Legal Background and Questions Concerning the Federal Government’s Contractual Obligations Under the “Standard Contracts” with “Utilities”

This Memorandum analyzes issues related to the Standard Contract between the U.S. Department of Energy (“DOE”) and the “utilities.” Beginning with a discussion of specific provisions of the Standard Contract, this Memorandum then analyzes the status of lawsuits involving the Standard Contract, reviews issues related to on-site storage of spent fuel and HLW, and assesses the prospects for modifying the current waste-disposal regime through Federal legislation or amendments to the Standard Contract.
The Standard Contract provides for an “acceptance priority ranking” that gives priority to the “oldest fuel first.” In addition to allowing exceptions from the acceptance priority ranking for “emergencies” and “shut down” reactors, the Standard Contract authorizes DOE to use its discretion in approving acceptance schedules provided by utilities. Under the terms of the Contract, a utility may exchange its position in the acceptance priority ranking with another utility, subject to DOE’s “sole discretion” to approve such an exchange. While no utility has yet exercised its right of exchange due to the on-going unavailability of a permanent repository, utilities would be expected to so once DOE begins performance under the Contract.