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Washington D.C. will host the first-ever Clean Energy Ministerial on July 19-20, 2010, gathering ministers and official delegations from nearly two dozen governments to collaborate on long-term policies and programs for a global transition to clean energy technologies.  To be hosted by the U.S. Secretary of Energy, Dr. Steven Chu, the Clean Energy Ministerial is an initiative of the Major Economies Forum on Energy and Climate (”MEF”), which is comprised of 17 major developed and developing economies.

In July of 2009, the MEF initiated a Global Partnership to promote the advancement of low-carbon and climate-friendly technologies while simultaneously reducing greenhouse gas emissions.  The MEF requested that the Global Partnership create a set of Technology Action Plans directed to ten clean energy technologies that would address more than 80% of the carbon dioxide (CO2) emissions reduction potential for the energy sector, as recognized by the International Energy Agency (”IEA”).  The MEF also intended for the Technology Action Plans to encourage efforts among interested countries to advance action on technologies such as-

• advanced vehicles
• bioenergy
• carbon capture, use & storage
• cross cutting R&D (i.e., clean energy R&D)
• energy efficiency in the buildings and industrial sectors
• high-efficiency, low-emissions (HELE) coal technologies
• marine energy
• smart grids
• solar energy
• wind energy

In December 2009, the MEF’s Global Partnership released these Technology Action Plans, summarizing the information generated by government experts and describing possible roadmaps to advance the development and deployment of these clean energy technologies.  The Technology Action Plans also propose the foundations for long-term policy commitments that would enable governments and the private sector to speed the adoption of clean energy technologies, as well as the means to overcome current barriers to the adoption of these technologies, such as regulatory barriers and the high costs of adopting the technologies, in pursuit of the common goal of a global, low-carbon economy. 

The MEF’s Clean Energy Ministerial will provide an opportunity to discuss these Technology Action Plans, including the policy obligations needed to accelerate the deployment of clean energy technologies.  The agenda also incorporates specific discussions relating to “Energy Efficiency/Smart Grid,” “Clean Energy Supply,” and “Energy Access” during the Public Forum on July 20. 

Congress begins its four-week sprint before summer recess and the Gulf of Mexico oil spill remains at the top of Congress’ agenda. Monday brought a revised draft of the offshore drilling ban from the Obama Administration, while various committees in the House will meet for research and development acts and reorganizing agencies related to the Gulf of Mexico oil spill. Later in the week, the Senate Committee on Energy and Natural Resources will meet to review and discuss the various energy bills still in negotiation.

Wednesday, July 14, 2010

The House Science and Technology Committee will hold a markup hearing on The Oil Pollution Research and Development Program Reauthorization Act of 2010 and The Safer Oil and Natural Gas Drilling Technology Research and Development Act. The full committee hearing will be held at 10:00 a.m. in Room 2318 of the Rayburn House Office Building.

The House Natural Resources Committee will hold a hearing on reorganizing the Office of Federal Energy and Minerals Leasing of the Department of the Interior tasked with overseeing offshore oil and gas drilling. This hearing will be lead by Chairman Nick Rahall (D-W.Va.) at 10:00 a.m. in Room 1324 of the Longworth House Office Building.

The House Committee on Agriculture will hold a markup hearing in regards to H.R. 4785, the Rural Energy Savings Program Act, that would help create a new loan program for rural communities to add new and improve energy efficient technology in homes. The hearing will be held at 2:00 p.m. in Room 1300 of the Longworth House Office Building.

Thursday, July 15, 2010

The Senate Committee on Energy and Natural Resources will hold a markup hearing of nine energy bills. The hearing is scheduled for 10:15 a.m. in Room 366 of the Senate Dirksen Office Building. This will most likely be the beginning of many energy bill meetings in the hill over the next four weeks.

 On July 8, the U. S. Court of Appeals for the Fifth Circuit denied the Obama Administration’s request to stay a lower court’s order lifting a six-month moratorium on offshore drilling. The Department of the Interior issued the moratorium following the explosion of a BP platform in the Gulf of Mexico. The moratorium impacted 33 exploratory drilling projects, but did not interrupt production at established platforms. Hornbeck Offshore Services and other companies that supply vessels and support to offshore drilling rigs quickly challenged the moratorium. These companies argued that the ban unnecessarily compromised much-needed jobs in the Gulf. On June 22, 2010, the U.S. District Court for the Eastern District of Louisiana granted Hornbeck’s motion for preliminary injunction, finding the Interior’s moratorium arbitrary and capricious under the Administrative Procedure Act. The Obama administration immediately appealed to the Fifth Circuit.

The Fifth Circuit’s ruling denied the government’s request to reinstate the moratorium while the Interior’s appeal is pending. According to the court’s brief per curium opinion, Hornbeck Offshore Services, L.L.C. v. Salazar, No. 10-30585, “[t]he motion for stay pending appeal is denied because the Secretary has failed to demonstrate a likelihood of irreparable injury …; he has made no showing that there is any likelihood that drilling activities will be resumed pending appeal.” Judge Dennis dissented in part, indicating that he would have granted the Secretary’s motion to stay. All three judges agreed that the Secretary could apply for emergency relief “if he can show that drilling activity by deepwater rigs has commenced or is about to commence.”

The court set an expedited brief schedule for the Interior’s appeal of the district court’s preliminary injunction. The merits argument will take place the week of August 30.

Some sources have suggested that the Fifth Circuit’s decision will lead the Interior to issue a revised moratorium that addresses the district court’s concerns. The New York Times reported that the Interior is releasing a new moratorium as early as this week.

Issues, however related to national energy policy, continue to derail chances for floor time for the Kerry-Lieberman Climate bill.  Last week, the  controversy surrounding Gen. Stanley McChrystal caused postponement of the meeting Sens. Kerry, Lieberman and other interested Democrats had scheduled with President Obama.  This week, the meeting is back on, but it comes on the heels of the death of Senator Byrd and the beginning of the Supreme Court confirmation process of U.S. Solicitor General Elena Kagan.  Even without those two events, vote counting on the Kerry-Lieberman legislation seems a long way from the 60 votes necessary for passage and might not yet have even a majority in favor.

This week brings more hearings on various aspects of the Gulf of Mexico spill with sessions in the Committees on Energy and Commerce and Natural Resources in the House on Wednesday.  The Senate Commerce Committee will hold a hearing on oil spill accountability on Wednesday as well.  On Thursday the House Transportation and Infrastructure Committee will hold a hearing on oil spill legislation, and the Senate HELP Committee will hold a hearing on BP’s worker safety record.  Also this week look for activity on the 2012 Farm Bill, this will provide ample opportunity for expanding many of the renewable and biomass energy proposals that were included in the previous bill.

Wednesday, June 30

The House Committee on Energy and Commerce will hold a hearing entitled “Legislation to Respond to the BP Oil Spill and to Prevent Future Oil Well Blowouts” in the House Committee on Energy and Commerce at 9:30 a.m. in Room 2322 of the Rayburn House Office Building.  At 10 a.m. the House Committee on Natural Resources has scheduled the Honorable Ken Salazar, Secretary, U.S. Department of Interior to testify at a hearing on drilling regulation legislation in Room 1324 of the Longworth House Office Building. Also that morning, the Senate Committee on Commerce, Science and Transportation will conduct a spill-related hearing entitled “The Deepwater Horizon Tragedy: Holding Industry Accountable” at 10 a.m. in Room 253 of the Russell Senate Office Building.

Also on Wednesday, the House Committee on Appropriations will conduct a markup of the agriculture spending bill at 1 p.m. in Room 2362-A of the Rayburn House Office Building, and the Senate Committee on Agriculture will hold a 9:30 a.m. hearing in Room 328-A of the Russell Senate Office Building regarding the 2012 farm bill. 

Thursday, July 1

The Senate Committee on Health, Education, Labor and Pensions has a 10 a.m. hearing entitled “Workplace Safety and Worker Protections at BP” in Room 430 of the Dirksen Senate Office Building.  The House Committee on Transportation and Infrastructure has a 11 a.m. markup scheduled to discuss the oil spill bill in Room 2167 of the Rayburn House Office Building. 

The U.S. District Court for the Eastern District of Louisiana yesterday issued a preliminary injunction lifting the Department of Interior’s six-month moratorium on deepwater oil drilling. Hornbeck Offshore Services v. Salazar, E.D. La., No. 2:10-cv-01663, preliminary injunction 6/22/10.  

Following the explosion of the Deepwater Horizon drilling platform on April 20, the U.S. Department of Interior issued the moratorium after completing a report reviewing the safety of deepwater drilling. The Secretary of Interior made a finding that, under current conditions, deepwater drilling poses an unacceptable threat of serious and irreparable harm or damage to wildlife and the marine, coastal and human environment, as set forth in 30 C.F.R. 250.172(b). The Secretary further determined that the installation of additional safety or environmental protection equipment is necessary to prevent injury or loss of life and damage to property and the environment, as set forth in 30 C.F.R. 250.172(c).  The moratorium prohibits drilling at depths greater than 500 feet for the 33 permitted wells located in the Gulf.

Led by Hornbeck Offshore Services, a company that operates vessels and supplies support services needed for deepwater drilling in the Gulf filed suit, alleging that Interior’s action in ordering the moratorium was arbitrary, capricious, an abuse of discretion and otherwise not in accordance with the Administrative Procedure Act (APA), the Outer Continental Shelf Lands Act (OCSLA) and its implementing regulations. Hornbeck sought an injunction precluding the government from enforcing the drilling ban.

The court entered the requested injunction, finding numerous flaws in the study that Interior used as the grounds for the moratorium. The court noted that:

• Interior’s report failed to justify the moratorium in terms of the irreparable harm it would avert or the time it would take to put in place adequate safety measures; and
• there were also unexplained discrepancies between the report’s recommendations and the moratorium, such as the report recommended halting drilling beyond 1,000 feet, not 500 feet as the moratorium required

Finally, the court found that “the blanket moratorium…seems to assume that because one rig failed although no one yet fully knows why, all companies and rigs drilling new wells over 500 feet also universally present an imminent danger.” This “patent lack of analysis,” in the court’s view, rendered Hornbeck likely to succeed on the merits of its claim.

The court then turned to the harm suffered by Hornbeck. The court noted that 150,000 jobs are directly connected to the drilling industry, adding, “[o]il and gas production is quite simply elemental to Gulf communities.” This public interest, the court concluded, when weighed alongside Hornbeck’s likelihood of succeeding on the merits, supported granting the motion for a preliminary injunction.

Press Secretary Robert Gibbs says the government plans to immediately appeal the decision to the 5^th Circuit. The likelihood of success of this appeal is uncertain. Under the Administrative Procedure Act, courts are required to give Interior’s decision to issue the moratorium a great deal of deference, overturning it only when it finds the agency acted arbitrarily and capriciously. The discrepancies between the report and the moratorium, the scope of the moratorium, its lack of timelines and the immensity of the economic harm to the industry may be enough to satisfy Hornbeck’s heavy burden of proof. Still, the enormity of the environmental damage and the unprecedented nature of this national emergency weigh heavily in the government’s favor.

Industry has applauded the injunction as ensuring a more thoughtful decision-making process. The Sierra Club called lifting the moratorium “one of the worst ideas ever proposed.”  Secretary Salazar announced his intention to issue a new directive, after providing additional factual support for the moratorium.  If that ploy is not effective, the district court’s decision means that until a trial is held or the court of appeals acts to overturn or stay the district court’s ruling, Gulf oil drillers could be going back to work

 It shouldn’t come as a surprise that Capitol Hill will again focus this week on the Gulf oil spill. While last week featured testimony from Big Oil executives, Joe Barton’s apology to BP for the White House’s actions and BP’s agreement to create a $20 billion dollar escrow for damages related to the spill, this week is not likely to produce similar theatrics.  The House Committee on Science and Technology will discuss deepwater drilling and spill cleanup technology, and the House Committee on Natural Resources will hear testimony from government officials on spill response plans on Wednesday and Thursday, respectively.  The Senate Committee on Energy and Natural Resources will hold a Tuesday hearing on reducing oil consumption with electric-drive vehicle deployment and a Thursday hearing on oil spill legislation. 

Tuesday, June 22

The Senate Committee on Energy and Natural Resources will conduct a 10 a.m. hearing on the deployment of electric-drive vehicles in Room 366 of the Dirksen Senate Office Building.

Wednesday, June 23

At a 10 a.m. hearing in Room 2318 of the Rayburn House Office Building, the House Committee on Science and Technology will hear testimony regarding deepwater drilling and cleanup response.  Also at 10 a.m., the House Committee on Education and Labor will hold a hearing entitled “Worker Health and Safety from the Oil Rig to the Shoreline” in Room 2175 of the Rayburn House Office Building.

Thursday, June 24 

The House Committee on Natural Resources will conduct a 10 a.m. hearing on oil response planning in Room 1324 of the Longworth House Office Building.  Also that morning the Senate Committee on Energy and Natural Resources will hold a hearing to discuss oil spill legislation in Room 366 of the Dirksen Senate Office Building.

Part III: Efforts to Promote Research and Development of Fast Reactors

Fast neutron reactors (FNRs or fast reactors) which burn uranium more efficiently have a very high energy production rate compared to conventional power reactors.  A fast  breeder reactor (FBR) is designed to produce more plutonium than it consumes as fuel.  According to the Argonne National Laboratory, “the fast reactor can create new fuel and destroy long-lived nuclear waste and plutonium while it produces electricity.”

The first U.S. prototype fast breeder reactor (Enrico Fermi, 66 MWe) operated for only three years and was shutdown for safety reasons in 1972.  U.S. efforts to advance FNR technology have been constrained by several factors, including the high costs of building and operating prototype fast reactors, technical failures of the earliest reactor designs both in domestic programs and abroad, a lack of U.S. public support, and, most importantly, proliferation concerns due to “the plutonium content of the spent and reprocessed fuel.”  U.S. research in the field of fast reactor technology continues, and there are now plans for the “deployment of prototype fast reactors between 2018 and 2025.”  However, the lack of Congressional support and appropriations for advancing FNR technology has been criticized by supporters of nuclear energy.

Currently, Russia is the only country with an operating commercial fast reactor (BN-600, 600 MWe).  According to the DOE Energy Information Administration, this reactor is “regarded as highly reliable.”  France closed its remaining fast reactor (Phenix, 250 MWe, 1973-2009) last year.  Japan has an experimental fast breeder reactor (Joyo, 140 MWt), which has been operating since 1977, and may restart a prototype fast breeder reactor (Monju, 280 MWe) in 2010.  India has a fast breeder test reactor (FBTR, 40 MWt) which has been operating since 1985 and is constructing a prototype fast breeder reactor (PFBR, 500 MWe) scheduled for completion at the same location in 2011.  Today’s critics of plutonium-fueled fast breeder reactors argue that Russia and India’s breeder reactor programs “leave much to be desired regarding the availability of data on reliability, safety and economics.”

Russia’s BN-600 reactor is a sodium-cooled fast breeder reactor (housed at Beloyarsk Unit 3) located at the Beloyarsk Nuclear Power Plant in the town of Zarechny, Sverdlovsk Oblast.  It has been supplying electricity to the Middle Urals power grid since 1980 and “is said to have the best operating and production record of all Russia’s nuclear power units.” A large sodium leak in 1993 was reported to have had “negligible radiological consequences.”  The BN-600 power unit was upgraded and received a license in April 2010 for 15 more years of operation.           

Russia plans to commission the first BN-800 fast breeder reactor (housed at Beloyarsk Unit 4) in 2014.  The new design of the more powerful (800 MWe) reactor offers fuel flexibility (U+Pu nitride, MOX, or metal fuels), enhanced safety, and improved operating costs.

Both the BN-600 and BN-800 reactors will be used in Russia to burn the country’s surplus weapons-grade plutonium as MOX fuel within the framework of the Plutonium Management and Disposition Agreement (PMDA).  According to the bilateral agreement, they will be modified to dispose of plutonium “without creating new stocks of separated weapons-grade plutonium.”

In October 2009, Russia’s Atomstroyexport signed a contract to carry out pre-project work for construction of two power units with two BN-800 reactors in China.  Construction of the first unit is scheduled to begin in 2011.  The contract was concluded with the China Institute of Atomic Energy and with the China Nuclear Energy Industry Company.

Russia also has two lead-cooled fast reactor designs that can be applied commercially and are considered to be more proliferation resistant: the BREST fast reactor of 300 MWe and the Lead-Bismuth Fast Reactor (SVBR) of 100 MWe.   

In 2008, Rosatom and Russian Machines set up a joint venture to design and build a prototype 100 MWe SVBR reactor.  According to an Atomenergoprom presentation, the plan is to build the SVBR-100, test it, obtain licenses, and complete a new nuclear power plant with the SVBR technology by 2020.  In 2009, Rosatom also set up a 50/50 joint venture with En+Group to design and produce a prototype SVBR reactor, as well as to obtain licenses.  This pilot project is a public-private partnership.  According to a Rosatom 2009 press release, the joint venture, OJSC AKME-engineering, is tasked with “completing R&D for the project.”  The SVBR-100 reactor unit is “scheduled to be commissioned around 2019.”

Dr. Ehud Greenspan of the University of California, Berkeley, Department of Nuclear Engineering, suggests that the United States should consider basing an American prototype reactor on the Russian SVBR-100 technology and cooperating with Russia in further developing this lead-cooled fast reactor (LFR) technology. 

Click here to read Part I of U.S.-Russian Cooperation in Nuclear Energy.

Click here to read Part II of U.S.-Russian Cooperation in Nuclear Energy.

The Importance of the US-Russia 123 Agreement

The Agreement between the Government of the United States of America and the Government of the Russian Federation for Cooperation in the Field of Peaceful Uses of Nuclear Energy (also known as the 123 Agreement) serves not only non-proliferation, but also the commercial interests of both countries.  Signed in Moscow in May 2008 and submitted to the U.S. Congress the same month, the Agreement was withdrawn after the Russia-Georgia military conflict in August 2008.  At the July 2009 Moscow Summit, Presidents Obama and Medvedev issued a joint statement  repeating earlier U.S. and Russian support for the 123 Agreement.  Opposition in Congress to the Agreement has been primarily linked to Russia’s stance on Iran’s nuclear program, particularly its past reluctance to support crippling sanctions against Iran. 

However, in the transmittal message to the U.S. Congress, President Obama noted that the United States and Russia “have significantly increased cooperation on nuclear nonproliferation and civil nuclear energy” in the last year.  The President urged the Congress to give the proposed Agreement favorable consideration because of Russia’s expressed support for a new United Nations Security Council Resolution on Iran, the April 2010 signing of the START Treaty and the Protocol to amend the 2000 U.S.-Russian Plutonium Management and Disposition Agreement, as well as Russia’s support for other non-proliferation initiatives, such as the establishment of an international nuclear fuel reserve in Angarsk, Russia.

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The United States and Russia are leading players in the nuclear energy global market.  Nuclear power accounts for approximately 20 percent of electricity generation in the U.S. and 17 percent in Russia. (Nuclear power is used by 31 countries and accounts for about 16 percent of the world’s electricity generation.)  In absolute terms, however, the U.S. produces five times more electricity from nuclear power than Russia does.  Looking ahead, both countries face a growing demand for electricity and pressure for energy efficiency.  Moreover, their commitment to halting nuclear weapons proliferation in the world gives them an additional incentive to limit the use of materials that could be used for weapons fabrication. 

At present, civilian nuclear cooperation between the United States and Russia is very limited, tied primarily to proliferation concerns and conversion of nuclear stockpiles.  Broadening civil nuclear cooperation will depend in large part on the 123 Agreement for peaceful nuclear cooperation entering into force.  (This Agreement, signed by the Bush Administration in May 2008, was resubmitted to the Congress by the Obama Administration on May 10, 2010.) 

The three-part series on this topic explores the present state of U.S.-Russian nuclear cooperation, the important role the 123 Agreement can play in fostering cooperation, and efforts in both countries to promote research and development of fast neutron reactors.

Part I:  U.S.-Russian Cooperation in Nuclear Energy: More to Be Done

Ongoing US-Russian nuclear cooperation has two dimensions: a broad focus on enhancing nuclear security and a more limited development of commercial activities.  Various activities have been undertaken under Congressionally-funded threat reduction programs to reduce the likelihood of nuclear materials falling into the wrong hands, including U.S. funding for security upgrades at Russian nuclear warhead storage sites to improve “protection, control, and accounting of” Russian nuclear weapons and materials.

The development of cooperation dates back to the signing of a February 1993 agreement under which Russia agreed to blend down highly enriched uranium (HEU) from Soviet nuclear warheads and to sell the resulting low enriched uranium (LEU) for use in the U.S. civilian nuclear industry.  The HEU Purchase Agreement, which established the 20-year, $8 billion Megatons to Megawatts program, provided for such one-way trade until 2013.  As of the end of 2009, Tenex, a Russian government-owned entity, had sold approximately 72 percent of the total amount of LEU that both sided agreed to be sold over the lifetime of the agreement to USEC, the program’s executive agent for the United States. (USEC is now a privately-owned corporation.)  This program has met a significant share of U.S. nuclear fuel needs, contributing to the generation of about 10 percent of electricity output in the United States.

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Energy policy on the Hill this week again revolves around the Gulf spill.  Congress, it seems, may now be coalescing around efforts to raise the oil spill liability cap.  That debate appears to hinge on whether to raise the cap for the entire oil and gas industry and apply the new cap retroactively to BP (an idea favored by many Democrats) or raise the cap retroactively only for BP (an idea floated by House Minority Leader John Boehner (R-OH) this weekend).  At any rate, there seems to be broad agreement that a new cap will be applied retroactively to BP. 

The President will address the nation this Wednesday on the continuing efforts in the Gulf, and the Senate and House will continue to hold hearings this week on the oil and gas industry, oversight of the industry, and the health and environmental impacts of the oil spill.  On Tuesday, there will be an oversight hearing in the House Committee on Energy and Commerce and a hearing on estimating oil spill volume in the House Committee on Natural Resources.  Those two committees will round out the week on Thursday with hearings in the House Committee on Energy and Commerce, examining BP’s role in the spill, and in House Committee on Natural Resources on the role of the Mineral Management Service.  Also this week, the Senate Committee on Health, Education, Labor and Pensions will have a hearing on the health effects of the spill.

The House Committee on Energy and Commerce will also have a hearing on Wednesday to mark up a clean energy bill introduced by Representatives Masui (D-CA) and Rush (D-IL) to help promote the development of American-made clean energy technology.  The House Committee on Energy and Commerce will also hold a mark up of energy bills, examining legislation that aims to install 10 million solar energy water heaters over ten years and legislation that would allow the federal government to enter into power purchase agreements with local utilities, hopefully speeding the adoption of alternative energy.

Tuesday, June 15

The House Committee on Energy and Commerce will hold a 9:30 a.m. hearing in Room 2123 of the Rayburn House Office Building on “Drilling Down on America’s Energy Future: Safety, Security, and Clean Energy.” Scheduled to testify are Rex Tillerson, Chairman and CEO, ExxonMobil; John Watson, Chairman and CEO, Chevron Corporation; James Mulva, Chairman and CEO, ConocoPhillips; Lamar McKay, President and Chairman, BP America; and Marvin Odum, President, Shell Oil Company.  The House Committee on Natural Resources will also hold a hearing that morning entitled “Ocean Science and Data Limits in a Time of Crisis: Do NOAA and the Fish and Wildlife Service (FWS) have the Resources to Respond?“  The 10 a.m. hearing will take place in Room 1324 of the Longworth House Office Building.

In the Senate, the Committee on Energy and Natural Resources will hold a hearing on current energy bills at 2:30 p.m. in Room 366 of the Dirksen Senate Office Building.  Also at that time, the Senate Committee on Health, Education, Labor and Pensions will hold a hearing entitled “Evaluating the Health Impacts of the Gulf of Mexico Oil Spill” in Room 430 of the Dirksen Senate Office Building.

Wednesday, June 16

The House Committee on Energy and Commerce will conduct a 10 a.m. hearing on clean tech manufacturing bills in Room 2322 of the Rayburn House Office Building.  The House Committee on Energy and Commerce will hold a 2:30 p.m. hearing on HHS Actions to Identify and Address Health Effects of the BP Oil Spill in Room 2123 of the Rayburn House Office Building.  Then at 3 p.m., the Senate Committee on Homeland Security will hold a hearing entitled “The Gulf of Mexico Oil Spill: Ensuring a Financially Responsible Recovery” in Room 342 of the Dirksen Senate Office Building.

Thursday, June 17

In the House, the Committee on Energy and Commerce will hold a hearing on BP’s role in the spill at 10 a.m. in Room 2123 of the Rayburn House Office Building.  Also at 10 a.m., the House Committee on Natural Resources will conduct a hearing in Room 1324 of the Longworth House Office Building entitled “The Deepwater Horizon Incident: Are The Minerals Management Service Regulations Doing The Job?“