Bloomberg News

Nuclear Board’s Open Feuding Gives Obama One More Energy Dispute

December 14, 2011

Dec. 12 (Bloomberg) -- President Barack Obama, embroiled in energy disputes over the Keystone pipeline and the failure of Solyndra LLC, now must contend with a rebellion against the chairman he chose to lead the U.S. Nuclear Regulatory Commission.

All four other NRC commissioners, both Democratic and Republican appointees, have complained to White House Chief of Staff William Daley that Chairman Gregory Jaczko is causing “serious damage” to the agency. Jaczko responded to Daley that a commission majority “loosened the agency’s safety standards” over his objections.

Republican lawmakers already are investigating the administration’s $535 million loan guarantee to Solyndra, a solar-panel maker that filed for bankruptcy in September. They are also trying to force Obama to speed a decision on TransCanada Corp.’s Keystone XL oil pipeline, which the administration plans to make after the 2012 elections. This week, a House panel will probe the NRC discord.

“For the president’s own appointees to be involved in a circular firing squad is unusual,” Peter Bradford, a former NRC commissioner and a Vermont Law School professor, said in an interview. The dispute is “certainly going to distract the commissioners and their offices from other agency work,” he said.

Commissioners George Apostolakis and William Magwood IV, who hold Democratic seats on the commission, “are telling the president who appointed them that he screwed up” by naming Jaczko as the agency’s chairman in 2009, Bradford said.

Eric Schultz, a White House spokesman, declined to comment on the NRC dispute.

House, Senate Hearings

The House Oversight and Government Reform Committee, which released the commissioners’ complaint to the White House on Dec. 9, will quiz Jaczko and his critics on their rift at a hearing Dec. 14. The commissioners will return to Capitol Hill the next day for a Senate Environment and Public Works Committee hearing on the agency’s actions in response to the crisis at Tokyo Electric Power Co.’s Fukushima Dai-Ichi nuclear plant in March.

The House Energy and Commerce Committee is investigating the Energy Department’s management of its loan guarantee program after Solyndra and Beacon Power Corp., an energy-storage company that received $43 million in U.S. backing, sought bankruptcy protection. The House may vote this week on a bill to extend the payroll tax cut through 2012, with a provision aimed at forcing the administration to move within months on the Keystone XL pipeline that would bring crude from Canada’s oil sands to refineries on the U.S. Gulf Coast.

New Reactors

The NRC is considering regulations to improve safety at U.S. nuclear reactors after the Fukushima disaster and weighing whether to award Southern Co. and Scana Corp. the first permits to build new U.S. reactors in more than 30 years.

Obama appointees Apostolakis, Magwood and Commissioner William Ostendorff joined the commission in 2010. Ostendorff and Kristine Svinicki, a member of the panel since 2008, hold Republican seats. President George W. Bush named Jaczko to the NRC in 2005, and Obama promoted him to chairman in 2009.

None of the four commissioners critical of Jaczko responded to requests for comment. Jaczko wasn’t available for comment, according to Eliot Brenner, an NRC spokesman.

Fissures in the NRC’s leadership became public on May 4, when Ostendorff told reporters after a House hearing that Jaczko didn’t consult with his colleagues when recommending that Americans stay at least 50 miles (80.5 kilometers) from the Fukushima site.

Yucca Mountain

The differences date back at least to Jaczko’s efforts in 2010 to act on Obama’s campaign promise to abandon plans to store radioactive waste under Yucca Mountain in Nevada.

An NRC inspector general’s report in June determined that Jaczko “was not forthcoming with the other commissioners about his intent to stop work” on Nevada project, which was backed by the nuclear-power industry. The report also cast him as a manager who acknowledges that “he sometimes loses his temper.”

Republicans have said Jaczko stopped work on the Yucca project for political reasons. The NRC chairman, a former science adviser to Senate Majority Leader Harry Reid, a Nevada Democrat who opposes storing waste at Yucca, has said he acted within the law and without political motivation.

Jaczko’s colleagues have a “lack of understanding” of their role on the commission, particularly during the agency’s response after Fukushima, the NRC chairman said in a Dec. 7 letter to Daley, a rebuttal to the Oct. 13 letter the other NRC commissioners sent.

‘Intimidated, Bullied’

While the NRC is responsible for writing regulations and policies that govern the industry, “all other functions,” including emergency response, are the chairman’s responsibility, a change put in place following a 1979 partial meltdown at the Three Mile Island nuclear plant near Harrisburg, Pennsylvania, Jaczko said.

Jaczko has “intimidated and bullied senior career staff” and is creating a “chilled work environment” that may affect the NRC’s safety mission, according to the commissioners’ letter. He also showed “contempt” for the commission and “open disdain” for its procedures at an Oct. 5 meeting of the agency’s Executive Director for Operations, they said. Jaczko’s office issued a statement saying the other commissioners didn’t attend the meeting.

“This issue that is of most concern is the question of a chilled working environment,” Marvin Fertel, president and chief executive officer of the Nuclear Energy Institute, a Washington-based industry group, said in a statement today. “We are confident that Congress and the White House will take the steps necessary to ensure that the NRC is an efficient, effective regulator.”

Southern Co., Boxer

Southern Co. of Atlanta, which is seeking to build two reactors at its Vogtle nuclear plant near Augusta, Georgia, remains confident the NRC will grant it a license for the project this month, Steve Higginbottom, a Southern spokesman, said in an e-mail.

Democratic lawmakers, including Senator Barbara Boxer, said Jaczko is under attack for making the NRC a tougher enforcer of safety for the nation’s nuclear plants.

“We must move away from the ‘do nothing’ culture of the NRC and support Chairman Jaczko as he translates the lessons of Fukushima into an action plan that will make America’s nuclear plants the safest in the world,” Boxer, a California Democrat and the chairman of the Senate Environment and Public Works Committee, said in a Dec. 10 statement.

--Editors: Larry Liebert, Steve Geimann

To contact the reporter on this story: Brian Wingfield in Washington at bwingfield3@bloomberg.net

To contact the editor responsible for this story: Larry Liebert at lliebert@bloomberg.net


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