Why NEI Opposes the Uranium D&D Tax

Alex Flint

Earlier today, Alex Flint, NEI's Senior Vice President for Government Affairs, sent the following letter to Senators Dianne Feinstein and Lamar Alexander, concerning the possible reinstatement of the Uranium D&D tax:

Dear Chairman Feinstein and Ranking Member Alexander:

The $200 million tax on the customers of nuclear utilities proposed in your mark of the fiscal year 2015 Energy and Water Development Act is unreasonable and unjustified.

The tax is ostensibly to pay utility customers’ share of decommissioning the federal government’s uranium enrichment plants because of enrichment services U.S. utilities purchased from the federal government from 1969 to 1992.

However, those utilities’ contracts with the Department of Energy and its predecessor organizations required full cost recovery. As a result, the utilities’ share of clean-up costs was paid even though the plants, which had produced enriched uranium for the weapons programs, were already contaminated.

Despite that, when the Energy Policy Act of 1992 imposed the uranium decommissioning and decontamination tax, the industry paid an additional $2.6 billion over 15 years, the full amount required by the statute.

Several utilities did object to paying the tax and sued to block its implementation. The courts eventually ruled that the Congress could retroactively impose a tax but, importantly, also determined that the so-called fee was a tax.

Not only is there no justification for further taxing nuclear utility ratepayers, there is no need for additional revenues at this time. The uranium decontamination and decommissioning trust fund has a balance of $4 billion; funds are available.

In past years, when the Administration has proposed to reinstate this tax, the Congress has wisely rejected it because it is unjustifiable, retroactive, and industry has already paid twice.

I urge you to remove this provision from the fiscal year 2015 Energy and Water Development Act.

Sincerely,

Alex Flint

To download a copy of the letter, please visit the NEI website.