Cuomo’s Nuke Bailout: Right Out of the Trump Playbook

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Cuomo’s Nuke Bailout: Right Out of the Trump Playbook

Will New York's governor stand up to corporate swindlers and tell them dinosaur nuclear plants aren't worth saving?

If giant energy corporations get their way, warns Hauter, the nuclear industry will continue to receive bailouts from taxpayers and ratepayers. (Photo: Twitpic/@FentonProgess)

It's a deal Donald Trump would love—let's call it "The Great New York Ratepayer Swindle of 2016-17" —and New York's Democratic Governor Andrew Cuomo is responsible for it. And if giant energy corporations get their way, it could be coming to your state next.

Last summer, the energy giant Exelon went to the Cuomo administration and, using the classic tactic of stick 'em up, threatened to close its three upstate nuclear power plants and leave town. Panicked at the thought of the bad publicity he'd get for losing some upstate jobs, Cuomo agreed to a whopper of a ratepayer giveaway. He offered Exelon $7.6 billion to keep the three unsafe, uneconomical nuclear plants open.

The original deal was bad enough: A $270 million subsidy to keep two of the plants open. But then Exelon showed up with hat in hand again, asking for even more money. The Cuomo administration responded with a near-total rewrite of its bailout plan—with no public input—and suddenly the cost ballooned to the head-spinning $7.6 billion figure.

So that means that as of April 1, all New York utility ratepayers—residents, hospitals, schools, businesses, municipalities—are footing the bailout bill, disguised as surcharges on their monthly electric bills. Talk about an April Fool's Day surprise.

How on Earth did the Cuomo administration turn a bad deal into a catastrophe? Opponents filed freedom of information requests, which were ignored. When the New York Assembly convened a hearing, and invited the Public Service Commission (PSC) to testify, the agency—which is theoretically looking out for the interests of New Yorkers—refused to send anyone. When they finally sent someone to Albany last month, they defended the corporate bailout with a green argument: If they let the plants close, New York would not be able to meet its targets for cutting carbon emissions. But that analysis only holds up if you decide the state can't do more to promote renewables and energy efficiency. In reality, New York could push harder on wind and solar to make up for the energy generated by these aging, unsafe nuclear plants.

That's bad—but it gets worse. Who did Governor Cuomo just nominate to head up the PSC, the chief protector of ratepayer money? John Rhodes, the state official who actually signed the corporate welfare contract with Exelon, and then publicly defended it.

As you might expect, after it snookered New York, Exelon is now shopping similar offers around the country. The company is reportedly trying to shake down Pennsylvania to keep the poster child of American nuclear industry disasters open— Three Mile Island. And other nuclear operators are following the Exelon playbook as well, because why wouldn't they?

While Cuomo's nuke bailout has been cheered by corporate interests, there's been a wave of opposition. Consumer advocates, ratepayers and clean energy activists have dogged the governor for months, asking him to reverse course. Lawmakers in Albany, meanwhile, are up in arms over the awful deal Cuomo cut.

Cuomo's plan has been slammed by friends and foes alike, and it is up to the governor to decide how this tale will end. He can tell the corporate swindlers that dinosaur nuclear plants aren't worth saving, and seize this as a chance to create a model for the rest of the nation by ramping up desperately needed renewables and energy efficiency programs. Or, he can continue to look ridiculous.

Wenonah Hauter

Wenonah Hauter

Wenonah Hauter is the executive director of the consumer advocacy group Food & Water Watch. She has worked extensively on energy, food, water and environmental issues at the national, state and local level. Experienced in developing policy positions and legislative strategies, she is also a skilled and accomplished organizer, having lobbied and developed grassroots field strategy and action plans.

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