Entergy Nuclear Indian Point 2, LLC v. United States

64 Fed. Cl. 515, 60 ERC (BNA) 1007, 2005 U.S. Claims LEXIS 62
CourtUnited States Court of Federal Claims
DecidedMarch 9, 2005
DocketNo. 03-2622-C
StatusPublished
Cited by14 cases

This text of 64 Fed. Cl. 515 (Entergy Nuclear Indian Point 2, LLC v. United States) is published on Counsel Stack Legal Research, covering United States Court of Federal Claims primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Entergy Nuclear Indian Point 2, LLC v. United States, 64 Fed. Cl. 515, 60 ERC (BNA) 1007, 2005 U.S. Claims LEXIS 62 (uscfc 2005).

Opinion

OPINION AND ORDER

LETTOW, Judge.

This ease involves a contract for the storage and disposal of spent nuclear fuel (“SNF”) and high-level radioactive waste (“HLW”). Entergy Nuclear Indian Point 2, LLC (“ENIP”) is the owner of Indian Point 1 Nuclear Power Station and Indian Point 2 Nuclear Power Station (collectively the “Indian Point facilities”). These facilities were previously owned by Consolidated Edison Company of New York, Inc. (“Consolidated Edison”), which entered into a contract with the Department of Energy (“DOE”) under the Nuclear Waste Policy Act of 1982 (“NWPA”), Pub.L. No. 97-425, 96 Stat. 2202 (Jan. 7, 1983) (codified as amended at 42 U.S.C. §§ 10101-10270), obligating DOE to dispose of SNF and HLW generated at the Indian Point facilities, with such disposal to commence no later than January 31, 1998. ENIP purchased the Indian Point facilities on September 6, 2001. DOE had not then begun disposing of any facility’s SNF, nor has DOE commenced such disposal to date. In the purchase agreement between ENIP and Consolidated Edison, the contract between DOE and Consolidated Edison for disposal of SNF and HLW was assigned to ENIP. Hr’g Tr. 24; PL’s App. 152 (Asset Purchase and Sale Agreement between Consolidated Edison and ENIP § 2.02(a)(xi) (as of Nov. 9, 2000)).1 As ENIP and Consolidated Edison would have it, that assignment grants ENIP the right to recover any damages from claims against DOE accruing after the date it purchased the plant, and it reserves to Consolidated Edison claims for damages accruing prior to the closing date of ENIP’s purchase of the Indian Point facilities. Both utilities have filed claims against the United States in this court.2

Conceptually, the claims and contentions in this case are a reprise of those that were the subject of a decision rendered a short time [518]*518ago in the action styled Entergy Nuclear Generation Co. v. United States, 64 Fed.Cl. 336 (2005). ENIP filed its complaint on November 5, 2003, claiming that the government partially breached its contract, violated the implied covenant of good faith and fair dealing, and took ENIP’s property without providing just compensation. ENIP subsequently filed a motion for summary judgment on liability for the partial breach of contract claim, arguing that DOE has failed to commence its disposal of SNF and HLW from the Indian Point facilities. The government responded with its own cross-motion for summary judgment on liability, which challenges ENIP’s standing to seek damages prior to the date of its purchase of the plants, claims that ENIP has failed to show any resultant injury to satisfy this court’s standard for summary judgment on liability, and seeks summary judgment that DOE is not liable to ENIP for any of the government’s actions prior to the first post-assignment date when it would have disposed of the Indian Point facilities’ SNF under DOE’s disposal procedures. A hearing was held on the cross-motions on February 9, 2005. For the reasons stated below, the plaintiffs motion for summary judgment is granted, and the government’s cross-motion is denied.

BACKGROUND3

Prior decisions of the Courts of Appeals for the District of Columbia and the Federal Circuit, as well as by the Court of Federal Claims, have described the continuing controversy over disposal of spent nuclear fuel.4 Given this background, the facts recounted below are limited to those relevant to the parties’ arguments and the disposition of the pending motions.

A The NWPA

On January 7,1983, the NWPA was enacted, authorizing the Secretary of DOE to “enter into contracts with any person who generates or holds title to high-level radioacfive waste, or spent nuclear fuel, of domestic origin for the acceptance of title, subsequent transportation, and disposal of such waste or spent fuel.” 42 U.S.C. § 10222(a)(1). Facilities could not renew their licenses unless they entered or were actively negotiating in good faith towards entering such a contract. Id. § 10222(b)(1)(A). The NWPA called upon the contracting utilities to pay a onetime fee for electricity generated and sold prior to April 7, 1983, and a continuing fee for electricity generated and sold after that date. Id. § 10222(a)(2)-(3). See Wisconsin Elec. Power Co. v. Department of Energy, 778 F.2d 1 (D.C.Cir.1985) (resolving the basis upon which the continuing fee would be calculated). In exchange for the payment of fees, the Act mandated that contracts include a provision requiring the Secretary to begin disposing of SNF or HLW no later than January 31, 1998. 42 U.S.C. § 10222(5)(B).

After notice and a comment period, DOE promulgated a Standard Contract for Disposal of Spent Nuclear Fuel and/or High-Level Radioactive Waste, codified at 10 C.F.R. § 961.11 (“Standard Contract”). See 48 Fed. Reg. 5,458 (Feb. 4, 1983). The Standard Contract allowed utilities either to pay the one-time fee in full without interest, or defer payment with interest, or prorate payment over forty quarters with interest accruing on the unpaid portion. Standard Contract, art. VIII.B.2. As required by the NWPA, the Standard Contract required DOE to begin disposal no later than January 31, 1998. Id., art. II.

B. The Standard Contract

The Standard Contract established a system whereby DOE would collect and dispose of SNF and HLW. For planning purposes, DOE was to issue an annual capacity report (“ACR”) every year beginning no later than July 1,1987. Id., art. IV.B.5(b). This report would “set forth the projected annual receiving capacity for the DOE facility(ies) and the annual acceptance ranking relating to DOE [519]*519contracts for the disposal of SNF and/or HLW including, to the extent available, capacity information for ten (10) years following the projected commencement of operation of the initial DOE facility.” Id. ACRs would determine the amount of SNF or HLW that DOE would accept in a given year. Acceptance priority rankings (“APRs”) would determine which SNF would be collected, and the general rule was that the oldest fuel or waste would be given the highest priority. Id., art. IV.B.5(a).

Utilities could submit delivery commitment schedules (“DCSs”) to DOE beginning on January 1,1992. Id., art. V.B.l. DCSs would identify “all SNF and/or HLW the Purchaser wishes to deliver to DOE beginning sixty-three (63) months thereafter.” Id. DOE was to approve or disapprove such schedules within three months of submission. If it disapproved a submission, DOE was to advise the utility of the reasons for disapproval and request a revised schedule within thirty days. Id. DOE was obliged to take action on the revised schedule within sixty days of its receipt. Id., art. V.B.2. No later than one year prior to the scheduled delivery, utilities were to submit final delivery schedules (“FDSs”). Id., art. V.C. Utilities could adjust the quantities of SNF in either direction by up to twenty percent if they did so at least two months prior to the submission of the FDS. Id., art. V.B.2.

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Bluebook (online)
64 Fed. Cl. 515, 60 ERC (BNA) 1007, 2005 U.S. Claims LEXIS 62, Counsel Stack Legal Research, https://law.counselstack.com/opinion/entergy-nuclear-indian-point-2-llc-v-united-states-uscfc-2005.