Dec 3, 2003 - Report: Funds set aside for nuke cleanup inadequate, by AD CRABLE, Lancaster New Era
Congressional investigators say utilities are not adequately setting aside the hundreds of millions of dollars needed to clean up nuclear reactors at Three Mile Island and Peach Bottom when the plant sites close.
The report by the U.S. General Accounting Office claims that funds that, by law, must be set aside for restoring plant sites to their original condition may be as much as 25 percent lower than needed for TMI's Unit 2 reactor. Decommissioning for Peach Bottom's closed Unit 1 reactor appears to be 51 to 100 percent underfunded, according to the report.
The cost of closing down and removing TMI Unit 2 was estimated at $433 million in 1997. The cost of decommissioning Peach Bottom Unit 1 was recently estimated at $129 million by plant owner Exelon Nuclear. The report did not say how much actually had been set aside to date in the decommissioning funds for the two reactors.
However, the owners of the two plants, where other reactors remain in use, said today that the decommissioning funding report by the investigative arm of Congress is flawed and that the money will be there when the plant sites end their useful life several decades from now.
Updating a 1999 report that first warned that decommissioning funding at many U.S. nuclear plants was not adequate, the GAO said on Monday that the $27 billion saved by the nuclear industry through 2000 was actually ahead of schedule.
But breaking down the savings by individual plant owners, the study said that owners of 42 of the 125 nuclear plants that have operated in the United States had accumulated fewer funds than needed to be on track to pay for eventual decommissioning, after the plants close.
"Under our most likely assumptions, these owners will have to increase the rates at which they accumulate funds to meet their future decommissioning obligations,'' the 55-page report said. Furthermore, the report criticized the federal Nuclear Regulatory Commission -- the nuclear industry's governmental watchdog -- for not taking action to force utilities to step up funding to address inadequacies.
In 1988, the NRC began requiring owners to certify that sufficient money would be available when needed to decommission their nuclear plants. Beginning in 1998, utilities were required every two years to show how much money had been set aside and where the money was coming from. Most funds come from ratepayers and investments in trust funds.
The GAO study singled out Exelon Nuclear, the owner of Peach Bottom and the active reactor at TMI, as being behind the curve on set-aside funding. GAO said the trust funds for 11 of the 20 nuclear power plants owned by the company were inadequate.
However, the GAO found that Exelon Nuclear was actually well above other utilities in saving for the future closure of TMI's active Unit 1 reactor and Peach Bottom's two active reactors. And Exelon spokesman Craig Nesbit said the more-than-adequate funding will take care of any deficiency for the other Peach Bottom reactor that closed in 1974. Nesbit criticized the GAO report, saying it looked only at individual units instead of entire plant sites, and did not consider specific decommissioning strategies, such as Exelon's.
He also said the GAO study was "skewed'' because it did not take into account that most nuclear plants, such as Peach Bottom and TMI, will be relicensed for another 20 years, which gives utilities more time to save decommissioning funds. "All of Exelon's plants are adequately funded for decommissioning now, and will be in the future,'' Nesbit said.
Though Exelon owns the site, the responsibility for decommissioning the TMI Unit 2 reactor, closed since a 1979 accident, lies with FirstEnergy Corp., which bought out former TMI owner GPU.
The GAO study indicated the funding shortage is between 1 percent and 25 percent for TMI's Unit 2. FirstEnergy spokesman Scott Shields denied today that there were inadequate funds for restoring the Unit 2 site to its original condition.
"We will continue to collect funds for the decommissioning for Unit 2 and we will be fully funded by the time the plant is retired,'' he said. Shields noted the site can't be cleaned up until Unit 1 is closed. TMI's license expires in 2014 but an extension is expected.
Eric Epstein, an expert witness on decommissioning before the Pennsylvania Public Utility Commission and chairman of TMI-Alert, a safe-energy citizens group, is not so confident.
He said the GAO study on decommissioning shortcomings is just the tip of the iceberg. Citing the escalating costs of disposing of low-level and high-level nuclear waste, Epstein said "clearly the utilities underestimate and lowball decommissioning costs.'' Epstein fears utilities will not be making the profits in the future when plants are closed down and will not be able to pay for what it will actually cost to restore nuclear plant sites. People not yet born may have to pay for that shortcoming through higher electric bills, he said.
Inadequate funding for future closures was a constant concern expressed by former Lancaster mayor Art Morris when he chaired a citizens advisory panel on the cleanup of TMI in the 1980s.
"It's just the same old story. It's absolutely remarkable that after all these years of public comment and criticism that the Nuclear Regulatory Commission just sits and does nothing about (inadequate funding),'' Morris said today. "The taxpayers will have to pay for it. There needs to be an NRC that stays on top of this and monitors it.''
