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Conspiracy theory puts NRG on the grassy knoll
CPS Energy's longest-serving board trustee, Steve Hennigan, hasn't actually given me a copy of his nine-page “not so far-fetched theory document,” but we spoke at length Friday night and Saturday afternoon about what's in it as he fights to keep his board seat and remain a major player at the municipal utility.
“I'm not a conspiracy theorist,” said Hennigan, a credit union executive by day and an unmistakably nice man.
Conspiracy theory, nevertheless, is making the rounds these days in one of those “truth stranger than fiction” scenarios as business and civic leaders ask what went wrong with a multibillion-dollar plan to expand the South Texas Project nuclear facility, the source of 30 percent of the city's current energy usage.
Costs Cloud Texas Nuclear Plan - WSJ.com
Spooked by escalating costs, a city-owned utility in San Antonio is considering backing out of a venture with NRG Energy Inc. to build two next-generation nuclear reactors in Texas.
CPS Energy is expected to make a final decision next month, after it gets an updated cost estimate from Toshiba Corp., which will oversee construction of the two reactors. The project is one of the furthest along in a new crop of nuclear proposals, but it is proving unpopular with city officials.
CPS board postpones decision on executives
CPS Energy trustees took no action Wednesday morning after deliberating for nearly 11 hours over the fate of several top executives connected to a nuclear cost estimate — much higher than expected — that was kept from the utility's board and the City Council.
The board came out of executive session shortly before 1 a.m. to announce that it would continue deliberation Monday.
“The seriousness of this issue warrants that this board takes care, takes caution,” Chairwoman Aurora Geis told the sparse crowd that waited. “People's lives are at stake.”
Tuesday's meeting was a continuation of Monday's nearly five-hour session, during which the board heard results of an internal investigation into how contractor Toshiba Inc.'s high cost estimate for the multibillion-dollar nuclear expansion was kept under wraps.
Your Turn – CPS heads must roll
I'm not surprised about this new turn of events but I am stunned that your staff accepted interim GM Steve Bartley's statement that he didn't know about the omission. How could henot know?
Ask Bartley what he'd do to any employee who: 1. told him he didn't know about a major element of their business, or 2. flat out lied to him? He would fire him on the spot.
What CPS management did was out and out fraud. They lied to us on their application for a rate hike. Treat them the same way any bank would treat an application for a home loan if the financial information was fraudulent. Turn down the application and call the authorities to investigate.
We should do the same. City Council would not tolerate any citizen coming before them and lying to their faces, or are they going to condone lying? Hopefully there are not two sets of rules — one for ordinary citizens and one for big shot citizens/companies.
CPS knew of higher STP cost year ago
CPS Energy knew a year ago that contractor Toshiba Inc. wanted at least $4 billion more than San Antonio was willing to pay for the nuclear expansion, according to several sources close to the deal.
Despite this, utility officials used a much lower figure as they pitched the project at public meetings during the summer, arguing that nuclear was the most cost-effective way for San Antonio to meet its future energy needs.
They took the same message to elected officials who were to vote on a $400 million bond issue and rate increases to finance the multibillion-dollar expansion of the South Texas Project near Bay City.
The response of City Council members and CPS Energy trustees to the 2008 estimate was muted Saturday. “Nothing can surprise me anymore,” Councilwoman Elisa Chan said.
But several officials said the revelation only deepens their mistrust of the city-owned utility's leadership.
“It concerns me greatly that neither the council nor the board was informed,” said Mayor Julián Castro, who acknowledged he, too, recently learned of the existence of the 2008 high estimate.
The high price of a deal gone bad: Rebuilding CPS leadership
It's come to this: The simple truth withheld from the community by CPS Energy was revealed last week by NRG Energy executives to a Houston gathering of financial analysts: San Antonio can't afford the high price of expanding the South Texas Project nuclear facility.
Not that we need another example, but once again Wall Street enjoys the advantage over Main Street. Ratepayers don't have a need to know, but let's not deny institutional investors a little inside information.
The project will cost billions more than CPS estimated, even after interim General Manager Steve Bartley went to Japan to seek concessions. Utility executives want until January to bring a new number to Mayor Julián Castro and the City Council. Why wait?
What CPS once promised was a good deal for the city is now, clearly, a bad deal. It's a bad deal made worse by utility executives who deliberately withheld critical financial data, thus misleading elected city leaders, the Express-News and the public. Even as we were told the project would cost CPS and NRG a total of $13 billion, utility executives knew Toshiba Inc. was estimating $4 billion more.
CPS partner: Nuclear deal costs too high for S.A.
Toshiba Inc. has shaved about $1.4 billion off its price to build two nuclear reactors, but it's unlikely to ever reach an amount within San Antonio's price range, NRG Energy executives said Thursday.
“We would expect ... the price estimate that Toshiba will come back with may be outside the affordability range for their ratepayers,” Steve Winn, CEO of the NRG-owned Nuclear Innovation North America, said at a financial analysts' meeting in Houston.
At issue is the cost San Antonio's CPS Energy and NRG Energy are willing to pay contractor Toshiba to build two nuclear reactors outside Bay City.
CPS Energy has promised ratepayers and the City Council that it will pursue the deal as long as it can limit power bill increases to 5 percent every other year for the next decade.
This can be done if the total project, with financing, will cost about $13 billion, utility officials say.
To hit that amount, Toshiba's costs need to come in about $8 billion. But the Japanese contractor, NRG confirmed, estimated its price at $12.3 billion in October.
CPS Energy sends team to Japan to negotiate cut in nuclear power costs - San Antonio Business Journal:
CPS Energy CEO Milton Lee and Interim General Manager Steve Bartley are heading to Japan on Tuesday to square off behind closed door meetings with Toshiba Corp. officials to discuss why the cost projection on two new nuclear reactors are higher than expected.
Toshiba Power Systems is the lead contractor for the proposed expansion of the South Texas Project nuclear power plant in Matagorda County, Texas. There have been reports indicating that the price tag could be as much as $4 billion higher than originally projected. CPS Energy’s partner in the South Texas Project expansion, NRG Energy, will also be involved with discussions. CPS Energy will press the Japanese for a pricing structure on the two new reactors that is more affordable than the current cost projection. CPS Energy wants the cost of the nuclear reactors to have no more than a 5 percent impact on customer bills, Bartley says.
Independent citizens panel needed for nuclear dilemma
Last week's revelation that the proposed STP nuclear expansion may cost $4 billion (31 percent) more than expected, is a blessing and an opportunity for San Antonio.
Courageous leadership is now needed, especially in light of the apparent attempt by CPS Energy management to hide this information before a council vote.
If this news had not been discovered, ratepayers would have been saddled with $400 million more for nuclear paperwork, setting a path for billions more in uncontrolled spending.
Warning about CPS debt, bond-rater Moody's dropped CPS' outlook from “stable” to “negative,” and noted council must be readily willing to raise electric rates.
How high will rates go? The cost overruns imply nuclear costs of 13-15 cents/kWh — much higher than projected.
What to do now? A completely fresh start is needed.
Public Citizen - As Thursday Vote Looms on Two New Reactors, Popular Opposition May Make Selling Nuclear Power More Difficult
As a Thursday vote on two new nuclear reactors looms, cities around the state that purchase power from San Antonio’s municipal utility, City Public Services (CPS), are balking at the prospect of buying pricey nuclear power from the reactors.
Three problems exist with the planned expansion at the South Texas Nuclear Project (STP) facility. First, nuclear power creates dangerous radioactive waste that no one has figured out how to dispose of safely.
Second, nuclear power is expensive – the nuclear industry requires taxpayer subsidies to prop it up. Third, no one knows for certain just how much the construction of the two reactors will cost ratepayers.
San Antonio Clean Tech Nuclear Forum September 16, 2009 Part 1 on Vimeo
Mayor Julian Castro City of San Antonio,Steve Bartley Interim General Manager, CPS Energy,Craig Severance, CPA Author, Business Risks & Costs of New Nuclear Power,Dr. Patrick Moore Co-Chair, Clean and Safe Energy Coalition, Dr. Arjun Makhijani President, Institute for Energy & Environmental Research
At the San Antonio Clean Tech Forum noted pundits square off and discuss the San Antonio's involvement in the proposed expansion of the South Texas Nuclear project.
CPS votes to lower share in nuclear plant
CPS Energy's board unanimously agreed Tuesday to look for buyers for about half the utility's stake in the expansion of the nuclear South Texas Project, while borrowing $400 million more to continue plans to build the new reactors.
The change in strategy means the utility, which owns half of the project estimated to cost $13 billion, will cut its ownership to 20 percent to 25 percent. Now CPS must find buyers for the portion it wants to sell.
SA Current - Nuke’m High: CPS Board votes 5-0 for nuclear power
Board Chair Aurora Gies opened the special meeting of CPS Energy’s Board of Trustees in a bunker in the bowels in the Alamodome with a defense of the utility’s clean-energy pursuits. “We don’t want to compromise our pursuit of other technologies,” Geis said. “We want to be able to support these technologies as they mature in the future.”
While her insistence that nuclear expansion will in no way limit the city’s ability to aggressively pursue cleaner options has become an expected soundbite over the past months, today’s — offered moments before a unanimous vote to devote itself to nuclear power expansion — was especially anemic.
SA Current - Express-News rejects: the Current’s new fall line
[Local clean-energy activist Margaret Day says the following column was rejected by Express-News Editorial Page Editor Bruce Davidson because it insinuates NRG Energy's Executive VP of Nuclear Development, Mr. Steve Winn, "is a liar." Express-News Ombudsman Bob Richter said Davidson turned it down because he “had other, better anti-nuclear commentaries” and felt Day “misstated Winn’s reasoning.” Whatever. We got a kick out of it. Which is why we at the second most comprehensive source on all things nuclear wanted to give it a public airing.
SA Current: Atomic Numbers
Most Texas homes weren’t built as if energy mattered. Despite 100-degree summer days, our roofs are still covered in heat-absorbing black-tar shingles. Cheap insulation in the attic, leaky doors, and single-paned windows mean when the air conditioner runs, it runs loads of cooled air right out the house.
San Antonio’s CPS Energy plans to spend $850 million to eliminate 771 megawatts of wasteful energy consumption through weatherization programs and rebates to help residential and commercial customers replace lights and appliances, and hoist solar panels onto their roofs by 2020. To do that will cost roughly $1,100 per saved kilowatt, according to the utility.
However, 80 miles to the northeast, municipally owned Austin Energy has already cut 800 megawatts through energy efficiency over the last 20 years at a cost of roughly $350 per kilowatt, said Scott Jarman, consulting engineer with Austin Energy’s efficiency program. But after 20 years of efficiency work, the savings are increasingly hard to find, and accordingly, more costly.
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