Limits to expire; lawmakers fear 30% increase

HARRISBURG — A PPL executive told senators Tuesday that extending electric rate caps for consumers would have a negative impact on his company’s plan for a third reactor unit at the Susquehanna nuclear plant in Salem Township, Luzerne County.

“It would create regulatory uncertainty that will discourage investment in new generation, and certainly will impact PPL’s consideration of an additional nuclear generating unit at Susquehanna,” Bryce Shriver, president of PPL Nuclear Development, said in testimony at a hearing before two Senate committees. Sen. Lisa Baker, R-Lehman Township, was one of two senators presiding at the hearing.

The hearing was about security measures at Pennsylvania’s nuclear plants, but discussion veered into plans by all three Pennsylvania nuclear power generators to expand production. While much of the focus in the special legislative session on energy is on promoting solar and wind power, several senators said Pennsylvanians need to remember that one-third of their energy comes from nuclear power.

PPL is considering whether to apply next year to the federal Nuclear Regulatory Commission for a license to build an additional unit at Susquehanna. Meanwhile, the utility is seeking NRC approval to increase the Susquehanna plant’s power output by about 20 percent above what the plants generated when they started operating in the 1980s.

For the past decade, electric bills for consumers have been capped in Pennsylvania. But those rate caps are set to expire at the end of 2009 and 2010, and lawmakers are concerned that will lead to sudden rate hikes of 30 percent or more as electricity must be purchased without caps, on the open market.

Mr. Shriver’s testimony presents a policy dilemma for Sen. Lisa Boscola, D-Lehigh, a member of one of the committees holding the hearing. Ms. Boscola said she supports the development of nuclear power and is considering sponsoring a bill to provide state incentives to spur investment in nuclear power.

“I can’t see a better way to go than nuclear for a number of reasons,” she said.

But Ms. Boscola has been vocal about the need to extend rate caps for two years after they would expire. She is drafting separate legislation on that topic.

“I’m worried people are going to have sticker shock in 2010,” she said.

Testimony on security issues focused heavily on a recent event at Peach Bottom nuclear plant in York County where security officers were videotaped sleeping in a station “ready room.” NRC officials are investigating the incident and Peach Bottom’s operator, Exelon Nuclear, fired a private security firm.

PPL officials said they have an in-house security force and have spent more than $20 million on physical security improvements at Susquehanna since the Sept. 11, 2001, terrorist attacks.

Contact the writer: rswift@timesshamrock.com