The Iowa Office of Consumer Advocate (OCA) won't contest any of the $6 million in expenditures made by MidAmerican Energy to examine the feasibility of building a nuclear power plant in the state.
OCA director Mark Schuling said he is not planning to contest any of the utility's expenses, including the $44,000 spent on a "public perception" study on nuclear power conducted by a Des Moines public relations firm in November 2010. The telephone survey – conducted shortly after the utility got the green light from the state legislature to raise rates to pay for the $15-million feasibility study – focused on six locations identified as likely sites for a new nuke plant.
The survey by Flynn Wright Public Relations found residents in Woodbury County would not be happy about the prospects of a nuclear plant nearby, while residents in the two "finalist" sites – Muscatine and Fremont counties – were much more "accepting" of a nuclear plant being built nearby.
The utility this June scrapped its nuclear feasibility study four months before the special surcharge on customers' electric bills was set to expire, and announced it would refund $8.8 million of the $15 million it has collected from customers over the past three years.
MidAmerican, which lobbied the state legislature for approval of the nuke plant feasibility surcharge, said it was ending the study this spring because it was premature "to pursue any additional site work on a future generation option, including a nuclear facility."
Schuling said that the perception study falls within the criterion of "site characterization expenditures" which the Nuclear Regulatory Commission (NRC) defines as "health and safety, environmental, socioeconomic and land use, and engineering and cost." The NRC criteria were referenced in the legislature's definition of what costs were to be allowed for recovery from ratepayers.
Schuling also said his office was not planning to contest the $600,000 the utility spent on analyzing natural gas prices. The utility hired NERA Economic Consultants, headquartered in New York City, to develop scenarios involving natural gas demand and pricing trying to predict 70 years into the future. The 131-page report translates into an approximate charge to utility customers of $4,600 per page.
Also among the expenses for the study was $200,000 for technical analysis of small modular reactors (SMR), which the utility had envisioned using in Iowa. However, the U.S. Nuclear Regulatory Commission isn't even expect to have an SMR design certification application to begin reviewing until late 2014.
MidAmerican is expected to begin refunding the $8.8 million in overcharges from the nuclear plant feasibility study in August.
