Proposed federal budget cuts affecting Nevada's Yucca Mountain nuclear waste facility and a nuclear industry poised to build new reactors may be giving new life to a plan to store that waste in Utah's Skull Valley.

If the much-delayed Yucca project is slowed even further because of budget cuts, "it could mean that utilities would be even more interested in our facility," predicts Sue Martin, a spokeswoman for Private Fuel Storage, the consortium of nuclear-powered utilities seeking to store spent nuclear fuel on Goshute tribal lands for up to 40 years.

Industry and congressional sources said Friday that President Bush's proposed budget, to be unveiled Monday, will include about $650 million for the Yucca Mountain waste project — about half of what once was envisioned for the fiscal year beginning next October. The officials spoke on condition of anonymity because details have not been announced.

"It's still going to end up being, in the long run, probably the most expensive public works project ever," says Chip Ward, co-founder of HEAL Utah, an environmental group opposed to the idea of storing spent nuclear rods in dry casks at the Skull Valley site, 75 miles southwest of Salt Lake City.

"I don't think they should fund Yucca at all. Or if they do something like Yucca, they should do it in the context of a longer project of walking away from nuclear power," Ward argues. "But half-funding a half-baked policy is that much more of a sign that our policy is ill-conceived and ineptly implemented."

Meanwhile, the nuclear reactor industry is poised to build new reactors much sooner than the Energy Department would be ready to accept waste at the Yucca site, "causing some in the industry to think about other alternatives" as storage sites, the staff director of the Senate Energy Committee says.

Bush's proposed spending cuts for Yucca reflect ongoing problems the administration has encountered since Bush and Congress gave the project a green light in 2002. A federal court threw the project off schedule last year when it rejected proposed radiation safety standards for the Yucca site. New standards are being developed.

The Energy Department describes the Yucca project as essential to the future of nuclear energy, but private sector advocates are trying to decouple the future of the industry from the government's Yucca plan. Some nuclear power supporters say the industry has made a strategic error by tying its future to the repository, which was once supposed to open in 1998 and is now scheduled for 2010. The departing energy secretary, Spencer Abraham, said earlier this month that the opening would be even later than that.

Rep. Jim Matheson, D-Utah, doesn't see the Yucca and Skull Valley plans as linked, says Matheson spokeswoman Alyson Heyrend. "Congressman Matheson has never supported either repository." His position is that if the dry cask storage technology proposed for the Goshute site is so wonderful, why not use it on site at the reactors themselves.