Diné Natural Resources
Protection Act of 2005

On June 23, 2006, the Nuclear Regulatory Commission (NRC) issued its first-ever license for a uranium enrichment plant to Louisiana Energy Services (LES). LES is wholly owned by Urenco, a European nuclear company with similar enrichment plants in the Netherlands, Germany, and Britain. On July 5, the Urenco board of directors announced that it would proceed with the project. Groundbreaking ceremonies at the plant site near Eunice, New Mexico, were held on August 29, and LES says that it expects to begin production in late 2008.

But a major obstacle remains for the LES plant. On August 15, the Nuclear Information and Resource Service (NIRS) and Public Citizen (PC) filed suit in the District of Columbia Circuit Court of Appeals, asking that the court overturn the NRC license. NIRS and PC are challenging various parts of the license, especially related to handling the nuclear waste and the costs of waste processing and disposal.

The waste issues were not resolved in the licensing process even though LES had promised in writing to New Mexico Governor Bill Richardson three years earlier to “ensuring that a disposal path outside the State of New Mexico is utilized as soon as possible” and to “put in place as a part of the NRC license a financial surety bonding mechanism that assures funding will be available...for the decontamination of the LES plant as well as the ultimate disposal” of the waste.

THE NRC LICENSE
The six-page license is in effect for 30 years. LES can have up to 136,120,000 kilograms of uranium, plus 545,000 kilograms of uranium enriched up to 5 percent, and unquantified amounts of transuranic isotopes “as a consequence of the historical feed of recycled uranium at other facilities.”

The license allows onsite storage of a maximum of “5,016 48Y cylinders” of depleted uranium hexafluoride (DUF6) waste and limits “onsite shortage of any one cylinder of DUF6...to a maximum of 15 years.” Those provisions are included as part of the settlement with the State of New Mexico in order for the State to drop its challenges to the license.

The license also requires LES to have “full liability insurance” including “full funding for decontamination and decommissioning of the full-size facility” at least 30 days before it begins operation. If the insurance is less than $300 million, it must provide the NRC an evaluation of why it needs less than $300 million at least 120 days before operation. LES cost estimates are based on the “U.S. Department of Energy (DOE) depleted uranium disposition cost estimate” and “shall be no less than the updated DOE cost estimate.”

Since LES submitted its license application in December 2003, using its new expedited procedures, the final NRC approval took about 30 months. In contrast, the first LES license application for a site near Homer, Louisiana, took more than seven years before it was withdrawn. The quick licensing process, carried out by a three-judge Atomic Safety and Licensing Board, also sets a precedent for future nuclear projects, as the nuclear power industry has frequently complained that lengthy licensing proceedings drive up costs. However, people wanting to participate in the licensing process, such as NIRS and PC, point out the difficulties in developing strong technical arguments in short periods of time, especially when LES frequently changed important aspects of its application. The public was excluded from much of the process because proprietary and economic information resulted in closed hearings. And during some time of the process, many of the non-secret documents were also not available to the public. (See Voices, Winter 2004.)

WHAT TO DO WITH THE WASTE?
LES projects that it will generate 15,727 waste cylinders during its lifetime, but the license does not indicate where the waste would be disposed. The license also does not indicate where the DUF6 would be converted into a type of waste that could be disposed, nor does it require such a facility to be operational at any particular time. LES has not otherwise provided for when or where conversion and disposal occurs.

The conversion process is required because fluorine must be removed since it can turn into a highly toxic hydrogen fluoride gas. Even after conversion, the remaining depleted uranium might not be able to meet requirements for disposal as Class A “low-level” waste.

During the licensing proceeding, the LES was not required to show that it would have a conversion plant and disposal site. Instead, it could rely on a “plausible strategy,”vaguely defined approaches that it might use, which was to dispose of the waste at the Envirocare low-level dump in Utah. Currently, that site is the only one in the nation licensed to dispose of the types and amounts of depleted uranium waste from enrichment plants. The Waste Control Specialists (WCS) site in Texas, just two miles east of the LES plant, was considered an alternative site in the NRC final environmental impact statement. But WCS is not currently licensed for disposal of such waste. WCS has applied for such a license from the State of Texas, but when or whether it will be issued will not be determined for some years.

The history of the nation’s other three enrichment plants, which were originally developed to produce highly enriched uranium for nuclear weapons and were not licensed by the NRC, shows that the waste cylinders will stay onsite indefinitely. Oak Ridge, Tennessee; Paducah, Kentucky; and Portsmouth, Ohio have stored some waste cylinders for more than 50 years. More than 700,000 metric tons of DUF6 is at those sites, waiting for conversion and disposal. Oak Ridge cylinders are being moved to Portsmouth, and conversion plants, paid for by federal taxpayer dollars, are being built at Portsmouth and Paducah. The conversion plants are supposed to begin operating in 2008 and tale 20 to 25 years to convert the DUF6 into “low-level” waste, which would be shipped to Envirocare.

WHAT DOES IT COST TO STORE, CONVERT, AND DISPOSE THE WASTE?
What the projected cost of the LES “plausible strategy” would be was not publicly disclosed because it is considered proprietary information. But, as the license indicates, the projected cost is based on the estimated cost (not publicly disclosed) for DOE to dispose of the waste at the three enrichment plants. NIRS and PC challenged the strategy and the cost estimates during the licensing process. Since the Portsmouth or Paducah conversion plants are not scheduled to finish processing existing waste until after 2025, they would not be able to process LES waste until years after the New Mexico plant exceeded its licensed storage limits for DUF6 waste cylinders. The costs of building another conversion plant, which has to be separately licensed, could be higher than the two plants DOE is now building, and, of course, the actual costs of those facilities is unknown. But the three-judge NRC licensing board would not allow NIRS/PC to challenge the DOE cost estimates.

On August 17, 2006, almost two months after the license was issued and two days after the NIRS/DC appeal was filed, the five NRC commissioners ruled that “the Board erred in giving the DOE estimate preclusive force” and that the DOE cost estimate could be challenged. However, that NRC decision found that the mistake “is harmless.” Its rationale was that NIRS/PC had not submitted a timely, adequate contention (challenge) to the DOE cost estimate, and, “[a]s a result, the validity of DOE’s cost estimate was not at issue in the contested portion of this proceeding.”

In addition, NIRS/PC argued that the NRC did not adequately analyze the disposal impacts. It rejected analysis for the Institute for Energy and Environmental Research (IEER) that the radiation dose for disposal at Envirocare could exceed regulatory limits. It also ignored NRC’s own low-level waste licensing requirements related to the time period for analyzing possible releases. Indeed, NRC staff did no independent analysis of the capability of Envirocare to meet regulatory requirements.

IEER calculated the total costs at $3 billion to $4 billion, more than four times higher than LES’s estimates. IEER considers the estimated costs of deconversion to be too low and finds that Envirocare is not an adequate facility because its shallow burial may not contain the wastes. Instead, IEER believes that a deep mine or geologic repository would be needed, which would be substantially more costly than disposal at Envirocare.

COMMUNITY CONCERNS ABOUT LES
Political, business, and other groups in southeastern New Mexico have supported the LES plant. The support is primarily based on jobs and other economic benefits that are believed to come with construction and operation of the plant. A crucial element in LES’s coming to the area was that Lea County authorized up to $1.8 billion industrial revenue bond to finance the plant’s construction. What private financing will purchase the bonds and what, if any, funds Urenco will expend will be determined in the future, when construction actually begins.

On the other hand, a number of community residents are members of NIRS and PC, and were essential participants in the challenges during the NRC process. In addition to the matters that were accepted by the licensing board, those and other residents have additional concerns. The major ones were recently included in a petition sent to New Mexico Governor Bill Richardson, asking that pending state air and water discharge permits that must be issued before the facility could operate not be approved.

In addition to the waste concerns that were major elements of the challenges to the license and will be part of the court appeal, there are several other major concerns, which are beyond what NRC allows in its licensing decisions. The first major new private nuclear facility in the nation in the past 30 years will likely attract other nuclear and hazardous waste facilities. As mentioned in the petition, a group of local officials and nuclear companies plan to apply to the Department of Energy in early September to be the new reprocessing site, which would bring all of the nation’s spent fuel from nuclear power plants to the state. (See full petition in the box.) The reprocessing facility would be the key site for the Global Nuclear Energy Partnership, the Bush administration program to promote nuclear power worldwide. (See Voices, Summer 2006)

An ironic and contradictory part of the administration’s worldwide nuclear power strategy is that the same uranium enrichment centrifuge technology that LES would use is what Iran is developing, and which the United States and other nations find to be unacceptable and dangerous because it could lead to proliferation of nuclear weapons materials.

WHAT HAPPENS NOW?
LES will try to find some financing to begin construction. Building the facility is scheduled to take about two years. During that time the D.C. Circuit Court of Appeals will consider the briefs of NIRS/PC and the NRC and LES and will likely have oral argument by the lawyers next spring. A decision by the Court could occur next summer. If the Court rejects the license, it would likely remand the case back to the NRC for further proceedings. Such a result would presumably interrupt construction and substantially delay the project. Depending upon the nature of the decision, the future of the entire facility might be in serious doubt. If the litigation fails, construction could be completed and the plant could begin operating.

Southwest Research and Information Center
105 Stanford SE
PO Box 4524
Albuquerque, NM 87196
505/262-1862
fax: 505/262-1864

For further information contact Info@sric.org.