NUCLEAR WASTE; State regulators sue DOE over repository fees

Katherine Ling, E&E reporter //573 words/5 April 2010GreenwireGRWREnglish© 2010 E&E Publishing, LLC. All Rights Reserved

The nation's state utility regulators are taking legal action against the Energy Department to stop the government from collecting fees to manage spent nuclear fuel.
The National Association of Regulatory Utility Commissioners filed a lawsuit Friday in the U.S. Circuit Court of Appeals for the District of Columbia seeking to overturn DOE's decision in October not to suspend payments into the Nuclear Waste Fund.
NARUC asked DOE last July to suspend the one-tenth-cent-per-kilowatt-hour fee paid by customers of nuclear-powered electricity because the Obama administration planned to cancel the waste repository at Yucca Mountain, Nev., and establish a "blue ribbon" commission to consider alternative waste disposal options.
"There is no clearly defined program for disposal of spent nuclear fuel and high-level radioactive waste. Therefore, there is no basis to assess the adequacy of fees that continue to be paid into the Nuclear Waste Fund," the NARUC letter said. "If we are going to pause to reconsider disposal options, we feel it is also appropriate to pause the fee payments."

Congress established the Nuclear Waste Fund to finance the management and ultimate disposal of the nation's commercial nuclear waste and later signed contracts with utilities that committed to taking the spent fuel away beginning in 1998. DOE has long since missed that deadline, and the government has paid hundreds of millions of dollars in settlement and legal fees to U.S. utilities over the partial breach of contract.
Meanwhile, customers of nuclear power have continued to pay fees on their electricity bills into the Nuclear Waste Fund, which is estimated to be worth about $25 billion on paper. But the money is not actually in a bank account somewhere. Congress voted to include the waste fund in the general spending fund, so it is used to offset discretionary appropriations every year. Stopping the fee payment would drop annual spending by at least $770 million.
DOE is required by law to review the nuclear waste fee every year to decide if it is appropriate to finance the eventual transportation and disposal of the nation's nuclear waste. DOE determined last July that the current waste fee was adequate and "essential" for meeting the government's obligations, the agency said in its rejection letter to NARUC.
"The Department of Energy has consistently determined that the current fee of one-tenth cent per kilowatt hour is adequate to cover the total system life cycle costs of disposing of the commercial spent nuclear fuel and high-level radioactive waste, using assumptions in place at the time," said Christopher Kouts, acting director of DOE's Civilian Radioactive Waste Management Office.
When pressed by lawmakers on suspending the nuclear waste fee, Energy Secretary Steven Chu has repeated DOE's findings to keep the fee in place but that DOE would review the fee's adequacy every year.
The Nuclear Energy Institute, which represents the nation's nuclear industry, previously has said it would consider taking legal action on the fee issue and was copied on the NARUC appeal filing. NEI said it did not have a comment on the matter at this time.
NARUC also filed last month to intervene against DOE's motion to withdraw its Yucca Mountain license application with prejudice from the Nuclear Regulatory Commission.