On December 18, 2009, the U.S. Court of Federal Claims issued an
opinion awarding more than $50 million to Perkins Coie's
client, Wisconsin Electric Power Company (WE), in its claim against
the U.S. Department of Energy (DOE) for the partial breach of a
contract to accept and dispose of spent nuclear fuel (SNF) and
high-level waste (HLW) from WE's Point Beach Nuclear Power
The WE litigation is one of numerous lawsuits filed by utilities
against the DOE for its failure to begin accepting and disposing
the utilities' SNF/HLW by January 31, 1998, as required by the
Nuclear Waste Policy Act (NWPA), 42 U.S.C. §§
10101-10270, and the standard contracts that the NWPA required the
utilities to enter into with DOE.
Prior to 1977, utilities had assumed that their SNF would be
reprocessed. After President Jimmy Carter effectively halted the
reprocessing of SNF in 1977, the NWPA was passed in 1983, affirming
the federal government's responsibility to provide for the
permanent disposal of SNF/HLW. In return for the government's
performance, the NWPA required the nuclear utilities to pay for the
costs of such disposal through an initial fee based on electricity
generated by each utility's nuclear reactors prior to April 7,
1983, and through continuing fees based on subsequent generation.
These fees are deposited into the Nuclear Waste Fund (NWF). As of
September 30, 2009, the utilities' payments and credited
interest to the NWF totaled $30.2 billion.
The DOE, however, has failed to accept any SNF or HLW and, given
the current administration's position that it will not proceed
with Yucca Mountain, it is uncertain how the government intends to
deal with spent fuel. At the same time, there appears to be renewed
interest in the construction of nuclear plants in the United
States. Currently, there are more than 15 applications for more
than 25 new reactors under active consideration before the Nuclear
Regulatory Commission. While long-term storage or disposal of
SNF/HLW obviously is an issue for nuclear plants that requires the
cooperation of the federal government, the generation of nuclear
power does not result in the generation of emissions that cause
global warming. Nuclear power can also generally provide
substantial base power generation at an attractive price per
While the government has settled several of the spent fuel
lawsuits, it has also chosen to litigate many of these cases. In
the WE case, there was a trial in Washington, D.C., that lasted
more than five weeks during which 27 witnesses testified and
hundreds of exhibits were entered into evidence. The focus of the
trial was on past damages that WE had incurred to mitigate the
DOE's partial breach because, prior to trial, the court had
determined that the DOE had partially breached its contract with
WE's past damages consisted of the costs that it incurred in
providing for alternative storage of its spent fuel. These damages
primarily included costs for constructing a dry storage facility,
purchasing casks for the storing and transporting of spent fuel,
loading spent fuel into these casks, and obtaining approval to
incur these dry storage costs from the Public Service Commission of
Wisconsin. In its decision, the U.S. Court of Federal Claims
awarded WE more than 96% of its claimed "nominal," or
non-finance-related damages to mitigate DOE's breach.
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