Skip to main content

UBS on Dominion's Decision to Close and Decommission Kewaunee Power Station

The global equity research group at the investment bank UBS just published a research note concerning Dominion's decision to close and decommission the Kewaunee Power Station:
In 2011, Kewaunee had a loss of -$39Mn in net income, which D[ominion] excluded from operating earnings. Following a roll-off of the above market PPA at the end of ’13, we had projected that earnings would fall by another ~$65Mn driving negative FCF and minimal EBITDA. We agree that the economics of Kewaunee were uniquely challenged given its small size and regionally depressed power prices.
That's a conclusion that pretty much reinforces what Dominion had to say earlier today.

Comments

Anonymous said…
When gas prices inevitably go back up, the opposite will be true, and they will have no plant to reap the rewards. Whatever happened to fuel diversity and long-term decision making.
Anonymous said…
how does that account for Dominion CEOs taking $10+ million in bonuses?
Engineer-Poet said…
Whatever happened to fuel diversity and long-term decision making.

It interfered with getting the next quarterly bonus.
Anonymous said…
To the first anonymous-
How are gas prices related to grid prices? Last I checked Kewaunee doesn't burn oil.

Popular posts from this blog

Making Clouds for a Living

Donell Banks works at Southern Nuclear’s Plant Vogtle units 3 and 4 as a shift supervisor in Operations, but is in the process of transitioning to his newly appointed role as the daily work controls manager. He has been in the nuclear energy industry for about 11 years.

I love what I do because I have the unique opportunity to help shape the direction and influence the culture for the future of nuclear power in the United States. Every single day presents a new challenge, but I wouldn't have it any other way. As a shift supervisor, I was primarily responsible for managing the development of procedures and programs to support operation of the first new nuclear units in the United States in more than 30 years. As the daily work controls manager, I will be responsible for oversight of the execution and scheduling of daily work to ensure organizational readiness to operate the new units.

I envision a nuclear energy industry that leverages the technology of today to improve efficiency…

Nuclear: Energy for All Political Seasons

The electoral college will soon confirm a surprise election result, Donald Trump. However, in the electricity world, there are fewer surprises – physics and economics will continue to apply, and Republicans and Democrats are going to find a lot to like about nuclear energy over the next four years.

In a Trump administration, the carbon conversation is going to be less prominent. But the nuclear value proposition is still there. We bring steady jobs to rural areas, including in the Rust Belt, which put Donald Trump in office. Nuclear plants keep the surrounding communities vibrant.

We hold down electricity costs for the whole economy. We provide energy diversity, reducing the risk of disruption. We are a critical part of America’s industrial infrastructure, and the importance of infrastructure is something that President-Elect Trump has stressed.

One of our infrastructure challenges is natural gas pipelines, which have gotten more congested as extremely low gas prices have pulled m…

Innovation Fuels the Nuclear Legacy: Southern Nuclear Employees Share Their Stories

Blake Bolt and Sharimar Colon are excited about nuclear energy. Each works at Southern Nuclear Co. and sees firsthand how their ingenuity powers the nation’s largest supply of clean energy. For Powered by Our People, they shared their stories of advocacy, innovation in the workplace and efforts to promote efficiency. Their passion for nuclear energy casts a bright future for the industry.

Blake Bolt has worked in the nuclear industry for six years and is currently the work week manager at Hatch Nuclear Plant in Georgia. He takes pride in an industry he might one day pass on to his children.

What is your job and why do you enjoy doing it?
As a Work Week Manager at Plant Hatch, my primary responsibility is to ensure nuclear safety and manage the risk associated with work by planning, scheduling, preparing and executing work to maximize the availability and reliability of station equipment and systems. I love my job because it enables me to work directly with every department on the plant…