Lawmakers Grill Cuomo Officials On Nuclear Power Plant Bailout

May 1, 2017

Nine Mile Point Nuclear Station in Scriba, NY
Credit nrc.gov

Assembly Democrats grilled Governor Andrew Cuomo’s energy officials for more than four hours on a plan executed by the Public Service Commission and a major energy company that will keep three upstate nuclear power plants alive for the next twelve years. Utility rate payers, mostly from downstate, will pay for the deal through a surcharge on their bills.

Assembly Environmental Committee Chair Steve Englebright says  he’s “very disappointed” in what he says was an opaque process, hastily decided last summer, that ratepayers will ultimately have to finance. Costs will average around $2 a month for residential customers, a charge critics have called “the Cuomo tax." 

“This is a huge imposition upon the ratepayers of the state,” said Englebright, who scolded Cuomo administration officials testifying at the hearing for not being better prepared to make the far-reaching decision.

“Instead of having this sort of effect of this being like a bug coming up on the windshield,” Englebright said. “And you were surprised when it hit.”

The hearing will likely not result in any changes to keeping the nuclear power plants open. The state has already signed contracts with the energy company Exelon and handed over the plants' operating licenses, on April 1.

Cuomo’s interim Public Service Commission Chair, Gregg Sayre, testified about the 2016 decision to have the state pay nearly $8 billion to keep the FitzPatrick, Nine Mile Point and Ginna nuclear power plants open. He says it was in part dictated by the timetable of the energy companies who own the plants. Sayre says the owners of the FitzPatrick plant were threatening to close it last June, jeopardizing hundreds of jobs, while the operators of the Ginna plant needed to recommit to refuel their plant by September.

“We concluded that all of those plants were in imminent danger of closing within months,” Sayre said.

The former head of the PSC Audrey Zibelman, who oversaw the deal, left for a job in Australia earlier this year and has not yet been replaced by Cuomo. Governor Cuomo and the PSC at the time of the agreement argued that the nuclear plants provide a clean bridge fuel while reaching the state’s goal of getting 50 percent of its power from renewable sources by 2030.

Assemblyman Englebright also questioned what he says is the “profound contradiction” of the state propping up the over 40 year-old plants, in Oswego and the Rochester area, while moving to close the Indian Point Nuclear Plant in Westchester, citing potential dangers. He sarcastically asked Sayre and the other officials if they were aware of the damage caused by the meltdown of the Fukushima nuclear reactor in Japan.

“It has devastated the economy of the entire nation of Japan,” he said. “And yet I don’t see any scientific cost evaluation analysis or an evaluation in your presentation of a risk assessment.”

Sayre answered that it’s not within the state’s “jurisdiction” to decide whether or not a nuclear plant is safe, it’s the federal government that makes that decision. And he says the federal Nuclear Energy Commission has required U.S. nuclear plants to take steps to avoid a Fukushima-like disaster.   

Nevertheless, Governor Cuomo has said that keeping the Indian Point Nuclear Power Plant open defies “basic sanity” because of inherent risks. That plant will close in 2021.

Other Assemblymembers complained about the extra charges that ratepayers will have to finance from the rescue deal for the three plants. Assemblyman Jeffrey Dinowitz represents portions of the Bronx, which he says includes a large number of low-income people who will be unfairly burdened by the deal.

“It’s worse than a regressive tax,” said Dinowitz. “It’s like regressive squared, as far as I’m concerned.”

The state energy officials argued that the financing arrangement is fair, saying that New Yorkers will benefit by cleaner air overall and hopefully, slower climate change, due to extending the life of the nuclear plants.

“We are not giving downstate a bad deal in this,” Sayre said. “It is fair to distribute the costs across the entire state.”

Lawmakers told the Cuomo administration energy officials that while they know they can’t change the bail out deal now, they hope in the future they can have more transparency when making major decisions about the state’s energy future.