Letter to NRC on Decommissioning Failures

Arnie Gundersen, a former nuclear plant engineer dddresses the NRC: 

Mr. Szabo, 

I participated in the NRC meeting on Decommissioning on Thursday morning, August 20, 2009, via teleconference link and have the following broad formal comments that I anticipate the NRC will consider.  Fairewinds Associates, Inc is highly qualified to comment on this matter, as two years ago we developed the first Decommissioning White Paper identifying the likelihood of decommissioning fund shortfalls at Vermont Yankee, which proved to be quite prescient.

As I stated on the teleconference it is my opinion that the NRC continues to ignore three broad issues concerning Decommissioning.  


The three areas of major weakness are:

First, the formula that the NRC uses to calculate the amount of funds licensees must escrow for cleanup is simplistic and will underestimate the funds necessary to actually decommission the units.  For example, the NRC calculates the decommissioning cost for VY to be approximately $500,000,000 while VY's own analysis places the cost at approximately $1,000,000,000.  That significant difference leaves ratepayers or taxpayers saddled with an enormous burden after the plant is shutdown.

Second, assuring that only the "minimum decommissioning costs" are escrowed ignores the historical fact that the there have been significant cost overages, including a half a billion dollar shortfall at Connecticut Yankee (CY).  Focusing on the "minimum" cost defers the true cost over to generations of citizens who did not use the power generated by the plant but are trapped with the cost after the plant is shutdown.  The $480 Million shortfall by CY was unfairly borne by Connecticut's ratepayers after significant electrical generation profits were paid to the corporation and its stockholders.

Third, while some of the NRC licensees are corporations with assets beyond the nuclear plant, some are Limited Liability Corporations (LLC's) with no assets beyond the licensee's single power plant.  When one of these so-called "merchant" plants that are LLC's face a decommissioning shortfall, there are no other assets to pay for the true decommissioning cost of the facility.  Vermont Yankee currently faces a $500 Million shortfall above the NRC formula.  Entergy continues to attempt to shield VY behind a LLC so that there appears to be no way for these costs to be recovered from the LLC.  As the NRC approved plan stands now, these additional $500 Million in costs will ultimately be borne by the citizens of the State of Vermont up to sixty years after the plant stops generating electricity.

In my opinion, by ignoring such major concerns in its proposed regulations the NRC policy is analogous to rearranging the deck chairs on the Titanic.  It seems to me that the NRC has made only minor adjustments to its proposed regulations as discussed today.  I believe that in the long term, these minor changes to the current regulations will be detrimental to the public as it is the residents of each state that will ultimately be forced to absorb additional decommissioning costs for years after final shutdown.  The goal of Decommissioning funding should be that those people who use the power from the nuclear plant will pay to clean it up.    The existing NRC system, even as discussed in today's meeting, will continue to kick the can down the road, so to speak, so that these costs will be a huge burden upon future generations. 

I formally request that the NRC review its policies again in order to protect taxpayers, ratepayers and the public as a whole, and not protect its licensees as it does with the current regulation.  Assuring that the true decommissioning costs, not the minimum costs, are borne by those people who actually used the power or profited from its generation taxpayers should be the NRC's objective.  Future generations should not bear this astronomical burden.  In my opinion, burdening future generations is patently unfair, violates fair trade laws, and falsely has the effect of artificially lowering the true cost nuclear generated electricity thereby making it seem somewhat financially equitable when compared against alternative forms of electrical generation like solar, wind, geothermal, biomass, etc.


Arnie Gundersen

Fairewinds Associates, Inc



To read about some of Mr. Gundersen's work, follow this link: