The House yesterday voted 396 to 17 in favor of a tenfold increase in the public utility industry's liability for a Chernobyl-like nuclear accident to $7 billion, an amount that was decried as too low by consumer groups and initially called too high by the nuclear industry.
The House struck down amendments that would have removed the ceiling on liability, imposed civil penalties on Energy Department contractors who violated safety regulations and ensured that victims would be paid before lawyers if it looked like the $7 billion pool would be drained.
Nuclear industry members, from utilities to contractors, lobbied against the higher cap but praised the final House action as a fair approach that expedites the payment of legal claims.
"We believe it's a good compromise," said Mary Kenkel, a spokeswoman for the Edison Electric Institute, which represents investor- owned utilities. But the vote was denounced by the National Taxpayers Union and some members of Congress as a blow to taxpayers who would have to foot the bill for expenses above the $7 billion limit.
"We just ratified folks being able to be grossly careless and let taxpayers pay for it," said Rep. Dennis E. Eckart (D-Ohio), whose amendment that would have forced nuclear utilities to pay for the total cost of an accident was defeated Wednesday. An alliance between the Department of Energy, nuclear contractors, nuclear utilities and insurance companies defeated amendments to make the industry responsible for the total cost of an accident, Eckart and Rep. Gerry Sikorski (D-Minn.) contended.
"If Mother Teresa had gotten up and supported the Sikorski amendment she would have been outvoted -- she doesn't have a political action committee," Sikorski said. He was defeated on an amendment to prohibit payment of industry attorneys' fees from the insurance fund if there was insufficient money to fully compensate victims. Some members of Congress had argued that the amendment would have caused insurance companies administering the $7 billion fund to pull out and would have hampered nuclear utilities in effectively screening frivolous claims.
The major overhaul of the Price Anderson Act -- created 30 years ago to protect a nascent nuclear industry from lawsuits that might be filed after an accident and due to expire Friday -- continues the no-fault nuclear liability system that expedites payments to accident victims, who must prove only that they were damaged, not who was at fault.
Experts have said the current limit of $700 million would be insufficient to cover a major nuclear accident on the scale of Chernobyl. The General Accounting Office recently estimated that such an accident could cost between $12 billion and $15 billion, but consumer advocates say the cost could be much greater.
The House bill covers accidents involving commercial nuclear power plants, some smaller reactors, nuclear research, fuel processing, waste management and weapons production activities performed by Department of Energy contractors.
The legislation raises the limit of liability for accidents at any one of 109 commercial reactors licensed to operate to slightly more than $7 billion. It raises the liability of Energy Department contractors to the same limit -- but with financial responsibility borne by the DOE.
Public utilities must continue to purchase liability coverage of $160 million per reactor for damages caused by an accident.
If claims exceed that amount, the industry would be assessed $63 million per reactor spread over six years.
The bill permits reimbursement of utilities' legal defense costs and the insurance industry's costs of administering the pool out of the $7 billion fund.
Should damages exceed the liability limit, the president would submit a proposal to Congress on how the additional accident damages would be paid for.