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NextEra Energy has filed a lawsuit against the Nuclear Energy Institute, accusing the trade group of taking “retaliatory action” in response to NextEra’s withdrawal from the organization.
Legal documents dated February 2 accuse the Nuclear Energy Institute (NEI) of breaching the Personnel Access Data System agreement, which allows NextEra-owned companies to access a database of nuclear energy industry workers across the country. But while NextEra is seeking reimbursement for damages related to the database, the lawsuit speaks to a broader rift in the energy sector amid changes to the nation’s resource mix.
NextEra companies, including Florida Power and Light, withdrew from NEI last month over the nuclear trade group’s “new agenda,” the lawsuit states. NextEra Energy operates eight nuclear reactors across the country, but it also holds a diverse portfolio of energy resources, including natural gas, solar and other renewable energies. Entergy, which operates 10 nuclear reactors across the U.S., also chose to leave NEI last month.
The withdrawals come as the nuclear energy industry grapples with an uncertain future. Existing power plants continue to struggle with high maintenance and safety costs, while new reactors face crippling cost overruns, which has triggered a national debate on the ability for nuclear to compete with natural gas, solar and wind, and whether or not it’s worth investing in reliable, low-carbon nuclear power for strategic reasons.
NEI’s decision to support Energy Secretary Rick Perry’s proposal to subsidize struggling coal and nuclear plants -- which was met with strong opposition from across the energy sector and ultimately was rejected by the Federal Energy Regulatory Commission on January 8, 2018 -- sparked tensions with NextEra. The Florida-based energy giant also accused NEI of funding studies intended to generate support for nuclear at the expense of other forms of power. These recent policy changes advocated by NEI represent “bad energy policy” and could harm NextEra’s businesses, the strongly worded lawsuit states.
“NEI recently has been vigorously advocating for irrational and unreasonable policies that would distort electric energy markets,” according to NextEra. “In this, NEI has also funded studies that call into question the reliability and costs of the electric system, attempting to create a false sense of panic and unfairly and incorrectly maligning the operations of its members, including the NextEra Companies.”
The legal document continues:
"NEI, rather than supporting nuclear, has undertaken, both overtly and covertly, efforts to undermine other generation resources -- again, implicitly implying and explicitly stating that diversity of generation, rather than making a system more reliable and lower cost, somehow is bad for the electric system. Without qualification, the NextEra Companies and NextEra disagree with this underlying thesis. As large nuclear generators, the NextEra Companies obviously support nuclear energy. But, the NextEra Companies cannot financially, or otherwise, support an organization that fundamentally mispresents the state of grid reliability in this country."
NextEra claims that NEI revoked its ability to access to the Personnel Access Data System (PADS), the nuclear industry personnel database, in retaliation for withdrawing from the trade group.
U.S. nuclear plant operators came together in the mid-1990s to standardize the approach for processing of nuclear plant workers through the establishment of PADS, a central records repository containing authorization records for workers. The data system is intended to ensure safety and security at commercial nuclear facilities. According to NextEra, access to the list of qualified nuclear workers is critical ahead of scheduled plant shutdowns, when the number of staff required on-site can nearly double.
Florida Power and Light’s St. Lucie plant is scheduled for an outage beginning on February 7, 2018, the lawsuits states. NextEra companies have a total of six outages planned in 2018.
For more than two decades, Florida Power and Light has contributed information to PADS and paid annual dues to maintain the system. Denying NextEra access to the system is “unjust” and violates terms of the PADS agreement, given that participation may only be terminated with a minimum of three months' notice, according to the complaint.
The lawsuit states that on January 30, NEI said that it would permit the NextEra to access PADS through March 2018 if -- “and only if” -- NextEra agreed to pay the lobby group $860,000. The vast majority of that payment represents NEI membership fees unrelated to PADS, according to NextEra. The plaintiff also alleged that NEI was aware of the damage refusing access to PADS would cause, including shutdown delays and lost pay for personnel, and attempted to leverage its control over the database to extract a monetary payment.
“We think this was the very definition of extortion,” said Peter Robbins, a spokesperson for NextEra Energy, in a phone interview. “We made a business decision to leave NEI; we thought they had not adapted to changing times. They are simply attempting to retaliate against us by trying to squeeze cash out of us and our customers.”
NEI rejects the charges outright.
Maria Korsnick, NEI president and CEO, said her organization “vehemently denies all of the allegations in NextEra’s lawsuit and will vigorously defend our position in court.”
According to an emailed statement from Korsnick, NextEra lost the ability to participate in PADS upon choosing to discontinue its NEI membership. Nonetheless, NEI said it would supply NextEra with the PADS information “necessary to maintain strict compliance with [Nuclear Regulatory Commission] regulations.” Korsnick said the information exchange has been accomplished and will continue.
She went on to push back against NextEra’s “inflammatory statements.”
“To call NEI’s approach retaliatory, or even suggest the notion of extortion, is both counter-factual and offensive to the good faith effort the offer represents,” Korsnick said. NEI recently contacted NextEra to open a dialogue that would “advance the industry’s interest in remaining unified, or as unified as possible, on regulatory and other policy positions.” NextEra’s response was to launch a “baseless” lawsuit, she said.
With respect to the work NEI did in support of DOE’s notice of proposed rulemaking, Korsnick said the trade group conducted a rigorous information-gathering process from its members to inform NEI’s policy position and acted accordingly. NEI currently has around 300 members in 17 countries, including U.S. utilities American Electric Power, FirstEnergy, Duke Energy, Xcel Energy and others. So while NextEra may not have agreed with NEI’s effort to support the continued operation of existing nuclear plants, the interests of its member companies guided the group’s work.
“NEI remains committed to achieving its foundational mission: to preserve, sustain, innovate and grow the nuclear energy industry,” said Korsnick. “All of NEI’s actions should be and are consistent with that purpose.”
Robbins underscored that NextEra is “absolutely committed” to nuclear power. He pointed out the company has been recognized for the safe and reliable operation of its five nuclear plants and eight reactors. “They’re an important part of our portfolio, just like renewable energy is,” he said.
The lawsuit doesn’t have to do with NextEra’s nuclear plants, said Robbins. “It has to do with NEI itself.”