Lawmakers would face political fallout from a nuke bailout

Nuke bailout is radioactive for PA politicians, poll shows.

Lawmakers would be unwise to ram through nuke bailout legislation during the traditional rush of activity leading up to the June 30 budget deadline, an opinion poll shows.

The poll, commissioned by the PMA and conducted by the Omega Research Group, shows that 68 percent of voters oppose the bailout bills (one each in the House and Senate) that would increase costs to consumers and businesses by over $500 million every year.

Note to lawmakers: the poll shows the opposition cuts across party affiliation, age, gender and geographic boundaries, and 56 percent of respondents said that the issue is substantial enough to influence their voting.

The poll also revealed that while consumers support a mix of generation in the electric grid including nuclear power, they are unwilling to pay higher electricity bills to subsidize the five nuclear generation plants in the state, especially since four of them are still profitable. Most Pennsylvanians believe consumers choosing power in a competitive market should determine the mix of generation, not state lawmakers.

The survey, with a two percent margin of error, was conducted April 8 to April 10.

“Pennsylvanians support competitive electricity markets and want to keep the benefits of innovation, efficiency, and savings,” said PMA President & CEO David N. Taylor. “Electricity customers are not willing to give up the hard-fought benefits competition delivers for them, and they will punish elected officials who hike electricity rates to bail out uncompetitive energy companies.”

The legislation would place nuclear power under the protection of a subsidy program, the Alternative Energy Portfolio Standard (AEPS), that the legislature established in 2004 to encourage the development of wind, solar, and other alternative sources of power. The update to the program would add a third tier in which the state's 11 electricity distributors would be required to buy credits from carbon-free energy producers, including nuclear power. The Pennsylvania Public Utility Commission estimates that costs passed onto ratepayers at $458.7 million to $551 million, annually.

Neglected in the discussion is the hazardous waste generated by nuclear power and that overturning competitive markets would do nothing to save Exelon’s ailing Unit 1 on Three Mile Island, located at the site of the worst nuclear disaster in the nation’s history. In fact, the plant’s owner, Exelon, recently announced it will shut the plant down by September 30. This means that ratepayers would be paying substantially more to subsidize four nuclear plants that are still profitable.

The change to AEPS would also disrupt a competitive generation market that is benefiting from the affordable, abundant natural gas extracted from the Marcellus Shale. Through more efficient, cleaner power generation, natural gas has not only brought the price of power down in real dollars but has led to lower greenhouse gas emissions.

And more generation capacity continues to come online. A natural gas fired plant that recently opened in Jessup, near Scranton, is an example of the growth in the industry.
With just 30 employees, the plant has twice the generating capacity of TMI, a plant that takes 600 employees to run.

In addition, the new plant’s owner, Invenergy, says it will generate more than $50 million in revenue for Jessup over the life of the project.

Invenergy is one of many energy investors attracted by Pennsylvania’s competitive market. In the PJM grid, the nation’s largest wholesale power grid in all or parts of 13 states and the District of Columbia, 26 gas-fired plants are under construction or being upgraded.

The rigor of market competition requires continuous improvement to succeed, and, as Glen Thomas, President of the GT Power Group, pointed out for an earlier Bulletin story, consumers have a lot to lose by giving that up. Pennsylvania’s energy costs used to run 15 percent higher than the national average before competition. Now they are consistently at or below average. Pennsylvania has a 29 percent reserve margin where 16 percent is considered good. And emissions of carbon dioxide (CO2), nitrogen oxides (NOx), and sulfur dioxide (SO2) have dropped precipitously under competition with the introduction of more efficient, cleaner burning plants.

Passage of a nuke bailout bill would be a terrible move for consumers, and as the Omega poll shows, an even worse move for lawmakers who support it.

View the poll results HERE