Electric utilities like atomic power so much they would accept government ownership of nuclear plants in order to hang on to the nuclear option, a utility executive said yesterday.
Charles F. Luce, chairman of the board of Consolidated Edison Co. of New York, told a House energy subcommittee that the future of the industry hinges on regulatory decisions about the costs that result from breakdowns at atomic plants. If utilities are not permitted to recover those costs by raising rates, he said government financing will be the only way to build new plants.
That, Luce said, "would present a large new set of problems . . . but it would be preferable to abandoning the nuclear option altogether."
The regulatory climate is so bad for the industry right now, Luce said, that if he had to recommend a new power generating unit to his board of directors he would recommend coal. This is in spite of his belief that nuclear power is 20 to 30 percent cheaper, even couting all the so-called "hidden" costs of nuclear power such as decommissioning old plants, spent fuel and waste disposal, tax breaks and so on, he said.
Regulators have not agreed tht consumers who benefit from nuclear power's relative cheapness when the plant is running should shoulder the costs when it is not, Luce said. "I couldn't take that kind of risk for my investors . . . on a $2.5 billion investment" in a new plant.
Luce was one of several witnesses who strongly defended nuclear power as the best available. One who disagreed was New York energy consultant Charles Komanoff, who said costs of nuclear plants had risen three times as fast as inflation before the March 28 incident at Three Mile Island.
Since that accident, he said, all figures must be readjusted skyward because of unknown safety changes that will be imposed in the future.
Komanoff attacked industry costs calculations as inaccurate. He said the lower numbers omit figures from poor-performing reactors, understate the costs at some plants, guess too low on the still unknown costs of decommissioning and assume that coal plants run less than they actually would if they replaced nuclear plants.
"Nuclear and coal plants today have about equal total generating costs . . . [but] new nuclear plants are more expensive overall than new coal plants," Komanoff said.
L. F. Sillin, chairman of Northeast Utilities Inc., which provides a higher proportion of its power from nuclear generation than any other utility (58 percent), emphasized that nuclear power saves oil. "A single new nuclear facility . . . can reduce oil consumption by 10 to 12 million barrels per year," he said. "There is no better way to reduce New England's debilitating dependence on foreign oil."
Luce was asked about proposals to remove the $560 million ceiling that the Price-Anderson Act placed on nuclear plants' liability for damage claims in case of accidents. "The financial community would be very concerned" and the industry would find it very hard to raise funds if the ceiling were lifted, he said. Doubling the limit, to $1.3 billion, "would make electricity more expensive," Luce said, since consumers would have to pay the higher premium costs, "but it would still be a lot cheaper than oil."