Cuomo Rewards Donors by Seeking Nuke Closure

Plant provides up to 30% of NYC's power

February 1, 2012

New York Gov. Andrew Cuomo is hard at work ensuring the closure of the Indian Point nuclear power plant that helps power New York City – and some of his closest political allies stand to profit significantly from the deal.

Records show that Cuomo has received hundreds of thousands of dollars in campaign contributions from individuals funding a competitor to the nuclear power plant, as well as from individuals who object to its existence on ideological grounds.

Indian Point, owned by the Entergy Corp., is applying to the federal Nuclear Regulatory Commission (NRC) for renewal of its reactors’ operating licenses, which expire in 2013 and 2015. Though the plant provides roughly 25 to 30 percent of New York City’s energy, Cuomo wants the site closed because of "safety concerns."

Entergy finds these concerns odd.

"Indian Point meets all of the NRC safety requirements," Entergy Nuclear communications director Jim Steets tells the Free Beacon. "Obviously, the NRC is the federal regulator in this field. They have the technical expertise to evaluate the safety of nuclear power plants, and they haven’t found our plant to be unsafe."

Cuomo has the power to withhold a water quality permit necessary for Indian Point to gain its NRC renewal, effectively shuttering what has been one of the state’s key energy sources for four decades. The state of New York would lose the $75 million Indian Point pays annually in taxes and the $137 million a year in wages that its 1,000 to 1,100 jobs pump into the local economy.

According to experts and lawmakers, including New York City mayor Michael Bloomberg, Indian Point’s closure would result in severe economic consequences for the state. The New York Times reported that it would "take years and require a long-term energy strategy" to replace the 2,000 megawatts of private-sector energy that Indian Point provides to homes and businesses throughout New York City and Westchester County.

A leaked preliminary draft of a report by New York City’s Department of Environmental Conservation predicts dire results stemming from the plant’s closure: The city’s energy costs would rise up to 10 percent and citywide reliability problems would begin within a year of the second reactor’s expiration.

Despite these concerns, the governor refuses to back down. Last June, Cuomo sent "one of his top advisers" to inform Entergy officials that he opposes Indian Point’s renewal, saying, "I’m not against nuclear power, but I am against nuclear power in this plant, in this location, with this density."

One of Cuomo’s political motives for closing Indian Point is clear – wealthy donors to his gubernatorial campaign are positioned to receive a significant windfall from its shuttering.

During his successful 2010 gubernatorial campaign, Cuomo accepted at least $75,000 from Competitive Power Ventures (CPV), making that company his second-largest contributor. He also accepted at least $55,588 from his fifth-largest contributor, the politically active law firm Nixon Peabody – as well as additional payments from at least two PACs operating from Nixon Peabody’s Rochester address. As recently as Oct. 12, 2010, Nixon Peabody represented CPV in an ambitious legal effort: petitioning the State of New York Public Service Commission for allowance to build a 630-megawatt, natural-gas-powered plant called the CPV Valley Energy Center in Wawayanda, N.Y. That plant, to be located approximately 50 miles from Manhattan, would compete directly with Indian Point.

And that is not the only Indian Point competitor linked to Nixon Peabody. As early as July 2006, Nixon Peabody lawyer Andrew Gansberg represented the affiliated energy companies Energetix and NYSEG. In March 2011, news of a low-profile NYSEG project started to leak out: a $125 million, 150-megawatt power plant in Watkins Glen, N.Y. that "would use compressed air to store energy that commercial wind farms produce at night and dispatch it back to the state’s electric grid."

Backers hope the Watkins Glen plant will launch in 2014 and serve as a "demonstration" project that can spur the wind industry nationwide. By March of last year, it had already received a $29.6 million grant from the U.S. Department of Energy and $1 million from the New York State Energy Research and Development Authority. It was also in March 2011 that U.S. Energy Secretary Steven Chu first publicly addressed Indian Point, saying, in the aftermath of the Fukushima earthquake, that the nuclear plant would have to be "reviewed" for safety concerns. "We’re going to have to look at whether this reactor should remain," Chu told Chris Wallace on Fox News Sunday.

Gov. Cuomo’s office and Nixon Peabody did not return calls for comment.

Nixon Peabody and CPV are not the only donors influencing the governor. The governor accepted at least $50,000 from Dan Tishman, as well as $37,200 from Tishman's wife and $25,000 from his father. Tishman chairs the National Resources Defense Council, one of the most active anti-nuclear special interest groups.

Cuomo accepted $50,000 from the New York law firm Kaplan Fox & Kilsheimer; Charles J. Moxley Jr., of counsel for the firm, sits on the board of the anti-nuclear Lawyers' Committee for Nuclear Policy. He also took $55,900 from leveraged-buyout guru Fred Iseman in 2009, who serves on the Advisory Board of Ted Turner and Sam Nunn's Nuclear Threat Initiative. Meanwhile, Cuomo’s list of real-estate developer donors includes Stephen Garofalo, whose Millbrook Ventures commercial real estate firm is developing a 670-acre five-star destination spa in Amenia, N.Y. – close enough to Indian Point that tourism and property values could be affected by the plant’s closure. Garofalo also donated at least $50,000 to Cuomo's campaign.

Cuomo’s history of aiding campaign contributors was an issue in his 2010 race for governor. One subject of controversy was his tenure at the Department of Housing and Urban Development, when Cuomo helped quickly settle a government corruption suit against one of his personal friends and donors, Andrew L. Farkas, and then several years later took a high-paying job with Farkas’ real estate company.

Cuomo is already looking ahead to a post-nuclear future. Last September, it was announced that the New York State Thruway Authority plans to install medium-scale wind energy turbines along the Western New York Thruway system. The project would be one of the most ambitious wind-energy initiatives in the history of the state, made possible by a law Cuomo signed in June 2011 relaxing longstanding wind-power regulations.