Thursday, April 28, 2005 | 10:53 a.m.
WASHINGTON -- A U.S. Court of Federal Claims judge may cancel the Energy Department's contract with a closed nuclear power plant to take its nuclear waste and return ratepayer money to the utility.
If made final, the decision could advance Nevada's push to leave waste at nuclear power plants, according to state attorneys but would not solve the other utilities' financial problems with storing the waste, according to the industry.
The state strongly opposes the Energy Department's plan to store 77,000 tons of nuclear waste at Yucca Mountain, 90 miles northwest of Las Vegas, but the Bush administration and the nuclear industry strongly support the plan.
In a court order issued last week, Judge Susan Braden of the U.S. Court of Federal Claims asked the Justice Department and the Sacramento Municipal Utility District to show why the court should not "void" the department's contract with the utility to take waste and order the government to pay back the $40 million it put into the waste fund.
Overall, ratepayers have put roughly $23 billion into the fund since its creation in 1983, and 66 lawsuits have been filed against the department for breaching its contract.
"There is no evidence in the record that the Government had reason to believe in 1983, 1989, or at present that: Yucca Mountain ever will be licensed to store spent nuclear fuel and high-level radioactive waste; an appropriate means of transporting such fuel and waste to the site will be authorized and licensed; and/or an appropriate method of temporary storage for transport and/ or permanent storage will be identified, licensed, and manufactured," according to the court order."
The Sacramento utility district sued the Energy Department for breaking its contract to take nuclear waste by 1998, as agreed to in the Nuclear Waste Policy Act of 1982.
The district's Chief Assistant General Counsel Steve Cohn said the utility put $40 million into the Nuclear Waste Fund, an account specifically designed by Congress to collect fees from ratepayers to fund the Yucca project, for the Rancho Secco nuclear power plant. The plant closed in 1989, but used nuclear fuel still sits at it, waiting to be moved to Yucca. The district sued for $78 million to pay for costs associated with storing the used fuel after the department did not take it.
The court gave the Sacramento Municipal Utility District and the U.S. Justice Department until June 20 to file responses, but also invited anyone else to file a response.
Attorney Joe Egan, who is hired by the state to handle Yucca issues, said the state plans to respond to the court.
"It's an amazing statement," Egan said, adding that it could be the groundwork for launching the nicknamed "PECO Alternative."
PECO Energy of Philadelphia, which is part of Exelon Corp. of Chicago reached an agreement with the department to claim ownership of its used fuel on site and build dry storage casks. Nevada says that is a better solution than moving dangerous nuclear waste across the nation to a site it sees as unsafe.
Although the industry has argued for years that the government continues to take its money but there is still no repository, getting its money back may be not the solution they want.
Cohn said the $40 million, which does not include the interest that the money has earned in the fund, would not cover the $78 million in capital costs or the estimated $5 million a year in operations and maintenance spent to keep the stored fuel safe.
Brian J. O'Connell, the director of the Nuclear Waste Project Office at the National Association of Regulatory Utility Commissioners, which supports the Yucca project, found the order "odd and surprising."
He said canceling the contract and giving back the money will not solve the waste disposal problem. Under law, the government is supposed to take the waste for "geologic disposal." He said keeping waste at the site will not satisfy the law.
Michael Bauser, associate general counsel for the Nuclear Energy Institute, the industry's advocacy group, said the judge is drawing incorrect conclusions and suspected her "record" or documentation for the case might be incomplete.
"She is asking for additional information," Bauser said.
O'Connell also pointed out that the judge refers to vertical storage of waste containers inside the mountain, even though it was decided a while ago they would be stored end to end.
O'Connell and Bauser have not decided yet whether their organizations will respond.
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