The head of the DOE's Yucca Mountain program has revealed that the full cost of the troubled nuclear waste disposal project appears to be 35% higher than most recently thought and that-in a proposal that utilities and state regulators would loathe-the DOE may soon recommend a hike on surcharges that nuclear ratepayers pay to fund Yucca.

After a House Budget Committee hearing that produced lots of fresh information about the stalled project, Ward Sproat, director of the DOE's Office of Civilian Radioactive Waste Management, told reporters that projected costs for the underground repository in Nevada are soaring.

That is because the energy department will have to store 25% more spent nuclear fuel at Yucca than previously expected, Sproat told reporters, noting that reactors are operating for longer periods of time and at higher output than contemplated when the DOE estimated costs in 2001.

Although the DOE is still crunching cost numbers, Sproat indicated that the department now thinks Yucca's lifetime costs will be $75.6 billion, dating back to 1983-when analysis of the Nevada repository site began-and running through construction, operation, and closure of the repository.

"The costs are about 35% higher than they were in 2001," when the DOE estimated a life cycle cost of $56 billion, Sproat said.

That is only the latest price increase for a project that was initially intended to open in 1998 as a permanent disposal site for spent commercial nuclear fuel and defense- related nuclear waste.

Sproat now says that Yucca could open as soon as 2017, but that 2020 or 2021 is more likely.

And in order to stay on track for those targets, Sproat floated the possibility of a funding mechanism change that most utilities, ratepayers, and state regulators would likely strongly oppose: raising surcharges paid by nuclear ratepayers into the Nuclear Waste Fund (NWF), a pot of money legally intended for use in developing Yucca. Ratepayers currently pay 1 mil, or one-tenth of penny, on each kilowatt-hour of nuclear-generated electricity they use.

The NWF has long frustrated the DOE, the nuclear industry, and ratepayer groups because Congress has spent the fund-which now stands at nearly $20 billion-on projects other than Yucca.

For years the DOE has tried and failed to shepherd legislation through Congress that would have improved its access to NWF monies.

Based on the belief that federal appropriators will be particularly loathe to provide access to the existing $20 billion in the NWF, or to the interest earned on the fund, the DOE has recently focused on getting access only to the NWF's cash intake, which is $750 million to $800 million annually.

But Sproat suggested that may not be enough, and that if the DOE has to rely on that funding source, ratepayers would have to pay more for Yucca to get adequate monies.

"Funding from the annual Nuclear Waste Fund fees alone at the current 1 mil per kilowatt hour level will not be sufficient to fund the program," Sproat said, adding that the DOE will "address the program's funding needs in the context of developing the president's annual budget."

The hearing also focused not just on the costs of developing Yucca but also on the growing costs faced by the federal government as a result of the repository's delay, including damages the DOE owes utilities for breaching contracts to begin picking up utilities' spent fuel in 1998 for disposal at the repository.

In the latest of those cases, the U.S. Court of Federal Claims in Washington last week awarded Minneapolis-based Northern States Power $116 million to cover the utility's costs of managing waste from its Prairie Island and Monticello nuclear plants between 1998 and 2004.

That is somewhat more than courts have awarded other nuclear utilities for comparable time periods because Northern States faced unusual state compliance costs to continue storing nuclear waste in Minnesota, including requirements that the utility fund state renewable and efficiency efforts.

Overall, the DOE's liability to utilities "currently stands at $710 million," from eight judgments in favor of the utilities and seven settlements, according to testimony from Deputy Assistant Attorney General Michael Hertz of the Justice Department.

Fifty utility lawsuits are still in the courts and have not been ruled upon; two more have been ruled upon but could still be appealed, Hertz said.

Hertz said the DOE estimates a total liability of about $7 billion, based on the highly optimistic assumption that Yucca will open in 2017. Hertz also cited industry estimates that utility claims will reach $50 billion, although it is unclear what time period that covers.

The courts have generally limited utility lawsuits to cover the periods between 1998 and the time that each lawsuit was filed. As a result, utilities are expected to file a second round of lawsuits, to cover the subsequent period of time in which utilities bore additional spent fuel management costs.

The first of the second round of suits came in August, when Xcel Energy filed to recover spent fuel management costs between 2004 and 2007.

Although the DOE has fared poorly in courts in the utility breach-of-contract cases, Hertz pointed out in written testimony a few "major" issues before appeals courts that could trim the DOE's financial exposure.

For instance, he noted that courts have yet to reach a final conclusion on whether the energy department could invoke a clause in its contracts with the utilities that would give it some relief if performance delays were "unavoidable."