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The US Department of Energy (DOE) released a Funding Opportunity Announcement (FOA) for its Advanced Reactor Demonstration (ARD) program on May 14. The program seeks to accelerate advanced nuclear reactor technologies through private-sector cost sharing, with the goal of commercially demonstrating at least two advanced reactor designs by the mid-2020s, and reducing risk for technologies that would be ready to deploy in the 2030s.

Morgan Lewis previously reported on DOE’s initial Request for Information for the ARD program and the related Memorandum of Understanding between DOE and NRC. Letters of intent are due by June 11, and applications due by August 12.

DOE is fast-tracking its review, and intends to announce awardees in the third quarter of 2020 for the Advanced Reactor Demonstration pathway and in the fourth quarter of 2020 for the Risk Reduction for Future Demonstrations and Advanced Reactor Concepts pathways. Thinking through government contracts, regulatory licensing, fuel procurement, intellectual property, and antitrust issues should be done early in the process.

Funding Pathways

The FOA outlines three pathways through which applicants can receive funding:

  1. Advanced Reactor Demonstrations (Demos): This pathway provides $80 million funding for two awardees “to build and achieve initial operations of Demos” in the United States. DOE expects the reactors to be designed, sited, licensed by the NRC, constructed, and operational within five to seven years from the date of award. This aggressive schedule requires the applicant’s design to be near final, with permitting and licensing interactions with the NRC in the very near future, if they have not done so already. If applicants want to propose a design that will not require NRC licensing, then they must provide a “compelling justification.” Awardees must provide at least 50% of costs for the project. The Demos may be sited either on federal or nonfederal land.
  2. Risk Reduction for Future Demonstrations (Risk Reduction): This pathway provides a total of $30 million for two to five awardees with “diverse” reactor designs “to address technical risks challenging the development of these reactor designs to get them ready for future demonstration.” DOE expects that these designs will be capable of demonstration in the early to mid-2030s. This schedule requires that an applicant’s design should be between the preliminary (converting concepts to a detailed design) and final design stage at the time the applicant submits the application. DOE suggests that projects could include development of a thermal hydraulic test facility, modeling and simulation of the design to address operational and safety issues, and development of innovative plant safety systems, among others. Risk Reduction awards will also be funded using cost-sharing partnerships, with at least 20% of costs from nonfederal sources.
  3. Advanced Reactor Concepts–20 (ARC-20): This pathway provides funding for a total of $20 million for up to two awardees developing advanced reactor concepts in safety, operations, and economics, under the presumption that such concepts could be demonstrated by the mid-2030s or later. The awards will “support the overall design concept but include only those activities in the Applicant’s proposed work scope that can be completed within the next five years.” This schedule requires applicants to be pursuing a conceptual design (identifying essential functions and capabilities of the technology, solidifying design specifications, and establishing early licensing requirements) at the time of application. These awards also require cost sharing with at least 20% of costs from nonfederal sources.

Applicants can apply for either the Demo funding or the Risk Reduction funding, or for both. Applicants not selected for Demo funding will automatically be considered for Risk Reduction funding unless the applicant states that it does not want to be so considered. Applicants can alternatively submit a single application for ARC-20 funding.

Key Considerations for Applicants

Funding under the FOA is not limited to reactors that will produce electricity. To qualify as a “demonstration,” the reactor must be “operated as part of the power generation facilities of an electric utility system or in any other manner for the purpose of demonstrating the suitability for commercial application of the advanced nuclear reactor.” The FOA explicitly mentions reactors that produce “process heat, etc.”

Awards are intended for both light water and non-light water reactors. To qualify as an “advanced reactor,” the reactor must be “any light water or non-light water fission reactor with significant improvements compared to the current generation of operational reactors in the [US] fleet.” Such improvements can include inherent safety features, lower waste yields, and greater fuel utilization, among others.

Additionally, DOE emphasizes that it intends the FOA to be “technology neutral,” meaning applicants can submit designs for “any advanced fission nuclear power reactor that is licensable and commercially viable.”

Awardees must establish a plan by which they would obtain the fuel and/or special nuclear material needed for their projects.

Scheduling

The FOA sets three key deadlines for applicants:

  1. Questions on the FOA are due by May 29, 2020.
  2. Letters of intent to apply are due by June 11, 2020.
  3. The entire application is due August 12, 2020.

Eligible Applicants

To be considered, an applicant must be “owned, organized, and operated in” the United States and eligible entities may apply as participants in multiple applications and under multiple pathways. Foreign subrecipients and vendors may be proposed as part of an applicant team.

An entity selected as one of the two Demos is not eligible to receive funding for a Risk Reductions project associated with the same advanced reactor design as that selected for the Demo.

DOE Outreach

DOE has established an informational FOA website, which contains FOA documents and will contain questions and answers and other related to the FOA. In addition, DOE will conduct an Industry Day—likely held via videoconference—to review program and FOA requirements with applicants, share information, and answer questions posed by interested parties. DOE intends to permit limited one-on-one meetings with interested parties.

How We Can Help

Morgan Lewis stands ready to advise applicants in connection with their funding applications. We are the only firm with a Chambers Band 1 ranking in nuclear energy, and our NRC licensing and compliance team regularly partners with other practices on matters related to government contracts, intellectual property, and antitrust considerations. Contact the authors or your usual Morgan Lewis contact if you need assistance with your FOA application.