Don’t buy Dominion Energy’s high-priced Millstone spin
Don’t buy the high-priced spin from Dominion Energy about the Millstone nuclear power plant they own. The plant is not in eminent danger of closing and does not need a Connecticut only ratepayer-funded subsidy.
There is no doubt that Millstone is an important asset in Connecticut that employees many hardworking residents and represents over half of energy generated here. However, according to a recent MIT study it is the most profitable of the more than 60 operating nuclear plants in the United States.
Let’s get the facts, and not the spin, about what ISO-New England, the regional grid operator, wrote in a public letter to Dominion on June 23, 2017. The letter clearly states that Millstone is obligated to provide power to all of New England, through at least May 2022, even if Dominion, owners of the Millstone plant since 2000, follows through on its threats to exit the Connecticut market because the publicly-traded company did not get the Connecticut ratepayer-funded subsidy it spent nearly a $1 million lobbying for.
ISO-New England, in the letter, also established there is already a process in place should the plant ever begin to struggle financially. That process would require Millstone to disclose financial information and demonstrate need.
It also confirms that if there is a need, then any solution developed by the ISO would be spread out financially on all the ratepayers of New England and not just on the backs of Connecticut ratepayers, who already pay the highest electric rates in the continental U.S.
Disclosure is something that Dominion has declined to do in any Connecticut-only legislative proposal that would seek to help the Millstone plant, despite the request from Connecticut legislators and consumer advocacy groups. How could policymakers be asked to solve a financial problem if Dominion is unwilling to disclose whether one actually exists? There must be some reason that Millstone does not formally appeal to the ISO for help!
Dominion can exit its obligations if it wants to, but according to the ISO letter, the earliest they could retire Millstone under this process would be 2022-23. ISO informed Dominion they have no authority to force the company to keep Millstone open, but that Dominion would have to pay significant fees if they decided break their contractual obligations. Why would the shareholders want Dominion to close a profitable asset and pay significant exit fees? This would be in violation of their fiduciary responsibility.
Since Connecticut is in a regional electric market, any Connecticut-only subsidy plan for Millstone would violate the wholesale price formation rules of the Federal Energy Regulatory Commission (FERC), as well as the Interstate Commerce Clause of the U.S. Constitution. A study performed for the New England States Committee on Electricity concluded Millstone will remain profitable through 2030 under every hypothetical scenario they could come up with.
Why should Connecticut residents have to pay for a special deal that subsidizes the profits of a company with revenues over $2 billion without any financial disclosures to prove it is necessary?
Connecticut’s energy landscape is complex. The Department of Energy and Environmental Protection (DEEP) is finalizing its Comprehensive Energy Plan (CES) for Connecticut’s energy future that takes Millstone into account. The General Assembly should examine DEEP’s findings, which are expected to be released in the near future, before approving any proposal for Millstone that would have a significant financial impact on residents and businesses in Connecticut.
John Erlingheuser is Advocacy Director for AARP/Connecticut.
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