EnergySolutions seeks deal with state for its N-dump

EnergySolutions, the Salt Lake City-based nuclear waste company, is stepping forward with a partial fix for the state's budget problem: foreign radioactive waste.

For weeks, the company has worked quietly with state lawmakers on a proposal to have the state split EnergySolutions' profits from the disposal of foreign waste, profits that could mean as much as $1 billion over a decade.

There's just one obstacle -- but it's a big one.

EnergySolutions hasn't been cleared to take foreign waste at its mile-square disposal site in Tooele County. Changing that would require Gov. Jon Huntsman Jr. to drop his adamant opposition or the Legislature to override him.

Lawmakers and the company have kept the details a tightly held secret, although the plan was confirmed by several individuals familiar with the discussions.

A company spokeswoman denies that there is any "proposal" or anything "concrete" being pushed in Utah's Capitol. But lucrative payments to the state make up "one idea" the company has been exploring.

"We think there's an opportunity for the governor, the Legislature and EnergySolutions to come together and find a solution to this issue and also to provide a benefit and assistance to the people, the citizens of the state of Utah," said company spokeswoman Jill Sigal. The money, she added, could help struggling public schools, universities and charitable organizations.

The simplest way for this partnership to advance would be to get Huntsman's buy-in. But that could be difficult.

Lisa Roskelley, the governor's spokeswoman, said neither Huntsman nor his staff has had any conversations with the company and neither has been briefed on "the specifics of this proposal."

"The governor is against having the Italian waste come here, or the foreign waste in general," she said. "He believes philosophically that foreign waste should be contained within the country of generation."

House Speaker Dave Clark had little to say when asked about the potential EnergySolutions deal. But he noted many bills will be unveiled in the weeks remaining in the legislative session.

"There are a whole lot of issues out there kind of in that 'Ready, set, not to go' stage," the Santa Clara Republican said.

Sigal said there have been no direct discussions with the governor's office, and said "to our knowledge there is no legislation." Splitting 50 percent of any foreign waste profits with the state, she added, is a topic of discussion within the company and "a few people" outside it.

She said no hotter radioactive waste would be involved. The site would only accept the same low-level Class A waste that it already takes from around the United States -- not more hazardous Class B, Class C or high-level radioactive waste, which is prohibited in the state.

Nor would the site be expanded. Four and three-tenths acres of the mile-square site, roughly 5 percent of the facility's remaining capacity, would be used. And foreign waste would only be accepted for a decade, she said.

But Sigal acknowledged that there's an obstacle.

"In order for us to share 50 percent of our net disposal revenue from internationally generated material, you are right, we would need to dispose of internationally generated material."

EnergySolutions chairman and chief executive officer Steve Creamer told lawmakers in one meeting that the state's share would be $100 million or more a year. That number was confirmed by multiple sources who spoke on the condition of anonymity.

The company had a nearly $9 million loss on revenues of $1.1 billion in 2007, its first full year as a publicly traded company. Its 2008 earnings report is expected Feb. 26 after a year that saw its stock price plummet nearly 80 percent.

EnergySolutions said in filings with the U.S. Securities and Exchange Commission last fall that disposing of foreign waste was crucial to its future.

The company was planning to go public with its proposal next week, after the Legislature on Tuesday gets new revenue estimates that will be the basis for the 2010 budget. Legislators entering the session facing an estimated $450 million shortfall now expect the new projections to be dire.

Whether the promise of additional revenue to ward off threatened deep cuts in public education, social services and other areas will entice the governor to change his position has yet to be seen.

Last year, he wrote to the U.S. Nuclear Regulatory Commission to say that foreign waste imports are a policy question that should be addressed at a national level. He also objected to EnergySolutions' application to the NRC for an import license to bring about 20,000 tons of low-level waste from Italy, process it in Tennessee and dispose of up to 1,600 tons in Tooele County.

Huntsman also supported the Northwest Interstate Compact on Low-level Radioactive Waste in updating the organization's 20-year-old contract with EnergySolutions to say that foreign waste is not permitted in Utah, which is a member of the compact.

Congress set up the compact system more than two decades ago to help the states of Washington, South Carolina and Nevada, which all hosted low-level waste sites. They were tired of getting dumped on by states that were doing nothing to develop disposal of their own.

The federal law encouraged all states to join these "compacts" to regulate the flow of contaminated waste in and out of their regional boundaries.

EnergySolutions argues it is a privately owned and operated site that is not subject to the Northwest Compact's authority. And it filed suit in federal court last spring to get a judge's ruling to affirm that position.

The company and the compact are scheduled to appear Feb. 26 before U.S. District Court Judge Ted Stewart to make oral arguments in the case. The state -- at Huntsman's direction -- has sided with the compact in the case.

Those familiar with the company's proposal on Utah's Capitol Hill say EnergySolutions is confident that it will win the case. And a decision could come from the bench the day of the oral arguments.

But if Stewart rules against the company, or a decision in EnergySolutions' favor is appealed, there is one alternative still available for clearing the way for foreign waste imports. The Legislature before it adjourns March 12 could pass a bill to withdraw the state from the compact altogether.

Glossary

Citation

Taylor, T. (2009). EnergySolutions seeks deal with state for its N-dump. Retrieved from http://www.trunity.net/USDC/view/article/137681

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