management program. for this and other reasons, the commission concludes that new institutional leadership is needed, specifically, we believe a single purpose congressionally chartered federal corporation is best suited to provide the stability, focus, and credibility needed to get the waste program back on track. for the new organization to succeed, a substantial degree of implementing authority and assured access to funds must be paired with rigorous financial, technical, and regulatory oversight by congress and the appropriate government agencies. our third recommendation is that access to the funds nuclear utility rate payers are providing for the purpose of nuclear waste management. nuclear facilities are assessed a fee on every kilowatt hour of generated electricity in exchange for the federal government's contractual commitment to begin accepting commercially spent fuel beginning by january 31st, 1998.

fee revenues go to the government's nuclear waste fund which was established for the sole purpose of covering the cost of disposing of civilian nuclear waste and ensuring that the waste program would not have to compete with other funding priorities. the fund does not work as intended. a series of executive branch and congressional actions has made annual fee revenues approximately $750 million a year and the unspent $27 billion balance in the fund effectively inaccessible to the waste program. instead, the waste program is subject to exactly the budget constraints and uncertainties that the fund was created to avoid. this situation must be remedied

immediately to allow the program to succeed. the commission sent a letter to the president on december 11th, 2011 discussing this particular recommendation in detail. and we will submit it as part of this hearing's recommendation. our fourth recommendation is prompt efforts to develop one or more geologic disposal facility. the conclusion that disposal is needed and that deep geologic disposal is a scientifically preferred approach has been reached by every expert panel that has looked at the issue. and by every other country that is pursuing a nuclear waste program. moreover, all spent fuel reprocessing or recycle options either already available or under active development at the time still generate waste streams that require permanent disposal solution. we simply know that regardless of what happens with yucca

mountain, the u.s. inventory of spent fuel exceeds that the amount that can be legally in place at that site until a second repository is in operation. the statutory limit for yucca mountain is 70,000 metric tons. and d.o.e. has set aside 10% for defense spent nuclear fuel. leaving only 365,000 metric tons for civilian waste. so under current law, the united states will need a new disposal site even if yucca mountain goes forward. we believe the approach set forth here provides the best strategy for assuring continued progress regardless of the fate of yucca mountain. >> the voting starts at 10:30, we're about five minutes into the votes. i'd like you to complete your testimony.

>> so continuing with the disposal as a key element of consent-based siting, disposal facility before any new disposal site is selected, a new safety standard should be developed so the commission has recommended that the environmental protection agency and the nuclear regulatory commission which this committee has jurisdiction over should begin working together to define an appropriate process for developing a generic disposal facility safety standard and associated implementing regulations. the fifth recommendation relates to prompt efforts to develop one or more consolidated storage facilities, capacity would allow the federal government to begin the orderly transfer of spent fuel from reactor sites to safe and secure centralized facilities independent of the schedule for operating a permanent repository. the arguments in favor of consolidated storage are strongest for spent fuel at shut down plant sites of which there are ten across the country. stranded fuel should be first in line for transfer to

consolidated facilities so these plant sites can be completely decommissioned and put to other beneficial uses. the availability of consolidated storage will also provide valuable flexibility in the nuclear waste management system that could achieve meaningful cost savings can provide backup storage that spent fuel needs to be removed quickly and would provide an excellent platform for ongoing r & d to better understand how storage systems how currently in use at both commercial and d.o.e. sites perform over time. we support the efforts of senator feinstein and alexander with their proposed legislation regarding a pilot storage program for high level nuclear waste and spent nuclear fuel as it incorporates several key recommendations of the blue ribbon commission and is a positive step toward the goal of creating integrated waste management program in the united states.

our letter of support dated april 23rd, 2012, will be submitted for the record. sixth is prompt efforts to prepare for the large scale transport of spent fuel and high-level waste. to consolidated storage and disposal facilities when such facilities become available. the current system of standards and regulations governing the transport of spent fuel and other nuclear materials appears to have functioned well. and the safety record of past shipments of these types of materials is excellent, particularly with respect to the w.i.p. transportation system. that being said, greater transfer demands for nuclear materials are likely to raise new public concerns. the commission believes that state, tribal, and local officials should be extensively involved in the transportation planning and should be given the resources necessary to discharge their roles and obligations in this area. historically, some programs have treated it as an afterthought. no successful programs have done so. seventh is support for advances

in nuclear energy in workforce development. technology have the potential to deliver an array of benefits across a wide range of energy policy goals. the commission believes these benefits in light of environmental and energy security challenges the united states in the world we'll confront this century justifies sustained private and public sector support for light water reactor technology and advance reactor and fuel cycle technologies. the eighth recommendation relates to the key topic of active u.s. leadership in international efforts to address safety, nonproliferation, and security concerns. as more nations consider putting nuclear energy or expanding consider pursuing nuclear energy or pursuing nuclear programs, u.s. leadership is need on issues of safety, nonproliferation, security and counterterrorism. from the u.s. perspective, two points are particularly important.

first, with so many players in the international nuclear technology and policy arena, the united states will increasingly have to lead by engagement and by example. second, the united states cannot exercise effective leadership on issues related to the back end of the nuclear fuel cycle so long as our own program is in complete disarray. effective domestic policies are needed to support america's international agenda. in conclusion, the problem of nuclear waste may be unique in the sense that there is a wide agreement about the outlines of a solution. simply put, we know what we have to do. we know we have to do it, and we even know how to do it. we believe the conditions for progress are arguably more promising than they have been in some time. but we will only know -- we will only know if we start, which is what we urge the administration and congress to do without further delay. thank you for having us here today, and we look forward to your questions. thank you very much.

>> i want to thank you both for that joint testimony. we're going to recess here for a brief period of time, we should be back in about ten minutes and start right back up. thanks, and we'll get right back into questions. thank you. >> thank you. >> i hate to bring that to a close. finish up the vote. and our colleagues in the next couple of minutes. the first question.

this is really a question for both of you. and feel free to take turns answering it or whatever you're comfortable with. it's my understanding that previous mechanisms for finding voluntary sites for nuclear waste facilities have been successful in this country. one of those is in new mexico, i think it's called the waste isolation pilot plant. however, there was a different type of facility, the one we're talking about is not for high-level waste as i understand it. but i believe the new mexico facility does take mid-level defense waste and, in fact, it's my understanding that the state and the community there agreed to the facility with the understanding that it would not accept high-level waste in the future. can y'all provide any take aways from the new mexico experience on what we can replicate in a consent based approach for a high-level repository?

or any cautions on what cannot be replicated? really, what can be exported for that experiment in new mexico or experience in new mexico? and what cannot? >> thank you, senator carper. there's -- we found a number of very important lessons in examining the success of the development of the w.i.p. facility. i can list just a couple. one was that the federal government in the end was willing to negotiate legally binding agreements with the state government that clearly defined a set of regulatory authorities, but the state helped. and in essence gave state leadership hands on a steering wheel or at least ability to put their foot on a brake. and i think that was a key element of creating confidence that the facility, that the facility could be operated safely and that they could

assure its citizens that, indeed, it would be operated safely. >> so instead of my way or the highway, federal government calling the shots, you've got the state in the car? >> yep. >> one of the front seats of the car. >> that's correct. >> and with the ability to put a foot on the brake. almost like in driver's ed when i was in high school, you'd have the student driver on one side and the instructor on the other side, both with a steering wheel and the pedals and everything. so -- >> right. and i believe the next panel others are likely to comment on the value of this. it does mean that whatever new entity is created by amendment to the policy act that it will be very important that it have the authority to negotiate and enter into these sorts of agreements on behalf of the federal government. another key thing that was done was that the federal government funded an independent scientific

and technical evaluation group called the environmental evaluation group in new mexico. i think the state government made a tremendous decision by locating that scientific review panel within their university system so that it was given in essence the type of independence that one associates with an academic institution. and therefore had tremendous credibility. it also didn't hurt to have two very capability national laboratories in the same state, as well. but to have -- to have independent source of scientific advice separate from the federal government i think was another key ingredient. another key element was that this repository was cited and developed and licensed to a safety standard that was established in advance of the siting of the repository not during or after the selection of the repository.

and this relates to the commission's recommendation that a new site independent safety standard be developed by e.p.a. and the nrc. i think a final element that was critical in my judgment was the fact that this program had assured funding in the sense that the senator -- senior senator from the state of new mexico served on both the appropriating and authorizing committees. and that gave some assurance that adequate funding would be available to operate the facility safely after it had been built. we can't really rely on that good luck happening again because the statistical probability as you might guess is rather low. so this is a key reason why the commission has recommended that we need to change at a minimum the way that we classify the fee

receipts in such a way that when they're appropriated, they don't have to compete against other discretionary spending priorities. and spending those moneys looks more how we fund a nuclear regulatory commission where the fees offset appropriations and congress is not faced with the dilemma of needing to cut other programs in order to fund something that's being paid for by fees. this is really critical because i think that the community really wants to have confidence that the facility will have funding. in other words, there was a lack of continuity of leadership. and them knowing that person is not likely to be around say within 18 months also would be a serious problem.

so this is another reason why we think some type of new organization does need to be created to take on these responsibilities so you can have the continuity of leadership that gives confidence. the federal government will ultimately live up to its obligations. >> thank you very much. let me yield to senator udall, a junior senator for now, but not for long. soon to be the senior senator from new mexico. >> yeah. >> i say that sadly because we love jeff binghamton. >> we sure do. we sure do. and senator carper, we're going to miss him very much and miss that ability as professor peterson has pointed out how he was serving on several committees that were really key. >> we also know, we also know

that the interest of new mexico will be in very good hands. >> well, you're very kind. >> we're going to work hard on that. >> and let me say to dr. peterson, i think you pulled out some of the very good lessons on the waste isolation pilot project. and i wanted to explore a little bit more, though, with both of you and here in terms of questioning. should a state as a whole have the right to accept or reject a nuclear waste site in its borders? and how should that authority work? >> that's a very hard question

for us to answer. >> that's why i ask. you were given a lot of time to think about that. >> well, we looked a lot at the differences between new mexico and w.i.p. and yucca mountain. and i think you put your finger on the principal difference. and in new mexico, there's a general acquiescence that this is good for the state, good for the country. so that is completely lacking in nevada. where the local communities are by and large very supportive, the state communities are very imposed. and i think that has described a number of the detail. but w.i.p. is what gives me the optimistic confidence that we can move ahead. because i think the attitude

that we found down there, that i found down there, and i'm not an expert like dr. peterson is, was immensely reassuring that this consent adaptive approach if really taken seriously by both sides can work. >> now, general, you still didn't answer this. you know the question was very pointed here. should a state as a whole have the right to accept or reject a nuclear waste site in its borders? and how should that authority work? yet you're comparing nevada and new mexico as you know and i think the history you're talking about what happened in nevada was the high-level nuclear waste policy act, which had a very scientific process and broad selection of sites was shortened by congress and congress basically said it's going to nevada and forced it down nevada's throat. i think at the time, the governor and local officials, i mean, there was a lot of objection.

in new mexico, it was different. the governor and local officials and the -- i believe the leadership in the congress all had a very accepting attitude. and so they came together and talked about what should this agreement be? and as one of the parts of the agreement as i mentioned in my opening statement was the idea that no high-level waste was going to come to new mexico. that this was going to be a waste site. and so that's why i ask this question to you. it's one i know -- i think you've tried to finesse in your report and i'm trying to get to the real heart here of what, you know, should a state as a whole have the right to accept or reject a nuclear waste site? and how should that authority work? you know, i realize it's a tough question.

but that's why we hired you to do this. >> well, i guess -- and i'm thinking now more as an individual because we didn't resolve that in detail. i'll be honest. >> but please, your best -- you've sat through all of this, you've seen the experiences, tell us what you think. >> i think to be successful, we need to have state, local communities together. if they're not together, it's not going to work. >> yeah. yeah. >> so i think part of if whole consent process is working with the communities as a whole. state, local, tribal, whatever they are to make it work. >> yes, dr. peterson, your thoughts on that question? >> i think that in our report, we essentially recognize that this is the major issue. and so the final report does address it more specifically in the sense that it points out

that in the end the ability to opt out in what the conditions would be and whether it should -- how long should it be unconditional is best left to be a matter of negotiation between the federal government and the state. because, for example, if you're going to enter into a mortgage to purchase a house, there's a -- there's points in time where you make decisions and such, but in this case, by having that be one of the most important but key elements of negotiation, you can preserve an unconditional opt out and then, of course, if any safety issues arise associated with the site, there should be an immediate ability to put a brake on to the whole

thing until things are fixed. but this is something that in the approach probably needs to be worked out between the state and federal government. >> and i think -- i think senator carper, he's pointed out an issue here that is very important when we look at final legislation. and many of the issues that arise along the way, what happened in the waste isolation pilot project was local people and state people were very worried about the safety issues. and they were worried about highways, emergency preparedness, and many dollars, hundreds of millions of dollars were put towards that to alleviate the fears, to improve the roads, to get emergency preparedness in place. number one, and then the issues that you've both talked about were -- came together around should we have the site? how we should have it, and the state was very worried about the

science. the state was saying, well, you know, we know that big federal government has a lot of science. we know about the national laboratories. but as a state, we want to have some oversight. and so as part of the negotiation as you both pointed out and put in your report, the environmental evaluation group was created, these were independent scientists and they walked every step with the federal scientists along the way, challenged them at times. and i think dr. horrel will talk about this when he hits the testimony. so there were some important lessons i think were learned. i've gone on way too long and i really only asked one question and you see how hard it is to get to the bottom of that crucial question. and i hope senator alexander will focus in on this too. he wants to protect tennessee, i know -- of getting a nuclear site. >> it may have only been one question, but it was a pretty good one. >> thank you. >> senator alexander, let me say

something. kind of thinking out loud here about the role that the senator played in this as an authorizer and appropriator. and i think pete who was a former colleague for many years may have seen, in fact, use the words of albert einstein in adversity lies opportunity, but also the potential for real economic opportunity for the people of new mexico if they figured out and played their cards right. and i think arguably they've done that pretty well. senator alexander? >> thanks, mr. chairman. as i said in my opening remarks, whether you're for yucca mountain or against yucca mountain, that's the point of the commission report, right? you said 25 years is long enough just to be sitting there and we need to get on with it. and if i'm not correct, you said

even if that as far as the repository needed -- even if yucca mountain were open, we'd need a second repository, right? so we have that work to do. and you didn't define what you meant by consent based, was that deliberate? you didn't say they have to pass a law and -- >> no, we didn't because we said consent based, but also adaptive. it depends on the circumstances. it may be different in different areas. >> and did you envision there would be incentives to local governments? to induce incentives? >> yes, we did. and i think per's talked about some of those, a research laboratory. all kinds of things that can make such a facility attractive to the community. >> basically whatever it took so people would want to compete for this, is that correct?

>> part of the consent basis. >> yeah, and in my experience, i don't want to pre-judge this. this may not be a part of senator binghamton's bill, but for a long-term repository, i would think that the federal government would want the governor and the state legislator passing a law approving it. and if i were the governor, i would want the congress to pass a law approving it. because i wouldn't want the next governor or president to undo it. what we mean by consent-based will work itself out because communities who compete for the research laboratory or whatever this opportunity turns out to be, will try to put together the most attractive package they can. and then from the -- whoever the federal administrator is will look at it and say new mexico has, a, a history, b, their city council said yes or tennessee said yes and that would be part of an attractive proposal to the federal government, would it not? to know you have that kind of

backing in law rather than just some statement by a governor who might not be there next year. >> oh, absolutely. and that's essential. and in our federal system, it's much more complicated than it is in other countries where we've looked like sweden, finland, and so on where they don't have a federal system. they've actually had communities bidding against each other. >> well, i would hope that would happen here. >> it's more complicated here because of the nature of our structure. >> yes, but still, i think senator carper and i've mentioned this myself. i had the same experience with prisons, we couldn't locate one and i announced that, you know, we only had one and we'd have a competition, pretty soon we had three proposals. so we can -- we can make it attractive and should. and i -- i think your consent-based recommendation just clears the air. it doesn't resolve yucca mountain for now. but, again, whether or not one is for yucca mountain as i am or whether one is against it as senator reed is, that doesn't matter in terms of whether we need a second repository.