Money for nothing argument prevails as court throws out nuclear waste fee

After extended litigation, nuclear plant operators won a federal court ruling Nov. 19 that effectively suspends collection of a nuclear waste fee while the government looks at long-term spent fuel storage options.

A three-judge panel for the U.S. Court of Appeals for the District of Columbia Circuit agreed with the nuclear power plaintiffs. The court basically said it is improper for the government to continue collecting the fee without construction of the Yucca Mountain facility in Nevada, or some viable alternative, in the foreseeable future.

The ruling won swift praise from the National Association of Regulatory Utility Commissioners (NARUC), which was a plaintiff in the case.

Sen. Lisa Murkowski (R-Alaska) also said that “zeroing out” the waste fee is the right move.

“The idea that the administration would continue to collect hundreds of millions of dollars from utilities, and ultimately ratepayers, is unacceptable,” Murkowski said in a statement. “I would encourage the administration to move quickly to restart work on the Yucca Mountain repository to deal with our permanent storage needs. The Senate should also immediately take up the nuclear waste legislation that I have been working on with my colleagues to deal with our storage demands in the immediate future,” said the Alaska senator.

The Nuclear Waste Administration Act (S. 1240) would establish an independent agency to address the nation’s stockpile of used nuclear fuel by advancing both interim and permanent storage facilities.

No storage facility plan should equal no fee, court says

The federal court panel agreed that nuclear plant operators are currently paying money for nothing.

“Petitioners, a group of nuclear power plant operators, appear again before us to claim, essentially, that so long as the government has no viable alternative to Yucca Mountain as a depository for nuclear waste they should not be charged an annual fee to cover the cost of that disposal. We agree,” the court said.

In the 2012 the same court decided that the Secretary of Energy had not complied with his statutory obligation to determine annually the adequacy of the fee that nuclear power companies pay to the government.

The appeals court had rejected the government argument that that the Department of Energy (DOE) was not obliged to determine the fee’s adequacy unless someone introduced evidence that the fee was either excessive or inadequate.

The appeals court said DOE had abandoned earlier cost analysis and ignored massive interest building up annually in the fund by previous assessments

The current situation is one where DOE has neither completed a national waste repository, at Yucca Mountain or elsewhere by 1998 as required by statute, or come up with a concrete plan for a Yucca Mountain alternative. A permanent spent fuel site might not be finished until 2048 and that is “truly ‘pie in the sky,’” the appeals court said.

“But until the Department comes to some conclusion as to how nuclear wastes are to be deposited permanently, it seems quite unfair to force petitioners to pay fees for a hypothetical option, the costs of which might well – the government apparently has no idea – be already covered,” the appeals court held.

“Today’s decision from the court is great news for consumers of nuclear power,” said NARUC Executive Director Charles Gray.

“Nuclear utilities and their consumers have paid more than $30 billion since the early 1980s for the construction of a nuclear-waste repository. These consumers have upheld their end of the deal, but unfortunately all they have to show for their investment is a hole in the Nevada desert,” Gray said.

“Thankfully, because of today’s actions, nuclear-power consumers will no longer have to pay for the government’s mishandling of this program,” Gray said.

“NARUC won big-time” in the appeals court, outgoing NARUC President Phil Jones told the NARUC annual meeting Nov. 19 in Orlando, Fla.

In another recent Yucca Mountain-related ruling, the D.C. Circuit had also said that it was improper for the Nuclear Regulatory Commission (NRC) to halt its case hearing into the Yucca Mountain license application.

About Wayne Barber 4201 Articles
Wayne Barber, Chief Analyst for the GenerationHub, has been covering power generation, energy and natural resources issues at national publications for more than 20 years. Prior to joining PennWell he was editor of Generation Markets Week at SNL Financial for nine years. He has also worked as a business journalist at both McGraw-Hill and Financial Times Energy. Wayne also worked as a newspaper reporter for several years. During his career has visited nuclear reactors and coal mines as well as coal and natural gas power plants. Wayne can be reached at wayneb@pennwell.com.