In the March 19 editorial "Well-crafted Millstone bill deserves support," The Day’s editorial board expressed its support for legislation that would let the Millstone nuclear plant bid on renewable energy state contracts. According to the editors, the bill (S.B. 106) would help Millstone seek “the security of long-term energy contracts to secure the viability of its nuclear energy model” to thereby provide a “bridge to a future with more clean, renewable energy.”

That’s one way to put it. But it’s also misleading, and fails to address the litany of problems posed by the legislation.

The expression “security of long-term energy contracts” is particularly problematic, because it’s a euphemism. Of course Millstone wants long-term energy contracts, because it knows it can box out competitors under this legislation. The bill would put Millstone on the same plane as renewables (a jaw dropping prospect, given Millstone produces high-level radioactive waste, uses millions of gallons of water each year, and relies on generators that produce carbon emissions), and let it bid against them under a state-sponsored procurement process.

The problem is that renewable generators need to charge, on average, 8 cents to 9 cents per kilowatt hour. Millstone only charges 3 cents. So if Millstone is allowed to bid against them, it’ll systematically undercut the competition while jacking up its own rates. This will render much of the electric market non-competitive, and ensure Millstone scores fixed-price contracts with guaranteed rates of return.

The board’s response to this concern? “It’s difficult to know who is right,” they say. But it’s no secret that small-scale solar, hydro, and wind projects can’t compete economically against an existing 2,000 megawatt power plant. Given that renewable energy is so important to Connecticut’s future — a point made by the editors — shouldn’t they consider the obvious consequences of pitting renewables against a generator like Millstone?

Other claims surrounding issues like competitiveness, selling directly, and middlemen are also misleading. The general argument is that generators must sell to middlemen like hedge funds, which subsequently makes electricity cost more than it should. But this is fundamentally inaccurate, since that’s not how the market works.

The truth is that power plants in Connecticut and New England, including Millstone, participate in a regional competitive wholesale market administered by an independent system operator known as ISO-New England. Wholesale power prices are set on a daily and even hourly basis, and are driven exclusively by competitive market forces. While it is true that generators can enter into various transactions with third-party financial entities, such is a risk management strategy known as “hedging,” this is a completely voluntary strategy on the part of the generator. Most importantly, it has nothing whatsoever to do with the price that consumers pay for power. Wholesale power prices are a function of a competitive market. There are no markups by these alleged “middlemen.” In other words, Millstone can sell directly if it wants to, and is certainly not being prevented from competing in any way, shape, or form.

Finally, the editors fail to fully grapple with what this legislation means for ratepayers. They are correct that Connecticut consumers already have among the highest electric bills in the country, and everyone obviously agrees this is an issue that must be addressed. But giving Millstone what it wants won’t magically reduce rates; it will only increase them. And when one considers how much money Millstone is already swimming in (largely thanks to ratepayers), this bill looks more like a corporate payout than a consumer solution.

The numbers are telling. Based on similar deals in other states, this bill would let Millstone take approximately $300 million from ratepayers each year via utility bill surcharges. That money is in addition to the $2.1 billion Millstone’s owner (Virginia based Fortune 500 firm Dominion Resources) earned last year, the $79 million in ratepayer funded capacity payments the plant is currently receiving, and the roughly $600 million in additional such payments they’ll get over the next three years. That’s a lot of money going to Millstone, and it takes some fuzzy math to claim that taking an additional $300 million per year will somehow reduce costs for consumers.

In the end, we must ask one fundamental question: If Millstone really needs money to survive, why won’t it prove it by opening its books? Millstone is yet to do so, and refuses to be transparent about its financials.

The answer is simple: the plant is far from struggling, and this bill gives them a chance to cut out competition and take more from ratepayers.

Matt Fossen is spokesman for the Stop the Millstone Payout coalition.