Western U.S. supporters of "clean" nuclear power say it means more jobs at uranium mines and mills. But critics say the escalating costs of past uranium facility clean-up, billion-dollar subsidies, and the fact that most of the companies are foreign-owned, has seemingly gone unnoticed.
During the State of the Union speech, President Obama announced that a green energy portfolio should include "safe, clean nuclear power plants." It was reminiscent of former President Bush, who pushed nuclear power as an "alternative energy" in the 2005 energy Act, which offered $18.5 billion in federal loan guarantees. Mr. Obama has proposed tripling those guarantees to $54 billion. The Department of Energy has already approved $8.3 billion for two reactors in Georgia, costing approximately $14 billion and taking six to 10 years to come on line. Last year, DOE also announced $2.9 million in scholarships to nuclear engineering students, and another $6 million in grants to universities for nuclear research. And on March 8th, the government gave $40 million to Westinghouse Electric Co. and General Atomics, the defense contractor that builds the Predator drones used in Afghanistan, to design the "Next Generation Nuclear Plant."
The uranium industry apparently saw this windfall coming and has quietly been dealing with one irony of U.S. nuclear power: the nation imports nearly 90 percent of its nuclear fuel. Ironically, most mining and milling proposals of recent years are from foreign-owned companies and some of the fuel is potentially destined to be shipped to Belgium, Japan, and South Korea. Even the newest enrichment plant to convert uranium to reactor fuel is wholly foreign owned. And, at a time when the government is still cleaning up1980's-era uranium mine and mills at a cost of many billions of dollars, some companies responsible for contaminated sites continue to receive leases on public land, including a Canadian company which tried to skirt clean-up laws under the terms of NAFTA.
Complicating the matter is the federal mining law of 1872 - unchanged since it was signed by Ulysses S. Grant - that allows mining claims for as little as $1 an acre on federal land and no royalties to taxpayers despite the fact that some companies routinely leave behind multimillion-dollar cleanup sites.
"Both the BLM and the Forest Service have taken the position that they are unable to say 'no' to exploration or mining on federal lands under the 1872 mining act," says Eric Jantz, an attorney for the New Mexico Environmental Law Center.
Mining law reform advocates are up in arms, pointing to one example time and again: Asarco, the copper mining and smelting company which declared bankruptcy in 2005 and left behind 94 Superfund sites in 21 states with a total cleanup cost of more than $1 billion - far above the $62 million bond the company posted for cleanup.
The Uranium Rush
Spurred by incentives in the 2005 energy bill, applications started arriving for not just nuclear power plants, but for uranium mining and milling facilities. That same year, the Navajo Nation - 27,000 square miles in the Four Corners area of Arizona, Utah, and New Mexico where there are more than 1,200 abandoned uranium mine and mill sites - banned such operations on their land.
In the Western states, less then 4,400 claims were filed in 2004, according to the Interior Department. By 2007, mining companies snatched up the best available sites and the number of claims jumped to over 43,000, mostly in Arizona. There are also some 18 applications for in-situ uranium mining in Wyoming, New Mexico, and Colorado - the three leading producers of uranium. Those proposals for in-situ mining - a technique that involves pumping water and chemicals into groundwater to free uranium so it can be pumped out - slowed in June 2009 when the NRC required more detailed environmental studies. Later in a March 3rd letter, the Environmental Protection Agency told the NRC to go back to the drawing board with its environmental reviews of three proposed in-situ uranium mines in Wyoming over concern for potential contamination of aquifers.
This renewed interest was sparked not just by the prospect of more nuclear plants, but the fact that the hot rock's record high price hit nearly $140 per pound in 2007, up from $10 per pound in 1984 when most mines shut down and the U.S. began importing nuclear fuel. When uranium prices climbed, mining companies bought-up old leases and staked new claims seeing a lucrative market: the U.S. produces about 4.5 million pounds of uranium a year, while it uses some 55 million pounds, mostly from Canada, Australia and Russia. Another factor is a U.S.-Russian program to use old Soviet nuclear weapons for fuel in American power plants is set to expire in 2013.
While industry insiders believe the long-term price of uranium - which is tracked privately because there is no formal commodity exchange - should settle at about $70 per pound, uranium sells today for about $41 per pound. Despite the downturn in price and a boom-bust history, companies are still going through with many new mining and milling operations in the West.
What is telling are the international connections of the companies involved and the fact that those leases go for "well below market value," according to Jantz.
Some of these projects are encroaching unconfortably close to public lands such Arches National Park, Capitol Reef National Park, Canyonlands National Park, the proposed Dolores River Canyon wilderness area in Colorado, and even Arizona's Grand Canyon.
Arizona has seen the most uranium mining claims in recent years - over 12,000. Within five miles of Grand Canyon National Park, there are more than 1,100, compared with just 10 in January 2003, according to the Interior Department. But by June 2008, Congress issued an emergency block to mining on 1 million acres around the park. Then the Interior Department announced in July 2009 that it was barring the filing of new mining claims for two years while they study whether to put the land off-limits to uranium mining for 20 years. National Park Service inventory data shows 44 abandoned uranium sites in or immediately adjacent to National Park Service units nationwide. But those with existing claims are exempt from the ban under the General Mining Act of 1872 unless Congress appropriates money to buy them. Because of that, 16 uranium exploration requests have been approved.
Most of these claims for are staked in the Arizona Strip, north of the Grand Canyon National Park and known for its high-grade uranium ore. Canadian-based Quaterra Resources has filed 616 claims. According to Quaterra's website: "Any search for clean and abundant energy with a minimum carbon footprint should lead to the uranium resources of the Arizona Strip." Currently there is one operating mine on the Strip, which Canadian-based Denison Mines re-opened in December 2009. The Arizona 1 mine was constructed in the late 1980s, but was mothballed in 1992 without producing any uranium. Denison is trucking the ore to their mill in Utah and some of the final product will likely end up with the South Korea Electric Power Corp., which acquired nearly 20 percent of Denison in April 2009. Canadian-based Energy Fuels Resources also holds 346 claims on the strip while Kee Nez Resources, a subsidiary of Vancouver-based Mayan Minerals Ltd., holds 308 claims.
Another top claimholder is Canadian-based Glamis Corporation with 611 claims. The company tried to set a legal precedent when it was required to backfill a proposed open-pit gold mine in California. Glamis sued the U.S. government in 2003 for $50 million in lost profits under Chapter 11 of the North American Free Trade Agreement, which gives foreign corporations the power to legally challenge national and local laws that affect the profits of foreign investors. The courts ruled against the company in May 2009.
"Under NAFTA, anybody who wants to come in and mine in the U.S. is subject to the same laws and environmental requirements that you would have if you were an American company," according to David Gantz, associate director of the National Law Center for Inter-American Free Trade at the University of Arizona.
"The area where you get into potential difficulty is if somebody is doing mining and there is a change in the environmental requirements and it is done in such a way that it only applies to foreign miners," says Gantz.
Abandoned Costs
While the nuclear power loan guarantees essentially subsidize new power plants, what has not been factored in are the hidden costs of "clean" nuclear power: the financial legacy of past mining and milling operations have reached into tens of billions of dollars in the West's "National Sacrifice Areas."
Unlike coal, which goes straight from the mine to the power plant, uranium goes through several steps to become fuel for "clean" nuclear power plants and then needs to be disposed of. From the mine the ore goes to a mill to be turned into "yellow cake," which then goes to an enrichment facility to boost its potency. The enriched uranium is then sent to a fabricator to become nuclear fuel rods before it is sent to the power plant. Finally, the spent power plant fuel is sent to a disposal site. And at each step of this process, the material leaves behind progressively more toxic - and expensive - waste.
When a company requests to terminate its license for a uranium mill or mine site, the site is placed under the custody and long-term care of the Department of Energy. That means new projects initiated now will become the financial responsibility of the government. And it's the uranium mills that are the most problematic and most expensive to tax payers.
"We need look no further than this country's experience with uranium mining and milling activities in the early years of nuclear power to appreciate the importance of regulatory oversight on these issues. Many of those sites are dealing with significant environmental challenges - notably groundwater contamination - that may take years, or even decades, to resolve," said Nuclear Regulatory Commission Chairman Gregory B. Jaczko at a commission briefing on uranium recovery regulation March 2nd.
Under the Uranium Mill Tailings Radiation Control Act of 1978, either NRC or "the pertinent State" is responsible for these sites. The NRC becomes involved in clean-up only when the ore is chemically altered in a mill or in situ mining. Currently, the NRC regulates 11 clean-up sites in Wyoming, New Mexico, and Nebraska, according to agency data. Of those 11 sites, only 5 have an estimated clean-up cost: over $80 million. However, the NRC does not directly regulate another 14 in the "agreement states" of Texas, Colorado, and Utah - none of which have estimated costs or completion dates yet.
On the other hand, conventional uranium mining is regulated by the Interior Department's Office of Surface Mining and the individual states where some 4,000 mines with documented uranium production are located. But a 2006 EPA report identified 15,000 uranium mine locations in 14 western states and estimated it will cost an average of $13 million each to clean up. And whether old or new projects, such remediation is a "liability" that cuts into profits, according to Jantz at the Environmental Law Center.
"I expect that the uranium mining companies, whether Australian, Canadian, or American, are going to do what ever they can do to get out from under remediation," says Jantz.
When these escalating clean-up efforts are factored in, the total cost of new nuclear power plants gets rather pricey. In 1998, DOE testified to Congress that it would cost approximately $2.3 billion (in 1998 dollars) to clean up the uranium processing facilities nationwide. Because there are other uranium mines and waste sites not included in this estimate, the total cost is expected to be much higher. Such government clean-up estimates of nuclear materials are constantly escalating. Over the past two years, the estimated cleanup costs at 22 federal cold war nuclear weapons plants have escalated from $180 billion to $240 billion.
"To the best of my knowledge after searching for 8-years, no one has ever put together a comprehensive total of taxpayer monies spent by all federal and state agencies on clean-up of the environment, or the cost to human damage, created while making fuel for reactors," says Sharyn Cunningham, co-chair of Colorado Citizens Against Toxic Waste.
Many of the companies that left hazardous sites in the 1980s are the same companies that are receiving new leases for projects now.
"Each project stands on its own. However if an applicant does have a history of not meeting commitments, then that is absolutely considered," says Dennis Godfrey, spokesperson for BLM's Arizona office. Godfrey says companies must also post a bond based on the "predicted cost" of what any clean-up would be.
But few companies have been turned away and the mess left behind is
staggering:
Arizona is a unique and potentially expensive case.
The abandoned Orphan uranium mine, two miles from Grand Canyon Village, is fenced off from visitors and hikers downhill are told not to drink the creek water. Uranium was mined from 1956 to 1969 before the Park Service obtained the land in 1987. About 800,000 tons of uranium ore from the mine were sent to the mill near Tuba City that is now a federal cleanup site. The Park Service has spent more than $1 million investigating contamination at the Orphan Mine, which is estimated to cost more than $15 million to cleanup. But Park Service "negotiations have broken down" with former owner DRS Technologies and General Atomics' Cotter Corp. over paying for the clean up.
Of the 1,200-odd former uranium sites on or near the Navajo Nation, only one has been assessed under federal Superfund protocols, and that didn't happen until 2007. The federal government spent almost $7 million on cleanup efforts in 2008 in addition to the $153 million that had already been put toward various uranium-related problems on the reservation. Meanwhile, after 12 years of asking various agencies to clean up a federal dump located near the uranium mill superfund site in Tuba City, the Navajo teamed up with their Arizona neighbors, the Hopi Tribe, to sue in late May 2009. Cleanup is estimated to top $23 million.
In 1990, legislation passed to give $150,000 payments to uranium miners - many of them Navajo - who were working prior to the 1971 health regulations. By June 2007, 4,560 miners had received $455 million. As of March 18, 2010, the government had claims from 6,815 people at a cost of $680 million, according to the Department of Justice Civil Division.
Political Costs
Critics say the new nuclear power subsidies should not come as a surprise. Over the last decade, the nuclear industry has spent more than $600 million lobbying Washington and another $63 million in campaign contributions, according to the Investigative Reporting Workshop at American University.
Critics like Sen. Richard Burr, R-N.C. have questioned whether banks will back new nuclear plants - which cost nearly 35% more than coal or natural gas plants - until the nuclear waste issue is dealt with. The Administration has all but killed the only nuclear waste facility - Yucca Mountain in Nevada - after spending over $9 billion trying to make it work, as well as "reprogram" $115 million toward termination of the site. NRC Chairman Jaczko has said that the roughly 60,000 tons of reactor waste can remain safely at the nation's 104 units in 31 states while alternatives are developed by a new 15-member Energy Department panel. But the five congressmen from Washington state and South Carolina said reprogramming the money would violate the federal law requiring DOE to construct Yucca Mountain and seemed inadvisable because of pending lawsuits. The federal government also faces nearly $50 billion in lawsuits from utilities because it had agreed to begin taking waste at Yucca Mountain in 1998 in exchange for one-tenth of a cent per kilowatt-hour produced by the reactors. Federal courts have awarded more than $1 billion in settlements for breach of contract. Some believe the vast, 250 million-year-old salt beds that house the 12 year-old Waste Isolation Pilot Plant in New Mexico - the government's only disposal site for radioactive waste from nuclear weapons production - could store waste once destined for Yucca Mountain.
Factoring Yucca Mountain into the other known hidden costs, the government's price tag to date to prop-up nuclear power is at least $21.6 billion. And only $8 billion of the proposed $54 billion in loan guarantees have been allocated.
In November 2009, senators Lamar Alexander (R-Tenn.) and Jim Webb (D-Va.) introduced the Clean Energy Act of 2009, which "provides a framework that will facilitate the revival of nuclear power" with another $4 billion is grants and expand the federal "loan guarantee" program by as much as a $1 trillion, according to critics. Senator Webb's home state of Virginia is the location of two nuclear power plant manufacturers, French-based Areva, Inc. and Babcock & Wilcox Co. So far, there has been no movement on the Alexander-Webb bill beyond being referred to the Senate energy and natural resources subcommittee. But last week (March 17, 2010), a "Dear Colleague" letter to other Senators began circulating seeking new co-sponsors for the bill.
"President Obama needs to remember what Candidate Obama promised: no more taxpayer subsidies for nuclear power," said Michael Mariotte, executive director of Nuclear Information and Resource Service. "The American people have made clear they are tired of taxpayer bailouts for giant corporations and the nuclear loan guarantee program could end up being the largest bailout of all."
Nuclear power supporters point to France for the answer, which has 58 nuclear power plants providing more than three quarters of the nation's electricity. The French have been recycling nuclear waste for some 25 years, a process the United States has banned since the 1970s because it is too expensive and creates the kind of weapons-grade byproducts terrorists would love to get their hands on. That concern has some nuclear critics worried about the $1.5 billion National Enrichment Center near Eunice, New Mexico, which is nearly ready to begin making fuel for nuclear power plants. The Facility is owned by Urenco, a joint venture of the governments of the Netherlands, UK, and two German utilities which operates several European enrichment plants with a 25% share of the global market. In 2004, Urenco was accused of selling sensitive uranium enrichment technology to North Korea, Iran, Iraq, Pakistan, and Libya.
"Anywhere you have a nuclear power-related industry, you have proliferation issues," says Environmental Law Center's Jantz. "They go hand in hand as much as the nuclear industry does not want people to believe that."
