The Progressive

NewsWire

A project of Common Dreams

For Immediate Release
Contact:

Phone: 202-588-1000

Maryland Should Impose Moratorium on Nuclear Project

Nation’s Financial Crisis, Pending Takeover of Constellation Raise Concerns

WASHINGTON

A coalition of environmental and public interest groups today called on Maryland regulators to place a moratorium on the permitting of a new $9.6 billion nuclear reactor in light of the nation's worsening financial crisis and serious concerns about the stability of the company building the project.

Constellation Energy Group, which is seeking permits to build the reactor at Calvert Cliffs, Md., was tied financially to Lehman Brothers Holdings, the giant investment firm that filed for bankruptcy Monday. By Wednesday's market close, Constellation shares had lost nearly 58 percent of their value, trading at less than $25 a share. In January, Constellation's stock was trading at a 52-week high of $107.97.

This morning, financier Warren Buffet, through his company MidAmerican Energy Holdings, moved to purchase Baltimore-based Constellation for $26.50 a share, or about $4.7 billion.

The boards of Constellation and MidAmerican approved the merger this morning and announced they expect a signed merger agreement by the close of business Friday. The transaction would take about nine months to complete, company officials said. The PSC and the federal Nuclear Regulatory Commission must approve the merger before it is final.

"The Maryland Public Service Commission's focus should be on the impacts this merger will have on Maryland ratepayers. It would be irresponsible for the state to continue with the permitting process while the ownership status is unknown and the impacts on the state are unresolved," said Paul Gunter, director of the Reactor Oversight Project for the Takoma Park, Md.-based Beyond Nuclear. Constellation's construction permit for a third reactor at Calvert Cliffs is pending before Maryland's Public Service Commission.

Constellation Energy has conceded it can't build the Calvert Cliffs project without loan guarantees subsidized by U.S. taxpayers and additional support from a French import-export bank. Under the company's plan, outlined at Maryland PSC hearings in July, U.S. taxpayers could be at risk for 80 percent of the reactor's cost.

"The integrity of Constellation's financial system is tenuous," said Michael Mariotte, director of the Nuclear Information Resource Service. "To respond by asking the American taxpayers to back a project that costs double the value of Constellation Energy itself is absurd."

Earlier this year, MidAmerican ended its pursuit of a nuclear power plant in Idaho after spending $10 million evaluating the idea, saying the project didn't make economic sense.

"MidAmerican has already issued its verdict on nuclear power," said Allison Fisher, energy organizer for Public Citizen. "With billions of dollars and our energy future at stake, Maryland should take a step back and withhold any decision on Calvert Cliffs until all of the ramifications of this deal have been thoroughly examined and disclosed to the public, which would on the line for any failure."

Members of the Chesapeake Safe Energy Coalition include Beyond Nuclear, Chesapeake Climate Action Network, Chesapeake Physicians for Social Responsibility, Clean Water Action, the Green Party of Maryland, Maryland PIRG, Nuclear Information and Resource Service, Public Citizen and Sierra Club of Maryland.

Public Citizen is a nonprofit consumer advocacy organization that champions the public interest in the halls of power. We defend democracy, resist corporate power and work to ensure that government works for the people - not for big corporations. Founded in 1971, we now have 500,000 members and supporters throughout the country.

(202) 588-1000