Nuclear Funds Hit With Losses

Published on Thursday, June 18, 2009 by Lancaster Online (Pennsylvania)

Nuclear Funds Hit With Losses

Money to close TMI, Peach Bottom units down a total of $203 million.

by Ad Crable

The economic downturn has caused funds set aside for the safe closure of the Three Mile Island and Peach Bottom nuclear plants to drop dramatically in the last two years.

This is Unit 1 of the Three Mile Island Nuclear Generating Station. It is the functioning part of a once larger station. (caption and flickr photo by rowens27)

Since 2007, estimates of dismantling costs at the nation's 104 nuclear plants have risen by more than $4.6 billion while the investment funds that are supposed to pay for the closures - or decommissioning as it's called - have dropped $4.4 billion, according to an investigation by the Associated Press.

According to decommissioning fund statements filed by Exelon Corp., owners of the two plants, the balance in the closure fund for Three Mile Island's Unit 1 dropped $69 million from 2007 to 2009.

For Peach Bottom, decommissioning funds dropped $64 million over the last two years for Unit 2 and nearly $70 million for the Unit 3 reactor.

The fund losses are tied to investments.

Is it a cause for concern?

Yes, says Eric Epstein of the Harrisburg-based Three Mile Island Alert monitoring group.

"It's a nuclear Ponzi scheme. The plants are grossly underfunded and taxpayers will be on the hook for billions, if not trillions, in cleanup costs.

"The money put aside is a minimal amount (for cleanup), according to Epstein. "The losses last year were staggering."

He said estimates the federal government uses for post-closure cleanup is highly conservative.

The dangers listed by Epstein and echoed by anti-nuclear groups if decommissioning is not done promptly include groundwater and surface water contamination if there is a leak of stored nuclear fuel and the security risk from terrorists who might release or steal the highly radioactive stored used fuel.

"Nobody signed up to host a radioactive waste site," says Epstein."The promise of the atom was that it would all be cleaned up."

But a U.S. Nuclear Regulatory Commission official said no community will be stuck with a closed, non-decommissioned nuclear plant.

"The decommissioning funds are in accounts that are protected. These are long-term decisions and it is not unusual to see fluctuations in trust funds," said Neil Sheehan.

Nuclear plant owners have to make annual contributions to the fund.

But, Sheehan said, "We do live in extraordinary economic times."

As a result, he said some plant owners soon will get letters asking for plans on how the owners will make up the decommission fund shortfalls they are experiencing.

He said he couldn't reveal which utilities would get letters until they are sent.

Even if a utility would go bankrupt, the federal government likely would come to the aid of the company "or take necessary steps to make sure these needs are still addressed," Sheehan said.

Nineteen nuclear plants have won approval from the NRC to mothball reactors for as long as 60 years after closing. That would delay decommissioning but the plant still would be drained and safely stored, Sheehan said.

Beth Archer, a spokeswoman for Exelon Nuclear, said today, "We are fully funded for our Peach Bottom and TMI decommissioning funds."

When Exelon purchased TMI in 1999, one of the conditions of the sale was that it make a hefty contribution to the decommissioning fund. Thus, there may be more in the fund than required, even with a drastic decline in the total.

PPL customers have long been paying a surcharge on their electric bills that helps pay the decommissioning fund for TMI's active Unit 1 reactor. That ends at the end of 2009.

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