Nuclear Gravy Train

Tom Shepstone
Shepstone Management Company, Inc.

….

…. 

There is long black train barreling down the tracks through the Mid-Atlantic. It’s the nuclear gravy train and it wants to take every consumer for a long ride!

…watch out brother for that long black train.
That devil’s drivin’ that long black train.

These lines from Josh Turner’s big hit sound a warning for those of us who have been following the subsidy game being played with our energy these days. We’ve documented the rampant cronyism taking place with green eggs and scam, but the nuclear energy folks have decided they want a piece of that action, too, and they’ve been putting together a nuclear gravy train that threatens to empty the pockets of every Mid-Atlantic energy consumer. It will be a long black train of profits for the nuclear industry at the expense of ratepayers and taxpayers.

The more one investigates the non-competitive nuclear industry, the more corruption one sees. There is a definite pattern and it is one of pure corporatism; the picking of the pockets of consumers via direct and indirect subsidies that are not only unethical and anti-capitalist but unneeded. Let’s take a look at this nuclear gravy train.

First, consider this from a November 11 article in Energy Wire (emphasis added):

The Department of Energy vowed yesterday to start a $6 billion nuclear credit program within about four months to help keep U.S. reactors operating, fulfilling a mandate of the bipartisan infrastructure bill President Biden plans to sign Monday.

…The program could run for five years.

“It’s designed to support those nuclear facilities that need economic support in order to keep operating and keep providing the benefits of that emissions-free power to communities across the country,” Baumann said…

The Biden administration is pitching the benefits to help win public support as questions remain about high energy prices.

In Baltimore yesterday, Biden called the bill “a once-in-a-generation investment to create good-paying jobs, modernize infrastructure, turn the climate crisis into an opportunity.”

The larger “Build Back Better Act” still pending in Congress could provide even more benefits to the nuclear industry if it becomes law and includes a production tax credit for operating nuclear plants.

“Turn the climate crisis into an opportunity,” Biden says. Yes, indeed. This is an opportunity to for a non-competitive nuclear industry to raid the pockets of ratepayers and taxpayers. Big Electric has put in an order for a recurring delivery of some green eggs and scam to go with some gravy on the side. They are creating a long black nuclear gravy train, if you will, for the corporatists and cronies who view the government, rather than consumers, as their market.

But, there’s more to the story. Not only will the nuclear gravy train deliver direct subsidies at the expense of taxpayers; it will also distort the market and inevitably raise the price of delivering alternative forms of energy such as that generated by natural gas plants and renewables. They will see their capacity factors reduced and the price of electricity per unit increased because they’ll still be needed, but operate far less efficiently as a result of the unfair competition from folks who are, themselves, non-competitive suppliers of electricity. Think Exelon.

Get this, though. The nuclear gravy train is designed to help companies who are already profitable and even without the need for subsidies. Consider this nice chart we have put together (click here for larger pdf version):

And, here is the source of the data, a table from Independent Market Monitor for the PJM Interconnection grid system:

Once again, think Exelon,  It claims to have two struggling nuclear power plants in Illinois, namely Byron and Dresden. A look at the table above, though, shows they’re not struggling at all and, in fact, are operating at a profit and producing an expected combined surplus of $523 million in 2021 that is projected to grow to $646 million in 2022 without considering subsidies the State of Illinois is—incredibly enough—giving them. They are profitable without subsidies and so is every other PJM nuclear operation.  None are at risk of premature retirement! There is no need for a nuclear gravy train!

Are we missing something? No. This is how these companies operate. First Energy in Ohio and Exelon in Illinois have, respectively, been fined $230 million and $200 million in the last two years in matters of bribery and corruption.  Both under deferred prosecution agreements with the federal government and, yet, the Biden infrastructure could potentially enrich them further, which is precisely why more competition, not less is needed in this electrical generation industry.

Given all this, it’s time legislators at both the state and Federal level started asking some truly tough questions like these:

1. If nuclear plants are, in fact, profitable as verified by the PJM Interconnection’s independent monitor, why are taxpayers being asked to provide $6 billion more to these companies in unneeded subsidies?
2. Why would the federal government create a nuclear gravy train for two companies who have entered into deferred prosecution agreements with the Federal government? Why is the government rewarding cronyism, corporatism and corruption?
3. Why are we effectively nationalizing these nuclear plants on behalf of these corporatists?  That’s what doling out $6 billion in subsidies for nuclear plants that are already profitable amounts to in the real world. Government leaders should be honest and just admit they want to nationalize power plants to reward the corporatists running them! There is no other way to describe what’s taking place by federal and state lawmakers providing nuclear subsidies for already profitable plants..

It’s time to derail this long already black (as in profitable) nuclear gravy train! Companies like Exelon are obviously appear to be lying.  They say their nuclear plants are financially struggling, but independent market data shows otherwise.  When are lawmakers finally going to come to their senses and ask companies like Exelon to open their books and demand an audit of their financial accounts?  How can our lawmakers agree to providing public financing to companies with budget surpluses?

Follow Us on MeWe and Join Our
Natural Gas for the Future Group

Also, please help us get the word out by
taking time to “Like” and “Share” below
and also share on other social media.
It’s so important!