Large utility makes deal on nuke waste

Suzanne Struglinski

Wednesday, Aug. 11, 2004 | 11:17 a.m.

WASHINGTON -- The country's largest nuclear power company struck a deal with the government Tuesday that could equal $300 million in payments for storing nuclear waste on site rather than in a federal storage site.

The Chicago-based Exelon Corp. announced a settlement with the Justice Department on Tuesday saying it "resolves all pending spent fuel litigation" the company and its subsidiaries brought against the government. The company had three legal challenges against the government.

The Energy Department was supposed to take commercial power plants' spent nuclear fuel in 1998 but failed to do so. It now hopes to open the federal nuclear waste storage site at Yucca Mountain, 90 miles northwest of Las Vegas, by 2010, although the state is fighting the plan.

Exelon and other nuclear companies have sued the government for failing to take the waste. The companies argue they have double the storage costs because they have to pay a fee into the Nuclear Waste Fund, which helps pay for the project while also paying to store their waste onsite.

Through the settlement, Exelon will receive $80 million immediately as reimbursement for the cost of keeping the waste on site, with more money expected each year until the site opens, according to the company. Exelon estimated if the sites opens in 2010, the company could receive about $300 million from the government.

Exelon operates 17 nuclear reactors and owns four shutdown reactors spread out on 11 sites in Illinois, Pennsylvania and New Jersey. It has 41,193 nuclear fuel assemblies in dry cask and pool storage, spokesman Craig Nesbit said.

Chris Cane, Exelon's president and chief nuclear officer, said in a statement that he was pleased with the settlement but that it cannot be considered a substitute for permanent storage at Yucca Mountain.

Angie Howard, executive vice president of the Nuclear Energy Institute, the industry's advocacy group that strongly supports the Yucca site, called the settlement "hugely significant and a direct result of the federal government's failure to meet its statutory and contractual obligations."

"The agreement means that taxpayers in every state -- including those who do not receive electricity supplies from nuclear power plants -- are now officially paying the costs of the federal government's failure to meet its obligations," Howard said in a statement.

"From this day forward, until the Yucca Mountain repository is open a minimum of six years from now, the meter will continue to run, costs will climb, and the burden of government inaction will continue to be borne by taxpayers from coast to coast," Howard said in a statement.