Nuclear plan needs more scrutiny

By The Gazette Editorial Board

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Legislation in both the Iowa House and Senate calls for encouraging “prudent development” of new nuclear electric power generation. We agree with the intent.

Even after the Japanese disaster, the nuclear power option as part of Iowa's future energy mix should not be dismissed without more review. While the upfront cost is higher than most other alternatives, and the problem of disposing of radioactive spent fuel rods is not yet solved, nuclear power offers virtually emissions-free generation on a large scale that other “clean” sources don't match, at least not yet. Safety designs are much improved.

Yet we question whether SF390 or HF561 strike the right balance between the nuclear industry and customers toward meeting Iowa's energy needs.

Perhaps the biggest red flag is how the utility company would recover its costs. Instead of the traditional rate increases that the state utilities board can approve after a project is completed, the proposed legislation would allow the company to recover permitting, licensing and other costs as the project unfolds. And if at some point the company elects not to complete the project, all costs to that point are eligible for recovery.

MidAmerican Energy, which is conducting a three-year feasibility study of new nuclear generation, argues that the ratepaying change is needed because of the high costs of regulatory requirements and constructing nuclear plants - estimated at $1 billion to $3 billion.

Understood. But saddling customers with advanced rate increases is troubling. The Iowa Utilities Board (IUB) estimates that for every $1 billion of cost, the average residential customer would pay about $7 per month; businesses would pay an extra $30 a month and industries $2,000 - for up to 40 years.

The Iowa Utilities Board says such a method might be the only way to finance a nuclear power project. And the advanced rate requests would be reviewed annually by the Iowa Utilities Board, which could adjust or reject.

Still, we think customers should risk less and the utility company's investors bear more of such a huge investment.

Certainly, investing in Iowa's energy future is important. There's risk if we don't. Expected baseload demands likely will require a major addition to capacity. New coal-fired plants are seen as environmentally unfriendly despite advances in pollution controls. And wind and solar can't yet meet the need.

Lawmakers shouldn't rush this legislation. Instead, a proposed commission to thoroughly study the safety and cost issues of nuclear power and whether expansion of renewable energy alternatives could realistically play a bigger role makes some sense. A project with this much potential impact on our future and our pocketbooks deserves extra scrutiny.

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