MidAmerican Scraps Nuclear Plant Plans
MidAmerican Energy announced on June 3, 2013, that it had decided against constructing a nuclear power plant in Iowa. The energy company cited its reasoning as lack of an approved design for the modular nuclear plant it envisioned and too many questions about limits on carbon emissions from a natural gas plant,
MidAmerican was considering building its new plant in Thurman, in Fremont County, or in Wilton, in Muscatine County. Currently, Iowa has one nuclear power plant -- Duane Arnold -- located northwest of Cedar Rapids. Three other nuclear plants surround Iowa -- the crippled Fort Calhoun plant northeast of Omaha, the Cooper plant along the Nebraska/Missouri border and Quad Cities northeast of Davenport.
Ratepayers will be repaid the $8.8 million MidAmerican collected while it was conducting its feasibility study that was approved by Iowa legislators in 2010. According to the company, the study "...concluded that it is premature, given the uncertainty of carbon regulation and the extensive regulatory review for new nuclear reactor designs, to immediately pursue any additional site work on a future generation option, including a nuclear facility."
Read the company's feasibility study.
Sierra Club opposed legislation that allowed MidAmerican Energy to charge ratepayers for the feasibility study. The Chapter also partnered with Friends of the Earth, AARP, Environmental Law & Policy Center, Iowa Farmers Union, Iowa Interfaith Power & Light and Iowa Environmental Council to oppose legislation that would have allowed the energy company to charge its ratepayers to plan, permit, approve and construct any new nuclear plant in Iowa. The Chapter's involvement with these bills can be found on our legislative information website.
Small Modular Reactors: What is a small modular reactor (SMR)?
MidAmerican Energy has suggested its preferred nuclear reactor -- should the company ever build a new nuclear reactor in Iowa -- would be an SMR. The Southern Alliance for Clean Energy has posted an informative article about SMRs and their risks. Read the article.
Building Small Modular Reactors Senseless
"The highly touted 'nuclear renaissance' is ending with a whimper," Dr. Arjun Makhijani, president of the Institute for Energy and Environmental Research, wrote in the Knoxville News Sentinel in April 2013. "Private investors don't want the risk of the huge investments new reactors require. At the same time, the price of other energy generation sources, including natural gas and wind energy is lower than new nuclear."
Heat Wave Heats Up Cooling Water
The 2012 heat wave created problems for nuclear plants across the Midwest, as cooling water temperatures rise above levels allowed by regulators. Read the New York Times article.
Chapter Files Petition to Revoke fort Calhoun License
On June 15, 2012, the Iowa Chapter filed a petition with the Nuclear Regulatory Commission (NRC) asking it to revoke the license to operate the troubled Fort Calhoun nuclear power plant near Omaha, NE. The petition cited a history of problems dating back to 1992 and safety concerns. The plant, operated by the Omaha Public Power District, was encircled by flood waters after the Missouri River flooded in June 2010. Although the plant was shut down at the time for refueling, it remains shut down while the NRC continues to inspect and investigate flood-related consequences. Inspectors continually uncover additional problems with the plant. Read the petition.
Two days after the first anniversary of the Fukushima disaster, the Senate Commerce Committee, determined to expand nuclear power in Iowa, amended and passed HF561 by an 8-7 vote on March 13, 2012. Learn more.
UPDATE: 2012 Legislative Session Ended without Senate Considering Nuclear Power Bill
Statement of Mark Cooper, Senior Fellow for Economic Analysis
Institute for Energy and the Environment, Vermont Law School
On HF561 (early recovery and special treatment of nuclear reactor costs) as passed out of the Senate Commerce Committee
March 19, 2012
The effort by the Senate Commerce Committee to put a consumer protection band aid over a high caliber bullet hole in the heart of traditional ratepayer protection only makes the absurdity of the early cost recovery for nuclear reactors even more apparent.
Because the bill removes nuclear power from “traditional ratemaking principles or traditional cost recovery mechanisms,” consumer bills will increase dramatically. As passed out of Committee:
· Mid-American customers will be forced to pay for nuclear reactors long before they produce any electricity with no hope of recovering those prepayments should the reactors not be completed.
· The IUB is not allowed to reject the utility-determined level of prepayments because there are less costly alternatives available.
· Although the risk of building and operating a nuclear reactor is shifted to ratepayers, the utility is guaranteed a rate of return that will be higher than it earns on other projects.
This mismatch of risk and reward gives the utility strong incentives to maximize profits at the expense of ratepayers and strips the Utility Board of the powers necessary to protect ratepayers. Notwithstanding the amendments, the harmful effects identified by the Staff of the Utility Board in the original bill are still in place.
· By conferring a special advantage on nuclear, it threatens to distort the utility and regulatory decision making process and gives utilities an incentive to choose investments and make construction decisions that harm ratepayers.
· Beyond the initial choice of projects, shifting the risk of nuclear reactor construction onto the backs of ratepayers creates an ongoing problem because it diminishes the incentive to drive a hard bargain with vendors that protects ratepayers or recover costs from joint owners.
· By excusing nuclear reactors from rigorous comparative analysis of alternatives, it all but guarantees less costly alternatives will be passed over.
· Because nuclear reactors are so risky and impossible to finance in normal capital market, the utilities are pushing for advanced and guaranteed recovery of all costs, but certainty denies regulators the flexibility that is needed in an uncertain and rapidly changing environment and ties the hands of the IUB in its efforts to balance the interest of ratepayers and utility shareholders.
· The need to accelerate cost recovery creates severe intergenerational inequities in cost recovery, violating the fundamental principle that those who consume the output of a plant should bear its costs.
· Having guaranteed utilities cost recovery on an annual basis, the IUB will be under greater pressure to approve “incremental” additions to cost even when those costs are the result of utility error.
In its press release, MidAmerican trumpets the fact that “MidAmerican Energy Iowa’s electric customers have enjoyed stable base electricity rates for 16 years” and takes credit for that accomplishment. It conveniently ignores the important role that traditional ratemaking principles and traditional cost recovery mechanism have played in ensuring utilities deliver least cost power. By excusing the most risky, high cost options available today from those principles, this bill destroys the consumer protections that have produced stable rates in the past. The inevitable result will be that the future rates paid by MidAmerican electricity customers will be higher than they could and should be.
Blue Ribbon Commission meets in Minneapolis
The Blue Ribbon Commission On America’s Nuclear Future met in Minneapolis at the end of October 2011. The Commission was chartered to recommend a new strategy for managing the back end of the nuclear fuel cycle. Wally Taylor, the Chapter's Legal chair, and Pam Mackey-Taylor, the Chapter's Energy chair, attended the meeting. The pair also submitted comments to the Commission on behalf of the Chapter. Read their comments.
You can also see the Commission's draft report.
Friends of the Earth placed an advertisement in the April 29, 2011, edition of The Omaha World-Herald that criticized MidAmerican Energy for wanting to “raise Iowans’ electricity rates to fund a new reactor that might never get built.” The World-Herald quotes Senate Majority Leader Mike Gronstal (D-Council Bluffs) as saying legislation enabling MidAmerican Energy to proceed with plans for its proposed nuclear power plant has a 50 percent chance of passing. Read the article.
House Passes Nuclear Power Bill
On the 25th anniversary of the Chernobyl nuclear meltdown in 2011, the Iowa House of Representatives adopted HF561 setting the stage for MidAmerican Energy to proceed with plans to build a nuclear power facility at an undisclosed location. The Senate will take up the issue later. (See action alert below.) Read more about the nuclear power debate.
Nine Iowa Senators wrote to their colleagues in March 2011 expressing their concern about a bill that would enable MidAmerican Energy to charge ratepayers for a nuclear power plant that may or may not be built. Read the letter.
The Union of Concerned Scientists recently released its report titled Nuclear Power: Still Not Viable Without Subsidies. The first paragraph states, "conspicuously absent from industry press releases and briefing memos touting nuclear power’s potential as a solution to global warming is any mention of the industry’s long and expensive history of taxpayer subsidies and excessive charges to utility ratepayers. These subsidies not only enabled the nation’s existing reactors to be built in the first place, but have also supported their operation for decades." Read the rest of the report.
As the disasters at Chernobyl, Three Mile Island and Fukushima have shown, nuclear power can cause catastrophic damage to land, human health, and our food supply. We should pursue our cleanest, quickest, safest, and cheapest energy options first: Nuclear power comes out last in every one of those categories.
Here's why nuclear power doesn't make sense:
New nuclear reactors, small or conventionally large, are a huge financial risk. These risks are backed up by both historical and current cost analyses that indicate a steadily increasing price-tag. Alternatives are far cheaper, even according to nuclear utility estimates. Subsidies and incentives for nuclear reactors not only distort the market by creating the illusion of cost-competitiveness, they entice utilities to undertake riskier behavior by avoiding a least-cost approach. Small modular reactors do not solve the fundamental financial problems associated with conventional reactors, but instead may exacerbate them.
Nuclear energy has increasingly been cast as a silver bullet to the realities of global warming and the pressing need to reduce carbon dioxide emissions. As memories of the accident at Three Mile Island fade and out of control cost overruns from the 1980s become more distant, nuclear energy has undergone a political makeover by its supporters. In reality though, despite the temptation to label nuclear reactors as a viable solution to global warming and meeting our electricity demands, nuclear power is a bad choice. It is significantly more expensive than cleaner options, produces waste that contributes to an unresolved problem of long-term exposure, opens the door for proliferation, and perhaps most importantly, will not solve global warming. Read more here.
Last Updated 06.20.13
Other Energy Related Issues:
Read about SF390/HF561, legislation that will enable MidAmerican Energy to begin charging ratepayers for a nuclear power plant that may never be built. The two legislative bills were introduced in 2011 and could have been considered in the 2012 session. They were not.
Iowa Organization DocumentsIowa Public Interest Research Group: "Unacceptable Risk: Two Decades of 'Close Calls, Leaks and Other Problems at U.S. Nuclear Reactors"
energy policy: a really unfortunate sausage
Nuclear Socialism Comes to the Heartland of America: Early Cost Recovery for New Nuclear Reactors in Iowa and the Return of Electricity Rate Shock by Mark Cooper, Senior Fellow for Economic Analysis, Institute for Energy and the Environment, Vermont Law School
Regional and National News
Nebraska nuclear plant not restarting soon, by Josh Funk, Bloomberg Businessweek News, July 20, 2012
"Regulators bear down on nuke plant," by Nancy Gaarder, Omaha World-Herald, December 14, 2011.
The Omaha Public Power District has submitted its Flooding Recovery Action Plan to the Nuclear Regulatory Commission (NRC). Selected actions in the plan will be included in a Confirmatory Action Letter (CAL) from the NRC that must be satisfactorily completed prior to OPPD restarting the Fort Calhoun Station nuclear power plant. Read the plan.
According to the Omaha World-Herald, Omaha Public Power District has spent $44.5 million protecting its Fort Calhoun nuclear power station from Missouri River flooding. Read the article.
NRC Hears from OPPD on Fort Calhoun
On July 27, 2011, representatives of the Omaha Public Power District (OPPD) met with Nuclear Regulatory Commission (NRC) personnel in Omaha, to discuss post-flooding recovery actions for Fort Calhoun Station.
The purpose of the meeting was to discuss OPPD’s plans and actions for identifying and assessing impacts of the long-term flooding on plant structures and equipment prior to the future restart of Fort Calhoun Station. During the meeting, OPPD representatives discussed post-flooding recovery actions they plan to take prior to restarting the plant. See the meeting summary and presentations by both NRC and OPPD.Fort Calhoun nuclear power plant cask building partially underwater Photo Credit: Tom Brunett/Arthur Hu/Jeff Rense
Read Climate Wire's report on the nuclear regulatory confrontation between the Nuclear Regulatory Commission and the Omaha Public Power District regarding flood defenses for the Fort Calhoun nuclear power plant
by Mark Cooper, Senior Fellow for Economic Analysis, Institute for Energy and the Environment, Vermont Law School, November 2009
by Arjun Makhijani (Institute for Energy and Environmental Research) and Michele Boyd (Physicians for Social Responsibility)