Ray’s Round Up: Beware of Electric Rates Increases to Support Nuclear Power Plants

As temperatures climbed to record levels last week, it reminded some Pennsylvanians of weather conditions in spring of 1979 and a very dramatic incident that impacted hundreds of thousands of lives. March 28, 1979 was a very hot day, with temperatures in the upper 80’s, when a nuclear reactor at the Three Mile Island power plant along the Susquehanna River experienced a partial meltdown.  The accident changed the perception of nuclear energy for many in the United States, as concerns were raised about the potential of further accidents, the disposal of nuclear waste, and the costs of safely maintaining the power plants.

The use of nuclear energy in the United States didn’t stop after Three Mile Island though.  Since 1979, nuclear power plants have operated safely, producing electricity for millions of American households and businesses.  Recently, however, the efficiency of nuclear power has become a concern, not only for those who remember the aftermath of Three Mile Island, but also for the companies that own the power plants.

Many nuclear plants have been in operation for decades and are in need of significant upgrades and maintenance.  At the same time, other energy sources such as natural gas, are responsible for increasing amounts of electricity production in the United States. Now people are starting to question whether some nuclear plants will continue to operate.  The companies that own nuclear plants have told elected officials and regulators in a number of states that they cannot afford to continue to operate unless they receive financial relief.

In Illinois last year, legislators approved a plan to provide financial relief to Exelon, the owner of two local nuclear power plants.  This plan came at the expense of Illinois electric customers, who will see their electric bills increase – possibly adding $4.50 to their bill each month. The elected officials who approved this bailout claimed it was to save the jobs of the workers at the two nuclear plants.  But opponents of the measure, including AARP Illinois, saw this as a giveaway to a profitable company at the expense of the customers of the utility.

Why should Pennsylvania consumers pay attention to what happened in Illinois?  Because a similar increase may be coming to an electric bill near you.  Remarkably, it all comes back to Three Mile Island.  When the 1979 accident took place, one of the two nuclear reactors was disabled and it has never restarted. The second nuclear reactor has continued to produce electricity though. However, the plant has still been identified as being financially unsound along with other nuclear power plants located in Pennsylvania.

Utility companies in New York, Connecticut, Ohio and New Jersey have all begun the process of attempting to duplicate the legislative success of Exelon in Illinois.  Their tales of financial woe and their threats of the loss of jobs at nuclear plants all have the same goal – to convince legislators and regulators to allow the utilities to raise rates on customers. Over the years, utility customers have been paying for the cost of maintenance in the plants, while shareholders have earned profits without accounting for changes to the electric marketplace.

Legislation has not yet been introduced in the Pennsylvania General Assembly that would permit a bailout for Pennsylvania’s nuclear power plants.  Consumer advocates, including AARP Pennsylvania, are keeping a wary eye on legislative initiatives in neighboring states, as well as the pronouncements about the unprofitability of Three Mile Island and other nuclear facilities in the Commonwealth in anticipation of a push for such legislation. The upcoming anniversary of the worst nuclear accident in United States history shouldn’t be celebrated, let alone remembered, by an electric rate increase that would boost the profits of utility companies in Pennsylvania.

“Ray’s Round Up” features updates on current state and federal issues by Ray Landis, AARP PA’s Advocacy Manager.