Charlie Mitchell: They must put politics aside on this issue
Posted: 07/18/08 - 12:15:18 pm CDT
In the next few years, whether Gov. Haley Barbour and the Mississippi Legislature can pull together in the state’s best interests will face a crucial test.
It will come in the form of luring an investment bigger than the Nissan and Toyota plants combined — and one that has long-term implications for the state’s industrial future as a place offering clean and reliable energy to the public and to employers.
In three years, maybe sooner, NuStart, a power company consortium formed to join forces for regulatory preliminaries, will decide whether one of its members, Entergy, will build a new nuclear plant near the state’s only nuclear plant, Grand Gulf in Claiborne County.
Grand Gulf is owned and operated by Entergy Nuclear and Entergy, on its own, is also submitting an application for a combined construction and operating license for its River Bend site in St. Francisville, La.
Entergy hasn’t said so, but it’s highly doubtful the company will build at both sites, which are 100 miles apart on U.S. 61.
Here’s what the company has said. Read it carefully:
“A decision to build a nuclear plant at either location will be based on a number of factors, including an assessment of customers’ need for additional power, the estimated cost of the advanced nuclear energy plant, the projected future cost of power from the plant compared to the projected cost of other fuel choices such as coal or natural gas, and both federal and state regulatory certainty. State regulators will be involved as Entergy moves forward in its decision process regarding potentially building nuclear units.”
A prudent reading of that statement, issued earlier this year when Entergy announced it was moving ahead to obtain federal construction and operation licenses in anticipation of a go or no-go decision, would put a lot of emphasis on the phrase, “state regulators will be involved.”
At the local level, Port Gibson and Claiborne County officials have, unlike other nuclear venues nationally, provided enthusiastic support for what could be the first new nuclear plant in the United States in 30 years.
Seven years ago, when the early site approval process was begun, Claiborne supervisors hired attorney and former Clinton cabinet member Mike Espy of Jackson as their advocate.
His mission is to wrest as big a bonanza as possible for the county, which has returned to widespread poverty and joblessness since the construction boom that accompanied Grand Gulf I. Questionable dealings, if not outright corruption, have been a constant presence in Claiborne County, which is dependent on the nuclear plant for most county revenue.
Officials there are hungry for more dollars.
At the state level, Barbour is committed to doing whatever it takes to make Mississippi Entergy’s choice.
Indeed, the Republican who will be ending his second term as decision time nears, even got an Espy endorsement in his re-election bid. No doubt, the two will work as a team to land what could be the largest single investment in Mississippi since the $3 billion Grand Gulf I was completed in 1985.
A preview of how the state will cooperate was apparent in this year’s lawmaking session. Barbour backed and legislators passed a measure that will allow, for the first time, major utilities such as Entergy to “front-load” construction costs when adding capacity.In practical terms, that means the investor-owned utility will be able to avoid at least some of the bank loans and interest paid after its first nuclear venture.
Until this year’s legislation, no utility has been able to add the costs of any construction to its rate base until the new asset was serving customers.
That means interest payments on Grand Gulf I — which have been paid by consumers for 23 years — total more than $1 billion, the largest single expense in the project.
Not given much press during the state’s debate on whether to change the law was the fact that Louisiana had already provided that incentive to Entergy. Indeed, it’s foreseeable that the states will go toe-to-toe, matching or topping offers as they compete for a new nuclear plant.
While many will view the coming exercise as a taxpayer-funded boon to a private company and its stockholders, the competing view — at least equally valid — is that taxpayers will benefit, too.
• Southwest Mississippi desperately needs a big-ticket project to match the Nissan and Honda plants.
• Taxes paid by nuclear plants are apportioned, but the largest share goes to the states and localities where they are located.
• The whole nation is trying to get away from fossil fuels and venues not dependent on oil, coal and gas are likely to attract investors interested in reliable and (relatively) inexpensive power.
It’s high-stakes stuff. If Barbour and lawmakers play games, the people who elected them will lose.
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