California wants Yucca refund

Benjamin Grove

Thursday, Dec. 8, 2005 | 8:17 a.m.

WASHINGTON -- California may ask the federal government to refund money that it has paid for Yucca Mountain, a request based on "uncertainty" surrounding the proposed nuclear waste repository.

Yucca supporters said the development could give federal officials fresh incentive to move to open it as soon as possible, while critics said the action was further evidence that Yucca is viewed as a waste of money.

"I don't blame California -- they should have their money back," Rep. Jon Porter, R-Nev., said. "And I think every other state should, too. This is just one more example that the foundation that has been supporting Yucca Mountain is starting to crumble."

California's action reflects the long-simmering frustration of nuclear power utilities nationwide -- and the states where they are located -- over Congress' broken promise to construct a national nuclear waste repository by 1998. The Yucca repository has suffered numerous setbacks for years, and some critics suggest that it may even be losing support in Congress.

While waiting for a storage site to open, utilities have paid to store their highly radioactive waste at their plants. The utilities have filed dozens of lawsuits, most of them still pending, to force the government to pay for the on-site storage.

Federal law requires that nuclear power ratepayers pay part of the cost of developing Yucca. So ratepayers since 1982 have paid a special tax collected in a national nuclear waste fund. The fund currently has about $17.9 billion, according to the Energy Department. About $8 billion has been spent on Yucca to date.

California ratepayers have contributed more than $1.1 billion to the fund. Last month the California Energy Commission recommended that "some portion" of that money be returned to the state to help pay for the "long-term on-site" waste storage.

"The federal waste disposal program remains plagued with licensing delays, increasing costs, technical challenges and managerial problems," a commission report noted.

It is not clear, however, how California could obtain a refund. It would be illegal for a state to stop making its payments to the fund, and it would take an act of Congress to approve refunds.

"The law is pretty clear about what is required of states," Energy Department spokesman Craig Stevens said. "We remain committed to Yucca Mountain and to opening the repository based on sound science."

Obtaining a refund for now is "more of a goal" than a specific plan, said Barbara Byron, nuclear waste policy administrator at the California Energy Commission.

The proposal, first pitched by a consultant to the state in August, is being sent this month to the California Legislature and governor's office, she said.

Byron made the case often repeated by officials in other states: Ratepayers are essentially paying twice for nuclear waste storage -- into the waste fund for Yucca, and for the current on-site storage at the plants.

"It's sort of a fairness issue," she said.

California may be the first state to consider requesting a Yucca refund, said Brian O'Connell, director of the nuclear waste program for the National Association of Regulatory Utility Commissioners. Other state utility boards may take notice, he said.

"Anytime the biggest state in the union does something, the other states pay attention," O'Connell said.

He added: "It has come up from time to time: 'If the money is going down a rat hole, why don't you stop paying?' "

While utilities generally have agreed that it is not in their best interest to stop paying, they also believe they eventually will prevail in their lawsuits, O'Connell said.

The California action is consistent with the frustration felt by nuclear power companies and the states, said Michael Bauser, a lawyer for the Nuclear Energy Institute, the industry's leading trade group. It likely would grab the attention of Congress if other states start asking for their money back, he said.

"It would draw their attention to the importance of the Department of Energy meeting its contractual obligation, so those enormous liabilities that have been piling up don't get any further out of hand," he said.