An internal memo from the Iowa Utilities Board that raises concerns about a bill introduced in the legislature last year making it easier to build new nuclear power plants has critics of bill saying it supports their stance. But, I.U.B. general counsel, David Lynch, says the memo wasn’t intended to shoot down the bill.
“If the bill passed as it is, we are confident the we could implement it without changes at all. But I think staff was looking at the legislation to try and say ‘are there areas that might be made better or clearer, are there technical things that we’d like to air maybe some discussion about’, so it’s really just an effort to identify points that were worthy of a little discussion,” Lynch says.
Lynch says the memo was developed after a meeting with legislative leaders who asked if the board had any updated analysis of the law, and that’s how it came about. “They’re subjects that we’d like to see some discussion on it would help us understand what the legislature is looking for so we can be sure we implement it the way the legislature intended, so it’s more of a talking point I think,” according the Lynch.
The memo cites concerns over allowing the utility to charge customers the costs of licensing and construction of the plant, a key issue for opponents. But Lynch says that was not the biggest issue for the board.
“What we thought might be the most important one for us was really related to the staffing, for us to get up to speed on these issue, it’s been a long time since we’ve seen a nuclear plant,” Lynch explains. He says they have since talked with the Nuclear Regulatory Commission, Department of Energy and a manufacturer of reactors, and the staffing issue is not as big a problem as they thought.
While the memo mentions concerns about who would pay the costs associated with a new plant, Lynch says there’s a process for handling those concerns. “I think those are issues that we’d take up when we had an actual application in front of us, something to look at and let all the parties come in and argue over what the costs would be, and whether it would make economic sense or not,” Lynch says.
The AARP has been a critic of the bill. The group’s associate state director for advocacy, Anthony Carroll, says the I.U.B. memo provides clear evidence of their concerns about the cost of the power plant.
Carroll read directly from the memo to support his position. “House file 561 would shift nearly all of the construction, licensing and permitting risk associated with one or more nuclear power plants from the company to its customers, it’s a confirmation, an affirmation of what we’ve been saying all along.” Carroll says if you read further in the memo you find more to raise concern.
“It says some of these provisions could create incentives for the company to engage in behavior that could be contrary to the public interest in certain situations,” Carroll says. “So in our mind that’s a confirmation that House File 5-61 not only fails to protect consumer interest, but that proposed changes to Iowa law would actually provide incentives for utilities to behave in a manner contrary to public interest.”
While Lynch says both sides could argue the costs once a proposal is before the I.U.B., Carroll says there wouldn’t be any chance for argument. Carroll says, “It’s pretty clear if you just read what’s in this memo, if you read page two, one of the first things it says is ‘House File 561 will require the board to establish advanced rate-making principals within 180 days after the application is filed.’ That’s not speculative that’s a will, will require, again another confirmation, the idea that this is speculative, it’s not factual.”
Carroll says AARP has done polling on the issue. “Seventy-two-percent of Iowans over 50 oppose this legislation, so we’re on solid ground in terms of our work, and we’re trying to do everything we can to remind our lawmakers to listen to Iowans, who have as this memo suggests, really everything at risk, versus listening to the companies themselves who are seeking a shift of risk and costs to customers,” Carroll says.
Carroll says AARP does not take a stance on the type of energy plant, just the way it is funded. MidAmerican Energy sought the bill, but it failed to clear the legislature last session.
The bill lost momentum in part because of the problems with nuclear plants following the earthquake in Japan.
See the memo here: Amended-HF561-Bill-Analysis1-AARP