ML19099A017

Regulatory Basis for the Physical Security for Advanced Reactors

ML19099A017
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Issue date:	07/15/2019
From:	NRC/SECY
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Berrios, Ilka 301-415-2404
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ML19099A006	List: ML19099A014 ML19099A017
References
10 CFR Part 50, 10 CFR Part 52, 10 CFR Part 73, NRC-2017-0227, RIN 3150-AK19
Download: ML19099A017 (47)

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Rulemaking for Physical Security for Advanced Reactors RIN Number: 3150-AK19 NRC Docket ID: NRC-2017-0227 Regulatory Basis for Public Comment July 2019

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EXECUTIVE

SUMMARY

On August 1, 2018, the U.S. Nuclear Regulatory Commission (NRC) staff (staff) submitted SECY-18-0076, Options and Recommendation for Physical Security for Advanced Reactors (Ref. 1), proposing to the Commission several possible approaches to physical security for advanced reactors, and recommending proceeding with a limited-scope rulemaking. Later in 2018, the Commission issued Staff Requirements Memorandum SRM-SECY-18-0076, Staff RequirementsSECY-18-0076Options and Recommendation for Physical Security for Advanced Reactors (Ref. 2), approving the staffs recommendation to proceed with a limited-scope rulemaking.

This document provides the regulatory basis for the proposed limited-scope physical security rulemaking for advanced reactors, which would propose alternative, optional physical security regulations specifically for advanced reactor designs as defined in this regulatory basis. This regulatory basis summarizes the current physical security framework for large light-water reactors (LWRs), describes regulatory issues that have motivated rulemaking for advanced reactors, evaluates various alternatives to address physical security for advanced reactors, and summarizes the background documents related to these issues. Within the context of this document, the term advanced reactors refers to light-water small modular reactors (SMRs) and non-light-water reactors (non-LWRs).

As stated in the policy statement on the regulation of advanced reactors1, dated July 8, 1986 (Ref. 3), the Commission expects that advanced reactors will provide enhanced margins of safety and/or use simplified, inherent, passive, or other innovative means to accomplish their safety and security functions and should include attributes that minimize the potential for severe accidents and their consequences. Accordingly, the designs and behavior of advanced reactors are expected to differ significantly from those of large LWRs. Specifically, advanced reactor designs are expected to include attributes that result in smaller and slower releases of fission products following any loss of safety functions. As a result, since the potential risk of radiological consequences posed by advanced reactors differs from that posed by large LWRs, the physical security requirements may need to differ as well to be commensurate with that risk.

The staff is proposing a limited-scope rulemaking to provide a clear, alternate, optional set of physical security requirements in two key areas for advanced reactors and reduce the need for exemptions to current physical security requirements for applicants that request permits and licenses. This limited-scope rulemaking would provide additional benefits for advanced reactor applicants by establishing greater regulatory stability, predictability, and clarity in the licensing process. Specifically, it would provide a voluntary, performance-based alternative to the prescriptive requirements in Title 10 of the Code of Federal Regulations (10 CFR) 73.55(k)(5)(ii) related to the required minimum number of armed responders and 10 CFR 73.55(i)(4)(iii) related to onsite secondary alarm stations for those advanced reactors that could demonstrate the ability to meet the performance criteria. The NRCs assessment of cost and impact considerations shows that the limited-scope rulemaking is cost justified because the averted costs exceed the costs of the rulemaking process. Therefore, the NRC concludes there is sufficient justification to proceed with rulemaking, with regards to cost and benefits.

1 This regulatory basis recognizes that the phrase advanced reactors has different meanings in different documents, including in some references cited in this regulatory basis. However, for the purposes of this regulatory basis, the term advanced reactor refers to light-water SMRs and non-LWRs.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis i July 2019

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Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis ii July 2019

CONTENTS EXECUTIVE

SUMMARY

............................................................................................................i ABBREVIATIONS AND ACRONYMS ........................................................................................ vi

1. INTRODUCTION...................................................................................... 1-1 1.1 Scope of Document.................................................................................. 1-2 1.2 Background .............................................................................................. 1-3

2. EXISTING REGULATORY FRAMEWORK .............................................. 2-1 2.1 Current Physical Security Regulations ..................................................... 2-1 2.2 Current Physical Security Guidance Documents...................................... 2-2

3. REGULATORY ISSUES .......................................................................... 3-1 3.1 Target Sets............................................................................................... 3-1 3.2 Performance-Based Approach to Physical Security ................................. 3-3

4. DISCUSSION OF ALTERNATIVES ......................................................... 4-1 4.1 Alternative 1: No Action ........................................................................... 4-1 4.2 Alternative 2: Prepare Guidance for Processing Requests ..................... 4-2 4.3 Alternative 3: Limited Scope Rulemaking ................................................ 4-3 4.4 Alternative 4: Broad Scope Rulemaking.................................................. 4-4 4.5 Staff Recommendation ............................................................................. 4-4 4.6 Future Regulatory Guidance .................................................................... 4-6

5. ESTIMATES OF COSTS AND SAVINGS ................................................ 5-1 5.1 Introduction .............................................................................................. 5-1 5.2 Potential Impact on Licensees ................................................................. 5-1 5.3 Potential Impact on Offsite Governmental Organizations......................... 5-3 5.4 Potential Impact on the NRC .................................................................... 5-3 5.5 Cost Justification ...................................................................................... 5-5 5.6 Uncertainty Analysis ................................................................................. 5-6 5.7 Nonquantified Benefits ............................................................................. 5-9

6. OTHER IMPACTS AND REGULATORY CONSIDERATIONS ................ 6-1 6.1 Regulatory Efficiency ............................................................................... 6-1 6.2 Increased Public Confidence.................................................................... 6-1 6.3 Compliance with National Environmental Policy Act ................................ 6-1 6.4 Regulatory Flexibility Act .......................................................................... 6-1 6.5 Backfitting, Forward Fitting, and Issue Finality ......................................... 6-2 6.6 Peer Review of Regulatory Basis ............................................................. 6-2 Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis iii July 2019

6.7 Impacts on States and Tribal Nations ...................................................... 6-2 6.8 Legal and Policy Issues ........................................................................... 6-3

7. NRC STRATEGIC PLAN ......................................................................... 7-1

8. STAKEHOLDER INTERACTIONS ........................................................... 8-1 8.1 Past Interactions ...................................................................................... 8-1 8.2 Cumulative Effects of Regulation ............................................................. 8-1 8.3 Questions for Public Comment................................................................. 8-1

9. RULEMAKING DEVELOPMENT TIMELINE ............................................ 9-1

10. REFERENCES....................................................................................... 10-1 Appendix A: Cost Estimate Inputs ...............................................................................A-1 Appendix B: Guidance documents ..............................................................................B-1 Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis iv July 2019

FIGURES Figure 1 Risk ManagementBarrier Assessment (Bow Tie) Method ..................................... 3-2 Figure 2 Industry Net Cost Savings for Alternative 37-Percent NPV ................................... 5-7 Figure 3 NRC Total Costs for Alternative 37-Percent NPV ................................................. 5-7 Figure 4 Total Averted Cost7-Percent NPV ........................................................................ 5-8 Figure 5 Tornado Diagram Net Costs7-Percent NPV ...................................................... 5-9 TABLES Table 1 Industry Operation: Physical Security Exemption Requests ...................................... 5-2 Table 2 Alternative 3 Industry Averted Costs ......................................................................... 5-3 Table 3 NRC Implementation: Guidance and Rulemaking Costs ........................................... 5-4 Table 4 NRC Operation: Alternative 3 Exemption Request Reviews Averted ......................... 5-4 Table 5 Alternative 3 NRC Net Costs ..................................................................................... 5-4 Table 6 Total Costs ................................................................................................................ 5-5 Table 7 Uncertainty Results Descriptive Statistics7-Percent NPV....................................... 5-8 Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis v July 2019

ABBREVIATIONS AND ACRONYMS 10 CFR Title 10 of the Code of Federal Regulations ADAMS Agencywide Documents Access and Management System CFR Code of Federal Regulations DBT design-basis threat FR Federal Register LWR light-water reactor MD management directive NEI Nuclear Energy Institute NEIMA Nuclear Energy Innovation and Modernization Act non-LWR non-light-water reactor NPV net present value NRC U.S. Nuclear Regulatory Commission OMB Office of Management and Budget PERT program evaluation and review technique SMR small modular reactor SRM staff requirements memorandum TEDE total effective dose equivalent Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis vi July 2019

1. INTRODUCTION On August 1, 2018, the U.S. Nuclear Regulatory Commission (NRC) staff (staff) issued SECY-18-0076, Options and Recommendation for Physical Security for Advanced Reactors (Ref. 1),

proposing to the Commission several possible approaches to physical security for advanced reactors, and recommending proceeding with a limited-scope rulemaking. Later in 2018, the Commission issued Staff Requirements Memorandum (SRM)-SECY-18-0076, Staff RequirementsSECY-18-0076Options and Recommendation for Physical Security for Advanced Reactors (Ref. 2), approving the staffs recommendation to proceed with a limited-scope rulemaking. Within the context of this document, the term advanced reactors refers to light-water small modular reactors (SMRs) and non-light-water reactors (non-LWRs).

Consistent with this direction and the NRCs rulemaking process, the staff has prepared this regulatory basis in support of a proposed, limited-scope rule for physical security for advanced reactors. This regulatory basis summarizes the current physical security framework for large light-water reactors (LWR) against radiological sabotage, describes regulatory issues that have motivated the NRC to pursue rulemaking in this area, evaluates various alternatives to address physical security for advanced reactors, and identifies the background documents related to these issues. Specifically, this regulatory basis:

• Explains why the existing regulations or guidance should be revised to address identified regulatory issues;

• Explains how a change in the regulations can resolve the identified regulatory issues and also identifies different approaches that could address the regulatory issues;

• Explains why alternatives to rulemaking cannot resolve the identified regulatory issues and why they were not pursued;

• Provides the information used to support the decision to undertake rulemaking;

• Discusses backfitting and issue finality considerations, as appropriate;

• Discusses stakeholder interactions in developing the technical portion of the regulatory basis and stakeholder views, to the extent known;

• Explains how the limited-scope rulemaking would support the NRCs Strategic Plan goals, and;

• Explains any limitations on the scope of the regulatory basis, such as known uncertainties in the data or methods of analysis.

The regulatory basis also presents the staffs consideration of whether to issue guidance to support the rule and lists documents cited or otherwise factored into the development of the document. Consistent with NRC policy and procedures, this regulatory basis does not include proposed regulatory text or a section-by-section analysis of current versus proposed regulations.

Given that the current fleet of nuclear power plants consists of large LWRs, NRC regulations were developed in the context of security challenges related to large LWRs. Specifically, the NRCs current physical security regulations for nuclear power plants were developed to address the risk of radiological consequences from radiological sabotage of a nuclear power plant that uses special nuclear material2 and the theft or diversion of special nuclear material from these 2 Special nuclear material means (1) plutonium, uranium-233, uranium enriched in the isotope-233 or in the isotope 235, and any other material which the Commission, pursuant to the provisions of section 51 of the act, determines to Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 1-1 July 2019

facilities. The current regulations do not consider 1) advances in designs and engineered safety features, and their applications to advanced reactors, and 2) the use of high-assay low enriched uranium in many advanced reactor designs and the matters related to possible theft or diversion of this type of special nuclear material.

This regulatory basis considers whether to revise the physical security requirements applicable to advanced reactors that could be licensed in the future under 10 CFR Part 50, Domestic Licensing of Production and Utilization Facilities, or 10 CFR Part 52, Licenses, Certifications, and Approvals for Nuclear Power Plants. This limited-scope rulemaking would apply the insights from advances in designs and safety research, retain the NRCs overall security regulations framework, and provide alternatives and guidance related to specific physical security requirements. In so doing, it would focus on threats from radiological sabotage.

Potential threats related to theft and diversion of special nuclear material are outside the scope of this limited-scope rulemaking, but may be considered in future projects. 3 This regulatory basis recognizes that the phrase advanced reactors has different meanings in different documents, including in some references cited in this regulatory basis. However, for the purposes of this regulatory basis, the term advanced reactor refers to non-LWRs and light-water SMRs. Some advanced reactors do not use light-water as a coolant or a moderator.

These are commonly referred to as non-LWRs. Non-LWRs comprise a variety of reactor types, including sodium-cooled reactors, gas-cooled reactors, and molten-salt-cooled reactors. The term SMR is defined in 10 CFR 170.3, Definitions, as a nuclear reactor (or module) designed to produce heat energy up to 1,000 megawatts thermal or electrical energy up to approximately 300 megawatts electric per module that the Commission licensed under the authority granted by Section 103 of the Atomic Energy Act of 1954, as amended, and pursuant to the provisions of 10 CFR 50.22, Class 103 Licenses; for Commercial and Industrial Facilities.

1.1 Scope of Document The scope of this regulatory basis is limited to physical security for advanced reactors and does not include large LWRs; fuel cycle facilities; research and test reactors; and other nonpower, noncommercial facilities. Furthermore, this regulatory basis is limited to the physical security requirements related to protection of advanced reactors against radiological sabotage, and does not address threats related to theft or diversion.

This limited-scope rulemaking would initially focus on performance-based alternatives to the prescribed physical security regulations identified in 10 CFR 73.55, Requirements for Physical Protection of Licensed Activities in Nuclear Power Reactors against Radiological Sabotage, specifically the minimum number of onsite armed responders currently required by 10 CFR 73.55(k)(5)(ii) and the prescriptive requirements for onsite secondary alarm stations as defined in 10 CFR 73.55(i)(4)(iii). During the limited-scope rulemaking, other prescriptive security requirements may be considered. Additionally, advanced reactors would need to be special nuclear material, but does not include source material; or (2) any material artificially enriched by any of the foregoing, but does not include source material Title 10 of the Code of Federal Regulations (10 CFR) 50.2 (Definitions).

3 Many non-LWR designs are expected to use higher assay low-enriched uranium (i.e., between 5- and 20-percent enrichments) and fuel forms other than the traditional uranium dioxide pellets used for LWRs. Different fuel forms introduce the possible need to develop new approaches to material control and accounting practices and protections against theft and diversion throughout the fuel cycle, including at reactor facilities. Future interactions between the staff and stakeholders will cover these and other issues related to higher assay low-enriched uranium and the nuclear fuel cycle.

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demonstrate the ability to meet the performance criteria that may be developed by this proposed limited-scope rulemaking to determine whether the voluntary, performance-based physical security alternatives identified above, would be applicable to that advanced reactor.

Separate from this proposed rule, other proposed policy and technical issues, including security requirements, for other aspects, including fuel cycle, are being addressed by other industry and NRC activities. For example, the staff issued SECY-18-0103, Proposed Rule: Emergency Preparedness for Small Modular Reactors and Other New Technologies (RIN 3150-AJ68; NRC-2015-0225) dated October 12, 2018 (Ref. 4), requesting the Commission to publish a proposed rule and draft guidance related to amended regulations for emergency preparedness for SMRs and other new technologies. This proposed rule would pursue a performance-based approach to determining the size of emergency planning zones for advanced reactors. Also separate from this proposed rulemaking activity, the staff is considering the use of performance-based approaches to address other possible policy and key technical issues associated with advanced reactors.

Section 1 of this regulatory basis summarizes the background and developments leading to this rulemaking. Section 2 summarizes the existing physical security regulatory framework and guidance documents. Section 3 describes the major issues that have motivated a physical security rulemaking for light-water SMRs and non-LWRs. Section 4 describes the alternatives considered by the NRC to address physical security for advanced reactors, as defined in this document, considers the issues described in Section 3, and discusses the NRCs proposed approach to this rulemaking. Section 5 includes other regulatory considerations related to the proposed rules development, in particular, costs and benefits. Section 6 discusses other impacts and regulatory considerations. Section 7 discusses the NRC Strategic Plan. Section 8 discusses stakeholder interactions. Section 9 discusses the timeline for the development of the rulemaking. Section 10 lists the references.

1.2 Background The current physical security framework is designed to protect the plant features needed to provide fundamental safety functions, such as cooling the reactor core, against radiological sabotage. The loss of plant features providing these safety functions can lead to damage of a reactor core or spent nuclear fuel, with a subsequent release of radioactive materials. When compared to operating large LWRs, many of the advanced reactor designs have small power outputs and a correspondingly smaller inventory of fission products available for potential release. Advanced reactor designs are expected to include attributes that result in smaller and slower releases of fission products following the loss of safety functions from acts of radiological sabotage. Accordingly, these designs may warrant different physical security requirements, commensurate with the risks posed by the technology.

Historically, as the industry proposed new reactor designs, the NRC considered the need to modify the physical security requirements. SECY-18-0076 discusses much of the historical basis guiding the NRC physical security policies for advanced reactors. As an example, SECY-18-0076 discusses that the advanced reactor attributes that result in smaller and slower releases of fission products may help justify different physical security requirements.

The NRC first issued its Policy Statement on the Regulation of Advanced Reactors on July 8, 1986 (Ref. 3) (Policy Statement), to provide all interested parties, including the public, with the Commissions policy regarding the review of, and desired characteristics associated with, advanced reactors. The Policy Statement identified attributes that developers should Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 1-3 July 2019

consider in advanced designs, including highly reliable and less-complex heat removal systems, longer time constants before reaching safety system challenges, reduced potential for severe accidents and their consequences, and use of the defense-in-depth philosophy of maintaining multiple barriers against radiation release. As noted in the revised Policy Statement on October 14, 2008 (Ref. 5), it is expected that, in many cases, advanced reactors, due to their inherent safety characteristics and simplified safety systems, will be less reliant upon physical security systems and procedures for protection against sabotage than current generation plants.

The NRC revised the Policy Statement to specifically include an attribute related to physical security that industry should consider in advanced designs:

Designs that include considerations for safety and security requirements together in the design process such that security issues (e.g., newly identified threats of terrorist attacks) can be effectively resolved through facility design and engineered security features, and formulation of mitigation measures, with reduced reliance on human actions.

The Commission also observed the following about the possible implementation of the Policy Statement:

Finally, the NRC also believes that it will be in the interest of the public as well as the design vendors and the prospective license applicants to address security issues early in the design stage to achieve a more robust and effective security posture for future nuclear power reactors.

More recently, reactor designers and other stakeholders have raised concerns related to physical security for SMRs and non-LWRs. In response, the NRC assessed potential regulatory changes that would modify existing physical security requirements to make them commensurate with the risks associated with advanced reactor designs, as defined in this document. Possible revisions to NRC regulations related to physical security could consider both the inherent features of many advanced reactor designs, such as lower fission product inventories and longer thermal time constants, as well as safety and security features incorporated into facility designs. As discussed above, these types of attributes and design features have been mentioned in the various revisions of the Policy Statement as means to reduce reliance on human actions in responding to attempted acts of radiological sabotage. Initial interactions related to a possible rulemaking involved meetings on the Nuclear Energy Institute (NEI) white paper, Proposed Physical Security Requirements for Advanced Reactor Technologies, dated December 14, 2016 (Ref. 6). The NEI white paper suggested consequence-oriented criteria for determining when an advanced reactor design would be a candidate for alternative physical security requirements.

The NRC issued NRC Vision and Strategy: Safely Achieving Effective and Efficient Non-Light Water Reactor Mission Readiness, dated December 2016 (Ref. 7), to specify the activities in which the NRC would engage to develop the technical and regulatory capacities needed to review and regulate non-LWRs. The NRC subsequently issued NRC Non-Light Water Reactor Near-Term Implementation Action Plans, dated July 2017 (Ref. 8), and NRC Non-Light Water Reactor Mid-Term and Long-Term Implementation Action Plans, dated July 2017 (Ref. 9) to further detail the NRCs activities related to non-LWR regulatory, technical, and policy infrastructure over different timeframes. The implementation action plans include a specific strategy to identify and resolve policy issues. The staff reported on the status of the action Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 1-4 July 2019

plans, including developing a consequence-based approach to security for advanced reactors, in SECY-18-0011, Advanced Reactor Program Status, dated January 25, 2018 (Ref. 10).

To facilitate stakeholder interactions, the NRC subsequently prepared a draft white paper (Ref.

11) on potential changes to the physical security requirements for advanced reactors. The NRC discussed this draft white paper with NEI and other stakeholders at a public meeting that was held on December 13, 2017 (Ref. 12).

The Nuclear Energy Innovation and Modernization Act (NEIMA) (Public Law No. 115-439) was enacted into law on January 14, 2019. Section 3 of NEIMA defines advanced reactors as follows:

(1) ADVANCED NUCLEAR REACTOR.The term advanced nuclear reactor means a nuclear fission or fusion reactor, including a prototype plant (as defined in sections 50.2 and 52.1 of title 10, Code of Federal Regulations (as in effect on the date of enactment of this Act)), with significant improvements compared to commercial nuclear reactors under construction as of the date of enactment of this Act, including improvements such as (A) additional inherent safety features; (B) significantly lower levelized cost of electricity; (C) lower waste yields; (D) greater fuel utilization; (E) enhanced reliability; (F) increased proliferation resistance; (G) increased thermal efficiency; or (H) ability to integrate into electric and nonelectric applications.

As noted above, pursuant to Commission direction in SRM-SECY-18-0076which predates NEIMA for the purposes of this regulatory basis, the term advanced reactor refers to non-LWRs and light-water SMRs. This usage is included in, but not coextensive with, NEIMAs definition.

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2. EXISTING REGULATORY FRAMEWORK 2.1 Current Physical Security Regulations The NRCs regulations include the requirements for the physical security of power reactors in 10 CFR Part 73, Physical Protection of Plants and Materials. All applicants that apply for an operating license for a production or utilization facility under 10 CFR Part 50 or a combined license under 10 CFR Part 52 must provide plans for satisfying the applicable requirements in 10 CFR Part 73. Regulations in 10 CFR Part 73 remained relatively stable for 30 years until the terrorist attacks of September 11, 2001. On March 27, 2009, the NRC issued a revised rule, Power Reactor Security Requirements, for 10 CFR Parts 50, 52, 72, and 73 (Ref. 13) that increased its security requirements pertaining to nuclear power plants. The revision incorporated requirements from Commission orders that were issued as a result of the terrorist attacks. In addition, the rulemaking added several new requirements consistent with insights gained from implementation of the Commission orders as well as from NRC review of site security plans, implementation of the enhanced baseline inspection program, and evaluation of force-on-force exercises.

In 10 CFR 73.1(a), the NRC prescribes requirements for the establishment and maintenance of a physical protection system which will have capabilities for the protection of special nuclear material at fixed sites and in transit and of plants in which special nuclear material is used. In 10 CFR 73.1(a)(1), the NRC identifies the design-basis threat (DBTs) that shall be used to design safeguards systems to protect against acts of radiological sabotage. In 10 CFR 73.55, the NRC identifies physical protection requirements for nuclear power reactors. Based on its authority under the Atomic Energy Act of 1954, as amended, the Commission determined that these requirements are necessary for operating production and utilization facilities to provide for public health and safety and the common defense and security. This section of the regulatory basis summarizes the current regulatory framework for the physical security regulations.

The design of a physical protection system must meet the requirements of 10 CFR 73.55, unless exemptions or alternatives are approved in accordance with 10 CFR 73.5, Specific Exemptions, or 10 CFR 73.55(r), respectively. Pursuant to the performance-based requirements in 10 CFR 73.55(b), licensees must establish and maintain a physical protection program. As identified in 10 CFR 73.55(b)(3), this physical security program must be designed to prevent significant core damage and spent fuel sabotage. Notably, 10 CFR 73.55(b)(3)(i) requires that the licensees physical security program must [e]nsure that the capabilities to detect, assess, interdict, and neutralize threats up to and including the [DBT] of radiological sabotage as stated in [10 CFR] 73.1, are maintained at all times. The NRC identifies other requirements for the licensees physical security program in 10 CFR 73.55, including, for example, the specifics of how certain engineered systems must be designed or configured, along with other process and organization requirements. Appendix B, General Criteria for Security Personnel, and Appendix C, Licensee Safeguards Contingency Plans, to 10 CFR Part 73 also prescribe the requirements for plans for training and qualification of security personnel and the safeguards contingencies, respectively.

As described in SECY-18-0076, the NRC intends this limited-scope rulemaking to provide alternatives for advanced reactors to specific regulations and guidance related to physical security, while providing reasonable assurance of adequate protection of public health and safety and the common defense and security, and protecting the environment. Based on Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 2-1 July 2019

stakeholder interactions, this rulemakings initial focus, if this rulemaking is pursued, includes consideration of the existing regulatory requirements in 10 CFR 73.55(i)(4)(iii)requiring a central alarm station and a redundant secondary alarm station onsiteand 10 CFR 73.55(k)(5)(ii)requiring not less than 10 dedicated onsite armed responders.

2.2 Current Physical Security Guidance Documents The NRC, other government agencies, government contractors, and industry (with subsequent NRC endorsement) have generated many physical security guidance documents. These guidance documents inform physical security design considerations and include, but are not limited to, those provided in Appendix B to this document. If needed, the NRC would prepare additional guidance as part of the rulemaking activities recommended in this regulatory basis to address implementation of the alternative physical security requirements. This guidance may include a proposed format or methodology for assessing plant designs and source terms for comparison to the proposed consequence-oriented performance criteria.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 2-2 July 2019

3. REGULATORY ISSUES This section describes the regulatory issues stemming from the fact that light-water SMRs and non-LWRs will differ substantially from and vary more than the existing reactor fleet.

Differences may include the adoption of security by design through enhanced safety and security features, the size of the core, fuel form, coolant type, source terms, and offsite dose consequences. These attributes, among others, of these reactors, potentially permit designers and applicants to apply security methods or approaches that differ from those used for current operating reactors.

Pursuant to 10 CFR 73.55(b)(1), the physical security protection programs primary performance objectives are to provide high assurance that activities involving special nuclear material are not inimical to the common defense and security and do not constitute an unreasonable risk to public health and safety. As described in SECY-18-0076 and the related SRM, the concept of high assurance of adequate protection found in our security regulations is equivalent to reasonable assurance [of adequate protection] when it comes to determining what level of regulation is appropriate.

In the context of large LWRs, this amounts to preventing significant core damage and spent fuel sabotage. The DBT for radiological sabotage is used to assess the capability of the physical protection programincluding physical barriers, system design features, and response force to detect, assess, interdict, and neutralize threats of radiological sabotage. The protection of a facility against the DBT is assessed, in part, by the licensees ability to protect specific target sets, as discussed below. Given the differences between large LWRs and the different reactor types addressed in this regulatory basis, the NRC may need to develop an alternative to significant core damage as a surrogate measure of the level of radiation released to the site boundary by advanced reactors.

The sections below discuss potential issues that may affect the limited-scope rulemaking for the physical security of advanced reactors.4 In particular, the sections discuss: the possible relationships between advanced reactor designs and related attributes and the identification and protection of target sets, and the possible performance-based approaches to establishing physical security requirements.

3.1 Target Sets Regulatory Guide 5.81,Target Set Identification and Development for Nuclear Power Reactors, dated November 2010 (Ref. 15) defines a target set as the minimum combination of equipment or operator actions which, if all are prevented from performing their intended safety function or prevented from being accomplished, would likely result in radiological sabotage (i.e., significant core damage or spent fuel sabotage).

The fuel forms, coolants, and other attributes of advanced reactors may result in plant damage states different from those present in large LWRs and may require the use of different surrogate measures for damage states related to potential radioactive material releases. For example, pursuant to 10 CFR 73.55(b)(3), [t]he physical protection program must be designed to prevent 4 The staff also identified some of these issues in SECY-16-0069, Rulemaking Plan on Emergency Preparedness for Small Modular Reactors and Other New Technologies, dated May 31, 2016 (Ref. 14). Lessons learned from that rulemaking will play a significant role in addressing these issues in this rulemaking, if this rulemaking is pursued, to assure consistency across different rules for advanced reactors.

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significant core damage and spent fuel sabotage. Some advanced reactor designs may not be susceptible to core damage as that term is used for LWRs. Consequently, the development of requirements and guidance for advanced reactors, including for physical security, may include defining or adopting alternatives to core damage as surrogate measures for damage states or adopting consequence measures related to offsite releases. These alternatives would affect the definition of target sets for these designs.

The more consequence-oriented approach to assessing physical security requirements, including target set identification, is similar to other changes made during the NRCs preparations for advanced reactor licensing. SECY-18-0096, Functional Containment Performance Criteria for Non-Light-Water Reactors, dated September 28, 2018 (Ref. 16); the related, SRM-SECY-18-0096, Staff Requirements - SECY-18-0096-Functional Containment Performance Criteria for Non-Light-Water Reactors, dated December 4, 2018 (Ref. 17); Draft Regulatory Guide (DG) - 1353, Guidance for a Technology-Inclusive, Risk-Informed, and Performance-Based Methodology to Inform the Licensing Basis and Content of Applications for Licenses, Certifications, and Approvals for Non-Light Water Reactors, dated April 2019 (Ref.

18), and SECY-18-0103, (Ref. 4), reflect the goal of preparing technology-inclusive, risk-informed, and performance-based approaches to safety and security. As discussed in to SECY-18-0096, the interrelationships between various safety and security measures and the associated design feature performance criteria used to retain radioactive materials within a plant require an integrated approach to resolving issues and developing [an advanced reactor] regulatory framework. Figure 1, from Enclosure 2 to SECY-18-0096, represents this integration of activities.

Figure 1 Risk ManagementBarrier Assessment (Bow Tie) Method (Resource: SECY-18-0096)

The progression of events leading to a possible release of radioactive materials from advanced reactor designs with attributes as defined in the Policy Statement can differ from the progression in large LWRs. The use of a mechanistic source term to model specific events, including those Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 3-2 July 2019

associated with radiological sabotage, may allow for the application of consequence-oriented performance criteria (i.e., offsite dose) to support an alternative set of physical security requirements and related target sets.

Regulations such as 10 CFR 50.34, Contents of Applications; Technical Information, and 10 CFR 52.79, Contents of Applications; Technical Information in Final Safety Analysis Report, define the reference values for offsite dose associated with NRC findings of adequate protection. For example, 10 CFR 50.34 states the following (footnote omitted) (see also 10 CFR 52.79):

1) An individual located at any point on the boundary of the exclusion area for any 2-hour period following the onset of the postulated fission product release, would not receive a radiation dose in excess of 25 rem total effective dose equivalent (TEDE).

2) An individual located at any point on the outer boundary of the low population zone, who is exposed to the radioactive cloud resulting from the postulated fission product release (during the entire period of its passage) would not receive a radiation dose in excess of 25 rem [TEDE].

The NRC anticipates that the limited-scope rulemaking would propose to use these traditional reference values to determine whether voluntary, performance-based alternatives to a limited number of physical security requirements are applicable.

Some advanced reactor designs, as defined in this document, employ inherent passive safety characteristics, such as natural circulation decay heat removal, below-grade or in-ground construction, integral primary systems, and advanced fuel types. For example, locating part or all of the reactor and structures below ground level may play a role in supporting passive heat removal and longer accident progression times and may also provide a physical barrier credited for protection against attributes of the DBT for radiological sabotage. More generally, passive safety features that do not depend on electric power could lead to longer accident progression times. These design aspects will have an impact on the design of the physical protection system, thereby impacting the appropriate methods or approaches for protection of an advanced reactor.

3.2 Performance-Based Approach to Physical Security The current physical security requirements use a combination of performance criteria (e.g., the physical protection program must protect against the DBT for radiological sabotage as stated in 10 CFR 73.1) and prescriptive requirements developed to achieve the performance objective.

In a performance-based approach to physical security rulemaking, performance criteria and objectives are the primary basis for regulatory decisionmaking, giving the licensee the flexibility to determine how to meet the established performance criteria for an effective physical security program.

The staff is considering approaches, informed by stakeholder input, for developing preliminary performance-based criteria for advanced reactors, as that term has been defined in this document, to determine the applicability of alternative physical security requirements related to for armed responders and onsite secondary alarm stations.

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The staff expects that limiting the scope of the proposed rulemaking to the armed responders and onsite secondary alarm stations would result in most of the other current requirements and programs related to physical security remaining unchanged for advanced reactors.

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4. DISCUSSION OF ALTERNATIVES This section considers the following four options described in SECY-18-0076, hereafter referred to as alternatives:

Option 1: [N]o changes to the current physical security regulations and no staff efforts to develop guidance to support requests for proposed alternatives or exemptions.

The NRC would address alternative methods or approaches for physical security on a case-by-case basis.

Option 2: No changes to the current physical security regulations. License submittals and the related NRC reviews would be supported by NRC-issued guidance in the form of either NRC-endorsed industry documents or an NRC standalone document.

Option 3: [A] limited-scope rulemaking that retains the current overall framework for security requirements but provides alternatives for advanced reactors to specific regulations and guidance related to physical security. The staff recommended this option in SECY-18-0076, which was subsequently approved by the Commission in the related SRM.

Option 4: A broad-scope rulemaking to assess and define performance-based requirements for advanced reactor designs.

4.1 Alternative 1: No Action Alternative 1 is to maintain the status quo with no changes to the current physical security regulations and no staff efforts to develop guidance to support requests for proposed alternatives or exemptions. This would require that subsequent applicants for advanced reactors comply with the current regulatory requirements. However, this would not preclude developers and subsequent applicants for operating licenses from proposing innovative methods or approaches to providing security for advanced reactor designs. For example, applicants could request alternative measures in accordance with 10 CFR 73.55(r), Alternative measures, or seek an exemption in accordance with 10 CFR 73.5, Specific exemptions.

Additionally, an advanced reactor developer or other entity could submit a topical report 5 justifying specific alternative measures or exemptions for a specific design.

Advantages: Agency resources would not be spent to conduct rulemaking and develop the related guidance documents within the current planning horizon. A rulemaking intended to address multiple non-LWRs could be complex. The staff could use existing guidance and procedures, to the extent applicable, to evaluate proposed alternatives or exemptions in future applications and apply these procedures and guidance to assess the physical security needed to protect large LWRs from the DBT for radiological sabotage. The staff would be better equipped to identify and assess potential changes to physical security regulations for advanced 5 An NRC-approved topical report provides a staff finding that can be referenced in a licensing action, design certification application, and for other purposes, but does not constitute a final agency position with the related finality and backfit protections for a design certification that are provided by a rulemaking.

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reactors after completing a review of an initial application for a license, certification, or an advanced reactor design.

Disadvantages: The Commission has set a goal for security issues to be addressed early in the design stage to achieve a more robust and effective security posture for future nuclear power reactors. Additionally, the NRC has traditionally attempted to avoid regulating by exemption when an issue can be addressed through a generic action such as rulemaking.

Case-by-case decisionmaking would not support the goals for (1) efficiency and clarity described in the Principles of Good Regulation; (2) consideration of safety and security in the early stages of design as stated in the Policy Statement on the Regulation of Advanced Reactors; and (3) timely resolution of policy issues as discussed in more recent documents defining vision, strategies, and implementation action plans for non-LWR regulatory readiness. Addressing physical security for advanced reactors on a case-by-case basis would not reduce the regulatory uncertainties the staff and stakeholders have identified.

These uncertainties complicate the ability of reactor developers and potential applicants to make decisions as they assess potential design features and programmatic measures to prevent or mitigate various events, including attempts of radiological sabotage.

4.2 Alternative 2: Prepare Guidance for Processing Requests Alternative 2 is to maintain the status quo with no changes to the current physical security regulations; however, the staff would prepare guidance for processing requests for proposed exemptions related to physical security requirements for advanced reactors. Alternatively, the staff could review and approve guidance prepared by an advanced reactor developer or other party (e.g., a generic topical report or industry guidance document that NRC can endorse in a regulatory guide). Under this alternative, applicants for licenses could also propose alternatives in accordance with 10 CFR 73.55(r) or request exemptions from NRC regulations using provisions such as 10 CFR 73.5. This type of submittal and the related NRC reviews would be supported by NRC-issued guidance as either an endorsement of an industry document or a standalone NRC document.

The staff expects that an important part of the guidance would involve developing performance criteria for applying alternative physical security requirements that are associated with attributes of reactor designs (e.g., potential accident consequences and timelines). In addition, the staff could prepare technical guidance on methods or approaches acceptable for design of physical security systems. An example of technical guidance for designers and potential license applicants is NUREG/CR-7201, Characterizing Explosive Effects on Underground Structures, issued September 2015 (Ref. 19), which might be useful for designs of advanced reactors that would be located underground. The staff has identified several topics during recent interactions with stakeholders that may also warrant investigating and developing technical guidance for advanced reactors. These topics include the possible use of remotely operated weapon systems, the application of vulnerability assessment tools, and the location of secondary alarm stations. The staff would leverage standards and guidance that already are available from the Department of Energy, Department of Defense, and other Federal agencies; available security industry best practices; and interactions with stakeholders to identify and develop technical guidance documents.

Advantages: This alternative would be somewhat less resource intensive compared to undertaking a rulemaking and preparing related guidance documents. The staff would consider applications for proposed alternatives or exemptions using existing procedures and any newly developed guidance documents. The guidance documents and possible review of generic Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 4-2 July 2019

submittals for a design or class of designs would reduce regulatory uncertainties. The NRC process for preparing and issuing guidance documents includes the opportunity for public engagement on the issues related to physical security for advanced reactors.

Disadvantages: This alternative only partially addresses the regulatory uncertainties identified by the staff and stakeholders. This alternative would require a significant portion of the resources associated with a rulemaking to prepare guidance documents, but would not provide the same degree of certainty or finality of agency decisions that are provided by a rulemaking.

This alternative also promotes using exemptions from existing regulations rather than establishing requirements that are more commensurate with the risks posed by advanced reactors. Proceeding with guidance rather than a rulemaking would ultimately still require case-by-case decisionmaking, which could raise concerns about consistency, clarity, and predictability of the NRC regulatory process.

4.3 Alternative 3: Limited Scope Rulemaking Alternative 3 is for a limited-scope rulemaking that retains the current overall security requirements framework in 10 CFR 73.55 to protect against radiological sabotage, while proposing optional alternatives to specific physical security-related regulations for advanced reactors, as that term has been defined in this document. With the expected variations in advanced reactor designs, this regulatory approach would relieve the burden imposed on applicants, licensees, and the NRC by the case-by-case exemption process and promote predictability in the NRCs approval processes.

The physical security measures established under current NRC regulations are technology-inclusive. Under a limited-scope rulemaking, the NRC would apply a similar, technology-inclusive approach for advanced reactors to accommodate a variety of facility designs, systems, and purposes.

A limited-scope rulemaking would target the identified requirements that rely on human actions for interdiction and post-attack command and control. Specifically, a limited-scope rulemaking would focus on establishing a performance-based approach and associated criteria to assess advanced reactor attributes, as described in the Policy Statement, in determining the applicability of alternatives to the prescribed minimum number of armed responders currently defined in 10 CFR 73.55(k)(5)(ii) and the prescriptive requirements defined in 10 CFR 73.55(i)(4)(iii) for an onsite secondary alarm station. However, as advanced reactor designs have yet to be analyzed against security scenarios, this analysis would need to be done to justify that a design meets any performance criteria that are established by rulemaking to determine the applicability of the alternative physical security requirements.

Advantages: Changes to a limited set of requirements related to advanced reactor physical security would (1) promote regulatory stability, predictability, and clarity, (2) reduce the need for future applicants to propose request exemptions from physical security requirements, (3) recognize technology advancements and design features associated with the NRC-recommended attributes of advanced reactors, and (4) replace prescriptive regulations with risk-informed, performance-based requirements. The rulemaking process includes the greatest opportunity for public engagement on the issues related to physical security for advanced reactors. Public notice and comment during rulemaking would provide the widest range of viewpoints for Commission consideration in the development of the proposed rule.

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Disadvantages: This alternative would be more resource intensive than Alternatives 1 and 2. The range of possible advanced reactors and sizes introduces the possibility of requests for exemptions or proposed alternatives to physical security requirements beyond those addressed by a limited-scope rulemaking.

4.4 Alternative 4: Broad Scope Rulemaking Alternative 4 involves a broad-scope rulemaking to assess and define physical security requirements for advanced reactor designs. The staff envisions a performance-based approach with physical security requirements defined in terms of advanced reactor attributes and design features, including inherent design characteristics, to address the variety of technologies and designs being contemplated. This alternative might also include threat assessments to determine whether different DBTs may be warranted for advanced reactors. The NRC would interact with stakeholders and consult with experts on both security and advanced reactors to identify possible performance-based requirements. The research and rule development would likely take 8 years or longer to complete. The staff estimates the level of effort for this Alternative would be significant, comparable to that needed to issue the 2011 final emergency preparedness rule.

Advantages: This alternative would best integrate performance-based security requirements into the processes for developing advanced reactor plant designs. Alternative 4 would provide developers with the flexibility associated with risk-informed, performance-based approaches and incorporate the best available knowledge from research and experience into the regulations as described in the Principles of Good Regulation.

Disadvantages: The anticipated range of possible designsmany currently at the conceptual design stageand broad consideration of security requirements (e.g., capabilities to detect, assess, interdict, and neutralize) would complicate evaluating and developing a new set of security regulations for advanced reactors. This alternative would also require significant resources and additional time to develop. Thus, while, theoretically, this alternative would best integrate security considerations into the reactor design process (with respect to all four alternatives), the level of effort for Alternative 4 would be significant. Therefore, this alternative would be unlikely to support current reactor developers that need to make critical design decisions.

4.5 Staff Recommendation Considering the above alternatives, the staff concluded that a limited-scope rulemaking (Alternative 3) would provide a clear set of requirements and guidance for advanced reactor physical security and reduce the need for physical security exemptions as applicants request permits and licenses. Specifically, the limited-scope rulemaking is proposed to define performance-based criteria for determining the applicability of alternatives to the minimum number of onsite armed responders and the need for onsite secondary alarm stations. Such a rulemaking would provide additional benefits for advanced reactor licensees by establishing greater regulatory stability, predictability, and clarity in the licensing process. Such a rulemaking is also consistent with the Commissions direction in SRM-SECY-18-0076, approving Alternative 3 to initiate a limited-scope revision to the physical security regulations and develop corresponding guidance for advanced reactors. The staff is therefore limiting the evaluation in this regulatory basis to the limited-scope rulemaking (Alternative 3). Therefore, Alternative 2 and Alternative 4 are not considered further in this document.

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Specifically, the staff is recommending pursuing a performance-based, consequence-oriented approach. The staff anticipates advanced reactor design characteristics and their safety analyses may support performance criteria that could justify alternatives to the minimum number of armed responders and the prescriptive onsite secondary alarm station requirements.

Current regulations for large LWRs require each site to have at least 10 armed responders for emergency security response and a secondary alarm station on site to monitor potential issues.

However, the staff has determined that advanced reactors may not need these security measures if intrinsic, engineered security measures are incorporated into the designs that limit the amount and timing of potential radioactive material releases. Therefore, the limited-scope rulemaking would identify alternative requirements related to the minimum number of armed responders pursuant to 10 CFR 73.55(k)(5)(ii) and for a redundant secondary onsite alarm station pursuant to 10 CFR 73.55(i)(4)(iii). However, during the limited-scope rulemaking, the staff could also identify other requirements that may be eliminated or modified to reduce the potential number of exemptions that would need to be processed for this class of facilities.

The performance criteria developed for Alternative 3 would consider the time available from the detection of a physical security threat to the occurrence of an adverse impact to public health and safety. The technical basis for offering an alternative to the physical security requirements for advanced reactors is the combination of inherent reactor characteristics and demonstration of security incorporated into the advanced reactor designs that reduces reliance on human actions to mitigate attempted acts of radiological sabotage. For example, NEI suggested three performance-based criteria in its white paper to determine the applicability of alternative security requirements for a specific design or facility (Ref. 6). Stakeholder interactions and further staff considerations resulted in the following possible performance measures for determining the applicability of revised security requirements for an advanced reactor design:

1. The radiological consequences from a hypothetical, unmitigated event involving the loss of engineered systems for decay heat removal and possible breaches in physical structures surrounding the reactor, spent fuel, and other inventories of radioactive materials result in offsite doses below the reference values defined in 10 CFR 50.34 and 52.79 (e.g., no definable target sets of equipment or operator actions that if prevented from performing their intended safety function or prevented from being accomplished, would likely result in offsite doses exceeding the cited reference values);

2. The plant features necessary to mitigate an event and maintain offsite doses below the reference values in 10 CFR 50.34 and 52.79 cannot reasonably be compromised by the DBT for radiological sabotage (e.g., no achievable target set resulting in offsite doses exceeding the cited reference values given the design features and security features incorporated into a specific advanced reactor facility); or

3. Plant features include inherent reactor characteristics combined with engineered safety and security features that allow for facility recovery and mitigation strategy implementation if a target set is compromised, destroyed, or rendered nonfunctional, such that offsite radiological consequences are maintained below the reference values defined in 10 CFR 50.34 and 52.79 (e.g., a reactor design with a large heat capacity and slow progression from loss of safety equipment to degradation of fission product barriers and release of radionuclides from the facility). Facility recovery and mitigation strategies may, where feasible, include support from offsite resources.

The staff expects that future discussions will involve evaluating the feasibility of defining performance criteria and any related issues, such as the reliance on offsite licensee resources for security response and to help recover facilities and mitigate events. A major focus of future Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 4-5 July 2019

outreach on this regulatory basis and the proposed rule is expected to be on refining the criteria or developing an alternative approach in using this type of performance criteria to determine the applicability of alternative physical security requirements for advanced reactors. In addition, the staff expects to include an assessment of how engineered safety and security features can be incorporated into this analysis.

The staff is aware of the safety improvements generally found in advanced reactors due to the incorporation of simplified, inherent, and passive features. These features may result in smaller and slower fission product releases following a loss of safety functions from malfunctions and likely from many malicious acts.

The staff expects an applicant looking to apply any new alternative requirements to develop approaches for analyzing the offsite radiological consequences from radiological sabotage on the facility and demonstrate that the potential impact poses no undue risk to public health and safety. Additionally, an applicants evaluation of the potential consequences of an event in combination with the use of intrusion detection, intrusion assessment, and central alarm system of the facility may also be used to justify the applicability of alternatives to the minimum number of armed responders and an onsite secondary alarm station.

4.6 Future Regulatory Guidance If the NRC conducts a limited scope rulemaking, the staff would develop new regulatory guidance to describe an acceptable approach for advanced reactor developers and applicants to use to implement the voluntary, performance-based alternative requirements in the rule. The regulatory guidance would be a standalone document using concepts drawn from existing guidance documents, and most likely would involve NRC endorsement of an industry guidance document, with exceptions and clarifications as needed. The regulatory guidance would describe at least one acceptable way for facilities to implement the alternative requirements to ensure that radiological sabotage would pose no undue risk to public health and safety. The staff would make the draft regulatory guidance available for public comment when it issues the proposed rule. Existing guidance documents will continue to remain applicable to large LWRs.

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5. ESTIMATES OF COSTS AND SAVINGS 5.1 Introduction The NRC must consider the potential benefits and costs of the alternatives for (1) advanced reactor licensees, (2) State, local, and Tribal government organizations, and (3) the NRC. The staffs assessment and stakeholder input informed the analyses in this section. This stage of the process does not examine impacts in detail. If the NRC continues with this rulemaking, the staff will provide a more detailed evaluation of the benefits and costs during the regulatory analysis included in the proposed rule (see Section 7.1 of this document).

The analyses in this section present the incremental benefits and costs that the industry, the NRC, and offsite governmental organizations would incur from the action. Incremental benefits and costs are calculated values and impacts that are above the baseline condition (Alternative 1). As identified in Section 4.1 above, Alternative 1 is the No Action alternative, meaning that the staff would make no changes to the current physical security regulations and take no efforts to develop guidance to support requests for proposed alternatives or exemptions. This cost estimate compares Alternative 1 to conducting this limited-scope rulemaking (Alternative 3).

Based on the staffs assessment, the incremental benefits and costs for this rulemaking action may include the following:

• incremental averted costs to the industry and the NRC from eliminating the current regulatory need for certain applicants to request exemptions from current physical security regulations

• incremental costs to the NRC for rulemaking and the development of associated guidance documents Importantly, both alternatives have averted costs when compared to complying with the current physical security regulations. This is because both alternatives could involve some agency action to reduce or possibly eliminate the need for onsite armed responders and for an onsite secondary alarm station based on potential design features and/or mitigative measures provided in these advanced reactors that provide a more robust and effective security posture. 6 The staff recognizes that the benefits and costs described in this regulatory basis are order-of-magnitude estimates subject to further refinement and input from stakeholders during the rulemaking process. However, these estimates are useful to eliminate unviable solutions and to identify potential tradeoffs early in the process. The staff expects development of the proposed rule and related guidance to clarify the scope and allow further refinement of these analyses. The staff will offer additional opportunities for comment on the proposed rule language, as well as on the updated benefits and costs, as these products develop. Quantified estimates are expressed in 2019 dollars. Appendix A shows the quantitative inputs used in the cost estimate of this regulatory basis.

5.2 Potential Impact on Licensees This rulemaking would propose alternative, optional physical security regulations specifically for advanced reactor designs as defined in this regulatory basis. Therefore, those licensees would not incur the incremental costs normally associated with the exemption process for the current 6 The robust security design features and mitigative measures are integral to the proposed advanced reactor designs and are sunk costs. Therefore, these features and measures are not considered in the cost-benefit analysis.

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physical security regulations. This includes the costs of preparing the exemption requests and responding to the NRCs requests for additional information through multifaceted interactions, such as correspondence, teleconferences, and meetings. Table 1 shows these averted costs, based on the NRCs assumption that three advanced reactor applicants will submit license applications in year 2021, with possibly two more applications submitted in year 2022, and another two applications submitted in year 2023. The NRC estimates that each applicant would need 100 person-hours to prepare and submit an exemption request, and the NRC estimates that the weighted industry hourly labor rate for personnel preparing these documents is

$124 per hour. The data on future license applications are based on the staffs current knowledge.

Table 1 Industry Operation: Physical Security Exemption Requests Number Per Entity Net Cost Savings (2019 dollars) of Weighted Year Activity Affected Labor Hourly Undiscounted 7% NPV* 3% NPV Entities Hours Rate Exemption Requests for 2021 3 100 $124 $37,000 $32,000 $35,000 Physical Security Exemption Requests for 2022 2 100 $124 $25,000 $20,000 $23,000 Physical Security Exemption Requests for 2023 2 100 $124 $25,000 $19,000 $22,000 Physical Security Total: $87,000 $71,000 $80,000 Note: Values rounded to the nearest thousand.

• Net present value (NPV)

As discussed above, current regulations for large LWRs require each site to have at least 10 armed responders for emergency security response and a secondary alarm station on site to monitor potential issues. The staffs view is that providing alternatives to these provisions in this rulemaking could represent significant incremental averted costs to these potential applicants and licensees. The staff assumes that advanced reactor applicants or licensees would use the exemption process (Alternative 1) or the revised physical security regulations resulting from the limited-scope rulemaking (Alternative 3) to avert these costs from each future advanced reactor licensee throughout its license term. The staff is assuming seven applicants based on proprietary, non-publicly available information provided to the NRC.

Advanced reactor applicants and licensees realize cost savings under Alternative 3 because this rulemaking will give greater regulatory stability, predictability, and clarity to the licensing process. Additionally, by defining the requirements for reducing the number of armed responders and removing the requirement for an onsite secondary alarm station, advanced reactor applicants and licensees would realize substantial savings, which are not quantified at this time. Therefore, the quantified cost savings result because applicants and licensees would not need to use the exemption process to establish the applicable physical security criteria.

This limited-scope rulemaking alternative, Alternative 3, results in estimated averted costs to the industry that range from $71,000 using a 7-percent discount rate to $80,000 using a 3-percent discount rate when compared to Alternative 1, as shown in Table 2.

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Table 2 Alternative 3 Industry Averted Costs Net Cost Savings (2019 dollars)

Attribute Undiscounted 7% NPV 3% NPV Total Industry Implementation Cost $0 $0 $0 Total Industry Operation Cost $87,000 $71,000 $80,000 Total Industry Cost $87,000 $71,000 $80,000 Note: Potential cost savings resulting from reduced number of onsite security personnel and the potential elimination of a secondary alarm station onsite are not included in these quantitative estimates.

5.3 Potential Impact on Offsite Governmental Organizations Consistent with the Commissions policy statement on advanced reactors, the staff expects the overall impact on offsite government organizations to be lower for advanced reactors than for large LWRs. The basis for the staffs expectation is that advanced reactors are expected to have smaller source terms and inherent safety features that would lead to reduced offsite consequences resulting from accidents when compared to large LWRs. While lower than for large LWRs, this impact on offsite government organizations could vary depending on the specific design of these advanced reactors. The staff does not expect these costs to significantly differ between Alternative 1 and Alternative 3 because the difference between the two licensing processes would not impact offsite government organization resources.

5.4 Potential Impact on the NRC The NRCs development and implementation of advanced reactor physical security regulations through a rulemaking would result in incremental costs to the NRC. These costs include the preparation of the rule language and accompanying guidance documents. The costs also include both staff and contractor time to prepare proposed rule language, draft guidance, supporting analyses (e.g., a draft regulatory analysis, draft environmental analysis, and draft Office of Management and Budget (OMB) Paperwork Reduction Act supporting statement), a Federal Register notice, and public outreach during the proposed rule and draft guidance development phase. After publishing the proposed rule, the NRC would incur costs associated with public comment resolution and preparation of the final rule, final guidance, and supporting documentation for the rulemaking. The NRC has committed a significant number of technical staff to develop the rulemaking and related guidance over a 4-year period. The staff anticipates that industry will develop a guidance document to help applicants proposing to use the alternative requirements that will be defined by the limited-scope rulemaking. Therefore, the costs for developing regulatory guidance in Table 3 represent the incremental costs assuming more detailed guidance will be included in documents submitted by industry for endorsement in an NRC regulatory guide. The estimated costs range from ($1.05 million) using a 7-percent discount to ($1.11 million) using a 3-percent discount rate. The cost estimate considers each actions costs at a labor rate of $129 per hour.

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Table 3 NRC Implementation: Guidance and Rulemaking Costs Weighted Net Cost (2019 dollars)

Year Activity Hours Hourly Rate Undiscounted 7% NPV 3% NPV Develop draft guide for 2020 1,610 $129 ($208,000) ($194,000) ($202,000) proposed rule Develop and issue proposed 2020 2,875 $129 ($371,000) ($347,000) ($360,000) rule Develop draft guide for final 2021 805 $129 ($104,000) ($91,000) ($98,000) rule Finalize regulatory guide for 2021 805 $129 ($104,000) ($91,000) ($98,000) final rule 2021 Develop and issue final rule 2,875 $129 ($371,000) ($324,000) ($350,000)

Total: ($1,159,000) ($1,049,000) ($1,109,000)

The benefits to the NRC include meeting the goals of the NRCs Strategic Plan for fiscal years 2018-2022 (NUREG-1614, Volume 7, Strategic Plan: Fiscal Years 2018-2022, issued February 2018 (Ref. 20)), in relation to the strategic goal of safety and the cross-cutting strategies of regulatory efficiency and openness, as discussed in Section 5.5 of this document.

Additionally, the NRC will experience averted costs (benefits) from the expected number of exemption requests that the industry will not submit (under Alternative 3 when compared to Alternative 1) and that, therefore, the staff will not review. Table 4 shows these averted costs, which range from $237,000 using a 7-percent discount rate to $264,000 using a 3-percent discount rate, assuming 317 hours0.00367 days <br />0.0881 hours <br />5.241402e-4 weeks <br />1.206185e-4 months <br /> of effort for each request and a labor rate of $129 per hour.

Table 4 NRC Operation: Alternative 3 Exemption Request Reviews Averted Number Weighted Net Cost Savings (2019 dollars)

Year Activity of Hours Hourly Requests Rate Undiscounted 7% NPV 3% NPV Review exemption 2021 3 317 $129 $123,000 $107,000 $116,000 requests Review exemption 2022 2 317 $129 $82,000 $67,000 $75,000 requests Review exemption 2023 2 317 $129 $82,000 $63,000 $73,000 requests Total: $287,000 $237,000 $264,000 Combined, these costs and averted costs show the NRC will, as a result of this rulemaking, incur an estimated cost ranging from ($0.81 million) using a 7-percent discount rate to

($0.85 million) using a 3-percent discount rate, as shown in Table 5.

Table 5 Alternative 3 NRC Net Costs NRC Net Costs (2019 dollars)

Attribute Undiscounted 7% NPV 3% NPV Total NRC Implementation Cost ($1,160,000) ($1,050,000) ($1,110,000)

Total NRC Operation Cost $290,000 $240,000 $260,000 Total NRC Cost ($870,000) ($810,000) ($850,000)

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5.5 Cost Justification Relative to Alternative 1, the staff concludes that the averted incremental costs to the licensees, the NRC, and offsite governmental organizations as well as the benefits of improved regulatory efficiency and certainty to the licensees and the NRC justify the incremental costs to the NRC for Alternative 3. Furthermore, the rulemaking would also benefit the NRC because the agency would not need to expend resources in the future for evaluating exemption requests from advanced reactor applicants and licensees from the current physical security regulations.

Table 6 shows a net cost for the quantitative factors discussed above. The qualitative factors, which are described below, are also primarily averted costs and benefits and are expected to be of a lesser order of magnitude than the costs quantified in this regulatory basis. 7 Table 6 Total Costs Net Cost Savings (Costs) (2019 dollars)

Attribute Undiscounted 7% NPV 3% NPV Industry Implementation $0 $0 $0 Industry Operation $87,000 $71,000 $80,000 Total Industry Cost $87,000 $71,000 $80,000 NRC Implementation ($1,160,000) ($1,050,000) ($1,110,000)

NRC Operation $290,000 $240,000 $260,000 Total NRC Cost ($870,000) ($810,000) ($850,000)

Net ($783,000) ($739,000) ($770,000)

Note: There may be small differences between tables from rounding.

The incremental quantitative cost difference between Alternative 1 and Alternative 3 is the difference between the rulemaking costs and the exemption request averted costs. The rulemaking costs of the regulatory basis, proposed rule, and final rule exceed the averted costs of exemption requests as shown in Table 6. However, Alternative 3 could achieve additional cost savings if there are future advanced reactor applicants and licensees beyond the seven included in this analysis, which would make Alternative 3 incrementally more cost beneficial with each future applicant. The averted costs to the industry of preparing and the NRC of reviewing seven exemption requests if the rulemaking alternative is pursued, as seen by summing the cost savings in Table 1 and Table 4, range from $310,000 (7-percent NPV) to $340,000 (3-percent NPV). The estimated costs for the NRC rulemaking actions under Alternative 3 are $1.

05 million (7-percent NPV) to ($1.11 million) (3-percent NPV), as shown in Table 6. Therefore, the breakeven point between the two alternatives would occur if there are approximately 27 additional exemption requests averted.

As noted in Section 4.2 of this document, the rulemaking alternative would provide additional qualitative benefits for advanced reactor licensees because it would (1) promote regulatory stability, predictability, and clarity, (2) recognize technological advancements, (3) credit small reactor core size and associated differences in accidents, and (4) eliminate the potential regulatory need to request exemptions from physical security requirements. In addition, current regulations require each site to have at least 10 armed responders for emergency security response and a secondary alarm station on site to monitor potential issues. However, 7 As noted in Section 5.1, the quantified costs do not include the potential savings from reducing or possibly eliminating need for onsite armed responders and for an onsite secondary alarm station because those costs will be averted in both alternatives.

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advanced reactors may not need these security measures if intrinsic, engineered security measures are incorporated into the designs that limit the amount and timing of potential radioactive material releases. Accordingly, this provision of the rule could represent significant incremental averted costs to these potential applicants and licensees, which are not estimated in this analysis and could result in the rule being cost-beneficial.

5.6 Uncertainty Analysis The staff completed a Monte Carlo sensitivity analysis for this regulatory basis using the specialty software @Risk. 8 The Monte Carlo approach answers the question, What distribution of net benefits results from multiple draws of the probability distribution assigned to key variables?

As this regulatory basis uses estimates of values that are sensitive to plant-specific cost drivers and plant dissimilarities, the staff provides the following analysis of the variables with the greatest amount of uncertainty.

Monte Carlo simulations involve introducing uncertainty into the analysis by replacing the point estimates of the variables used to estimate base-case costs and benefits with probability distributions. By defining input variables as probability distributions instead of point estimates, analysts can effectively model the influence of uncertainty on the results of the analysis (i.e., the net benefits).

The probability distributions chosen to represent the different variables in the analysis were bounded by the range-referenced input and assumptions based on the staffs professional judgment. When defining the probability distributions for use in a Monte Carlo simulation, summary statistics are needed to characterize the distributions. These summary statistics include the minimum, most likely, and maximum values of a program evaluation and review technique (PERT) distribution, 9 the minimum and maximum values of a uniform distribution, and the specified integer values of a discrete population. The staff used the PERT distribution to reflect the relative spread and skewness of the distribution defined by the three estimates.

The NRC performed the Monte Carlo simulation by repeatedly recalculating the results 10,000 times. For each iteration, the values were chosen randomly from the probability distributions that define the input variables. The staff recorded the values of the output variables and used these values to define the resultant probability distribution. Figures 2, 3, and 4 display the histograms of the incremental benefits and costs of Alternative 3 as compared to those of Alternative 1. The analysis shows that the industry would benefit if the NRC pursues Alternative 3.

8 Information about this software is available at https://www.palisade.com.

9 A PERT distribution is a special form of the beta distribution with specified minimum and maximum values. The shape parameter is calculated from the defined most likely value. The PERT distribution is similar to a triangular distribution in that it has the same set of three parameters. Technically, it is a special case of a scaled beta (or beta general) distribution. The PERT distribution is generally considered superior to the triangular distribution when the parameters result in a skewed distribution, as the smooth shape of the curve places less emphasis in the direction of skew. Similar to the triangular distribution, the PERT distribution is bounded on both sides and therefore may not be adequate for some modeling purposes if it is desired to capture tail or extreme events.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 5-6 July 2019

$49,000 $96,000 5.0% 90.0% 5.0%

Total Industry Cost - 7%

Minimum $35,000 Maximum $118,000 Mean $71,715 Std Dev $14,648 Values 10000

$30,000 $40,000 $50,000 $60,000 $70,000 $80,000 $90,000 $100,000 $110,000 $120,000 Figure 2 Industry Net Cost Savings for Alternative 37-Percent NPV

-1.030 -0.640 5.0% 90.0% 5.0%

Total NRC Cost - 7%

Minimum -$1,300,000 Maximum -$520,000 Mean -$809,918 Std Dev $116,602 Values 10000

-1.40 -1.30 -1.20 -1.10 -1.00 -0.90 -0.80 -0.70 -0.60 -0.50 Values in Millions ($)

Figure 3 NRC Total Costs for Alternative 37-Percent NPV Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 5-7 July 2019

-0.955 -0.571 5.0% 90.0% 5.0%

Total Cost - 7%

Minimum -$1,235,000 Maximum -$421,000 Mean -$738,203 Std Dev $117,582 Values 10000

-1.30 -1.20 -1.10 -1.00 -0.90 -0.80 -0.70 -0.60 -0.50 -0.40 Values in Millions ($)

Figure 4 Total Averted Cost7-Percent NPV Figures 2, 3, and 4 present descriptive statistics on the uncertainty analysis. These figures reflect the 5- and 95-percent (rounded) valuesthe bands marked 5.0 percent on either side of the 90.0-percent confidence intervalthat appear as numerical values on the top of the vertical lines, as the 0.05 and 0.95 values in Table 7, respectively.

Table 7 Uncertainty Results Descriptive Statistics7-Percent NPV Incremental Cost-Benefit (2019 million dollars)

Uncertainty Result Min Mean St. Dev. Max 0.05 0.95 Total Industry Cost $0.03 $0.07 $0.01 $0.12 $0.05 $0.10 Total NRC Cost ($1.30) ($0.81) $0.12 ($0.52) ($1.03) ($0.64)

Total Cost ($1.24) ($0.74) $0.12 ($0.42) ($0.96) ($0.57)

Note: There may be small differences between tables from rounding.

Examining the range of the resulting output distribution provided in Figure 4 makes it possible to more confidently discuss the potential incremental costs and benefits in this regulatory basis.

Table 7 displays the key statistical results, including the 90-percent confidence interval in which the net benefits would fall between the 5-percent and 95-percent percentile values.

Figure 5 shows a tornado diagram that identifies the key variables whose uncertainty drives the largest impact on total costs (and averted costs) for this regulatory basis. This figure ranks the variables based on their contribution to cost uncertainty. Three variablesthe NRC hours to develop the final rule, the averted NRC hours to review exemption requests, and the NRC hours to develop the regulatory guidancedrive the most uncertainty in the costs. The remaining key variables show diminishing variation.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 5-8 July 2019

Total Cost - 7%

Inputs Ranked By Effect on Output Mean Hours to develop/issue final rule -$948,751 -$611,782 Hours for NRC to review exemption request -$798,306 -$665,622 Hours to develop regulatory guide -$794,372 -$692,235 Input High Input Low Hours for NRC to develop RG-1350 -$801,230 -$704,574 Hours for industry to generate and submit exemption request -$761,090 -$712,367 Industry hourly rate for exemption requests -$746,788 -$725,858 Baseline = -$738,203

-1.30 -1.10 -0.90 -0.70 -0.50 -0.30 -0.10 Total Cost - 7%

Values in Millions ($)

Figure 5 Tornado Diagram Net Costs7-Percent NPV As Figure 5 shows, the industry and the NRCs net costs in this regulatory basis have a mean value of $0.74 million at a 7-percent discount rate. The uncertainty analysis shows a 99 percent chance that the rulemaking would not be cost effective. This is due to the rulemaking costs incurred by the NRC, but the rulemaking would result in averted costs to each future licensee as well as the NRC, and offsite governmental organizations as well as the benefits from improved regulatory efficiency and certainty, and therefore the staff recommends proceeding with the rulemaking.

5.7 Nonquantified Benefits In addition to the quantified costs discussed in this regulatory analysis, the attributes of regulatory efficiency and public confidence would produce nonquantified benefits for the industry and the NRC as summarized below.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 5-9 July 2019

6. OTHER IMPACTS AND REGULATORY CONSIDERATIONS 6.1 Regulatory Efficiency The NRC is proposing to pursue rulemaking that would establish a limited-scope, alternative, optional, performance-based regulatory framework for advanced reactors, as that term has been defined in this document. This framework would result in a licensing process with enhanced regulatory stability, predictability, and clarity by reducing reliance on case-by-case exemption requests.

The NRC traditionally attempts to avoid regulating by exemption when it can address an issue through generic actions such as rulemaking. The estimated benefits of the proposed rulemaking action include (1) fewer exemption requests than under current regulations, (2) improved ability to define and optimize engineering and security features during the design process, (3) consistent regulatory applicability and associated efficiencies gained during security plan development and reviews, and (4) the use of a more risk-informed, performance-based security framework.

6.2 Increased Public Confidence In addition to regulatory efficiency, using rulemaking to revise the physical security requirements for advanced reactors instead of relying on the exemption request process will increase public confidence in the NRCs ability to adapt to new technology and new regulatory needs.

Additionally, the rulemaking process includes the greatest opportunity for Commission and public engagement on the issues related to advanced reactor physical security. Public notice-and-comment during rulemaking will provide the widest range of viewpoints for Commission consideration during the proposed rules development.

6.3 Compliance with National Environmental Policy Act This rulemaking would develop performance-based physical security requirements for advanced reactors that would be commensurate with the potential consequences to public health and safety from radiological sabotage and is not expected to be a major Federal action significantly affecting the quality of the human environment. Therefore, an environmental impact statement is not likely to be required. If the NRC decides to proceed with the proposed rulemaking, an environmental assessment would likely be performed to identify and evaluate potential environmental impacts, and the environmental assessment findings will be used to make a final determination on whether an environmental impact statement would be required. Based on the staffs preliminary analysis, the staff would not expect this action to result in a significant impact to the public because the staff would propose using the reference values for offsite dose associated with NRC findings of adequate protection set forth in 10 CFR 50.34 and 10 CFR 52.79.

6.4 Regulatory Flexibility Act The Regulatory Flexibility Act, enacted in September 1980, requires agencies to consider the effect of their regulatory proposals on small entities, analyze alternatives that minimize the effects on small entities, and make their analyses available for public comment.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 6-1 July 2019

None of the applicable licensees falls within the definition of small entities set forth in the size standards established by the NRC in 10 CFR 2.810, NRC Size Standards. Therefore, conducting a rulemaking would not have a significant economic effect on a substantial number of small entities.

6.5 Backfitting, Forward Fitting, and Issue Finality Neither of the two alternatives analyzed in this section is subject to the NRCs backfitting regulation at 10 CFR 50.109, Backfitting, or issue finality regulations in 10 CFR Part 52.

Alternative 1 is the current regulatory baseline, thereby imposing no change in requirements or the staff positions. Alternative 3, the proposed rulemaking, would provide a voluntary, performance-based alternative to the prescriptive requirements in 10 CFR 73.55(k)(5)(ii) related to the required minimum number of armed responders and 10 CFR 73.55(i)(4)(iii) related to onsite secondary alarm stations. Because future license applicants would be able to choose whether to follow the current requirements or this voluntary alternative, the proposed rulemaking would not impose new requirements on applicants or licensees. Therefore, the proposed rulemaking would not constitute backfitting as that term is defined in 10 CFR 50.109(a) or fall within the issue finality provisions of 10 CFR Part 52. Therefore, the NRC will not further address backfitting under 10 CFR 50.109 or the issue finality criteria in 10 CFR Part 52 in the proposed rule.

The alternatives analyzed in this section would not constitute forward fitting, which is defined in Management Directive 8.4, Management Of Backfitting, Forward Fitting, Issue Finality, and Information Requests," (Ref. 21) as the imposition of a new or modified requirement or regulatory staff interpretation of a requirement that results in the modification of or addition to systems, structures, components, or design of a facility; or the design approval or manufacturing license for a facility; or the procedures or organization required to design, construct or operate a facility as a condition of approval by the NRC of a licensee-initiated request for a licensing action when the underlying request did not propose to comply with the new or revised requirement or interpretation. Neither alternative would impose new requirements or interpretations of requirements. Furthermore, the voluntary, performance-based alternative in the proposed rulemaking would not be the result of a licensee-initiated request for a licensing action, nor would it be a condition of approval for a licensing action. Therefore, the NRC will not further address forward fitting in the proposed rule.

6.6 Peer Review of Regulatory Basis OMBs Final Information Quality Bulletin for Peer Review, dated December 16, 2004 (Ref. 22),

requires each Federal agency to subject influential scientific information to peer review before dissemination. OMB defines influential scientific information as scientific information the agency reasonably can determine will have or does have a clear and substantial impact on important public policies or private sector decisions. This regulatory basis document does not contain influential scientific information. Therefore, a peer review of the regulatory basis is not necessary.

6.7 Impacts on States and Tribal Nations The proposed rulemaking would be applicable only to advanced reactors, none of which are currently licensed. In anticipation of the NRCs need to regulate the security of these new technologies in the future, the agency is planning to propose this security-related rulemaking Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 6-2 July 2019

(Alternative 3). To date, the staff has not conducted outreach with the Tribal nations or States (including Agreement states) on the issue of security for advanced reactors. As part of the rulemaking process the NRC plans to engage with a variety of stakeholders, including, the public, States, and the Tribal nations, through public meetings during the public comment periods (regulatory basis and the proposed rulemaking). Stakeholders will also have an opportunity to provide written comments on rulemaking documents.

6.8 Legal and Policy Issues The staff has not identified any potential legal or policy issues resulting from evaluated alternatives.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 6-3 July 2019

7. NRC STRATEGIC PLAN The proposed rulemaking (Alternative 3) would support the NRCs Strategic Plan (Ref. 20) for fiscal years 2018-2022 in relation to the safety strategic goal of ensuring the safe use of radioactive materials and the security strategic goal of ensuring the secure use of radioactive materials. It would contribute to attaining the NRC Strategic Plans strategies to further risk-inform the regulatory framework for safety and security. It would support an NRC licensing initiative with a future regulatory benefit, considering Commission and congressional interest in advanced reactors. Finally, the public has substantial interest in this topic.

The NRCs strategic goals are:

• Safety: Ensure the Safe Use of Radioactive Materials.

• Security: Ensure the Secure Use of Radioactive Materials.

The actions proposed in this regulatory basis primarily support the NRCs Strategic Plan in the Security Strategy 1, which is to maintain and further risk-inform the current regulatory framework for security using information gained from operating experience, lessons learned, external and internal assessments, technology advances, and changes in the threat environment.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 7-1 July 2019

8. STAKEHOLDER INTERACTIONS 8.1 Past Interactions Many public meetings and other interactions have taken place between the NRC and stakeholders on licensing issues related to advanced reactors. During several public meetings (Refs. 12, 23 and 24), the NRC supported discussions specific to possible alternatives for physical security requirements for advanced reactor designs.

8.2 Cumulative Effects of Regulation The NRC has implemented a program to address the possible cumulative effects of regulation in the development of regulatory bases for rulemakings. The concept of cumulative effects of regulation is an organizational effectiveness challenge that results from a licensee or other affected entity implementing several complex positions, programs, or requirements within a prescribed implementation period and with limited available resources, including the ability to access technical expertise to address a specific issue. The NRC requests feedback from the public at this regulatory basis stage on the cumulative effects that may result from an alternative to the requirements in 10 CFR Part 73 and any other NRC actions that may affect advanced reactors. The NRC will consider the comments received as it develops the proposed rule. The NRC will continue to engage and request feedback from the public at the proposed rule stage on the cumulative effects that may result from the new physical security requirements for advanced reactors.

8.3 Questions for Public Comment The NRC welcomes comments on any aspect of this regulatory basis but is particularly interested in obtaining additional information related to the three questions provided in the related Federal Register Notice.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 8-1 July 2019

9. RULEMAKING DEVELOPMENT TIMELINE The NRC is making this regulatory basis available for public comment from stakeholders, including industry (e.g., vendors and utilities), governmental and nongovernmental organizations, and individuals.

This rulemaking is considered to be of medium priority. Key milestones and target completion dates for the rulemaking deliverables can be found on the NRCs Rules and Petitions Web page under Planned Rulemaking Activities, https://www.nrc.gov/about-nrc/regulatory/rulemaking/rules-petitions.html Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 9-1 July 2019

10. REFERENCES

1. U.S. Nuclear Regulatory Commission, Options and Recommendation for Physical Security for Advanced Reactors, SECY-18-0076, August 1, 2018, Agencywide Documents Access and Management System (ADAMS) Accession No. ML18170A051.

2. U.S. Nuclear Regulatory Commission, Staff RequirementsSECY-18-0076Options and Recommendation for Physical Security for Advanced Reactors, SRM-SECY-18-0076, November 19, 2018, ADAMS Accession No. ML18324A478.

3. U.S. Nuclear Regulatory Commission, Regulation of Advanced Nuclear Power Plants; Statement of Policy, July 8, 1986, 51 Federal Register (FR) 24643.

4. U.S. Nuclear Regulatory Commission, Proposed Rule: Emergency Preparedness for Small Modular Reactors and Other New Technologies (RIN 3150-AJ68; NRC-2015-0225), SECY-18-0103, dated October 12, 2018, ADAMS Accession No. ML18134A086

5. U.S. Nuclear Regulatory Commission, Policy Statement on the Regulation of Advanced Reactors, Final Policy Statement, October 14, 2008, 73 FR 60612.

6. Nuclear Energy Institute White Paper, Proposed Physical Security Requirements for Advanced Reactor Technologies, December 14, 2016, ADAMS Accession No. ML17026A474.

7. U.S. Nuclear Regulatory Commission, NRC Vision and Strategy: Safely Achieving Effective and Efficient Non-Light Water Reactor Mission Readiness, December 2016, ADAMS Accession No. ML16356A670.

8. U.S. Nuclear Regulatory Commission, NRC Non-Light Water Reactor Near-Term Implementation Action Plans, July 2017, ADAMS Accession No. ML17165A069.

9. U.S. Nuclear Regulatory Commission, NRC Non-Light Water Reactor Mid-Term and Long-Term Implementation Action Plans, July 2017, ADAMS Accession No. ML17164A173.

10. U.S. Nuclear Regulatory Commission, Advanced Reactor Program Status, SECY 0011, dated January 25, 2018, ADAMS Accession No. ML17334B217.

11. U.S. Nuclear Regulatory Commission, Draft White Paper on Potential Changes to Physical Security Requirements for Small Modular and Advanced Reactors, November 2018, Released to Support Public Discussions on December 13, 2017, ADAMS Accession No. ML17333A524.

12. U.S. Nuclear Regulatory Commission, Summary of December 13, 2017, Public Meeting to Discuss Possible Changes to Physical Security Requirements for Advanced Reactor Designs, January 10, 2018, ADAMS Accession No. ML17354B266.

13. U.S. Nuclear Regulatory Commission, Final Rule, Power Reactor Security Requirements for 10 CFR Parts 50, 52, 72, and 73 (74 FR 13925).

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis 10-1 July 2019

14. U.S. Nuclear Regulatory Commission, Rulemaking Plan on Emergency Preparedness for Small Modular Reactors and Other New Technologies, SECY-16-0069, May 31, 2016, ADAMS Accession No. ML16020A388.

15. U.S. Nuclear Regulatory Commission, Regulatory Guide 5.81, Target Set Identification and Development for Nuclear Power Reactors, dated November 2010, ADAMS Accession No. ML102720056 (not publicly available).

16. U.S. Nuclear Regulatory Commission, Functional Containment Performance Criteria for Non-Light-Water Reactors, SECY-18-0096, September 28, 2018, ADAMS Accession No. ML18114A546.

17. U.S. Nuclear Regulatory Commission, Staff Requirements - SECY-18-0096-Functional Containment Performance Criteria for Non-Light-Water Reactors, SRM-SECY-18-0096, December 4, 2018, ADAMS Accession No. ML18338A502.

18. U.S. Nuclear Regulatory Commission, Draft Regulatory Guide (DG) - 1353, Guidance for a Technology-Inclusive, Risk-Informed, and Performance-Based Methodology to Inform the Licensing Basis and Content of Applications for Licenses, Certifications, and Approvals for Non-Light Water Reactors, April 2019, ADAMS Accession No. ML18312A242.

19. U.S. Nuclear Regulatory Commission, NUREG/CR-7201, Characterizing Explosive Effects on Underground Structures, September 2018, ADAMS Accession No. ML15245A640.

20. U.S. Nuclear Regulatory Commission, Strategic Plan: Fiscal Years 2018-2022 18, NUREG-1614, Volume 7, February 2018, ADAMS Accession No. ML18032A561.

21. U.S. Nuclear Regulatory Commission, Staff Requirements-SECY-18-0049- Management Directive and Handbook 8.4, "Management of Backfitting, Issue Finality, and Information Collection," SRM-SECY-18-0049, May 29, 2019, ML19149A294

22. Office of Management and Budget, Final Information Quality Bulletin for Peer Review, M-05-03, December 16, 2004.

23. U.S. Nuclear Regulatory Commission, Summary of May 3-4, 2017, Public Meeting to Discuss Regulatory Improvements for Advanced Reactors, June 6, 2017, ADAMS Accession No. ML17144A403.

24. U.S. Nuclear Regulatory Commission, Summary of October 12, 2017, Public Meeting to Discuss Possible Changes to Physical Security Requirements for Advanced Reactor Designs, November 8, 2017, ADAMS Accession No. ML17310B512.

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APPENDIX A: COST ESTIMATE INPUTS Mean Low Best High Activity Estimate Estimate Estimate Estimate Exemption Requests for Small Modular Reactors Weighted hourly rate $124 $99 $124 $148 Hours to generate and submit exemption request 100 50 100 150 NRC Review Exemption Requests Hourly rate for the NRC $129 Hours to review 317 200 300 500 NRC Develop Regulatory Guide Hours to develop 1035 810 900 1,800 NRC Develop Proposed Rule Hours to develop 2,875 2,250 2,500 5,000 NRC Revise Regulatory Guide Hours to develop 805 630 700 1,400 NRC Finalize/Issue Regulatory Guide Hours to develop 805 630 700 1,400 NRC Develop/Issue Final Rule Hours to develop 2,875 2,250 2,500 5,000 Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis A-1 July 2019

APPENDIX B: GUIDANCE DOCUMENTS

1. Regulatory Guide 5.7, Entry/Exit Control for Protected Areas, Vital Areas, and Material Access Areas, Revision 1, May 1980.

2. Regulatory Guide 5.12, General Use of Locks in the Protection and Control of:

Facilities, Radioactive Materials, Classified Information, Classified Matter, and Safeguards Information, Revision 1, October 2016.

3. Regulatory Guide 5.43, Plant Security Force Duties, January 1975.

4. Regulatory Guide 5.44, Perimeter Intrusion Alarm Systems, Revision 3, October 1997.

5. Regulatory Guide 5.54, Standard Format and Content of Safeguards Contingency Plans for Nuclear Power Plants (safeguards information (SGI), not publicly available),

Revision 1, June 2009.

6. Regulatory Guide 5.59, Standard Format and Content for a Licensee Physical Security Plan for the Protection of Special Nuclear Material of Moderate or Low Strategic Significance, Revision 1, October 1983.

7. Regulatory Guide 5.66, Access Authorization Program for Nuclear Power Plants, Revision 2, October 2011.

8. Regulatory Guide 5.69, Guidance for the Application of Radiological Sabotage Design-Basis Threat in the Design, Development and Implementation of a Physical Security Program that Meets 10 CFR 73.55 Requirements (SGI, not publicly available),

September 2007.

9. Regulatory Guide 5.71, Cyber Security Programs for Nuclear Facilities, January 2010.

10. Regulatory Guide 5.74, Managing the Safety/Security Interface, Revision 1, April 2015.

11. Regulatory Guide 5.76, Physical Protection Programs at Nuclear Power Reactors, July 2009.

12. Regulatory Guide 5.81, Target Set Identification and Development for Nuclear Power Reactors (official use onlysecurity-related information), November 2010.

13. NUREG-0800, Standard Review Plan for the Review of Safety Analysis Reports for Nuclear Power Plants: LWR Edition, Section 13.6, Physical Security, Revision 3, March 2007.

14. NUREG-1959, Intrusion Detection Systems and Subsystems: Technical Information for NRC Licensees, Revision 1, September 2017.

15. NUREG-1964, Access Control Systems: Technical Information for NRC Licensees, April 2011.

16. NUREG/CR-0543, Central Alarm Station and Secondary Alarm Station Planning Document, June 1980.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis B-1 July 2019

17. NUREG/CR-1468, Design Concepts for Independent Central Alarm Station and Secondary Alarm Station Intrusion Detection Systems, 1980.

18. NUREG/CR-4250, Vehicle Barriers: Emphasis on Natural Features, July 1985.

19. NUREG/CR-4298, Design and Installation of Computer Systems to Meet the Requirements of 10 CFR 73.55, July 1985.

20. NUREG/CR-6190, Protection against Malevolent Use of Vehicles at Nuclear Power Plants: Vehicle Barrier System Selection Guidance, December 1994.

21. NUREG/CR-7145, Nuclear Power Plant Security Assessment Guide, April 2013.NUREG/CR-7201, Characterizing Explosive Effects on Underground Structures, September 2015.

22. SAND99-2388, Technology Transfer Manuals: Interior Intrusion Detection.

23. SAND99-2390, Technology Transfer Manuals: Alarm Communication.

24. SAND99-2391, Technology Transfer Manuals: Exterior Intrusion Detection.

25. SAND99-2392, Technology Transfer Manuals: Protecting Security Communications.

26. SAND2001-2168, Technology Transfer Manuals: Access Delay Manual, Volume I.

27. SAND2007-5591, Technology Transfer Manuals: Nuclear Power Plant Security Assessment Technical Manual.

28. IROW-002, Performance Specification System Specifications for the Interagency Remotely Operated Weapon Systems (IROWS).

29. U.S. Army Corps of Engineers (USACE), Update of NUREG/CR-6190 to Reflect Revised Design Basis Threat.

30. USACE PDC-TR-06-05, Evaluating Adequacy of Landform Obstacles as Vehicle Barriers.

31. USACE PDC-TR-06-06, Passive Inertial Vehicle Barrier Design Guide.

32. USACE PDC-TR-06-09, Vehicle Access Control Point Guidance.

33. National Institute of Standards and Technology (NIST) SP-800-82, Guide to Industrial Control Systems Security, Revision 2, May 2015.

34. NIST SP-800-53, Security and Privacy Controls for Federal Information Systems and Organizations, Revision 4, April 2013.

35. NEI 03-12, Template for the Security Plan, Training and Qualification Plan, Safeguards Contingency Plan [and Independent Spent Fuel Storage Installation Security Program],

Revision 7 (endorsed by the NRC), October 2011.

36. NEI 09-05, Guidance on the Protection of Unattended Openings that Intersect a Security Boundary (endorsed by the NRC), November 2012.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis B-2 July 2019

37. International Atomic Energy Agency (IAEA), Engineering Safety Aspects of the Protection of Nuclear Power Plants Against Sabotage, IAEA Nuclear Security Series No. 4, 2007.

Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis B-3 July 2019

SUBJECT:

REGULATORY BASIS FOR THE PHYSICAL SECURITY FOR ADVANCED REACTORS RULEMAKING DATED: July 2019 Package: ML19099A006, Regulatory Basis: ML19099A017, Federal Register notice: ML19099A014, CA Note: ML19099A009 *Via E-Mail NMSS/DRM/RRPB: NMSS/DRM/RRPB: NRO/DSRA/ARPB: NMSS/DRM/RRPB:

OFFICE QTE PM RS PM BC NAME IBerrios JDougherty* GLappert* WReckley* MKhanna DATE 04/09/2019 04/01/2019 04/10/2019 4/30/2019 04/12/2019 NSIR/DPCP/RSB: NRO/DDSRA/ARPB NMSS/DRM/RASB:

OFFICE NMSS/DRM: DD NSIR/DPCP: DD BC  : BC BC MSampson NAME JSegala* CBladey* PHolahan* SHelton*

LRegner for*

DATE 04/17/2019 04/16/2019 04/22/2019 04/25/2019 04/19/2019 OFFICE NRO/DSRA: D NSIR: D OGC (NLO) NRO: D EDO NAME JMonninger* BHolian* NMertz* FBrown MDoane DATE 04/25/2019 05/02/2019 05/23/2019 06/05/2019 OFFICIAL RECORD COPY Rulemaking for Physical Security for Advanced Reactors: Regulatory Basis July 2019