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 .