PLYMOUTH — When Holtec International took ownership of the shuttered Pilgrim Nuclear Power Station in 2019, it came with a decommissioning trust fund with more than $1 billion in it. The money, paid by the utility’s customers over the 28 years the plant was owned by Boston Edison, was to cover the cost of dismantling the reactor once it shut down.
While state officials and citizen groups have worried that the money could run out before decommissioning is complete, company projections don’t show that account ending in the red.
In fact, Holtec’s latest financial report predicts the company will have $252 million in the fund when the job is done, thanks to decades of accruing interest. Holtec spokesman Patrick O’Brien agreed with an analysis of the report’s data by the Independent.
The company’s financial projections extend to 2063, reflecting several decades of managing the spent fuel on site. The decommissioning itself is expected to be finished by 2027.
The $252 million left in the trust fund won’t be the only source of profit for Holtec. Reimbursements from the federal Dept. of Energy (DoE) for the expense of managing the radioactive spent fuel on site could boost Holtec’s bottom line by another several hundred million.
The Decommissioning Fund
Based on Holtec’s annual financial report published in March, $497 million had been spent from the trust fund as of December 2021. The fund’s balance, thanks to accruing interest, stood at $825 million.
Spending is divided into three categories: license termination, spent fuel management, and site restoration. Based on projected expenses through 2063, Holtec anticipates the total cost for license termination to be $548 million, spent fuel management $579 million, and site restoration $33 million.
That puts the projected grand total for decommissioning Pilgrim at $1.16 billion. Thanks to accruing interest, the company has projected the fund will still have $252 million if all goes as planned. That money would go to Holtec as profit.
Holtec will also be able to sue the DoE for reimbursement of money taken from the decommissioning fund for spent fuel management. So far, $237 million has been spent at Pilgrim for that purpose, and another $342 million of expenses is projected, putting the total at over half a billion dollars.
Under the federal Nuclear Waste Policy Act of 1982, the U.S. DoE committed to begin removing spent nuclear fuel and other nuclear waste from plant sites around the country by January 1998. There is no national repository to store the fuel, however. Nevada’s Congressional delegation has repeatedly blocked the construction of a repository there, and no other possible location has ever been established.
The waste remains at the various individual nuclear plants, and plant owners have successfully sued the DoE for breach of contract to recoup their costs for managing the fuel. Holtec has indicated it plans to do the same thing.
For example, the owner of the Maine Yankee, Yankee Rowe, and Connecticut Yankee nuclear plants has collected $575.5 million to date in damages related to spent fuel storage from the DoE.
At a recent Congressional hearing in Plymouth, Seth Schofield, senior appellate counsel for the Mass. attorney general’s office, said any reimbursement for spent fuel costs from the DoE should go back into the decommissioning trust fund, since the money had come out of the fund to cover spent fuel management.
Krishna Singh, Holtec’s president and CEO, disagreed. “You forget: we as a company take the risk,” he said. Holtec would therefore keep the money, Singh said.
For Pilgrim, Holtec may not be awarded the full $579 million in damages for spent fuel costs, according to the Nuclear Regulatory Commission. “How much of that amount will be recoverable from the Department of Energy settlements with the plant owner is uncertain,” said NRC spokesman Neil Sheehan in an email.
Holtec has other expenses related to Plymouth as its host community. It also has obligations to some surrounding communities for emergency planning, thanks to a hard-won court settlement with the state attorney general’s office.
Plymouth isn’t getting the amount the town is used to, however. In 2014, Entergy Corp., the company that owned Pilgrim at the time, paid the town $10 million under its PILOT (payment in lieu of taxes) agreement. The amount dropped to $9.5 million for a few years, then slid to $7 million for fiscal 2020, the first year Pilgrim was closed. In fiscal 2021, Holtec paid Plymouth $6.5 million.
The town was unable to negotiate a PILOT for the current year, and therefore sent Holtec a real estate tax bill for about $3.5 million, which the company paid.
Holtec has also reduced the amount of money it has paid to the Dept. of Public Health for radiation monitoring, and to the Mass. Emergency Management Agency for emergency planning. The region’s legislators, led by Sen. Julian Cyr of Truro, have proposed an attachment to the state budget that would bolster funding to keep the testing program in place.
The Nuclear Decommissioning Citizens Advisory Panel (NDCAP), established to advise on Pilgrim’s decommissioning and made up of representatives from state agencies, local officials, and citizen representatives, will hold a hybrid meeting on May 23 at 6:30 p.m., to be aired from Plymouth Town Hall. The agenda had not yet been posted as of the Independent’s deadline.
NDCAP member Mary Lampert has asked Holtec to provide at the meeting a list of the systems that the radioactive water now stored at the Pilgrim is coming from, whether the state will be given samples of the water or simply supplied with data from Holtec’s sampling, and other details related to the more than one million gallons of radioactive water at the plant.
During the recent Congressional hearing, U.S. Sen. Ed Markey secured a pledge from Holtec’s president to allow for independent testing of the water prior to any discharge into Cape Cod Bay.