Blank check for nuclear power?

A standing-room-only audience of about 60 people crowded into a state legislative committee meeting Wednesday to hear debate on a proposed bill that would allow a utility to recoup the cost of constructing a nuclear power plant from ratepayers, even if the facility never produces any electricity.

Critics of the proposal told the Public Utilities and Technology Interim Committee that they believe the measure could result in ratepayers footing the bill for plants that may not produce the power they would be built to generate. Supporters said nuclear power could be a source of energy needed as the state's population grows in the coming years.

"We have to continue to see development of energy, and the base of our energy policy should be that we use a broad spectrum," said the committee's chairman, Rep. Michael Noel, R-Kanab.

"We think in order to meet the base loads that we need in the next 30 years, nuclear has got to be part of that portfolio."

But S. David Freeman, president of Hydrogen Car Co. and former general manager of the Los Angeles Department of Water and Power, told the committee that he questioned the wisdom of any state government allowing a company to build a power plant with the promise of recovering all the company's costs. He said it would be a dream scenario for the utility company.

"If I had that deal, I'd feel like I'd died and gone to utility heaven," he said. "The idea that you could get a return on every dollar you spend, no matter how much you spend, without any ceiling on it — it's writing a blank check to the guys that know how to spend money."

David Schissel with Synapse Energy Economics said the cost to build nuclear power facilities has historically been far more expensive than the proposed costs that planners have provided, and he cited examples in Japan and France.

Regarding the draft legislation being considered in Utah, Schissel said the bill seems overly broad.

"There needs to be public oversight of all nuclear energy options, and I don't think nuclear should get a benefit over the other options. It should be a level playing field," he said.

The committee agreed to continue studying the concerns of the draft bill before making any substantive changes to the legislation. However, Noel said he thinks offering incentives to utilities to develop energy is the way the state should proceed.

Few companies would be willing to risk the time and money to obtain a permit, find a site for a plant and obtain the water rights needed for nuclear power, he said, "unless they know that they've got some kind of an opportunity to come back to the ratepayer."