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*Update: Greg Harman at the San Antonio Current just published a fantastic and very thorough recap of the twisted nuclear saga. Check it out!

Here’s part 2 in this year’s first annual Year in Review: Top Texas Vox Stories of 2009 series. Part 1 is just a hop, skip and scroll down.

3. San Antonio Nuclear Debacle/Amores Nucleares Telenovela

This year has been a doozy for nuclear power, with the highlight of course being the San Antonio situation.  Over the last 12 months San Antonio has ridden a wild wave of cost estimates, community meetings, protests, scandals, and misinformation.  But I’m getting ahead of myself. Remember when…

Last January, CPS Energy committed to spend $60 million more on the proposed expansion of the South Texas Nuclear Project, a decision which at that point brings the city utility’s total expenditures on units 3 & 4 to $267 million. Not long after that, Austin City Council took a look at participating in the expansion project but said “No way, that’s much too risky of an investment for us.” San Antonio decided that something magical (but mysterious) was different for them, despite our prediction in late April that the proposed reactors could actually cost as much as $22 Billion.  Mum was CPS’ word on a cost estimate at that time, but by June they announced that $13 Billion was a good, round number. We worried at this point that CPS was being overly optimistic, ignoring the history of the South Texas Project and other nukes around the nation and independent reports, but those concerns largely fell on deaf ears.

Then over the summer, CPS Energy launched a massive public outreach campaign, with meetings in every district — but kind of botched it.  Despite activists’ protests that CPS’ cost numbers were innacurate, the utiltiy refused to release their information or back up numbers, and many San Antonio citizens left the community meetings feeling disenchanted with the process and suspicious of CPS.

As a rising tide of activists and concerned citizens grew, eventually they formed the coalition group Energía Mía and worked together to halt CPS’ spending for more nuclear reactors. The group launched a string of protests and press conferences highlighting the many flaws of nuclear power and the San Antonio deal in particular.  Everyone was all geared up for a big showdown the last week in October, but then the cowpie really hit the rotating bladed device (let’s call it a windmill). For the next part, I’m going to pull from a previous post where I likened the whole situation to a geeky, policy version of a telenovela.

Previously, on Amores Nucleares:

With just days before San Antonio City Council was to vote to approve $400 million in bonds for new nuclear reactors, it was leaked that the project could actually cost $4 Billion more than CPS had been saying all summer (according to Toshiba, who would actually be building the plant). The vote was postponed, there was an impromptu press conference, and it came out that CPS staff had actually known about the cost increase for more than a week — Oops! Oh, and the “leak” wasn’t that CPS came out with the truth, an aide from the mayor’s office only found out after confronting CPS about a rumor he’d heard. But how did the mayor’s office find out? NRG, CPS’ partner in the project was the “Deepthroat”, because they were going to announce Toshiba’s $17 Billion cost estimate at a shareholder’s meeting soon after the city council vote and thought, geez, that could look really bad for CPS! Meanwhile, CPS reps flew to Japan in a hurry to figure things out. Steve Bartley, interim GM for CPS, resigned. Furious that CPS had hidden the ugly truth from City Council, the mayor demanded the resignation of two key CPS board members, and got City Council to vote unanimously that they get the boot. Chairwoman Aurora Geis agreed to go, but Steve Hennigan said “No Way, Jose.” THEN CPS completed an internal audit of the whole shebang to figure out what-the-hell-happened, which found that Steve Bartley was to blame, and everyone else was only guilty of failure in their “responsibility of prompt disclosure”. Then it came out the project could be even more way way expensive than anyone thought (except of course Energia Mia, Public Citizen, SEED Coalition, the Center for American Progress, Nuclear Information and Resource Service, and analysts Arjun Makhijani, Clarence Johnson, Craig Severance, and Mark Cooper to name a few). And then those crazy cats all started suing each other.

So in the end, they told folks all summer long that the plant would cost $13 Billion, even though insiders knew since late June that it could very well be $4 Billion more. Latest update is that the plant could really cost $18.2 Billion! On December 31st, Toshiba provided CPS with another new estimate, which the utility will use to come up with their own new cost estimate mid-January. City council is slated to vote sometime after that, once and for all, on $400 million in bonds to continue the project.

But clearly, enough is enough. So if you live in San Antonio, tell City Council to stop throwing good money after bad, and to cut their losses before its too late. Tell them to vote “no” to nuclear bonds and start the year off fresh and free from the “ghost of nuclear projects past.”

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By promoting cleaner energy, cleaner government, cleaner cars, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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The San Antonio Nuclear Expansion Soap Opera plot thickens.  Today’s update brings the shocking news that South Texas Project Reactors 3 & 4 could actually cost, not $13 Billion, not even $17 Billion… but $18.2 Billion!

With all the trouble CPS has gotten into recently regarding transparency (a gentle term we’re using that translates roughly to “lying to the public and covering up bad news”), you’d think that they would’ve come forward and made this estimate public as soon as humanly possible.

But you’d be wrong.  Instead, they presented the numbers to their board in a closed session last week (read: NOT public, you’re not invited).  Sometime later, the San Antonio Express-News got wind of the update, “based on numbers provided by the South Texas Project Nuclear Operating Co”, and published the results.

When will CPS learn that they have got to be honest with the public, the mayor, and city council? They told folks all summer long that the plant would cost $13 Billion, even though insiders knew since late June that it could very well be $4 Billion more.  CPS has led a lengthy and sloppy cover-up campaign of STP and nuclear power’s “inconvenient truth” that culminated in resignations, an internal investigation, and several firings and demotions.

Am I going to fast for you? Did you miss a few episodes, and are confused that CPS’ prize project could so quickly fall to pieces? Let’s do a recap.

Previously, on Amores Nucleares:

With just days before San Antonio City Council was to vote to approve $400 million in bonds for new nuclear reactors, it was leaked that the project could actually cost $4 Billion more than CPS had been saying all summer (according to Toshiba, who would actually be building the plant).  The vote was postponed, there was an impromptu press conference, and it came out that CPS staff had actually known about the cost increase for more than a week — Oops! Oh, and the “leak” wasn’t that CPS came out with the truth, an aide from the mayor’s office only found out after confronting CPS about a rumor he’d heard. But how did the mayor’s office find out? NRG, CPS’ partner in the project was the “Deepthroat”, because they were going to announce Toshiba’s $17 Billion cost estimate at a shareholder’s meeting soon after the city council vote and thought, geez, that could look really bad for CPS! Meanwhile,  CPS reps flew to Japan in a hurry to figure things out.  Steve Bartley, interim GM for CPS, resigned.  Furious that CPS had hidden the ugly truth from City Council, the mayor demanded the resignation of two key CPS board members, and got City Council to vote unanimously that they get the boot.  Chairwoman Aurora Geis agreed to go, but Steve Hennigan said “No Way, Jose.” THEN CPS completed an internal audit of the whole shebang to figure out what-the-hell-happened, which found that Steve Bartley was to blame, and everyone else was only guilty of failure in their “responsibility of prompt disclosure”.  And then this week it came out the project could be even more way way expensive than anyone thought (except of course Energia Mia, Public Citizen, SEED Coalition, the Center for American Progress, Nuclear Information and Resource Service, and analysts Arjun Makhijani, Clarence Johnson, Craig Severance, and Mark Cooper to name a few).

That about brings us up to speed.

So what is next? December 31st, Toshiba should come out with a new, “official” cost estimate, which CPS will use to come up with their own cost estimate mid-January. City council is slated to vote January 15th, once and for all, on $400 million in bonds to continue the project.  But clearly, enough is enough.  Tell City Council to stop throwing good money after bad, and to cut their losses before its too late.  Tell them to vote “no” to nuclear bonds January 15th, and start the year off fresh and free from the “ghost of nuclear projects past.”

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By promoting cleaner energy, cleaner government, cleaner cars, and cleaner air for all Texans, we hope to provide for a healthy place to live and prosper. We are Public Citizen Texas.

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Last week San Antonio’s CPS released their cost estimate for the proposed South Texas Project Nuclear Expansion, and we found their numbers naive optimistic ignored history wanting.  To find out why, check out this Guest Column, printed in today’s San Antonio Express-News, from Public Citizen’s own Energy Policy Analyst Matthew Johnson.

Matthew Johnson: Why not cheaper, safer sources of energy?

Matthew Johnson: Why not cheaper, safer sources of energy?

Nuclear reactors too expensive

By Matthew Johnson – Express-News Guest Voices

CPS Energy announced its cost estimate for two more nuclear reactors at the South Texas Project near Bay City last week. The $13-billion price tag is the latest estimate in a sustained and systemic low-balling by utilities wishing to receive government subsidies.

CPS’ partner, NRG Energy, recently pegged the cost of units 3 and 4 at $10 billion, a figure that has jumped nearly 50 percent from its original estimate of $5.4 billion.

Other analyses, however, have estimated the cost of two new reactors to be nearly 100 percent higher than the CPS estimate. Former Texas Office of Public Utility Counsel official Clarence Johnson recently estimated the cost of STP expansion to be $20 billion to $22 billion, while nuclear engineer and president of the Institute for Energy and Environmental Research Dr. Arjun Makhijani estimated a cost of up to $17.5 billion in 2008.

A new study by Mark Cooper, of the Vermont Law School, analyzed numerous cost estimates of the so-called nuclear renaissance beginning around 2001. He discovered that early estimates of new nuclear reactors were made predominantly by industry and academics and were optimistic and eager to rejuvenate the industry.

Since then, utilities’ estimates have shown similar wishful thinking, but continue to rise. Independent analysts and Wall Street, Cooper shows, offer the most realistic estimates that are much higher.

The history of the STP expansion effort follows this pattern. CPS and NRG have been attempting to gain support in federal, state and city government since they submitted their application to build two new reactors to the Nuclear Regulatory Commission in 2007.

Wall Street estimates also place a similar and continuously rising price tag on new reactors. The bond-rating agency Moody’s predicted $5,000-6,000 per kilowatt for new reactors almost two years ago, which translates to $16.2 billion for STP expansion, and recently indicated that it could downgrade bond ratings on utilities constructing new nuclear reactors.

The federal government established an $18.5 billion subsidy to back loans taken out to construct new reactors. STP expansion advocates brag about being on the short list for part of these loan guarantees, but proponents and opponents agree that more reactors won’t be built if the feds don’t pony up the dough.

The reason is simple. Investors are squeamish to lend money for projects with such a high risk of defaulting on repayments. Delay and cost overruns increase risk. STP’s original reactors took eight years longer than planned to complete and costs soared six times over original estimates.

CPS Energy has faster and cheaper alternatives. Their recent announcement on the 27 megawatt solar plant in West Texas, the Mission Verde plan to develop 250 megawatts of solar and new wind contracts plus their goal to save 771 megawatts through energy efficiency by 2020 are shining examples of the path they should focus on to keep rates stable and low in the future. This path also creates more local jobs.

City Council will soon have to decide on San Antonio’s involvement in new reactors. It must vote no on nuclear to protect San Antonians from bearing the overwhelming economic burden of building costly, dangerous and unnecessary nuclear reactors.

Matthew Johnson is an energy policy analyst for Public Citizen’s Texas office.

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