The U.S. Court of Federal Claims awarded Xcel Energy $116.5 million for the Energy Department's breach of contract. Under the law, the department was required to open Nevada's Yucca Mountain to nuclear waste storage by 1998.
Xcel's lawsuit is one of 56 pending actions against the department.
Charles Bomberger, general manager of Nuclear Asset Management for Xcel Energy, says the company is pleased with the court's decision.
"The government, just like everybody else, is obligated under this high level waste policy act of 1982 to be the federal repository for the spent fuel," says Bomberger. "We know now that the courts have upheld that we did have a binding contract, and held them accountable. And they in fact breached that by not being able to accept the waste in 1998."
Yucca Mountain was designated in the 1980s as the nation's nuclear waste repository. Since then, the project has been bogged down in controversy and never opened.
The 1980s Nuclear Waste Policy Act requires ratepayers to pay a fee on power generated by nuclear power plants. Xcel Energy used those fees to build storage facilities at its Prairie Island and Monticello power plants to store the nuclear waste until Yucca Mountain is opened.
Xcel officials say the company brought the lawsuit as a way to pressure the federal government to move ahead with the Yucca Mountain project.
A Department of Energy spokeswoman declined to comment, saying the agency is "reviewing the court's decision."
DFL Sen. Ellen Anderson, who chairs the State Senate's Environment, Energy and Natural Resources Budget Division, says the court's decision is not enough to make up for the millions of dollars Minnesota ratepayers have already spent on the problem of nuclear waste storage.
"We've been led down the garden path for years and years and years," she says.
Anderson says the amount of waste Yucca Mountain is authorized to store when it opens won't be enough to hold the nation's projected amount of future waste.
"And so even if Yucca Mountain does open, which I'm very skeptical it will, there is no reason to believe it will take our waste away," says Anderson. "This problem is one that I don't expect to be solved in my lifetime."
It is unclear whether the Department of Energy plans to appeal the court's ruling, or how Xcel Energy could spend the settlement money.
The Department of Energy plans to submit a license application to open Yucca Mountain sometime in mid-2008. The earliest possible opening for the site would be 2017.