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Fight rages over Connecticut lifeline bill for Millstone nuclear plant

Connecticut's two electric utilities have come out against Connecticut legislation to throw a lifeline to Dominion Energy Inc.'s Millstone nuclear power plant to prevent a threatened shutdown despite calls by climate scientists and environmentalists for passage of the bill.

In a June 1 letter addressed to Connecticut Gov. Dannel Malloy, former NASA climate scientist James Hansen and 18 other scientists and nuclear supporters urged Malloy and state officials to support Senate Bill 106 to help secure Millstone's future.

Introduced in January, the bill is awaiting hearing by the full House of Representatives and Senate and would allow the 2,100-MW nuclear plant in Waterford, Conn., to secure a long-term contract through 2029 for roughly half of its generating capacity. The process is already used in the state to mandate large-scale renewable procurement by local distribution utilities. In addition, S.B. 106 seeks to increase the state's renewable portfolio standard from 20% by 2020 to 40% by 2040.

The letter warned Malloy that the loss of Millstone, which supplies more than half of the electricity consumed in Connecticut and more than 96% of its emissions-free generation, would damage the state's progress towards cutting carbon dioxide emissions 80% by 2050. Others signing the letter included Massachusetts Institute of Technology professor of atmospheric science Kerry Emanuel, Pulitzer Prize recipient Richard Rhodes and climate scientist Pushker Kharecha of Columbia University's Earth Institute.

The group said an early closure of Millstone would increase Connecticut's dependency on natural gas-fired generation and electricity imports, while putting ratepayers at the mercy of volatile natural gas prices in a state that already has the second highest electric retail rates in the U.S. at about 20 cents per kilowatt-hour. Furthermore, since gas-fired generation emits greenhouse gases, electricity prices would also likely increase due to the state's participation in the Regional Greenhouse Gas Initiative to cut emissions and plans by the ISO New England to incorporate the price of carbon dioxide into the cost of electricity.

The letter blamed the exclusion of nuclear power from state and federal subsidies and mandates for clean energy for putting Millstone in danger of early retirement.

Citing recent information from the nonpartisan Congressional Budget Office, the letter said U.S. renewables received $6.3 billion more or 2.4 times what was given to fossil fuels in tax preferences in 2016, and $10.7 billion more or 55 times what was given to nuclear. On a unit of energy basis, the letter said this means that renewables subsidies amounted to 100 times more than what was given to nuclear, which received no subsidies between 1985 and 2000 and only "comparatively small" amounts between 2000 and 2005.

Many nuclear advocates want Connecticut and other states to copy Illinois' and New York's new zero-emissions credit initiatives that compensate otherwise-uneconomic nuclear plants for their emissions-free generation. The letter, however, cautioned that such nuclear subsidies "will not be enough to ensure long-term fairness towards nuclear, which must compete against renewables that are both subsidized and guaranteed compensation."

In the long run, the letter asserted, if states want to prevent early retirements of nuclear plants lawmakers must pass legislation that ends preferential treatment of renewables and starts compensating nuclear for both its emissions-free electricity and the "affordable energy it provides around the clock."

Not everyone agrees that shoring up Millstone's finances is the most cost-effective alternative to an early plant retirement. Among those opposed to S.B. 106 are Connecticut's two utilities, Eversource Energy and United Illuminating Co., whose customers foot the costs of the plant.

In a recent joint op-ed published by CT Viewpoints, Eversource President of Electric Operations Craig Hallstrom and United Illuminating President and CEO Tony Marone decried any power purchase agreement for Millstone as a tax on their customers "to pay millions more for the same energy they are already receiving," especially since Dominion "hasn’t produced any evidence that it needs the money" to keep the facility running.

"We know that keeping energy costs stable and affordable is important to our customers and the state legislature," said Hallstrom and Marone. "So why, now, would they consider passing a bill that favors the bottom line of one company over the household budgets of millions of residents?"

The lobbying arm of the U.S. oil and natural gas industry, the American Petroleum Institute, is also working hard to oppose S.B. 106 and recently sponsored a survey that found 78% of the 822 registered Connecticut voters surveyed are also against giving "special treatment" to Millstone at the expense of ratepayers.

"We believe consumers benefit most when markets are allowed to flourish without mandates, riders and special treatment by lawmakers and regulators," said API Chief Economist Erica Bowman. "We should let the markets protect consumers as they are currently doing for consumers across Connecticut."

United Illuminating is a subsidiary of Avangrid Inc.