Too Much to Lose

Why Utah Cities have Opted Out

One by one in 2020, Utah municipalities that had previously signed up for the UAMPS/NuScale small modular reactor nuclear project near Idaho Falls began reconsidering and ultimately withdrawing. City exits started in August 2020, on the heels of a U.S. Department of Energy announcement that it would no longer take power from the first module at the plant. 

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Escalating Costs Concerns

The city of Logan in northern Utah dropped out first, with a city council resolution citing “increased projected costs” as the primary reason. "We don't have the experience to be swimming in these waters," said Logan Finance Director Richard Anderson. "I didn't feel good about it." 

Logan had invested $400,000 at the time, and was due to commit another $654,000 within weeks if it stayed in. From the time Logan first signed up to the city’s withdrawal, projected construction costs had increased from $3.1 billion to $6.1 billion. Logan’s light and power director, Mark Montgomery, warned that with the hike to $6.1 billion the city’s expenditures on the project could soar to more than $21 million during the 2023-2025 phase of the project’s licensing period. 

UAMPS initially promised electricity costs of $55/MWh, but those estimates rose to $58/MWh as the project was downsized in June 2021, which affected the economics of the project. UAMPS has to date refused to release the data behind its cost calculations, making it impossible for independent experts to verify them. Energy modelers at PacifiCorp have estimated electricity from the proposed plant will cost $95/MWh, and Idaho Power Company estimates $125/MWh—nearly double UAMPS’ estimates. No investor-owned utility has invested in the project. The nuclear industry has a long history of ballooning costs. At Plant Vogtle, a nuclear facility in Georgia, costs for the first two units rose from $660 million to nearly $9 billion and costs for units 3 and 4 have swollen from $14 billion to $27 billion

“It was a financial decision based on the escalating costs because of the under subscription of the project.”

Richard Higginson, Bountiful City, UT council member, Salt Lake Tribune

“There’s enough things wrong with this project that made it really scary. We’re just a bunch of little utilities in the state of Utah trying to do a $6 billion nuclear power plant.”

-Bart Miller, Chief Financial Officer, Heber Light and Power, Salt Lake Tribune
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Concerns over Risk

In a unanimous city council vote, the city of Lehi, UT, dropped out soon after Logan in late summer 2020. Lehi had spent $455,000 on the project, and city Power Director Joel Eves told the city council that it was “concerning” that there hadn’t been “a lot of movement” in getting new project subscribers in the two years since Lehi signed up. “That makes us nervous,” Eves said. “It seems like we’re going at this alone with the UAMPS members.”

In Heber City, the Light & Power Board voted 5-1 to withdraw its share from the UAMPS/NuScale project. “I thought why are no other people jumping into this?,” said Heber City Mayor Kelleen Potter. 

In Kaysville City, the city council voted unanimously to withdraw. “We just don’t want to take on the risk of being in the project at this point,” said Councilman Andre Lortz.

In Murray, Utah, city Power Manager Blaine Haacke flagged risks and future uncertainties around federal funding, warning the city council that leadership or priority changes at the national level could affect promised appropriations down the road. Haacke also informed the council of too many risks involved in committing another $1.1 million to $1.4 million in taxpayer dollars, with an ultimate anticipated price tag to city residents of around $2.1 million, according to the Salt Lake Tribune’s coverage. The Murray city council voted unanimously to withdraw. 

In Bountiful, yet another Utah city where council members voted unanimously to exit the Idaho Falls nuclear project, Light & Power Department Director Allen Johnson echoed the financial risk concerns of his peers in other municipalities: “New resources must also be affordable for Bountiful's ratepayers,” Johnson said, “and the financial risk to the city may be too great at this time."

“Why are people jumping out? There could be other deeper issues that we aren't understanding or that nobody likes to take the first risk. But it can’t be small cities like Heber.”

Kelleen Potter, Heber City Mayor, KPCW 91.7
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Concerns over Secrecy & Uncertainty

UAMPS and NuScale initially indicated electricity from the proposed plant would be available in 2015-16. In 2019, they shifted the date to 2026, and in 2020, they moved it to 2030. This trend tracks with the nuclear industry’s long history of delays and broken promises. For example, the Washington Public Power Supply System (WPPSS) of the 1980s delivered that lesson, with one of the largest defaults on municipal bonds in American history. After repeated delays, it never did generate its promised power.

As cities in Utah have considered their decisions about committing taxpayer money to the UAMPS/NuScale small modular reactor project, many uncertainties, doubts, questions and concerns have been raised:

Lack of transparency:

UAMPS has steadfastly refused to provide access to the data behind the project’s power price estimates needed to enable independent assessment. Meanwhile, major utilities like Idaho Power and PacifiCorp calculate costs much higher. 

Secrecy around key developments:

UAMPS and NuScale kept secret the fact that the power plant’s operator, Northwest Energy, backed out from that role in March 2021.

Uncertainty around federal government support that is subject to changing political winds:

Communities facing even higher costs if funding promises made by the Department of Energy aren’t appropriated under future administrations.

Risk that the electricity will cost much more than advertised,

or that the project will never be built. 

Extra costs associated with nuclear waste management:

With no repository for spent nuclear waste in the United States, communities must shoulder the burden of managing the waste on their own. 

Continued timeline delays:

Concern that the power may not be available when communities need it, or ever.

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