DOE held liable in storage of nuke waste

Friday, Sept. 1, 2000 | 11:33 a.m.

SUN STAFF AND WIRE REPORTS

WASHINGTON -- A federal appeals court ruled Thursday that four electric utilities may seek millions of dollars in damages from the government for the Energy Department's failure to accept highly radioactive waste from their nuclear power plants.

The decision by the U.S. Court of Appeals for the Federal Circuit dealt a blow to government attempts to negotiate out-of-court settlements with scores of utilities over the waste issue.

The DOE signed an agreement on July 20 with PECO Energy Co. to allow Peach Bottom nuclear power plant in Pennsylvania to store its radioactive wastes on-site because of delays in building a permanent repository.

Yucca Mountain, 90 miles northwest of Las Vegas, is the sole site under study for a nuclear dump by the DOE and if approved would not open until at least 2010. The site has not passed scientific muster. Congress and the president must approve the site first, then the Nuclear Regulatory Commission will take up to four years to license it.

Energy Secretary Bill Richardson said he had hoped the PECO agreement would become a framework for dealing with other nuclear power plants.

The DOE has acknowledged it is obligated to accept the waste, but argued that it missed a January 1998 deadline set by Congress because there is no place to put the used reactor fuel now kept at more than 100 nuclear power plants.

MaryAnne Sullivan, the DOE's general counsel, said no decision has been made on whether to appeal the ruling. "We wil be discussing our litigation options with the Department of Justice in the coming weeks," she said in a prepared statement.

It was not clear how the ruling will affect other utility cases, or if it would affect them at all. Still, lawyers for the utilities called the ruling a major victory.

"This is a clear affirmation that the government is liable for breaching these contracts and has to pay damages to these utilities and the damages are going to be huge," said Jerry Stouck, an attorney for the three utilities involved in the litigation.

The court rejected the government's argument that relief was available through the administrative process and concluded the utilities have authority to seek civil damages from the Court of Federal Claims.

"Failure to perform a contractual duty when it is due is a breach of the contract," the appeals court found in the case involving Maine Yankee Atomic Power Co., Connecticut Yankee Atomic Power Co., and the Yankee Atomic Electric Co.

The utilities own three reactors in New England that have been shut down, but tons of used reactor fuel remain on-site.

The court, in a separate ruling, found that Northern States Power Co. in Minnesota also could seek damages through the Court of Federal Claims. The court cited the same reasoning as in the Yankee case.

It's unclear how much in damages the utilities may get.

Stouck said that the three Yankee companies are seeking a total of about $300 million. Northern States Power is seeking "in excess of $1 billion," according to court filings.

"It means these utilities are going to get a chance to prove their damages. It's a major victory," said Alex Tomaszczuk, an attorney for Northern States Power.

About a dozen utilities, including those involved in the two cases before the appeals court, have sought damages.

It was unclear today how the appeals court decision will affect these other cases or some of the other utilities that want the government to accept some 40,000 tons of spent nuclear fuel building up at reactors in 31 states.

"We remain persuaded that the quickest and most efficient ways to get relief to those utilities that are incurring costs as the result of our delay in accepting spent nuclear fuel is direct negotiations between individual utilities and the department," Sullivan, the government's attorney, said.