By Scott DiSavino
May 7 U.S. power company Dominion Resources Inc
shut the 566-megawatt (MW) Kewaunee nuclear power plant in
Wisconsin on Tuesday, as planned.
"We planned to shut at about noon today but are running a
little ahead of schedule. We closed the breaker a little bit
ago," Dominion spokesman Mark Kanz told Reuters before noon.
Dominion said in October it would shut Kewaunee, even though
its operating license does not expire until 2033, after failing
to find a buyer for the plant due to economic reasons related in
part to low natural gas and power prices.
"This closing does not herald the end of our company's
commitment to nuclear power," David Heacock, president of
Dominion Nuclear said in a release.
"It is a safe, reliable and carbon-free technology, but as
with all forms of generation, it must compete on economics,
including the necessity of being price competitive on a regional
level," Heacock said.
Kewaunee, a pressurized water reactor, entered service in
1974 and is located on the shore of Lake Michigan, about 27
miles (43 km) southeast of Green Bay, Wisconsin.
Kewaunee is the second U.S. reactor to be retired this year.
The last group of reactors was retired in the late 1990s.
Earlier this year, Duke Energy Corp said it would
retire its 860-MW Crystal River 3 reactor in Florida, due in
part to the uncertain cost of replacing the unit's containment
Crystal River 3 had been shut since 2009 when its
containment structure was damaged during a power upgrade and
replacement of the unit's steam generators.
Kanz said there are 632 workers at the plant. Dominion plans
to lay off about 200 people at the end of May and another 100 or
so at the end of June, he said.
By September 2014, the company expects to have about 293
workers and will stay at about that level for the plant
Kewaunee does not pay property tax but it does pay utility
tax on the generation it produces. Kanz could not say exactly
what the plant paid in total taxes but that it gave just under
$1 million a year to Kewaunee County and about $425,000 a year
to the town of Carlton, Wisconsin, where the plant is located.
Kanz said the company and the state were in discussion about
NO ECONOMIES OF SCALE
With the deregulation of the power market in Wisconsin,
Dominion bought Kewaunee from Wisconsin utilities Wisconsin
Public Service, now a unit of Integrys Energy Group Inc
and Wisconsin Power and Light, a unit of Alliant Energy Inc
, in July 2005 for about $220 million.
But since it was unable to grow a Midwestern nuclear fleet
to take advantages of economies of scale and Kewaunee's power
purchase agreements were ending at a time of projected low
wholesale electricity prices in the region, Dominion said in the
release Tuesday it decided to shut the reactor.
Dominion continues to own nuclear reactors at Millstone in
Connecticut, and Surry and North Anna in Virginia.
In October, Dominion said it would record a $281 million
after-tax charge in the third quarter of 2012, related to the
closing of the reactor.
Dominion also said in October that the reactor's
decommissioning trust is currently fully funded and the company
believes the amount available in the trust plus expected
earnings will be sufficient to cover all decommissioning costs.
Kanz said the decommissioning fund was $578 million at the
end of 2012.
In the weeks ahead, Dominion said it will remove all 121
fuel assemblies from the reactor and store them in the used fuel
pool. Under federal law, the company said it must decommission
the unit and return the site to a green field condition within