1. Who should I contact with questions about applying for the Civil Nuclear Credit (CNC) Program?
Please direct all questions about applying for the first award cycle, including any questions about the application process, clarification of requirements, timelines, etc. to Suzette Olson (olsonsm@id.doe.gov) and Alden Allen (allenar@id.doe.gov).
2. Who is eligible to participate in the CNC Program?
In the first award cycle, owners or operators of nuclear reactors are eligible to apply if they have already made public filings that the reactor is projected to retire prior to September 30, 2026, due to economic factors. As urged by many public commenters who responded to the Request for Information (RFI) earlier this year, the first CNC award cycle prioritizes reactors that have already announced their intention to cease operations.
To ensure the first award cycle is directed toward nuclear reactors most at risk of imminent closure, the applicant must demonstrate that it has made a public filing on or before November 15, 2021 announcing its intention to permanently cease operations of the nuclear reactor on or before September 30, 2026. The filing cannot have been withdrawn, and any conditional statements about market conditions must be verifiable. In addition to demonstrating that they will cease operations due to economic factors, the applicant for certification must also demonstrate that air pollutants would increase if the reactor were to shut down. Applicants must provide additional information that is described in the CNC Amended Guidance.
Future CNC award cycles, including the next cycle to be launched in the first quarter in Fiscal Year (FY) 2023, will not be limited to nuclear reactors that have made public filings announcing their intentions to retire.
3. Does the Amended Guidance (issued June 2022) affect eligibility?
The Amended Guidance affects the eligibility for the first round of awards. Eligibility for subsequent rounds will be described in subsequent Guidance. DOE will issue a draft of the next Guidance for public comment prior to finalization.
The June 2022 Amended Guidance replaces the requirement that a nuclear reactor applying for credits under the CNC Program not recover more than 50 percent of its cost from cost-of-service regulation or regulated contracts with a materiality standard.
Under the CNC Program, taxpayer dollars may only be applied for amounts needed to keep a reactor operational. Credits would be awarded only for costs that are not recoverable in a reactor’s cost-of-service rates or in the wholesale market. The Amended Guidance includes additional edits to allow DOE to ensure an Applicant has exhausted all other possible cost-of-service accounts before demonstrating the materiality of the amount exposed to market risk.
This change does not affect the requirement that an applicant must demonstrate that they will cease operations due to economic factors. DOE also kept the requirement that major capital costs must be accounted for in accordance with generally accepted accounting principles, meaning, for example, applicants are not permitted to compress 20 years of capital costs into the 4-year CNC award period.
Any applicant will still need to meet the criteria laid out in the Guidance for certification, which were not changed by the Amended Guidance, including that the reactor is projected to operate at a loss during the award period and that air pollutants would increase if the reactor were to shut down.
4. Why did DOE issue Amended Guidance (in June 2022)?
DOE made changes to the Guidance after careful consideration to ensure the Civil Nuclear Credit Program better supports the intent of the Bipartisan Infrastructure Law to support as many certified reactors as possible. DOE proposed the Guidance amendment in response to a letter from the Office of the Governor of California, which requested several changes to the original Guidance based on the circumstances of the Diablo Canyon Power Plant. The Governor’s letter highlighted a scenario not previously contemplated by DOE that reactors other than Diablo Canyon may face. This was confirmed by feedback received from another reactor in response to DOE’s invitation for public comment on the proposed Guidance Amendment.
DOE issued the proposed changes for public comment to be sure different perspectives were considered before making changes to the Guidance. After considering the feedback received, DOE issued the Amended Guidance reasons consistent with those provided in the invitation for public comment.
5. How do you apply to the program?
Owners or operators of a nuclear reactor may submit an application to seek certification based on requirements described in the CNC Amended Guidance. Applicants are invited to submit certification applications and sealed bids to receive credits from DOE.
Following the closure of the application and bid submission period on September 6, 2022, DOE will certify nuclear reactors that meet the requirements in the CNC Amended Guidance.
DOE will evaluate the bids from certified nuclear reactors only, using criteria described in the CNC Amended Guidance, and will allocate credits to as many certified nuclear reactors as possible.
6. When does the current application period close?
DOE is accepting certification applications and sealed bid submissions under the first award cycle until September 6, 2022. Application information and bids must be received by midnight MT, September 6, 2022, or they will not be considered for the first award period and will not be evaluated.
7. What are the next steps for the CNC Program?
DOE will review applications for certifications and bids for credits submitted under the first award cycle. Applications are due September 6, 2022. We expect to issue certification determinations and preliminary credit award decisions as soon as 30 days following the deadline for submission of certification applications and sealed bids.
DOE plans to initiate the second CNC award cycle in the first quarter of Fiscal Year 2023. The second award cycle will not be limited to nuclear reactors that have publicly announced intentions to retire. DOE will provide an opportunity for public comment before publishing guidance for applicants under the second award cycle.
8. How long are civil nuclear credits good for?
The civil nuclear credits will be allocated to selected certified reactors over a four-year period beginning on the date of the selection. The program may allocate credits until September 30, 2031, if appropriated funds remain available.
9. Can nuclear reactors receiving State zero-emission credits or other State supports apply for Civil Nuclear Credits?
Owners or operators of nuclear reactors that receive payment(s) from State programs (zero-emission credit, clean energy contract, or other programs) may apply for certification to bid for credits for nuclear reactors that meet the eligibility criteria.
Owners or operators of nuclear reactors that receive payment(s) from State programs (zero-emission credit, clean energy contract, or other programs) may apply for certification to bid for credits for nuclear reactors that meet the eligibility criteria. DOE will review all applications against the criteria described in the CNC Amended Guidance.
10. How many reactors are currently at risk of closure due to financial hardship?
DOE cannot provide a precise number, as decisions to close are up to plant owners and operators. However, it’s very clear that there are multiple reactors facing significant financial pressures. Shifting energy markets and other economic factors have already forced the early closure of 13 commercial nuclear power reactors across the United States, and more economically strained facilities may cease operations in the coming years.
11. When does the Civil Nuclear Credit program start/end?
The Civil Nuclear Credit Program was established on November 15, 2021. The program provides $6 billion for civil nuclear credits at $1.2 billion per year over fiscal years 2022 to 2026. Funds that are not paid out in each year will be are available for future credit allocation until spent or until the end of fiscal year 2031, whichever is sooner.
12. How is eligibility for the first award cycle different from future award cycles?
The first period is limited to nuclear reactors most at risk of imminent closure that have already announced their intention to cease operations prior to September 30, 2026. Future award cycles will not be limited to nuclear reactors that have publicly announced their intentions to shut down.
13. How will sealed bids be handled for the combined certification application and sealed bid submission in the first award period?
DOE is accepting certification applications and sealed bids in a single submission period for the first award cycle. Only those nuclear reactors that are certified under the CNC Program will be eligible to participate in the auction. The bids of applicants who are not certified will not be opened.
14. To participate in the CNC Program, does uranium used in the reactor have to be produced, converted, enriched, and fabricated into fuel assemblies only in the United States?
There is no specific domestic fuel sourcing threshold in determining whether to certify a reactor or allocate credits to that reactor. However, the Secretary gives priority in certification to a nuclear reactor that uses, to the maximum extent available, uranium that is produced, converted, enriched, and fabricated into fuel assemblies in the United States. Applications for civil nuclear credits will identify the source of the nuclear reactor’s uranium and the location of where it is or will be processed and manufactured into fuel, including information on the countries of origin of the uranium planned to be used during the award period. Reactors receive a favorable adjustment, up to 5 percent, to their bid prices based on their domestic fuel content. An applicant must also confirm that it will use best efforts during the four-year award period to maximize the procurement of uranium that is produced in the United States and the procurement of conversion services, enrichment services, and fabrication into fuel assemblies in the United States. DOE will audit such information.
15. Will DOE audit and/or verify all information contained in the applications for certification and bids?
All information in the application for certification will be reviewed, and DOE will have independent technical experts support evaluation of the submissions. Additionally, DOE will audit awardees annually to assess differences between projections made at the time of certification and the actual financials in each year, as well as to review the status of the awardee’s contractual commitments.