Free Motion for Authorization of Service 100+ Miles - District Court of Federal Claims - federal

Case 1:98-cv-00126-JFM

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS

YANKEE ATOMIC ELECTRIC COMPANY,

Plaintiff
No. 98- 126C

(Senior Judge Merow)

UNITED STATES OF AMERICA,
Defendant.

IVAN F. STUART SUPPLEMENTAL EXPERT WITNESS REPORT This report addresses matters relevant to the contract entered into by Yankee Atomic
Electric Company ("Yankee Atomic ) with the government for the acceptance of spent nuclear
fuel and high- level radioactive waste (together " spent
fuel"). This contract is one of

approximately 50 such contracts with essentially the same terms between the government and

commercial nuclear utilities. The form of each such contract is sometimes referred to as a
Standard Contract. I am aware that the Court has held that the government breached Yankee
Atomic s contract by not beginning to accept spent fuel from Yankee Atomic by January 31
1998.

Frank Graves has submitted an expert report in this matter addressing the pace and schedule on which the government would accept spent fuel from Yankee Atomic and other
contracting utilities after January 31 , 1998 pursuant to the parties ' contracts. In his report, Mr.

Graves relies on various data to develop factors used in his economic analysis to demonstrate

how the fuel removal program would have operated. This data includes: costs for the dry storage
of spent fuel; information on dry storage cask capacity, handling, and transportation; the

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operations and maintenance costs associated with the wet storage of spent fuel; and historical and
projected fuel discharge data for U. S. nuclear utilities. 1 was asked to review the above-noted
data. This report presents my opinions concerning that data, together with the other information

called for in Fed. R. Civ. P. 26(a)(2)(B).

Opinions to be Expressed and the Bases Therefor
I offer the following points as the opinions to which I expect to testify at the trial of this

matter. I present my reasoning for reaching my conclusions along with the conclusions

themselves. In general, my opinions are based on my over 40 years of experience in the nuclear
industry, the last 20 of which have been in the field of spent nuclear fuel management particularly in the area of spent fuel transportation and storage, and my review of relevant
documents. The cost numbers supplied to Mr. Graves were provided by NAC International

NAC"). I worked for NAC from 1990 to 1999 , and retired as Senior Vice President of
Engineering and Design Services, and during my employment I supervised the design, licensing,

and implementation of nuclear fuel storage systems, fuel transport casks and fuel consolidation

systems, including the costing and pricing of those products and related services. From 1999 to
the present, I have worked as a consultant in spent nuclear fuel

management NAC has

performed extensive spent fuel transportation and management work for the U. S. Department of
Energy ("DOE" ) for more than 20 years.

My principal opinion is that the data concerning the costs of dry and wet storage for spent

fuel, dry storage cask capacity, handling, and transportation, and fuel discharges, that was
supplied to Mr. Graves is accurate and reliable for purposes of the economic models that Mr.

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Graves has constructed.

Spent fuel dry storage cost data
NAC suppHed Mr. Graves with data on the costs of various aspects of a dry storage

system for spent fuel. The cost data supplied is as follows:
Dry Storage Fixed Costs include licensing, engineering, construction of the ISFSI engineering and technical support of the cask/canister system, and equipment and materials of the cask/canister system. Together these fixed costs total $6.4 million and represent the fixed costs associated with implementing a dry storage system.

Variable (per canister) initial costs associated with dry storage include varying the size of the storage pad , fabrication oversight, quality assurance oversight, project management, and variable equipment and materials. Together, these variable costs total $ I 67 000 per canister. In addition, the physical cask/canister system is $720 000. Together , these costs represent the variable costs on a per canister basis associated with implementing a dry storage system.
Costs associated with a crane upgrade , if needed, are $3. 5 million for an upgrade ofless than 30 ton handling capacity, and $4. 5 million for a greater than 30 ton upgrade. In addition~ an average of $1 million per site for structural modifications to buildings to accommodate a larger crane is necessary, if a crane upgrade is needed. Together, these fixed costs represent the fixed costs associated with upgrading a crane when implementing a dry storage system.

Dry Storage Decommissioning Cost is $240 000 per canister. the decommissioning expense associated with an ISFSI.

This cost represents

Dry Storage Operating & Maintenance Cost (per year) is $3, 500 000. This cost is largely associated with monitoring, surveillance and support, and represents the expenses on an annual basis associated with the operation and maintenance of an ISFSI.
NAC has developed a substantial body of knowledge concerning dry storage systems
including, in particular, the following areas:

installations (ISFSI) at reactor sites for

the design, licensing, and construction of independent spent fuel storage of spent fuel using dry the storage

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storage cask/canister systems;

the design, engineering, and fabrication of dry storage cask/canister systems;

the movement of spent fuel from a spent fuel pool to an ISFSI; and
the annual Operations and Maintenance costs for an ISFSI.

Through my employment at NAC I gained a substantial body of experience in these areas as well.

As Senior Vice President of the engineering and design services group, I supervised the design,

licensing, and implementation ofNAC' s spent fuel storage and transport casks, as well as the
costing and pricing of those products and related services. In my positions at NAC and
elsewhere I acquired a substantial body of knowledge in the pricing of spent fuel dry storage

systems and the various components of such systems. I also prepared and reviewed bids
submitted by NAC for the provision of dry storage systems for spent fuel; and, also reviewed

commercial bids and contracts drafted by other companies and submitted to NAC for the
provision of such services. The numbers NAC supplied to Mr. Graves for the category of Dry Storage Fixed Costs
have several bases. In part , these numbers are derived from bids for the provision of dry storage

services that were either developed and submitted by NAC, or submitted to NAC by other

contractors and reviewed by NAC. An additional source of information is the Owl Creek Energy
Project, a private interim storage facility being developed in Wyoming for which I served as the

project manager. It is NAC' s responsibility to develop pricing information for this project, and
some of the information developed is reflected in the cost numbers supplied to Mr. Graves.
The Dry Storage Cost numbers are also formed by the experience of Virginia Power

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which is currently operating two ISFSIs -- one of which is the longest operating domestic ISFSI
and one of which is a relatively new domestic ISFSI in operation. Cost information from these

ISFSIs was used as an additional basis for the numbers supplied to Mr. Graves. The numbers for Crane Upgrade Costs, Dry Storage Canister Cost, Dry Variable Construction Costs, and Dry Storage Decommissioning Costs are all developed from NAC'

extensive experience in dry storage systems for spent fuel. In large part these numbers are
derived from bids submitted by and/or to NAC for the various aspects of a dry storage system.

The Dry Storage Operating and Maintenance Cost number is based upon cost information
supplied by several utilities for their ISFSIs.

I personally reviewed all of the dry storage cost information discussed above. Based
upon my experience in and knowledge of the subject of dry storage of spent fuel , particularly the

pricing of spent fuel dry storage systems, it is my opinion that these cost numbers are reliable
estimates of the indicated expenses associated with a dry storage system.

Dry storage cask capacity, handling, and transportation data
NAC suppHed Mr. Graves with data on the capadty of casks used for the transportation

and dry storage of spent fuel , as well as data on aspects of the handling and transportation of such
casks. The data concerns the following aspects of dry storage:

capacities for transportation and storage casks for boiling water reactors and pressurized water reactors; and
spent fuel pool crane design capacities and loaded transfer cask weights for spent fuel pools currently in service.

The data on cask capacities is derived from transportation and storage cask designs

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created by NAC. These cask designs have been approved for use by the NRC. The data on the
capacity of canister based systems is based on the NAC-UMS design, which received NRC

approval for general use in 2000. A similar system , the NAC-MPC system, has been previously
approved by the NRC for storage and transportation of spent fuel.
The data on cask removal is derived from NAC' s experience in conducting shipping

campaigns for spent fuel. NAC made over 3 200 shipments of spent fuel as of 1999 and has
developed a sizable body of knowledge concerning the time necessary to complete the various operations associated with a spent fuel shipping campaign.

The information on crane design capacities and transfer cask weights is derived from
Facility Interface Capability Assessment (FICA) studies performed by NAC for the Department
of Energy ("DOE").
The purpose of these

studies was to evaluate the cask handling capabilities

of the nuclear utilities that entered into Standard Contracts with the government. All of the
studies were submitted to DOE at their completion.
I personally reviewed all of the information discussed above. Based upon my experience

in and knowledge of the subject of dry storage of spent fuel, particularly in the areas of
cask/canister systems and the movement of spent fuel from a spent fuel pool to an ISFSI , it is my

opinion that the information provided to Mr. Graves is accurate and reliable.

Operations and maintenance costs associated with the wet storage of spent fuel

NAC supplied Mr. Graves with data indicating that a conservative estimate ofthe
annual cost of operating and maintaining a spent fuel pool at a shutdown nuclear plant is

average

approximately $8 million as of 1999. NAC is in the business of collecting data on the

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management of spent fuel by nuclear utilities. In the course of this business, NAC has collected
information on the costs of wet storage for spent fuel. The $8 million cost number supplied to
Mr. Graves is derived from cost information collected by NAC from shutdown nuclear plants
that were operating spent fuel pools as of 1999.
I personally reviewed all of the information from which the wet storage operations and

maintenance costs discussed above were derived. Based upon my experience in and knowledge
of spent fuel management and storage, it is my opinion that the information provided to Mr.
Graves is accurate and reliable.

Historical and projected fuel discharge data
NAC

supplied Mr. Graves with data on historical and projected discharges of nuclear fuel

from the reactors of U. S. nuclear utilities. This data is a product ofNAC' s research and analysis

of nuclear fuel cycles and markets, areas in which NAC has provided extensive consulting

services for over 30 years. I worked extensively with this data when I worked at NAC.
personally reviewed all of the fuel discharge information supplied to Mr. Graves. Based upon
my experience in and knowledge of the research and analysis of fuel cycles and markets, it is my

opinion that the information provided is accurate and reliable.

11.

Data or Information Considered in Forming Opinions
1 to

Data and

other information

considered in forming

my

opinions

is listed

in Exhibit

this report.

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ID.

Qualifications

My qualifications to offer the opinions contained in this report, including a list (compiled
to the best of my recollection) of the publications I have authored within the preceding ten years

are set out in Exhibit 2 to this report.

IV.

Compensation
I am being paid $275 per hour for my time working on this matter. Other Expert Testimony

I have not testified as an expert at trial or by deposition in any other cases within the
preceding four years.

Respectfully submitted

Dated: April 21 ,

2004

Ivan F. Stuart

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