Amended DOE standard contract reduces SNF responsibility, report says

In their report, How an Amended DOE Contract for Nuclear Waste Will Affect New Reactors: Considerations for Policymakers, Bowen and Ponangi claim that amendments to the DOE’s standard contract with owners and generators of SNF, whereby the department would assume title of and dispose of the fuel, has weakened the force of the original contract.

Background: When the DOE published the original standard contract following the passage of the Nuclear Waste Policy Act in 1982, the expectation was that the federal government would begin SNF disposal operations in 1998. As that has yet to happen, and SNF remains in storage at reactor sites, the U.S. government has continued to be liable to plant owners and operators for SNF management costs.

The government’s projected future liability for the continued breach of the standard contract is estimated to be in the range of $37.6 billion to $44.5 billion, according to a 2024 audit.

The changes: Starting in the 2000s, the DOE began using an amended version of the standard contract for new nuclear power plants. Bowen and Ponangi note that the DOE made the changes without publishing the text in the Federal Register or explaining the new language to the public. They add that plant owners operating under the amended contract “possess materially different rights to assert claims against the federal government.”

Bowen and Ponangi highlight the effects of two of the amended contract’s changes—a “significantly delayed” date for when the DOE is obligated to take the SNF and limits to federal liability if the DOE fails to take possession of the SNF.

The authors explain that the amended contract does not require the DOE to accept the SNF until up to 10 years after a reactor’s license expires. Given potential license extensions, this means that it may be 70 years following the start of new reactor operations before the department begins removing the fuel. Likewise, the authors write that “new clauses in the amended contract appear to substantially limit the federal government’s liability if it fails to accept SNF at these distant dates.”

“All told, there is not much incentive for DOE to do anything in the near term with respect to SNF from any new reactors. (Or, from a different perspective, there is not much in the way of punishment in the event DOE fails to act in coming decades,)” the report states.

Recommendations: While Bowen and Ponangi note that the DOE could further amend its standard contract to require more action on SNF, they admit that it is unlikely the federal government would be willing to accept increasing its exposure to liability. Short of that, the authors recommend that at a minimum, Congress hold a hearing to give the public a chance to weigh in on the changes.

Further recommended actions include policy solutions such as drafting new Environmental Protection Agency standards for SNF disposal and creating a new single-purpose organization with immediate access to the Nuclear Waste Fund to implement a national waste management program. Such recommendations have been made by other organizations, including the American Nuclear Society.