NEW YORK, Dec 9 Exelon Corp (EXC.N) will shut the Oyster Creek nuclear power plant in New Jersey in 2019, about 10 years before its license expires, in a deal with the state allowing the reactor to operate until then without building expensive cooling towers, the company said in a release late Wednesday.
The 619-megawatt plant, which entered service in 1969, is the oldest operating nuclear power reactor in the United States. It is federally licensed to operate until 2029.
To avoid killing fish and other aquatic life in the Barnegat Bay, New Jersey wanted Exelon to install a closed loop cooling system that uses much less water from the bay by recycling most of the water used to cool plant systems. Barnegat Bay is a brackish estuary that empties into the Atlantic Ocean through the Barnegat Inlet.
Exelon opposed the cooling towers as too expensive -- estimated at up to $800 million, according to some reports.
Exelon said New Jersey environmental regulators will not require the installation of cooling towers due to the company's decision to retire the plant early.
"The plant faces a unique set of economic conditions and changing environmental regulations that make ending operations in 2019 the best option for the company, employees and shareholders," Exelon President and COO Chris Crane said in the release, noting a specific date in 2019 had not been set.
In addition to the cooling water issue, which Exelon said created "significant regulatory and economic uncertainty," Exelon said several factors had decreased Oyster Creek's value, including low power market prices, recession weakened electricity demand and large capital expenditures.
Over the next decade, Exelon said, the plant would continue to supply enough clean, "carbon free" power for about 600,000 New Jersey homes until replacement power can be developed.
The decision also delays any immediate economic impact on Lacey Township, where the plant is located, Exelon said, noting Oyster Creek is one of the largest employers in Ocean County, providing more than $70 million annually in wages for nearly 700 plant workers, property taxes and purchases of goods and services from New Jersey businesses. ---------------------------------------------------- PLANT BACKGROUND/TIMELINE STATE: New Jersey COUNTY: Ocean TOWN: Forked River about 60 miles (96 km) east of
Philadelphia OPERATOR: Exelon Nuclear OWNER(S): Exelon Nuclear CAPACITY: 619 MW UNIT(S): General Electric boiling water reactor FUEL: Nuclear DISPATCH: Baseload COST: $488 million (in 2007 dollars) TIMELINE: 1965 - Plant construction started 1969 - Plant enters service, making it the oldest
operating nuclear plant in the United States 2000 - AmerGen Energy, a joint venture between
Philadelphia Electric Co (PECO) and British
Energy Group Plc, bought the plant from GPU Inc
(now part of FirstEnergy) in the same year PECO and
Unicom merged to form Exelon Corp 2003 - Exelon buys British Energy's stake in AmerGen and
transferred it to Exelon Nuclear 2005 - Exelon applied with the NRC to extend the original
40-year operating license that was to expire in
2009 2009 - NRC renews the operating license for another 20
years 2010 - Exelon agrees with New Jersey to retire plant in
2019 to avoid spending up to $800 million to
install cooling towers 2019 - Exelon to retire plant 2029 - Operating license expires (Reporting by Scott DiSavino; Editing by Walter Bagley)