Richland council hears options to reserve funds for possible small modular reactor participation

At the Feb. 18, 2025 Richland City Council meeting, staff presented options for potentially participating in future small modular reactor (SMR) projects and asked whether the council wanted staff to return with additional information or to consider restricting funds for that purpose. No formal action was taken.

Clint Whitney, the staff presenter, said the discussion was exploratory: the city has not been asked to participate in an SMR project or with any private partner. Whitney gave a high-level estimate of a $4,000,000,000 plant cost and described a Department of Energy loan program that could cover about 80 percent of a project, leaving participants responsible for roughly 20 percent of the capital. Whitney estimated that participation would equate to about $2.5 million per megawatt based on his back-of-envelope calculations.

Whitney said Richland currently sits about 20 megawatts above its contract high-watermark with its federal wholesale provider and that scale matters for potential participation. He described the city's energy-services fund financial position as having roughly $28,000,000 in unrestricted cash (about 167 days cash on hand at the time of the third-quarter financials). Restricting $5,000,000 as a reserved participation fund, Whitney said, would reduce days cash on hand by about 29 days but would leave the city with liquidity that staff characterized as workable while preserving an option to invest should an opportunity arise. He also said a larger Bonneville Power Administration (BPA) wholesale rate increase expected in October will likely reduce liquidity and that he expects staff to return later in the year with a rate recommendation.

Council members asked clarifying questions about the cost projections, timing and how the commitment would interact with the city's wholesale power contract. Whitney said a first SMR project might come online around 2032 and noted that any participation decision would likely fall into the next BPA contract period; he emphasized that no formal invitation or request to participate had been received.

Council members expressed general interest in pursuing more information. Council member Van Dyke said the council should "learn more" and cautioned against using reserves to mask near-term rate increases. Council member Meyer said he was "strongly in support of restricting funds to make sure we have that option when the time comes." Council member Jones asked for more resident input as the conversation develops. Several members described the possibility as a long-term hedge against future wholesale-price volatility.

Whitney said the $5 million figure was a starting point and that staff could return with refined modeling, potential funding sources, and formal proposals if the council wanted further study. The presentation concluded without direction to adopt or restrict funds; council members asked staff to provide additional information in future briefings.

Next steps: staff will bring more detailed financial modeling and options back to council if requested; no ordinance, resolution, or budget restriction was adopted at this meeting.