1 - Introduction to Energy and Politics
Bret Kugelmass: Were you interested in energy issues since the beginning of your career?
Jeff Merrifield: Jeff Merrifield was a young Senate staffer working as a legislative assistant on energy issues for then U.S. Senator Gordon Humphrey in the midst of licensing activities for Seabrook Station. Seabrook was having a hard time getting licensed because New Hampshire and Massachusetts bordered each other and a good portion of the 10-mile emergency evacuation zone was in Massachusetts. President Reagan wanted to reduce the emergency zone to two miles. Senator Humphrey was supportive of Seabrook but against reducing the emergency evacuation zone. The Senator asked Merrifield to put together materials to make the argument that reducing the zone was not a good idea. Jeff Merrifield grew up in New Hampshire, a state in which it is very easy to get politically involved, and caught the politics bug. Merrifield studied political science at Tufts University with the original goal of going into defense and foriegn policy. While Merrifield was working in the Senate, he also attended law school at Georgetown to study environmental law. This led him to work for McKenna & Cuneo, a law firm in D.C. working on environmental issues. When the Republicans retook the Senate in 1994, Merrifield worked for four years on the Senate Environment Committee trying to rewrite the Superfund law.
2 - Superfund Sites
Bret Kugelmass: What is a Superfund site and what issues were you looking at?
Jeff Merrifield: There is a site in New York called Love Canal where there was serious environmental contamination. The parties responsible for it were not able to pay the cost for clean up and, in the 1970’s, the U.S. became aware that there were a lot of abandoned hazardous waste sites that needed to be cleaned up. Congress passed the Superfund law which used a liability scheme to impose the cost of the clean-up on the many people who may have contributed to that site, under the theory of “polluter pays”. Jeff Merrifield spent four years drafting a 280-page bill to reform the Superfund law. As part of his duties, Merrifield investigated a variety of Superfund sites around the country. Under the provisions of the law at the time, owners of land could be held liable if contamination from another site migrated off-site and contaminated their clean land. Merrifield had a chance to visit Palo Verde Nuclear plant during one of his Superfund visits to Arizona, where he learned of a couple vacancies on the Nuclear Regulatory Commission (NRC). He decided to reach out to past Senators he worked for to give their blessing for him to be considered for the role of commissioner at the NRC, which he did six months later.
3 - Nuclear Safety Culture
Bret Kugelmass: How did you get up to speed as a new commissioner at the Nuclear Regulatory Commission (NRC)?
Jeff Merrifield: The Nuclear Regulatory Commission (NRC) regulates everything civilian wise cradle to grave when it comes to radioactive material and radium in the U.S. Jeff Merrifield had to learn about radioisotopes, the industrial use of isotopes, how nuclear units work, and how to regulate nuclear units. He wanted to be involved in everything the NRC did, going through a lot of training and traveling a lot, going to every nuclear station in North and South America and 30 of the 31 countries that had nuclear plants at the time. Merrifield also visited uranium mines, medical facilities, irradiation facilities, and facilities that produce medical isotopes. This gave Merrifield a much broader ability to advocate and he had to earn his credibility. The hardest thing the NRC was challenged with during Merrifield’s time at the NRC was the issues of nuclear safety culture. There was an incident at Davis-Besse Nuclear Station in which corrosion caused a large hole in the reactor vessel head. The NRC had a requirement for inspections of steam generator heads on a specific timeline. FirstEnergy, the utility that owned Davis-Besse, requested an extension for the inspection based on a technical assessment of why that would be valid. The Commission allowed them to go forward, only later to find out that there were indicators FirstEnergy obfuscated and there were indicators the NRC did not pick up on. Nuclear safety culture is hard to regulate and Merrifield advocated that the utility must craft and manage a safety culture, but that response was not received well. The NRC began to rethink safety culture and collaborated with power operations to make sure operators are doing so at the highest level of safety.
4 - Transition from NRC to Industry
Bret Kugelmass: How did you transition from the NRC into industry?
Jeff Merrifield: Jeff Merrifield made a conscious decision to leave the Nuclear Regulatory Commission (NRC) and join industry in order to learn outside of D.C. Merrifield was hired by The Shaw Group, an engineering and construction company, whose power operations were based in Charlotte, NC. Shaw had a 10% ownership in Westinghouse, were responsible for building the Vogtle AP-1000 units, and were also going to be key players in the construction of the Sanmen and Haiyang plants in China. Seven of the eight years Merrifield worked for The Shaw Group and its successor, Chicago Bridge & Iron (CB&I), in business development, specifically related to maintenance contracts and environmental contracting. Later on, Merrifield became responsible for all power business development, domestically and internationally, across multiple different energy sources including nuclear, natural gas, and coal. The low point for Merrifield was trying to sell a couple of coal units a company in the Philippines, which led him to leave CB&I and join Pillsbury Law in 2015 where he advises companies like ClearPath.
5 - Procurement of Westinghouse
Bret Kugelmass: What do you do within Pillsbury’s nuclear energy team?
Jeff Merrifield: Pillsbury has between 700-800 attorneys between approximately 20 global offices. Pillsbury has been involved in energy for a length of time and the nuclear practice is considered one of the crown jewels of the firm as a whole. One important issue the firm worked on was the private fuel storage facility. That facility became a model for interim fuel storage facilities. Over the last year and a half, Westinghouse went through bankruptcy proceedings and Pillsbury served as outside nuclear council for Brookfield, a large private equity firm that was the winning bidder to take over Westinghouse. Brookfield has been involved in energy assets for many years and is the largest shareholder in Vistra, a former Texas utility and has purchased other energy groups. Vistra owned Comanche Peak Nuclear Station, so Brookfield was very familiar with nuclear power. The CIFUS law requires various departments and agencies to review and approve foreign corporations who want to buy a majority state in certain key U.S. businesses. Brookfield had to go through CIFUS when purchasing Westinghouse.
6 - Benefits of Advanced Reactors
Bret Kugelmass: How did you first start thinking about advanced reactors?
Jeff Merrifield: Jeff Merrifield’s wife, Diana, had been watching advanced reactors for a time and brought it to his attention. His son is finishing up his training to be an apprentice welder to eventually go into nuclear welding. In Canada, where the Pickering and Darlington plants are being refurbished, one challenge will be having a sufficient number of nuclear trained welders to do the $20 billion worth of work in Ontario. This is the largest construction project underway right now, with the exception of Vogtle. Jeff Merrifield returned to D.C. and connected with David Blee with the U.S. Nuclear Industry Council. They talked about advanced reactors and came up with the notion for an advanced reactor task force. Merrifield is also an on-site advisor to X-energy, a developer of a high temperature gas pebble bed reactor and a fuel fabrication facility. Some current developers are very sophisticated, well-funded entities and others are startups that are not far from the conceptual phase. Reactor designs must be able to compete with combined-cycle natural gas plants and, with a larger amount of distributed power, a gigawatt size power plant doesn’t make sense anymore. These reactors have also generated interest from countries that are not currently nuclear power producers. They also produce production-grade industrial heat, which could be used for industrial processes or desalination. A very large nuclear power plant generates a lot of waste heat, requiring either a seaside location or an inland river or lake to provide a heat sink for the excess heat. Advanced designs may not need this ready access to water if they are combined with an air cooled style system, opening up new markets domestically and internationally. The UAE construction has gone well, but the challenge has been getting the skilled workforce trained and able to operate the nuclear plants. Pillsbury is also involved in the Akkuyu development in Turkey, which has four Russian Atomstroyexport reactors under construction.
7 - International Nuclear Climate
Bret Kugelmass: Where do you see some of the international interest moving forward in nuclear?
Jeff Merrifield: Many of the current news stories lead people to believe that nuclear power is on the decline. However, there are roughly 60 nuclear power plants under construction today. China’s desire is to have as many nuclear power stations as the U.S. by the mid-2030’s. India has a very active program underway that provides opportunities for U.S. countries to build plants. China is a very strong competitor which has a pressurized water reactor design that has roots in Westinghouse and Framatome, called Hualong One, and a derivation of the Westinghouse AP-1000 pressurized water reactor design called the CMP1400. Today, there is a lot greater diversity of opportunities for countries who want to buy nuclear units. Some of those competitors are state-owned enterprises that have the full financing backing of the government, including China, Russia, and others. This makes it tough for a Westinghouse or G.E. who doesn’t have the same level of financing. The development of advanced reactors fills a diverse need for nuclear power. Over the next 15 years, there will be a growth in countries that want to go ahead and build nuclear plants, but they may be smaller, advanced designs in different configurations. Advanced reactor development is a long game and requires financing, regulatory structure, government support, and design development. Lawyers can provide a useful service in identifying some of the roadblocks that may be out there and helping companies strategize how to overcome some of these challenges. One of the hindrances the nuclear industry has had is that it doesn’t communicate very well. Jeff Merrifield spent over two weeks doing about 100 interviews trying to explain to people what was going on in nuclear in a way that was effectively communicated and understood by the audience.