FOR IMMEDIATE RELEASE
June 20, 2000
Contact:
Dianne R. Nielson, Executive Director, 801.536.4402
Today the State of Utah is litigating the estimated costs of constructing and operating the Private Fuel Storage, L.L.C. (PFS) high level nuclear waste storage facility proposed for the Skull Valley Band of Goshute Indian Reservation, Utah. We are not allowed to discuss specific cost issues because PFS simply claims that financial matters are proprietary. As a result, the public will not be able to scrutinize PFS's financial qualifications to safely operate and close the facility.
The Nuclear Regulatory Commission (NRC) has done an unacceptable job at reviewing and approving PFS's financial qualifications. Although the State has raised many substantial concerns about PFS's financial status, NRC has restricted the State to only questioning PFS's cost estimates. NRC has not thoroughly investigated the financial viability of PFS itself and the proposed storage facility.
PFS is a limited liability company with no assets of its own. As a limited liability company, PFS member utilities will be shielded from individual liability for any incidents related to the PFS project. Therefore, there are no deep pockets to fund unforeseen safety problems that may occur.
Although NRC regulations require the demonstration, NRC will not require PFS to demonstrate its financial qualifications prior to granting PFS a construction and operating license for a 4,000-cask nuclear waste storage facility. Although the State believes PFS's current and projected assets, liabilities, and capital structures are critical to ensure financial responsibility, NRC said it was not necessary to look at PFS's current financial status. According to NRC, "PFS will have no significant assets, liabilities, and capital" until a license is granted. Thus, NRC's attitude essentially nullifies its own financial assurance requirements. Moreover, instead of deciding now whether PFS has adequate funds to undertake this project, NRC is forcing the State of Utah and other intervenors to spend significant funds to participate in this licensing proceeding.
PFS will not be required to show that there is a viable market for the storage facility. PFS should demonstrate a viable market now as part of the licensing proceeding, and should not be issued an NCR license if no market exists. PFS has been unwilling to disclose whether any utility has actually agreed to store nuclear waste at the Skull Valley site. If there is not a sufficient market, PFS may be forced to cut corners and jeopardize safety.
NRC does not require any insurance or bonding to ensure liability coverage in the event of an accident.
Although required by regulation, NRC will not require PFS to set aside all decommissioning funds prior to receiving a license.
The State has no confidence in NRC's evaluation of PFS's financial qualifications. NRC recently issued a license to a company it knew was on the verge of bankruptcy.
In general, NRC has accepted unsupported statements and required little documentation that support PFS's claims about its financial capabilities. Moreover, NRC has relied on unenforceable license conditions that defer any financial demonstration until after the license is issued. As a result, NRC will allow PFS to construct the facility before PFS is required to show revenue sources to operate it. Once the facility is constructed, PFS will have a strong impetus to move forward with operation -- possibly sacrificing safety. Furthermore, NRC did not even evaluate PFS's current data. For example, NRC approved PFS's outdated construction cost estimates that are more than half of PFS's own updated cost estimates.
Under NRC's approach, the State and the public are completely excluded from the process and denied their right to challenge whether PFS is financially qualified.