information 

that he or she considers to be privileged 

or confidential and potentially exempt 

from public disclosure, that person must 

clearly identify the information that is 

considered to be privileged or 

confidential and explain why the 

submitter thinks the information is 

exempt from disclosure, addressing as 

appropriate the criteria for 

nondisclosure in the Department’s 

Freedom of Information Act regulations 

at 10 CFR 1004.11(f). The Department 

also requests such submitters provide 

one copy of their comments from which 

the information believed to be exempt 

from disclosure has been redacted, with 

the areas where information or data 

sought to be protected from disclosure 

is exempt from such disclosure in 

accordance with the procedures set 

forth in its Freedom of Information Act 

regulations at 10 CFR 1004.11. 

Factors of interest to the Department 

when evaluating requests to treat 

submitted information as confidential 

include: (1) A description of the items; 

(2) whether and why such items are 

customarily treated as confidential 

within the industry; (3) whether the 

information is generally known by or 

available from other sources; (4) 

whether the information has previously 

been made available to others without 

obligation concerning confidentiality; 

(5) an explanation of the competitive 

injury to the submitting person which 

would result from public disclosure; (6) 

when such information might lose its 

confidential character due to the 

passage of time; and (7) why disclosure 

of the information would be contrary to 

the public interest. 

Issued in Washington, DC, on November 

17, 2005. 

R. Shane Johnson, 

Acting Director, Office of Nuclear Energy, 

Science and Technology. 

[FR Doc. 05–23177 Filed 11–23–05; 8:45 am] 

BILLING CODE 6450–01–P