Back in 1996, the Connecticut Yankee nuclear power plant in Haddam Neck was shut down because it was too costly to keep operating. Dangerous radiation had leaked from the plant in 1978 and again in 1989, which contributed to the decision.
But even after the plant closed, the meter kept running.
Under a contract that was tied to the operation of the plant, the federal government was supposed to take possession of the spent nuclear fuel at the site starting in 1998, but never did. As a result, the company paid more than $10 million a year to keep the materials secure.
The federal Department of Energy had attempted to build a repository to permanently store the waste in Nevada's Yucca Mountain, but its efforts to remove and store the fuel rods and other waste didn't materialize. In a lawsuit that was filed in 1998, the plant owner accused the federal government of being in breach of its contract to remove the materials from the state. The suit was joined by two other nuclear plants in New England.
This month, the federal government agreed in a settlement to pay the owners of the closed Connecticut Yankee plant $39.7 million for the costs related to removing the radioactive materials, which had been paid by electric customers, but never done. The settlement agreement calls for the government to reimburse an additional $120 million to the Maine Yankee Atomic Power Co. and Yankee Atomic Electric Co. in Massachusetts. Because electric customers in the three states had been paying the federal government for the cost of storing the nuclear waste, plans are being filed with the Federal Energy Regulation Commission to establish a process to distribute the funds.
Owners of the three plants said the entire $160 million settlement will be returned to the rate payers, after adjustments are made for state and federal taxes. The money has already been transferred from the U.S. Treasury to the three companies.
In a statement from the owners of the three plants, which are part of a consortium of New England utility companies, the companies plan to find "the best way to use the proceeds from the damage awards to benefit the ratepayers."
The three plants, which were all decommissioned at around the same time, together sued the government for breach of contract. In August 2004 there was a seven week trial on damages in federal court. Various appeals dragged the process out until last May when the U.S. Court of Appeals upheld a decision by U.S. Court of Federal Claims Senior Judge James F. Merow.
In addition to the $39.7 million awarded to Connecticut Yankee, Maine Yankee was awarded $81.7 million and Yankee Atomic $38.3 million.
Some say the settlements are just the beginning. That is because the issue of disposing of the spent nuclear waste remains unsolved.