WASHINGTON, March 29, 2017 /PRNewswire-USNewswire/ -- A new report created for the U.S. Department of Energy on financing small modular reactors ("SMRs") highlights the role that federal agencies play as purchasers of power produced by SMRs. The report, Purchasing Power Produced by Small Modular Reactors: Federal Agency Options, is a collaborative work from Kutak Rock, a leading law firm whose disciplines include structuring federal government energy projects, and Scully Capital Services, a specialized provider of environmental, energy, transportation and federal credits financial services. The report highlights the role that federal agencies play as purchasers of power produced by SMRs, key considerations and benefits, and best practices for federal agencies seeking to purchase power from SMRs. The report is available at no charge on the Web page of the Department of Energy ("DOE") Office of Nuclear Energy ("NE").
SMRs are compact, factory-fabricated reactors that can be transported to a nuclear power site. Producing 300 megawatts electric ("MWe") or less, they are significantly smaller than the 1,000 MWe or higher base load power plants currently in operation.
Purchasing power from SMRs will provide federal agencies the opportunity to purchase highly reliable carbon-free power while providing support for financing the development of the initial SMRs. DOE has stated that these small nuclear power plants will "play an important role in addressing the energy security, economic and climate goals of the U.S. if they can be commercially deployed within the next decade."
Federal agencies expressing interest in purchasing electric power produced by an SMR include the Department of Defense, DOE/National Nuclear Security Administration, and others. However, there are numerous complex regulations and processes to navigate, making implementing federal purchasing on a broad scale very challenging. Among the most burdensome is that federal law typically limits power contracts to a term of 10 years. A power purchase agreement involving nongovernmental agencies typically lasts 30 years, spreading out the high costs of development and construction.
The report is published on the NE Web page at https://www.energy.gov/sites/prod/files/2017/02/f34/Purchasing%20Power%20Produced%20by%20Small%20Modular%20Reactors%20-%20Federal%20Agency%20Options%20-%20Final%201-27-17.pdf
The report was prepared with funding from the DOE, NE pursuant to a contract with Allegheny Science & Technology Corporation.
Seth Kirshenberg and Hilary Jackler are Kutak Rock's primary authors of the article. Kirshenberg devotes a significant portion of his practice to financing federal public-private partnerships ("P3s"). He has worked on over $15 billion dollars of P3 transactions and has developed several federal privatization "first-of-a-kind" projects, including energy projects. Jackler advises federal agencies, state and local governments, and private entities on a variety of regulatory, transactional and litigation matters that require significant experience in administrative law, military base realignment and closure processes, and the structuring, financing and implementation of public-private partnerships. She regularly supports federal agencies on regulatory, transactional and litigation matters.
SOURCE Kutak Rock LLP