Nuclear site Permit legislation is dead
Or so it seems as the bill enabling electric rate increases to pay site permit fees for a new Callaway nuclear reactor languishes.
A group of Missouri utility companies wants the law allowing a rate increase to cover the $40 million permit cost. Most lawmakers favor the change as a step toward building a new nuclear power plant at the Callaway site, but a few well-placed senators are blocking the bill as a favor primarily to Noranda Aluminum Co., Ameren Missouri’s largest electric customer, which enjoys the lowest electric rate in the state. The company’s 1½-cent-per-kilowatt rate would increase if the bill is passed. Even a small increase would increase costs by millions and damage the company’s market valuation accordingly.
Another large electric user, Anheuser-Busch, also opposes the change.
Of course, a state legal posture disallowing electric rate increases is impossible over time if we are to underwrite a power generation future. You can’t blame favored consumers for holding out, but when most citizens and their representatives want to move forward with a project like Callaway II, even extraordinary users of electricity must share the cost.
Apparently no progress will be made this year, but several years are needed to process the federal permit needed for the Callaway site, and approaches are possible not involving public regulation of consumer rates linked so directly to the project.
If, for instance, a separate company were to build the nuclear plant only to sell wholesale power, its rates would not be subject to state Public Service Commission regulation, but the commission would have to recognize such wholesale power costs in setting consumer rates for companies selling retail.
Such a wholesale-only company could not get the benefit of prior rate increases from retail customers but would be in a great position to recover costs of building a well-conceived plant like Callaway II, presumably with rates that would have to be higher if instituted later. In this context, it’s worth noting electric rates in Missouri are among the nation’s lowest and are likely to remain so if Callaway II is built.
Meanwhile, reactions in the state Capitol to Ameren’s promotional efforts are generally disdainful. Ameren is thought even by supporters as an excellent engineering outfit with poor political skills. Reacting to a polling effort recently conducted by the utility, Rep. Chris Kelly, D-Columbia, said, “It’s amazing that people who do such a good job technically can be so stupid politically,” indicating improvement in lobbying technique could do much to salvage a commendable project.
Construction of Callaway II would be a boon to the state’s electric supply, and the $6 billion construction job — the largest in state history — would boost regional economic health. Callaway is a great site, already approved by the federal government, and Ameren is an expert operator of nuclear power generation, proven over time.
Like all power supply methods, nuclear power deserves continual oversight, but no technique offers such a strong combination of substantial production without damage to the atmosphere. Safe spent-fuel handling is more a political than a scientific problem.
Renewable power sources such as wind and solar are nice adjuncts but never will replace coal, gas and nuclear as base sources of energy. Among the three, nuclear has distinct advantages that should not be ignored.
HJW III
-Henry J. Waters III
