A watchdog group has filed a federal lawsuit that contends Holtec International’s application to create an underground storage site for commercial nuclear waste could leave taxpayers holding the bag.

The group Beyond Nuclear argues Holtec International has an illegal provision in its license application that would allow the federal government to take ownership of spent fuel from nuclear reactors before the proposed $3 billion storage facility is built in Southern New Mexico.

That violates a federal law aimed at preventing public agencies from being stuck with massive waste if a company like Holtec decides not to follow through with construction, said Diane Curran, an attorney representing Beyond Nuclear, based in Washington, D.C.

“It’s an end run around the federal statute,” Curran said.

The Nuclear Regulatory Commission twice rejected the group’s efforts to challenge Holtec’s application. Holtec plans to lease 1,000 acres from the Eddy-Lea Energy Alliance — a consortium of local governments — to construct an underground site that could hold as much as 173,000 metric tons of high-level radioactive waste.

The storage site would be temporary until Yucca Mountain in Nevada — which has been embroiled in a political firestorm for years — becomes available.

In its April decision, the commission’s licensing board acknowledged the application contained an unlawful provision that would let the government prematurely take over the commercial waste but said that nothing forces the government to do so.

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“The Board assumes Holtec will honor its commitment not to contract unlawfully with DOE [Department of Energy] to store any other spent nuclear fuel,” the agency said in its decision. “Likewise, we assume DOE would not be complicit in any such unlawful contracts.”

The agency didn’t order the provision removed, saying it trusted the parties involved not to pursue it, Curran said.

A Nuclear Regulatory Commission spokesman said he couldn’t comment on a case in litigation.

Eddy-Lea Chairman John Heaton said he didn’t have the legal expertise to discuss the agency’s rulings, other than he agreed with them. “All I know is NRC has rejected these claims … as having no substance or validity,” Heaton said.

However, Curran said the provision that’s still in the application clearly violates the 1982 Nuclear Waste Policy Act.

The purpose of the law is to compel companies to invest in infrastructure so they have a stake in transporting and storing commercially generated waste and can’t pass it off on the government, Curran said.

“As long as these private companies own the spent fuel, everyone has got to come together and figure out the solution,” Curran said. “Once they [the companies] can shift liability for spent fuel to the federal government, that that becomes our problem — the taxpayers’ problem.”

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