NEI Nuclear Notes

NEI VP Richard Myers Over the past 24 hours, we've seen a number of folks online ask the question of why it's no longer economically feasible for Dominion to continue to operate the Kewaunee Power Station in Wisconsin. Earlier today, I put the question to Richard Myers , NEI's Vice President, Policy Development, Planning and Supplier Programs. Here's what he wrote back: In 2005, when Dominion bought the plant: (1) power prices in the Midwest were in the $40-50/MWhr range; wellhead gas prices were in the $6-10 per million Btu range; and U.S. electricity demand was growing. Today: (1) power prices in the Midwest are in the $30/MWhr range: gas prices are in the $2-3 per million Btu range; and (3) the U.S. has had 5 years of no growth in electricity demand, thanks to the worst recession in 80 years. Thanks to Richard for laying out the numbers for us. For a statement from NEI's Marv Fertel on the decision to close Kewaunee, click here . For a a quote from an R...

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 .

Earlier this morning, Dominion announced that it would be closing the Kewaunee Power Station , a 556 MWe nuclear facility located about 27 miles outside Green Bay, Wisconsin.The following is an official statement from Marv Fertel, NEI's President and CEO, concerning the announcement. "Nuclear energy remains a reliable, cost-effective producer of electricity for America’s homes and our economy. As stated by Dominion, the company’s decision to close Kewaunee is based on the fact that it did not acquire additional reactors in the Midwest markets, so it could not achieve the economy of scale needed to be economical in that low-price power market. "Dominion is one of the best nuclear energy facility operators in the country and is committed to nuclear energy in other states it serves as part of the company’s electricity portfolio. Nuclear energy is vital to meet America’s growing electricity needs today and to ensure the secure, reliable and low-carbon power for decades ...