Nuclear Matters Chair Says Pilgrim PILOT Program will "Throw Plymouth off a Financial Cliff"

Comment on Entergy
by Jeff Berger, Tuesday, June 26, 2012

Last week, at the Nuclear Matters Committee meeting, we discussed a number of topics. Shortly thereafter, I concluded that I had to make some personal comments to this Board. These are personal comments, not anything from the Nuclear Matters Committee which I chair.

A couple of weeks ago, the Plymouth 400 website was unveiled. It focuses on our town’s need to celebrate and leverage the 400th anniversary of the landing of the pilgrims.

Although that’s important, I submit to you that another date is many times more important. That date is 2032. Just 20 years from now … only 12 years after our town’s 400th anniversary … the Pilgrim nuclear power plant will shut down forever, be decommissioned, and will close, and that will literally throw Plymouth off a financial cliff of unprecedented proportions.

You know that, of course. But that pending financial cliff crystallizes the importance of the current PILOT negotiations and those negotiations are the focus of my comments tonight.
 
In my humble opinion, Entergy…right now…owes Plymouth far more than it ever has in terms of PILOT funds. The plant is worth more today than it has ever been worth, though Entergy bought it for pennies on the dollar; our risk as its host community is infinitely greater today than it has ever been; and radioactive Tritium continues to be present in the soil around the plant and no one knows why, how much is really there, or what the future holds.

I’m going to review valuation, risk, and Tritium very briefly. First, valuation. The NRC… in its infinite wisdom or lack thereof … has chosen to relicense Pilgrim for 20 years. Whether the people of Plymouth and neighboring communities are happy about it or not, Pilgrim will continue to operate for the next 20 years. The union now locked out of the plant by Entergy says Entergy generates about $1 million in revenue from that plant every day it’s in operation. Pilgrim is a huge money-maker for Entergy and will remain so for the next 20 years. If you assume that the plant’s revenue never increases from its current $1 million/day, Pilgrim will take in about $7.3 billion, if my math is correct, over the next 20 years. That plant is worth a huge fortune to Entergy and the PILOT funds – Payment in Lieu of Taxes – it pays to Plymouth should reflect its real multi-billion-dollar value.

Second, risk. The spent fuel pool at Pilgrim is elevated and packed very tightly with every ounce of spent fuel the plant has ever used since it began operations 40 years ago. A leading global authority on security more than once has described the elevated spent fuel pool at Pilgrim as “vulnerable.” Imagine how that vulnerability could skyrocket during the extremely delicate operation of moving even small amounts of spent fuel from the spent fuel pool to dry cask storage starting in only a couple of years.

This is not 1972. Pilgrim was built here instead of in Squantum, Boston Edison’s preferred site, because only about 16,000 people lived here in 1972. Our population has about quadrupled. We live in an era of terrorism -- and Al Qaeda, Hamas, and other terrorist organizations would like nothing more than to sabotage critical infrastructure. Make no mistake: Pilgrim is critical infrastructure and, as I quoted, a renowned expert has called it “vulnerable.”

The plant is also 40-years-old and it will be operating until it is 60-years-old. It has a tremendous amount of underground piping and other aging infrastructure and the condition of that piping, quite frankly, is anybody’s guess. No one – not even the NRC - knows how that piping – or the rest of the plant, for that matter - will fare going forward as it moves toward 60 years of operation.

Consequently, we are in what amounts to an unholy experiment by the NRC – and in that experiment all of us – everyone in this room and everyone who lives with 50 miles of the plant – are unwitting guinea pigs.

Overall, the risk to the Town of Plymouth from Pilgrim over the next 20 years is Ginormous – infinitely greater than it has ever been. We are a de facto dump for tons of nuclear waste and we are an inviting target for terrorists. Our historic significance adds to the attractiveness of Plymouth as a target.

And last, radioactive tritium. Despite its best efforts to find the source of radioactive tritium in the soil around the plant, Entergy has been unable to do so. No one knows where this situation will go. Whatever is in the ground water at Pilgrim goes into Cape Cod Bay. So the future presence of an unknown amount of radioactive Tritium is yet another severe liability faced by Plymouth going forward.

There was a time when Plymouth received $15-million in one year from Pilgrim. Given all these items faced by our town, it should be painfully obvious to everyone that the very real liability we face today, thanks to Pilgrim, is infinitely greater than it has ever been. The bottom line is that realistically, given the enormous risk this town faces every day, no amount of money – no amount of money – provides adequate compensation.
 
Nonetheless, Entergy does have a very real moral responsibility to  its host community. In my humble opinion, given that the plant will generate far in excess of 7.3-billion in 2012 dollars over the next 20 years, Entergy has an obligation to deliver at least $20-million dollars a year in PILOT funds, and half of that should be salted away for that financial cliff I mentioned in 2032.

If Entergy really lives up to its obligations in these negotiations, we can have a party in 2020 without having to worry a lot about what happens 12 years later.

Thank you.

--Jeff Berger