With hundreds of millions of dollars at stake, Wisconsin regulators are signaling interest in scrutinizing plans to decommission a former nuclear power plant, but questions remain about how much authority the state has.
The Public Service Commission will require the owner of the shuttered Kewaunee Nuclear Power Plant to disclose details about a deal to transfer the plant and its decommissioning trust fund to a contractor that will also be required to share information about its financial resources.
Dominion Energy is seeking approval to sell the 49-year-old plant to EnergySolutions, a Utah company that specializes in nuclear waste disposal and decommissioning.
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Under the proposal, EnergySolutions would assume ownership of the plant and about $780 million set aside to cover the cost of decommissioning, which the company estimates will cost about $724 million.
A competitor, NorthStar Group Services of New York, says it could do the job for just $550 million and return the rest to ratepayers.
The commission is reviewing the sale to determine whether it complies with a 2005 order that authorized Alliant Energy and Wisconsin Public Service Corporation to sell the plant to Dominion for $220 million.
Wisconsin's three transmission utilities would be able to block competitors from bidding on projects within their territories, which opponents say would boost their profits at ratepayers’ expense.
That order included a condition that any excess decommissioning funds be returned to ratepayers and gave the utilities the “right of first refusal” to match any future offer to buy the plant. NorthStar offered the utilities $25 million for that right of first refusal, but the utilities declined.
Without competitive bidding on the project, NorthStar argues that Dominion and EnergySolutions, which contracts work to its own subsidiaries, have no incentive to spend the funds prudently.
NorthStar is seeking information on EnergySolutions’ financial resources and details about Dominion’s decision to sell the plant, which the company says will help regulators evaluate whether the sale is in the public interest.
EnergySolutions, Dominion and the utilities asked the PSC to suppress that information and limit the proceedings to the questions of whether EnergySolutions has the financial resources to complete decommissioning and whether the utilities acted prudently when they declined to buy back the plant.
The PSC took no action Thursday, effectively denying the request.
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Chair Rebecca Valcq and Commissioner Tyler Huebner said they want more information to determine how much authority the PSC has over the sale and the funds.
“These are Wisconsin ratepayer dollars,” Valcq said. “What type of controls or guardrails can we put in place to make sure whoever ultimately decommissions the site doesn’t just blow through the entirety of that decommissioning trust?”
Commissioner Ellen Nowak suggested the commission may have given up that authority long ago.
“You can’t relinquish jurisdiction you don’t have,” she said.
Nowak cited the order authorizing the sale to Dominion.
“‘The commission is willing to relinquish its approval authority over the use of (Kewaunee’s) decommissioning funds and rely on federal control because of the overall benefits of the sale,’ yadda yadda,” Nowak said. “It’s some strong language.”
Valcq noted the issue may not be so clear.
“I think it’s the yadda yadda part, right?” Valcq said. “What are those benefits and what is the yadda yadda in the rest of the order?”
All three commissioners said they’d like to know more about the Nuclear Regulatory Commission’s authority over decommissioning expenses.
The NRC oversees site cleanup and verifies that license holders have enough money to cover the costs, which it says generally costs $300 million to $400 million, but does not review line-item expenses, said spokesperson Viktoria Mitlyng.
A spokesperson for Dominion Energy declined to comment on the commission’s actions. A spokesperson for EnergySolutions did not respond to a request for comment Friday.
NorthStar CEO Scott State said he was encouraged by the commission’s focus on protecting ratepayers.
“It is not the NRC’s job to determine whether this decommissioning deal will end up shortchanging state ratepayers of hundreds of millions of dollars,” State said. “That’s the PSC’s duty.”
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