UPDATE 1-Exelon to stage output additions at nuclear units

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FORT LAUDERDALE, Florida, Nov 3 (Reuters) - Exelon Corp (EXC.N) Chief Executive John Rowe said on Tuesday the company will stage its planned $3.5 billion output additions at its nuclear fleet to take advantage of economic and power price conditions.

Chicago-based Exelon, the nation's largest nuclear operator, has proposed adding from 1,300 to 1,500 megawatts of output at its reactors by 2017.

"The exact amount we add will depend on the economy and power prices," Rowe said said at the Edison Electric Institute financial conference. "Later projects will only occur as we see the value improve."

Over the next five years, Exelon plans to boost nuclear output by 400 to 500 MW by replacing generators, turbines, motors and transformers -- work that does not require nuclear regulatory approval -- at a cost of about $800 million.

The company will also update plant instrumentation which can add 1.7 percent in additional output at a cost of $300 million. This work, known as measurement uncertainty recapture, requires approval from the U.S. Nuclear Regulatory Commission.

Beginning about 2015, Exelon plans to invest another $2.4 billion to perform more sophisticated work, known as extended power uprate, to expand its nuclear capacity by 899 to 1,016 MW, the company said. This work also requires NRC approval.

While the total cost of the uprate program will reach $4.4 billion by 2017 with inflation, Rowe estimated the "overnight cost," which excludes financing, at $2,200 to $2,500 per kilowatt.

Rowe said the nuclear plan will add the equivalent of a new reactor "at half the cost and doesn't add much to our operating costs" when completed.

Earlier this year, Exelon put off a plan to seek a license to build a new nuclear plant in South Texas. Instead, the company will seek an early site permit, a move that allows Exelon a 20-year option to pursue construction.

"Our best growth opportunity is nuclear," Rowe said, dispelling expectations of analysts at the conference that Exelon might pursue another acquisition after a failed bid for NRG Energy (NRG.N) earlier this year.

Rowe said the board has extended his contract by 18 months, into 2012, not to pursue any major transactions but to keep the company on course through the current economic downturn and the expected transition to carbon regulation. (Reporting by Eileen O'Grady; Editing by Christian Wiessner)