Iowa's nuclear problem
IIt's been five days since the massive earthquake and accompanying tsunami hit Japan. We are still coming to grips with the devastation and the massive humanitarian relief effort that lies ahead.
Amid the loss of life and property, it has become apparent that the warning systems and emergency response plans that have been in place for years were well thought out, practiced and executed with a calm precision.
It has also become apparent that the problems at the nuclear power plants are being handled as well as can be expected. The world is holding its collective breath, hoping that the containment holds and the brave workers who are working to prevent a larger disaster are successful.
Nuclear power has been touted by the Obama administration as an integral part of the long term energy needs of the nation. This event will no doubt force everyone to re-evaluate the technology, construction and safety protocols, which is fitting and a reasonable response.
In Iowa, there's a nuclear problem of a different sort.
MidAmercian Energy wants to explore the possibility of constructing a nuclear power plant in Iowa. They want their utility customers to pay higher rates to pay for engineering studies necessary for the plant, which may not even get built.
Historically, when a utility wants to add new generating capacity it must build the plant and begin producing electricity before seeking to recover the costs from its customers. They can only recover costs that are reasonable and prudent.
Last year, the Iowa legislature considered cost recovery legislation that had a provision empowering the Public Utility Board to require competitive bidding for new electricity resources. Under that approach, only if nuclear is cheaper can the project proceed, but MidAmerican knows nuclear is much more costly than efficiency, natural gas or wind, so this year's bill drops that language.
We argued against this measure last year. This year's measure is worse.
The shareholders, the ones that will benefit from increased profits, should take on the risks and expenses related to this project, not the captive customers.