Environmentalists Attack NRC's Nuclear Fuel Export Licensing

Environmentalists have historically challenged only the domestic manifestations of nuclear power. The tangible fact of a nuclear power plant, together with a well-established regulatory system, lends itself to neighborhood mobilization and discrete legal fights. Recently, however, some environmentalists have ambitiously questioned a less visible aspect of the nuclear energy issue: exports of nuclear fuel destined for use in reactors operated in foreign countries.

The first such suit, Sierra Club v. AEC,¹ set the precedent that the National Environmental Policy Act (NEPA) applies to the federal government's international programs, specifically the Atomic Energy Commission's (AEC) licensing of nuclear fuel exports. The Sierra Club plaintiffs have now taken the fight directly to the Nuclear Regulatory Commission (NRC), the agency authorized, when the AEC was divided into regulatory and promotional functions, to regulate the exportation of nuclear fuel for foreign reactors. These groups, the Natural Resources Defense Council (NRDC), the Sierra Club, and the Union of Concerned Scientists, have thus gone where few have dared to tread, into the high stakes and sensitive foreign policy area of nuclear proliferation.

The focus of this particualr challenge is a 400-megawatt nuclear reactor known as the Tarapur Atomic Power Station, located 60 miles north of Bombay, India. In late 1975, the Edlow International Company, as agent for India, submitted two applications to the NRC for licenses to export a total of about 550 kilograms of U-235 contained in 21,400 kilograms of enriched uranium for use in Tarapur. These applications appeared to be nothing out of the ordinary, since Tarapur has required 24 fuel export licenses since becoming operational in 1969. Processing of the applications proceeded normally, with the NRC receiving submissions and classified briefings on the Indian fuel supply arrangements from the State Department, the Central Intelligence Agency (CIA) and the Energy Research and Development Administration (ERDA). All of these proceedings were routine matters pursuant to the 1963 cooperative agreement between the United States and India on civilian uses of nuclear energy.²

The routine was shattered when the three environmental groups petitioned the NRC to intervene in the licensing proceeding in order to establish that Edlow ought not to receive the license.³ The petitioners sought to intervene under § 189 of the Atomic Energy Act, which provides in part:⁴

In any proceeding under this chapter, for the granting, suspending, revoking, or amending of any license … the Commission shall grant a hearing upon the request of any person whose interest may be affected by the proceeding, and shall admit any such person as a party to such proceeding.

Petitioners claimed the institutional interests of disseminating information on nuclear issues and the representational interests of their Indian and United States members, who might suffer from nuclear contamination from the Tarapur plant or from an atomic blast from materials fabricated by India or terrorists from the exported fuel.

Substantively, the petitioners posed three contentions. First, the United States' nuclear non-proliferation stance would be seriously undermined by our exporting nuclear fuel to India, which surprised the world when it exploded a nuclear device in 1974, using materials supplied, originally for "peaceful purposes," by Canada and the United States. Petitioners pointed out that India has not signed the Treaty on Non-Proliferation of Nuclear Weapons⁵ and thus may use the exported fuel to fabricate additional nuclear weapons. The export thus would violate § 123 of the Atomic Energy Act,⁶ which prohibits exporting materials that constitute "an unreasonable risk to the common defense and security" of the United States. Second, the health and safety of petitioners' members in India and the United States would be jeopardized by the possibility that India would explode another nuclear bomb, or that, lacking United States-enforced safeguards, sabotage or terrorist diversion of Indian nuclear fuel would spread global nuclear contamination. Third, petitioners claimed that the export license required prior preparation of a NEPA impact statement.

After preliminarily staying the license and holding hearings on the petitioners' standing to intervene, the NRC issued an opinion on May 7 refusing standing and denying their request for adjudicatory hearings in the matter.⁷ In addition, however, emphasizing that the petition was the first of its kind, the NRC did schedule a legislative-type hearing on what it termed the policy aspects of the Tarapur licenses.

[6 ELR 10191]

The NRC gave essentially three reasons for its denial of the petitioners' standing. (1) Their injury — corporate as well as individual — was de minimis; (2) it did not wish to read § 189 broadly; and (3) the NRC was not the proper forum for airing the health and safety aspects of the Tarapur reactor. Before discussing these rationales, it should be noted that the NRC made a special point of applying the judicially-developed doctrine or standing to its procedures. The current formulation of standing, as announced in two companion 1970 Supreme Court cases, Association of Data Processing Organizations, Inc. v. Camp⁸ and Barlow v. Collins,⁹ requires that a plaintiff establish that he is "injured in fact" and that he comes "arguably within the zone of interests to be protected by the statute." Subsequent Supreme Court cases on standing have sought to define the boundaries of the injury in fact test, in situations where environmentalists,¹⁰ taxpayers,¹¹ citizens,¹² and minorities excluded from wealthy communities¹³ have sought to obtain judicial relief. Although the Data Processing-Barlow tests are still good law, the injury in fact test has become so attenuated that "an identifiable trifle"¹⁴ is now considered sufficient to confer standing to secure judicial review.

The NRC focussed on whether the petitioners would in fact be injured by the export license. Noting that petitioners collectively had only seven members living in India, the NRC characterized their possible harm as de minimis. Furthermore, the Commission stated, harm to petitioners' United States members was inseparable from the total United States population and thus the kind of "generalized grievance" disapproved of in Warth v. Seldin,¹⁵ the Supreme Court's most recent standing case.

The NRC's reliance on a de minimis standard is inapposite, because so long as a harm has occurred or is threatened, a person has been "injured" sufficiently to meet the standing test. Furthermore, Warth did not disturb the Supreme Court's ruling in United States v. SCRAP¹⁶ that merely because environmental interests are shared by many does not make them less deserving of legal protection.

Petitioners also asserted the somewhat novel claim that their institutional interests in compiling and disseminating information on nuclear power andexports was injured by the NRC's alleged failure to carry out proper analyses of the risks posed by the export to Tarapur. Similar institutional standing has been upheld in the NEPA context in Scientists' Institute for Public Information, Inc. v. AEC,¹⁷ However, the NRC distinguished SIPI on precisely the ground that the NEPA disclosures requested there were not similarly required by the AEC Act.

This latter ruling emphasizes the cautiousness of NRC's interpretation of the AEC Act's intervention section (§ 189). The Commission stated that the sensitive foreign policy aspects of export licensing dictated a narrow reading of § 189, and that congressional oversight, rather than adjudicatory hearings, were the normal mode of review. To come to this conclusion, the NRC had to read § 189 out of the AEC Act. The statutory language is any interest that "may be affected." This phrase is broader on its face than the "adversely affected" language in the judicial review provision of the Administrative Procedure Act¹⁸ upon which several recent Supreme Court standing cases were predicated.¹⁹ If the members of NRDC and the Sierra Club, who not only share the interest of every other United States citizen in nuclear proliferation but also the more concentrated interest in NRC licensing, cannot intervene in export licensing proceedings under § 189, then apparently no person has that right. Under the NRC's interpretation, only equipment suppliers and foreign importers of nuclear materials would have standing to intervene.

The NRC may have been swayed by the geographical distance between India and the United States, but its rule would apply as well to exports to Mexico, Haiti, or the Dominican Republic, where the risk of nuclear contamination from a sabotaged plant or government exploded bomb would certainly affect United States citizens to a much greater degree. It is no answer to say that, like the taxpayer challenge to CIA expenditures in United States v. Richardson²⁰ and citizen challenge to congressional membership in the military reserves in Schlesinger v. Reservists Committee to Stop the War,²¹ review of certain activities is left to Congress and the political process. Far from being constitutionally immune from review, the NRC is statutorily required to grant intervention to potentially affected persons.

The NRC's conclusion that the proper forum for considering the health and safety aspects of the Tarapur licensing is connected with its denial of petitioners' NEPA claim. It is not the function of a United States agency, said the Commission, to analyze the health and safety problems of Tarapur that are internal to India's territory, especially since the AEC Act provides that only "common defense and security" matters are to be considered in export licenses.²² Furthermore, ERDA's generic environmental impact statement on the export process²³ was said to analyze adequately the relevant NEPA issues. And in any case, each export license involves merely an incremental, non-major increase in environmental problems from uranium processing.

The difficulty with the NRC's analysis is that irrespective of the AEC Act's language, NEPA requires [6 ELR 10192] that every agency analyze its actions through the impact statement process unless there is a clear statutory conflict.²⁴ Moreover, the D.C. Circuit's recent ruling in Natural Resources Defense Council, Inc. v. Nuclear Regulatory Comm'n,²⁵ that the impact statement for the licensing of an individual nuclear reactor must consider the incremental impacts of the nuclear fuel cycle associated with that reactor undercuts the Commission's reasoning.

In spite of the NRC's formal arguments, one suspects that it was trying to extricate itself from the very uncomfortable corner into which the petitioners had pushed it. Indeed, this challenge was the first to an export in over 20 years of atomic licensing. United States policy had always sanctioned nuclear exports, but under the Energy Reorganization Act of 1974,²⁶ the NRC was supposed to exercise independent scrutiny of nuclear licensing. However, most of the technical information is still held by the State Department and ERDA. The NRC was thus forced to make — or modify — policy without the requisite institutional tools.

Attempting to find a suitable compromise while nonetheless rejecting petitioners' strong request for an adjudicatory proceeding, the Commission called for a legislative-type hearing on the policy issues of export licensing. This mandate, however laudatory as a first step, failed to meet the substantive contentions of the petitioners, some of which the NRC agreed were matters that could be "disputed."²⁷

As noted above, it is questionable to assert that the Commission currently has the authority or willingness to alter federal policy regarding exports. Nor, as the State Department has argued, would it be expedient, in view of the reliance of importing countries on an assured supply of uranium.

What the NRC can do, however, is act as a factfinder, to test the validity of data supplied by the State Department and ERDA about the safeguards imposed by the importer and required by the United States. The petitioners had asserted that such testing was exactly what they hoped to accomplish if allowed to intervene.²⁸ Indeed, the NRC admitted in its opinion that the petitioners had raised factual issues that the NRC itself considers in making a national security determination, such as whether the United States has required India to place international safeguards and physical security on all its nuclear facilities, whether the United States has demanded control over plutonium produced at Tarapur, and the extent to which national friction between India and its neighbors threatens disruption of such safeguards.

These are questions of fact, not policy, that cannot be established in a legislative hearing. Adjudication, together with cross-examination, can best ferret out the answers to such issues. The inadequacy of the legislative hearings, held on July 20-21, 1976, struck home when the NRC had to grant the State Department extra time to answer the 110 factual questions raised by the petitioners at the hearings.

The NRC's hesitance is thus disappointing for those who expected it to assume a vigorous and independent regulatory function after being split off from the AEC. Although the split did leave some confusion as to the exact boundaries of NRC, ERDA, and Department of Commerce jurisdiction over nuclear exports, the recent promulgation of Executive Order 11902,²⁹ which allocated procedures for the export licensing process, confirmed that the NRC retains ultimate authority for approval. Thus, while the NRC might not be able to impose conditions on importing countries — the general tenor of which normally would be negotiated by the State Department in the context of bilateral agreements — it certainly could require the State Department and ERDA to investigate and resolve all technical and safety uncertainties before granting a license.³⁰

Nevertheless, the cumulative effect of the public pressure appears to be forcing the Commission to scrutinize export licenses more closely. On June 21, the NRC approved the export of a nuclear reactor for Spain, but only over the first recorded dissent of a commissioner.³¹ Victor Gilinsky objected to the lack of a requirement that Spain use United States uranium only for reactor fuel. Then, on July 2,³² the NRC approved, again over a Gilinsky dissent, the smaller of the two contested fuel shipments to India (which, incidentally, had been agreed to by the environmental petitioners without prejudice to their objections to the larger shipment).

The NRC's troubles have not gone unnoticed by Congress. The recently-enacted foreign aid bill³³ specifies that any country that sells or purchases uranium reprocessing facilities (which are necessary to enrich spent fuel to weapons-grade plutonium) without international safeguards will lose all United States economic [6 ELR 10193] and military aid. This provision recently prompted Secretary of State Kissinger to warn Pakistan of just such a cutoff if it buys a reprocessing facility from France.³⁴ In a more direct move, the Senate Government Operations Committee has reported out a bill, S. 1439,³⁵ that would consolidate all export regulatory functions in the NRC, thus stripping ERDA of its control of desigmand technical information regulation. The bill would also require the State Department to take into account NRC recommendations and policies when negotiating bilateral export agreements and would force the NRC to consider importers' safeguards when licenesing nuclear exports. Regardless of this bill's eventual fate, nuclear export licensing will clearly never again be the quiet, routine process that it was prior to the NRDC and Sierra Club interventions last March.

1. 4 ELR 20685 (D.D.C. 1974). See Comment, Environmentalists Challenge Nuclear Export Program, 3 ELR 10181 (Dec. 1973).

2. Agreement for Cooperation for Civil Uses of Atomic Energy Between the United States and India, T.I.A.S. No. 5446, entered into force Oct. 5, 1963.

3. In the Matter of the Application of Edlow International Co. as Agent for the Government of India to Export Special Nuclear Material, Nos. XSNM-805, -845, Docket Nos. 70-2071, 70-2131 (Nuclear Regulatory Comm'n, filed Mar. 2, 1974), summarized at ELR 65326.

4. 42 U.S.C. § 2239(a) (1970) (emphasis supplied).

5. 21 U.S.T. 483, T.I.A.S. No. 6839, entered into force for the United States, Mar. 5, 1970.

6. 42 U.S.C. § 2153(b) (1970).

7. In re Edlow, supra note 3, Opinion (Nuclear Regulatory Comm'n, May 7, 1976). This Opinion is available from ELR (68 pp. $8.50, ELR Order No. A-1002).

8. 397 U.S. 150 (1970).

9. 397 U.S. 159 (1970).

10. Sierra Club v. Morton, 405 U.S. 727, 2 ELR 20192 (1972); United States v. SCRAP, 412 U.S. 669, 3 ELR 20536 (1973).

11. United States v. Richardson, 418 U.S. 166 (1974).

12. Schlesinger v. Reservists Comm. to Stop the War, 418 U.S. 208 (1974).

13. Warth v. Seldin, 422 U.S. 490 (1975).

14. Davis, Standing Again: Taxpayers and Others, 35 U. Chi. L. Rev. 601, 613 (1972).

15. Supra note 13.

16. Supra note 10.

17. 481 F.2d 1079, 3 ELR 20525 (D.C. Cir. 1973).

18. 5 U.S.C. § 702 (1970).

19. E.g., Sierra Club v. Morton, supra note 10, 405 U.S. at 739, 2 ELR at 20193.

20. 418 U.S. 166 (1974).

21. 418 U.S. 208 (1974).

22. See, e.g., §§ 103, 123, 42 U.S.C. §§ 2133, 2153 (1970).

23. In re Edlow, supra note 7, Opinion at 47.

24. Flint Ridge Dev. Co. v. Scenic Rivers Ass'n of Oklahoma, 6 ELR 20528 (U.S. June 24, 1976). See Comment, NEPA's Power to Amend Other Federal Laws: EDF Seeks to Compel the FDA to Consider Environmental Criteria, 5 ELR 10104 (July 1975).

25. Nos. 74-1385, -1586, __ F.2d __, digested at 6 ELR 20615 (D.C. Cir. July 21, 1976).

26. P.L. 93-438, 88 Stat. 1233.

27. In re Edlow, supra note 7, Opinion at 54.

28. In re Edlow, Preliminary Hearing Transcript at 20 (Nuclear Regulatory Comm'n, Mar. 17, 1976).

29. 41 Fed. Reg. 4877 (Feb. 3, 1976).

30. For instance, ERDA considers five factors when licensing nuclear technology exports: (1) whether there is a bilateral agreement between the United States and the importer, (2) whether the importer is a party to the Non-Proliferation Treaty, (3) whether the importer will accept safeguards imposed by the International Atomic Energy Agency, (4) the availability of other nuclear fuel sources, and (5) other factors bearing on the importer's political situation or the security of the United States: 10 C.F.R. § 8108(b).

31. In the Matter of the Application of Westinghouse Electric Corp. for the Export of Pressurized Water Reactor to Asociacion Nuclear ASCO II, Barcelona, Spain, No. XR-99, Docket No. 50-474 (Nuclear Regulatory Comm'n, June 21, 1976). The decision and dissent are reprinted in 122 Cong. Rec. S10043-51 (daily ed. June 21, 1976).

32. In re Edlow, supra note 3, No. XSNM-805 (Nuclear Regulatory Comm'n, July 2, 1976). This application involved nearly 83 kilograms of U-235 contained in approximately 3055 kilograms of enriched uranium.

33. International Security Assistance and Arms Export Control Act of 1974, § 305, H.R. 13680, P.L. 94-329 (signed June 30, 1976).

34. Washington Post, Aug. 9, 1976, at Al, col. 6.

35. Export Reorganization Act of 1976, S. 1439, 94th Cong., 2d Sess. (1976). See Sen. Rep. No. 94-875, 94th Cong., 2d Sess. (1976); Hearings o S. 1439 Before the Senate Comm. on Gov't Operations, 94th Cong., 2d Sess. (1976).