Oct 22, 2019

Ep 210: Helen Cook - Principal, Global Nuclear Energy Advisory

Global Nuclear Energy Advisory
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Show notes

Entering the Industry from a country banning nuclear energy (1:52)
1:52 - 8:37 (Helen discusses her transition from studying corporate law in Australia to practicing nuclear law. Helen’s first introduction to nuclear law was when advising the development of Bahrain’s nuclear energy program.)

Q. How did you end up in nuclear law?
A. Helen Cook grew up in Australia, where she earned her law degree from Sydney University. She held several internships with The International Criminal Tribunal in Holland and as the President’s intern for the International Criminal Court, where she became more interested in international law. While working in corporate law back in Sydney, she was offered the opportunity to practice law in Dubai. Here, she was first introduced to nuclear law, something that had not been discussed back in Australia, which bans nuclear energy. Helen remembers the exact day that she first learned about nuclear law: when she accompanied her boss to a mysterious meeting with the Deputy Primeminister of Bahrain. This turned out to be the first meeting of the National Committee for Nuclear Energy, attended by Bahrain’s top ministers. Helen considers herself lucky to be in the right place at the right time to advise the development of Bahrain’s nuclear energy program.

Drafting Nuclear Energy Laws (8:38)
8:38 - 14:02 (Helen describes how she drew inspiration from various law philosophies and the IAEA to construct Bahrain’s nuclear legal framework.)

Q. How did you begin constructing nuclear energy laws?
A. Helen drew inspiration for drafting Bahrain’s nuclear laws by first looking to countries that had existing nuclear energy laws and the philosophies behind various country’s regulations. While Australia favors contracting laws that are easy to understand using plain language, the United States’ nuclear laws are often complex. Based on its clarity, Helen identified the Canadian system as a strong basis on which to build Bahrain’s nuclear laws. The Handbook on Nuclear Law produced by the Office of Legal Affairs in the International Atomic Energy Agency (IAEA) was also used for inspiration, but Helen had to wait for the Implementing Legislation, which was only released after Helen’s first draft of Bahrain’s legal framework. The Implementing Legislation provides provisions that countries can use as a starting point for establishing nuclear laws.

Looking to the Canadian frameworks and the IAEA documents helped structure the first draft, which was completed in only a few months. The main nuclear legislation are high level because the details are in the regulations that implement the provisions of the law. Laws are on a country level which create the framework that establishes a nuclear regulator to create regulations. Nuclear regulations detail such things as design and construction of a nuclear power plant.

Nuclear regulation challenges (14:03)
14:03 - 16:15 (The main regulatory challenges involve planning for new technology and determining liability.)

Q. When creating the framework, you needed to plan for the regulations. What were some of the limitations or challenges involving regulating nuclear that you kept in mind during this process?
A. While not an issue at the time of constructing Bahrain’s nuclear framework, nuclear technology challenges law development today. Frameworks exist for large scale reactors, but not yet for small modular reactors (SMRs). Countries new to nuclear energy must now prepare their frameworks to include both large scale reactors and SMRs.

Liability is another issue that must be considered when constructing nuclear laws. Nuclear liability conventions are complex and fundamentally change nuclear liability rules within a country.

SMRs vs Large Scale Reactors (16:16)
16:16 - 22:00 (Small Modular Reactors (SMRs) introduce a different set of regulatory challenges that must be considered when creating a legal framework. Helen favors the building of more large scale reactors but believes that if SMRs are chosen as nuclear’s focus, then the regulatory framework needs to get ahead of these challenges.)

Q. What about regulations make them specific to large scale reactors and why can’t they be scaled down for SMRs?
A. This is an issue that the nuclear energy industry and regulatory bodies are trying to figure out, but the answer has not yet been reached. SMRs have many different designs and technologies, complicating the creation of a legal framework and the following regulatory regime. Countries need to get ahead of this issue and begin thinking of the regulations involved with such things as underground SMRs and modular construction. While discussions around how to tackle time and budgeting issues of large scale reactors are happening, such as between NuScale Power and the Nuclear Regulatory Commission (NRC), newcomer countries should still think about how to approach new SMR technology from the beginning as the time for large scale reactors may be passing.

Nuclear Liability (23:58)
23:58 - 34:12 (Helen discusses liability in the context of nuclear law.)

Q. What do you mean when you say liability and how can countries reduce those issues?
A. When considering liability, it is important to think about Fukushima and accidents that cause transboundary damage. Liability focuses on ensuring straight forward compensation for victims in the event of an accident and manages the quantifiable involvement of companies involved in a nuclear project. These have been considered special legal regimes from the beginning of nuclear regulation and are present in national laws of all countries with nuclear power plants.

When constructing liability law, we must think about the worst case scenario accident, such as radiation spreading across country boundaries through air and waterways. The ramifications of a large accident has potential to be global and does not matter on the size of the country. Damage and claims for compensation could also stem from closing a seaport or airport. Fukushima is an example of this where individuals in the US filed claims against Tepco and vendors of the technology.

The nuclear liability regime seeks to make only one entity exclusively and strictly liable to victims, making it clear who claims will be brought against. Proof of damage and causation of accident are needed, but claims do not need to include who is at fault. The operator will be liable to pay the third party victim compensation. While it may seem like this system could disincentivize operators, it can sometimes work in their favor. The liability framework sets the operator’s liability at a minimum level of compensation, which requires operators to hold the minimum insurance to ensure the available funds in the case of an accident. In some countries, this liability is also capped. State funds may also be available in the case of exhausting the operator’s funds, as seen in Japan after Fukoshima. International treaties add protection to the operator, meaning they can not be sued in another country that is also a contracting party to the same treaty or convention. This allows operators to manage risk, quantify liability, insure liability and enables protection against lawsuits in another country if their country of operation is a contracting party to the same international nuclear treaty or convention.

The minimum liability amount under new conventions, such as the Convention on Supplementary Compensation (CSC) and the 1997 Vienna Convention, is 300 million Special Drawing Rights (SDRs) of the International Monetary Fund (IMF), which is equivalent to $430 million. Operators do not need to hold this amount, but do need to be able to pay this in the event of an accident, meaning they must be insured for this amount. The nuclear liability system is similar to that of the oil industry in that it attempts to simplify liability and transboundary accident issues.

Helen’s career post Bahrain (34:13)
34:13 - 47:58 (Helen discusses Bahrain’s current nuclear industry and what path she took after leaving the region. She discusses her textbook and the creation of her own nuclear law practice.)

Q. What is Bahrain’s nuclear industry like now? Why did you leave Bahrain and what have you done since?
A. Bahrain was just beginning to site land where a large reactor could be built when Helen left the region. While Bahrain’s nuclear program ended after 2011, Helen believes Bahrain may consider SMRs in the future.

From Bahrain, Helen moved to Washington DC to join Pillsbury Winthrop Shaw Pittman to work in their nuclear practice alongside other titans of the nuclear industry, including Jay Silberg and Jim Glasgow. After 4 years, Helen was recruited to join Shearman and Sterling to facilitate the development of their nuclear practice. After another 4 years, Helen left to practice independently.

The first edition of Helen’s book The Law of Nuclear Energy came out in 2013. Helen’s former boss at Freshfields told Helen to write a textbook because one had not existed, requiring lawyers to draw from many sources. Helen was nervous upon releasing the book due to her junior status, but received positive feedback and the second edition was published in 2018. After a decade in the industry, Helen felt more in place to write the second edition, having identified gaps in available resources. The second edition represent the important changes to the nuclear industry over the past decade, such as the Convention on Supplementary Compensation, which is a nuclear liability treaty which was not enforced at the time of Fukoshima, and the enforcement of the Convention on the Physical Protection of Nuclear Materials Amendment, which came into effect during the Obama administration.

Just over a year ago, Helen’s passion for nuclear law inspired her to start her own practice. While she enjoyed the 15 years spent at law firms, Helen believes a single-minded focus is required to practice nuclear law. Helen supports the IAEA’s Nuclear Infrastructure Department’s workshops as a law expert to help newcomer countries develop nuclear infrastructure. While the IAEA has excellent human resources and a wealth of materials and guidance, their activities are restricted. The IAEA can not give strategic advice, suggest technologies, or provide negotiation guidance. Helen fills this gap by educating countries and helping them strategize and transition from consideration to implementation.

Egypt’s Nuclear Program (47:59)
47:59 - 56:41 (Helen discusses Egypt’s nuclear program and Egypt’s negotiations with the Russian nuclear industry to manage risk.)

Q. What are some of the countries you’re working with?
A. Helen has spent the last 3 and a half years advising the Egyption government broadly on their nuclear program and in their negotiations of project agreements with the Russian nuclear industry. Helen has spent 80-100 days in Egypt during each of these years and, while it requires her to spend time away from family and friends, Helen sees this as a valuable learning experience.

Egypt’s nuclear program began in the 1950s and had considered launching a tender process for a large reactor on multiple occasions. A few years ago, Egypt reinvigorated the project and was approached by the Russian government with a comprehensive proposal. The intergovernmental agreement was signed in 2015 and implemented in 2017, setting the legal, financial, technical and commercial frameworks to build 4 Russian VVER1200 reactors on Egypt’s Meditterranean coast. The agreement includes a $25billion loan from Russia to Egypt to facilitate the project. While there are supply and energy security risks involved in relying on another country, this deal helped establish Egypt’s nuclear industry.

Managing risk is heavily considered when drafting commercial contracts. Helen thinks about the worst case scenarios and negotiates solutions that allocate risk to one party and incentivises the continued performance by both parties in the case of a political dispute. The Egypt-Russia contract, for example, includes protections against any potential political issues that could arise between the two countries.

Nuclear negotiations involve both companies and governments. For example, the Russian government owns the Russian nuclear industry through Rosatom, which owns the majority of subsidiaries. Through the subsidiaries, commercial agreements are put in place. For example, a country may sign an intergovernmental agreement. Then, they may sign individual contracts with individual companies within the Russian apparatus. Negotiations occur with different commercial entities, and the Russian nuclear program is able to manage this massive industry and bring everything together.

Nuclear energy moving forwards (56:42)
56:42 - 1:00:23 (Helen states why she has stuck with nuclear law and what she sees for the future of nuclear.)

Q. What grabbed your attention in nuclear law and keeps you pushing for nuclear energy?
A. Helen was first grabbed by nuclear law because she sees how much left there is to do in the industry. Each new nuclear framework is created from inspiration and requires identifying new issues and solutions. Helen thinks there is still so much work to be done if nuclear is to supply clean energy, requiring active thinking about how to continue doing it better and more efficiently, effectively, safely and securely.

Helen is positive and wants to see nuclear energy playing a role in climate change. She sees nuclear coming to a global crossroads when it comes to large reactors and SMRs. No matter the direction, Helen wants to see the next wave of construction on budget and on time to secure the future of nuclear energy. She also wants to see the legal and regulatory perspectives get in front of the issues facing the industry to ensure nuclear development is not impeded.

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