Heeding cries that lawyers should not be protected before victims, the House Energy and Commerce Committee voted to withhold nuclear insurance funds payments to defense attorneys until all victims are compensated.
The 24-18 vote wrecks a compromise agreed to in subcommittee that would have slapped a surcharge of 5 percent on nuclear power licensees to cover legal costs if the almost $7 billion Price-Anderson compensation scheme were not sufficient to pay all victims and all legal costs.The committee language tosses out the surcharge and instead prohibits insurance and power industry attorneys from being compensated out of the nuclear insurance fund until a judge determines that such payments will not jeopardize any victims' claims.
The insurance industry has been concerned it won't be compensated for investigation, settlement, and defense costs if these are not included in the nuclear insurance scheme.
The subcommittee compromise was devised by nuclear insurers and the power industry and accepted by Rep. Sam Gejdenson, D-Conn.
Rep. Gejdenson started the snowball in the Interior Committee by winning support for an amendment requiring a utility involved in a nuclear incident to pay 30 percent of defense costs outside the Price-Anderson insurance formula.
Rep. Carlos Moorhead, R-Calif., then convinced his Commerce subcommittee colleagues to accept an insurance and nuclear power industry amendment that would create a mechanism to cover the new obligations involved in the 30 percent of legal costs.
But all of this was negated Tuesday morning when the full Energy and Commerce Committee decided that it would prefer to just pay victims first and then compensate attorneys if the $7 billion Price-Anderson insurance plan is sufficient.
The amendment by Rep. Gerry Sikorski, D.-Minn., followed heated debate and defeat for an amendment by Rep. Dennis Eckart, D-Ohio, to lift the liability limits in the bill and instead assess each utility $10 million a year after a nuclear incident until all damages were paid.
When you cap the compensation fund, Rep. Sikorski argued, then Congress cannot allow lawyers to go ahead of victims.
It is inappropriate to expect the insurance industry to defend the many entities that may ulti mately be liable without any compensation, Rep. Moorhead protested.
Rep. Philip Sharp, D-Ind., subcommittee chairman, stayed with the Moorhead compromise, but this was not enough to head off victory for Rep. Sikorski.
The committee will return to the bill next Tuesday. Unless there is a new attempt to change the liability ceiling, the bill will incorporate the $7 billion limit established in the Interior Committee and Energy and Power Subcommittee. The $7 billion insurance fund is created by $160 million in traditional insurance provided by the two insurance pools, American Nuclear Insurers and Mutual Atomic Energy Liability Underwriters, plus retroactive assessments on nuclear power plants of $63 million a reactor.