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NEI, NARUC Argue for Suspension of Nuclear Waste Fee

Sept. 26, 2013—The nuclear industry asked a federal appeals court this week to order the Department of Energy to stop collecting Nuclear Waste Fund (NWF) fees until a viable nuclear waste disposal program is in place and until DOE can evaluate whether further revenue collections are justified to offset the costs of such a program.

Industry attorney Jay Silberg of the law firm Pillsbury Winthrop Shaw Pittman argued for NEI, the National Association of Regulatory Utility Commissioners and utility petitioners before the U.S. Court of Appeals for the D.C. Circuit in a case (NARUC v. DOE) that asks DOE to suspend NWF fee collection from nuclear utility ratepayers. The Nuclear Waste Fund was created under the Nuclear Waste Policy Act to fund the Yucca Mountain radioactive waste repository program, which DOE and the administration unilaterally canceled three years ago.  

The industry request is based on the argument that the Energy Department’s 2013 assessment of the adequacy of the NWF fees it collects is “legally deficient” because the department did not look at the correct program costs DOE is required to evaluate.

Silberg argued that the department instead is erroneously relying on DOE’s nonexistent waste disposal “strategy” to evaluate those costs. He noted that the assessment fails to show, as required, whether excess or insufficient revenues are being collected through Nuclear Waste Fund fees. In addition, the DOE assessment does not analyze whether the existing balance in the fund would be adequate if the fee collection stopped. The fund’s current balance is more than $26 billion and accrues interest at approximately $1.5 billion annually. This led Judge Sentelle to observe that even without any additional monies, the fund will grow substantially.

Ellen Ginsberg, NEI’s general counsel, said the oral argument went well for the petitioners and not as well for DOE. Judge Brown and Senior Judges Sentelle and Silberman had questions for both sides but spent more time questioning DOE counsel.

An important issue for NEI and NARUC is the remedy that the court might issue. A 2012 decision by the court found that it did have the authority to direct DOE to suspend collection of the fee. Silberg said that until a nuclear waste program is in place whose costs DOE can evaluate and until the department can evaluate whether further revenue collection from utility ratepayers is justified, the court should order DOE to promptly submit a proposal to Congress to reduce the fee to zero.