Paying For Power Plant Shutdowns

A formula used by the Nuclear Regulatory Commission (NRC) lowballs how much money companies should set aside to close down their old nuclear power plants, warns a Government Accountability Office report. Therefore, it is possible that insufficient funds are being accumulated to cover the cost to eventually decommission and clean up the sites where 104 U.S. nuclear power plants are operating today.

In a May 5 report, GAO, the investigative arm of Congress, looked at 12 reactors that were within a few years of reaching the end of their operating licenses. Because these reactors are near retirement, the reactors’ owners are required to make public their own estimates of decommissioning costs. The study found that for nine of the 12, the NRC method underestimates the funds that are necessary to set aside. For five plants, the formula would result in a fund that was only 50 to 76% of what the reactor’s owner calculated would be needed.

Decommission costs will be high—from $400 million to $836 million per reactor—according to company estimates in the report. By law, the sites are to be dismantled and prepared for other uses during a 60-year period following shutdown.

The GAO report includes a review of a series of reports spanning a decade and written by GAO, NRC, and NRC’s Office of the Inspector General. Those previous studies have turned up inadequacies in decommissioning funding because of a combination of NRC’s use of the outdated, 30-year-old funding formula; greater than expected radiological contamination; and poor decisions by owners about where to invest the funds they set aside for cleanup.

One NRC study, discussed by GAO, looked at 27 of the nation’s 104 reactors and predicted a decommissioning shortfall of $2.4 billion.