Entergy focus under new CEO may shift to New York nuclear fight
HOUSTON (Reuters) - Entergy Corp's (ETR.N) decision to shut its Vermont nuclear plant begins the final chapter in a battle with politicians seeking to close the station and may shift the firm's focus to the larger Indian Point nuclear plant in New York.
Entergy on Tuesday said it will shut the 620-megawatt Vermont Yankee by the end of 2014, saying the reactor is no longer economical to operate with current low power prices and rising regulatory costs.
The decision will end legal appeals and regulatory disputes and highlights the actions of Entergy's new chairman and chief executive, Leo Denault, who succeeded J. Wayne Leonard as CEO in February. Denault previously served as Entergy's chief financial officer for nine years.
Vermont Governor Peter Shumlin cited a "constructive" call with Denault on Tuesday and said he hopes to work with the new CEO going forward.
"The past is the past; we're now dealing with the future and he pledged to work together as a team to get the best outcome we possibly can," Shumlin told reporters.
In New York, Entergy also faces a showdown with politicians, regulators and environmental groups in its effort to keep the two Indian Point reactors running after their current licenses expire later this year and in 2015.
New York Governor Andrew Cuomo opposes Indian Point's license renewal because of the plant's proximity to the New York City metropolitan area that is home to 19 million people.
At Cuomo's direction, state power agencies are pursuing plans to modernize the New York grid so that it can operate without the 2,037-MW Indian Point plant.
Denault told Reuters the company's current Indian Point strategy is to continue the safe, reliable operation of the plant located 40 miles north of New York City, but he remains open to talks to determine the plant's future.
Like Vermont Yankee, Indian Point also faces the double economic challenges of falling wholesale prices and uncertain capital costs to deal with changing nuclear regulatory mandates, Denault said.
Entergy is "open to a resolution with the state that makes sense for us and for the objectives of the state," Denault said.
However, the much larger Indian Point plant - which can supply one-quarter of the power used in New York City and Westchester - operates in a different power market and can take better advantage of scale, Denault said.
"It's a different animal," he said.
Indian Point also contributes to the local economy with high-paying jobs and taxes, supplying low-cost power that releases no carbon dioxide or other pollutants, Denault said.
He said he wants to make sure Entergy has recovered the large investment it has made since purchasing the first Indian Point reactor in 2000 from the state power authority.
(Additional reporting by Scott Malone in Boston. Editing by Andrew Hay)