Newspaper: The Sentinel
Date: April 6, 1979
Article: Met-Ed: Consumers should foot bill…
Author: United Press International
Washington (UPI) – Consumers and not utility company stockholders should pick up the tab for repairs and power losses resulting from the Three Mile Island nuclear power plant accident, according to a lawyer for owners of the Pennsylvania facility.
Washington attorney Gerald Charnoff, testifying at congressional hearings, said Thursday forcing utilities to pay the costs could “impoverish or bankrupt” them.
Charnoff’s contention that electric ratepayers should foot the bill was challenged by consumer spokesmen and several members of Congress, including subcommittee Chairman Edward M. Kennedy, D-Mass.
Consumers should not be made to pay for bad business decisions, Kennedy told the utility spokesman.
“CONSUMERS ARGUE that the management made the decision, so it should pay the costs of its mistakes,” he said.
“It seems to me inescapable that considerations of fairness and ultimate economic impact require that the cost of replacement power be flowed through to consumers,” Charnoff told the energy subcommittee of the Joint Economic Committee.
He said the company had invested $780 million in the damaged unit and that it was insured for up to $300 million.
“It is not yet known whether the total (accident) costs will exceed $300 million,” he said.
Pennsylvania Rep. Eugene Atkinson, a Democrat, said he was opposed to automatically passing on costs to consumers “who played no role” in causing the plant shutdown. He suggested that the government share in the costs if the Nuclear Regulatory Commission was “responsible for licensing a deficient plant.”
MARK WIDOFF, official Consumer Advocate for Pennsylvania, said the Three Mile Island plant was merely the “the most dramatic and most serious example” of a growing problem for utility customers faced with picking up the tab for shutdowns.
And Alden Meyer, testifying for the Environmental Action Foundation, urged that, “Consumers must no longer be forced to bear all risks of poor design, operator error, or other shortcomings for which utility management is primarily responsible.”
Hazel Rollins, deputy administrator of the Energy Department’s Economic Regulatory Administration, said that passing the accident costs on to customers would add about $7.50 to the average monthly electric bill.