The CHIPS and Science Act Creates Opportunities for Advanced Nuclear | Hogan Lovells

While the Inflation Reduction Act of 2022 created financial incentives for the existing nuclear fleet and some advanced reactor initiatives that we discussed in a previous post, the CHIPS and Science Act takes advanced nuclear incentives a step further by promoting university nuclear science and engineering programs, creating diverse funding streams for advanced nuclear activities, and expanding eligible entities to include not only nuclear companies, but also governmental and tribal entities, universities, and others involved in nuclear supply chain activities.

Below, we review some of the elements of the CHIPS and Science Act that are related to nuclear energy, which include support for ground-based advanced reactors and space power and propulsion activities.

  • Sec. 10781. Federal advanced nuclear technology research, development, and demonstration program.

The US Department of Energy (DOE) will establish a program to provide federal financial assistance to eligible entities to support the research, development and demonstration of advanced nuclear reactors. It should be noted that the definition of “advanced reactors” cited in the legislation includes advanced fission reactors, fusion and radioisotope thermal decay systems used to generate power. Section 10781(a)(1), citing 42 USC 16271(b).

“Eligible entities” for financial assistance are broadly defined and include states, Indian tribes and tribal organizations, local government units, electric utilities, DOE national laboratories, institutions of higher education, and private entities specializing in advanced nuclear technologies, nuclear supply chains or non-electrical applications of nuclear technology.

DOE will prioritize projects that will be located in communities that have retired or retired fossil fuel power generation facilities (coal plants), as well as projects that would support non-electric applications such as energy storage, hydrogen or other liquid and gaseous fuel or chemical production, industrial processes, desalination technologies and processes, isotope production and district heating.

The Act authorizes $800M in FY2023 through FY2027 for DOE to establish this program ($75M in FY2023, $100M in FY2024, $150M in FY2025, $225M in FY2026, and $250M in FY2027).

  • Sec. 10841. Space Nuclear Capabilities.

NASA will establish a Space Nuclear Propulsion Program to continue the development of nuclear propulsion and energy technologies. This includes the development of two programs (1) to support the development of nuclear propulsion technology for use in both robotic and human space exploration, and (2) to support the design development of a space nuclear surface power reactor.

In the first, NASA will establish a space nuclear propulsion program. The program will conduct research, development and demonstrations to enable NASA to use human and robotic exploration activities, including in cargo missions to Mars in the late 2020s and crewed missions to Mars in the 2030s. Specific elements of the program include research and development efforts to mature nuclear electric and nuclear thermal propulsion technologies and the development of consistent metrics of merit across both types of technology to inform lower choices between nuclear electric or nuclear thermal propulsion system by 2026 (or as early as possible), ground testing and in-space demonstration of the propulsion system by the end of 2020, which could be carried out as a cargo mission to Mars. The law requires NASA to submit a plan to Congress within 180 days of the law’s enactment (ie, February 2023) detailing how it will achieve a space test of such a system that can support the first manned mission to Mars in 2030.

Under the second, NASA will establish a program to research, test and develop a design for a space-based nuclear surface energy reactor. NASA is required to develop a plan and timeline for this program, taking into account mission needs and opportunities for US commercial entities to participate. NASA’s plan for this program must be submitted to Congress within a year (ie, by August 2023).

NASA will also establish a propulsion test facility in space. It will conduct an assessment of the facilities needs and technical capabilities required to support ground testing of a full-scale, full-power integrated nuclear propulsion system. The assessment will consider the potential development of facilities that will support long-term research and development of space-based nuclear propulsion systems. NASA’s report on the results of this assessment must be submitted within 270 days of the law’s enactment (ie, May 2023).

  • Sec. 10842. Prioritizing Low Enriched Uranium Technology.

NASA will prioritize the use of low-enriched uranium, including high-enriched low-enriched uranium (HALEU), for space nuclear power and propulsion research and development. NASA will collaborate with other federal agencies on nuclear power and propulsion activities for space applications.

  • Sec. 10741 – 10745. Reinvestment of the research infrastructure of the National Nuclear University.

The Act contains a number of provisions that seek to update the nuclear research capacity of universities to meet the research demands of modern nuclear power systems; to ensure continuous operation of university research reactors; to coordinate available resources to enable the establishment (including the initiation and effective completion of construction) of new nuclear scientific and engineering facilities; and to support development critical to maintaining U.S. leadership in nuclear science and engineering and related disciplines, and establishing or enhancing nuclear science and engineering and other related capabilities at historic colleges and universities of black, tribal colleges or universities, minority serving institutions, EPSCoR universities, junior or community colleges, and associate degree-granting colleges.

Among its specific provisions are the following:

  • Sec. 10743 authorizes $55 million per year, from FY2023 through FY2027, to promote collaboration, partnerships, and knowledge sharing among institutions of higher education, national laboratories, other federal agencies, industry, and associated unions. In carrying out this program, DOE may support programs that:

    • Maintaining and upgrading the existing infrastructure of a university research reactor (e.g. to convert from high-enriched uranium to low-enriched uranium and to update operational equipment);

    • Revitalizing and upgrading the existing nuclear science and engineering infrastructure that supports the development of advanced nuclear technologies and applications;

    • Inclusion of regional or sub-regional university-led consortia that increase access to university research reactors, improve university-based nuclear science and engineering infrastructure, and provide project management, technical support, quality engineering and inspections, manufacturing and maintenance of nuclear materials;

    • Establishing student training programs, in cooperation with the US nuclear industry, for the relicensing and modernization of reactors, including by providing technical assistance; and

    • Include reactor improvements that emphasize research, training, and education, including through the Nuclear Infrastructure Innovation and Education Program or other similar program.

  • Sec. 10744 authorizes $390 million for FY2023 through FY2027 for the Department of Energy to establish a new “Advanced Nuclear Research Infrastructure Enhancement Subprogram” to (1) demonstrate various advanced nuclear reactor and nuclear microreactor concepts; (2) establishing reactors for the production of medical isotopes or other specialized applications; and (3) develop other research infrastructure that is consistent with DOE’s mission. In carrying out the subprogram, DOE will establish (1) no more than 4 new research reactors; and (2) new nuclear science and engineering facilities as required to address research demand and identified infrastructure gaps. In terms of location, new reactors and facilities will be established on a matter that (1) supports regional or subregional consortia; and encourages the participation of historically black colleges and universities, tribal colleges or universities, minority-serving institutions, EPSCoR universities, junior or community colleges. The authorizations include $45 million in FY 2023, $60 million in FY 2024, $65 million in FY 2025, $80 million in FY 2026, and $140 million in FY 2027.
  • Sec. 10745 authorizes an additional $15 million from FY2023 through FY2025 for the University Nuclear Leadership Program within the Office of Nuclear Energy, increasing the annual total from $30M to $45M. It also adds non-technical nuclear research to the scope of the program. The Act defines “non-technical nuclear research” as research with specializations such as social science or law that can help increase community engagement, participation and trust in nuclear energy systems, including managing the licensing required for advanced reactor deployments.​​
  • Section 10110. Isotope research, development, and production.

The Department of Energy will evaluate the technical and economic feasibility of establishing an isotope demonstration program to support the development and commercial demonstration of critical radioactive and stable isotopes at existing commercial nuclear power plants. Sec. 10110(b). Under this provision, DOE will construct a radioisotope processing facility to provide for the growing needs for radiochemical processing capabilities associated with the production of critical radioactive isotopes. The act authorizes $330 million over five years, from FY2023 through FY2027, for this initiative. In addition, DOE will establish a stable isotope production center and research center to expand the U.S.’s ability to conduct multiple large-scale production stable isotope production campaigns and mitigate its reliance on foreign-produced stable isotopes. Sec. 10110(d). The law authorizes $197 million between fiscal years 2023 and 2027 for this.

  • Section 10771. Department of Energy Research, Development, and Demonstration Activities.

The act authorizes $11.2 billion in funding for research, development, and demonstration activities in various Department of Energy agencies, including $400 million for FY2023 through FY2026 for the Office of Nuclear Energy to conduct research, development, and demonstration activities for advanced materials , and $1.2 billion for the existing Advanced Research Projects Agency (ARPA-E) program.

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