Tom Mudge ASQ Energy & Environmental Division

1. Nuclear Industry Update - 2014 Tom MudgeASQ Energy & Environmental Division

2. Speaker Background • Nuclear Quality Manager for URS • Past Chair of the ASQ Southern Jersey Section • Past Chair of the ASQ Design and Construction Division • Past ASQ Deputy Director for Region 5 • Current Chair of the ASQ Energy and Environmental Division • Member of Nuclear Energy Industry QA New BuildTask Force • BS Metallurgical Engineering – Lafayette College

3. Nuclear Industry Outlook in 2009 • 2005 – Energy Policy Act of 2005 ($18.5 Billion in Loan Guarantees) • 2008 – Nuclear Energy Institute (NEI) Initiatives • National Supply Chain Workshops – encourage new nuclear suppliers • Workforce Requirements - QA / QC Personnel – estimated >5000 • 2009 – COLAs for 31 New Reactors • AP1000 – Westinghouse • ESBWR – General Electric • EPR – Areva • USAPWR - Mitsuibishi

4. Nuclear Industry Today • 2014 – Four nuclear units currently under construction • 2 Units at Vogtle (GA) • 2 Units at V. C. Summer (SC) • 2013 – year started with 104 operating nuclear units • 4 units were closed in 2013 • San Onofre (CA) -2 units • Crystal River (FL) – 1 unit • Kewaunee (WI) – 1 unit • Closing of 2 other units announced • Vermont Yankee (VT) – in 2014 • Oyster Creek (NJ) – by 2019 • The economic viability of 44 other units in question – market issues

5. Nuclear Plant Economics • As recently as mid-2008, competing sources of generation had very high costs relative to nuclear • As fossil fuel costs came down, nuclear lost a lot of its cost advantage • At Exelon’s Clinton Plant, power prices plummeted from $42 per megawatt hour in 2008 to $22 in 2009

6. What Happened to the Nuclear Renaissance? • Financial Environment • Nuclear Units costs $ 8 – 12 Billion depending on technology selected • Utilities require level of confidence in regulatory process • Regulatory Uncertainty • Yucca Mountain Waste Repository • Waste confidence • Fukushima Daiichi Accident • Earthquake • Tsunami

7. Yucca Mountain Geological Waste Repository • 1982 – Nuclear Waster Policy Act – Gave DOE responsibility to construct and operate a geological repository for high level waste • 1987 – Congress directed DOE to focus on Yucca Mountain (NV) • 2002 – DOE determined that Yucca Mountain would be a suitable location • 2008 – DOE submitted license application to NRC

8. Yucca Mountain Geological Waste Repository • 2009 – New Administration appoints new Head of DOE and NRC • 2009– Senate cuts all funding to DOE for Yucca Mountain • 2010 – DOE files motion to withdraw license application • 2010 – US Court directed that license application process proceed • 2011 – NRC ceases review of license application citing lack of funding • 2013– US Court of Appeals directs NRC to complete review of license application

9. Fukushima Daiichi Accident – March 11, 2011 • 9.0 Earthquake • Most powerful earthquake known to hit Japan • 5th most powerful earthquake in world since modern record-keeping started in 1900 • Epicenter 43 miles east of Tohoku • Units satisfactorily survived earthquake (which exceeded design basis) • Tsunami arrived 50 minutes later • Generated maximum tsunami waves of 40 meters high • Seawall 10 meters high (Design Basis) • Tsunami waves 14 meters high (at plant location)

10. Fukushima Daiichi Accident – March 2011 • Status of the plants six units at time of earthquake • Unit 4 had been de-fueled • Units 5 & 6 were in cold shutdown for maintenance • Units 1 -3 automatically shutdown after earthquake

11. Fukushima Daiichi Accident – March 2011 • Tsunami arrived 50 minutes later • Tsunami water flooded low-lying rooms in which the EDG were housed • EDGs failed, thereby cutting power to primary circulating coolant pumps • Fuel rods remained hot enough to melt themselves • Secondary emergency pumps (run by back-up electrical batteries) continued to run for one day • After battery power was exhausted, the secondary pumps stopped and the reactor began to overheat

12. Fukushima Daiichi Accident – March 2011 • Reaction between hot zirconium fuel cladding and water produced hydrogen • March 12 -15 – multiple hydrogen- air chemical explosions occurred in all the upper secondary containments • Debris obscured spent fuel pools raising concerns about water levels

13. NRC Response to Fukushima Daiichi Accident • NRC Report – Assessment & Recommendations – July 12, 2011 • Three Tiers of Recommendations • Tier 1

14. NRC Tier 1 Recommendations • Containment Venting System • Spent Fuel Pool Instrumentation • Seismic re-evaluations • Flooding Hazard Re-evaluations • Seismic and Flooding walkdowns • Emergency preparedness – staffing & communications • Station Blackout Mitigation Strategies (FLEX) • Onsite Emergency Response Capabilities • Filtration and Confinement strategies

15. NRC Draft Waste Confidence Rule • Policy on storage of Spent Nuclear Fuel • By law, DOE was required to take custody of spent nuclear fuel by 1998. • Without a functioning geological waste repository, utilities have • Continued to store spent fuel in fuel pools • Constructed Independent Spent Fuel Storage Installations (ISFSI), consisting of casks stored on concrete pads • Draft policy issued for comment in November endorses the continued storage of spent fuel beyond the licensed life for operation of a reactor and to have a mined geological repository within 60 years following the licensed life of the reactor. • Policy currently open for public comment is to be issued by no later than October 3, 2014.

16. Nuclear Energy Institute Initiatives • Counterfeit and Fraudulent Items – Mitigating the Increasing Risk • Recently identified incidents • Contributors to Counterfeiting and Fraud • Profiteering • Globalization of the Supply Chain • Low cost Items • Lack of Awareness, Complacency or Loosening of Existing Controls • Changes in Technology • Enforcement Challenges • Prevention • Detection • Incident Data Sharing – Industry database • Commercial Grade Dedication Guidance Update

17. The Future - Small Modular Reactors • Smaller in size (> 300 megawatts) • Passive design • Totally shop fabricated • Installed underground • DOE has issued funding grants to two suppliers: • B&W mPower • NuScale • Locally Holtec (Marlton, NJ) is developing a SMR design

18. Questions?