Sacramento utility gets $35M in nuclear waste case

SACRAMENTO, Calif. (AP) -- A federal court has awarded nearly $35 million to the Sacramento Municipal Utility District because of the federal government's failure to build a permanent site to store nuclear waste.

The utility had filed suit in the U.S. Court of Federal Claims, seeking to recover $80 million in payments it was required to make from 1992 to 2009 to eventually house nuclear waste from the closed Rancho Seco plant near Sacramento.

Since Rancho Seco closed in 1989 following a public referendum, the utility has been storing the spent fuel because Congress never opened its planned facility at Nevada's Yucca Mountain.

Judge Susan G. Braden ruled Thursday that the government partially breached its contract but also said the utility was not entitled to the full $80 million because it changed its storage method in anticipation of transferring the spent fuel, thus saving money.

The utility moved the nuclear waste from so-called wet ponds to dry storage containers, which are less expensive to maintain, in 2004.

"What is troubling is the judge's reasoning — the federal government, by breaching its contract, saved you money because you moved it into dry storage," the utility's general counsel, Arlen Orchard, said Friday.

He said that doesn't make sense because the utility would not have had the fuel storage costs had the government complied with the contract and taken the spent fuel. Orchard said the utility will consider an appeal but hopes eventually to reach a settlement with the federal government.

He said similar lawsuits have been filed across the country. About 82,000 tons of spent nuclear fuel and high-level nuclear waste is stored currently at 80 sites in 35 states.

In 1987, Congress designated Yucca Mountain as the only site for possible development as a repository. Some $15 billion has been spent to prepare the site as the central burying point for the nation's spent nuclear fuel, but Senate Majority Leader Harry Reid, a Democrat from Nevada, opposes the project.

President Barack Obama, meanwhile, has taken steps to follow through on a campaign promise to shut it down. His administration has sought to withdraw the government application to build the dump.

A telephone message left after business hours for a spokesman with the U.S. Department of Justice in Washington, D.C., was not immediately returned.

A spokesman for SMUD, Chris Capra, said the material is encased in concrete and steel, and is safe at its current location.

"There is no hazard to our customers," he said Friday.