July 26, 2017 / 5:35 PM / in a year

Connecticut Governor orders review of Millstone nuclear plant viability

(Reuters) - Connecticut Governor Dannel Malloy has ordered state agencies to review the economic viability of Dominion Energy Inc’s Millstone nuclear power plant, which critics want shut down in the face of cheaper energy sources.

Connecticut governor Dannel Malloy speaks at the Democratic National Convention in Philadelphia, Pennsylvania, U.S. July 25, 2016. REUTERS/Mike Segar

“We must objectively and thoroughly review and evaluate the relevant information and market conditions of the Millstone facility ... in the context of reducing costs for consumers and moving our clean energy strategy forward,” the governor said in a statement on Tuesday.

Dominion has been fighting for months to get the Connecticut leaders to find a solution to ensure Millstone’s viability. Those efforts have been opposed by other generating companies that stand to benefit if the plant shuts down.

Millstone is among several nuclear power plants in danger of shutting before its licenses expire as cheap and abundant natural gas from shale fields keep power prices low, making it uneconomic for generators to keep some reactors operating.

“The time for a study without action has passed,” Paul Koonce, chief executive of Dominion Energy Power Generation Group, said in a statement on Tuesday.

“Without action this year, prospects for continued operation of Millstone diminish,” Koonce said, noting Dominion would continue its strategic assessment of Millstone and make a business decision regardless of Connecticut’s latest study.

Opponents of state support for the reactors, like the Stop the Millstone Payout coalition, said “Millstone does not need a ratepayer-funded corporate payout.”

“Governor Malloy made the right call in seeking additional information from Millstone before any decision is made regarding financial support for the company,” said Matt Fossen, spokesman for the Stop the Millstone Payout coalition, in a statement.

Fossen noted external evidence suggested Millstone was profitable and was obligated to serve the energy markets until at least 2022.

Koonce said Dominion still hoped state legislators would include something to help the plant in their current special budget session.

Since 2013, six reactors, including Dominion’s Kewaunee in Wisconsin, have shut for economic reasons. Another six are expected to shut over the next five years.

Connecticut is among several states exploring rules to keep reactors in service to preserve carbon-free energy, jobs, taxes and a more diverse power pool. Other states looking at similar rules are Ohio, Pennsylvania and New Jersey.

New York and Illinois adopted rules to subsidize some of their reactors in 2016.

Over the past two weeks, federal courts dismissed challenges to those rules by groups representing other generators, like NRG Energy Inc, Dynegy Inc and Calpine Corp.

Reporting by Scott DiSavino; Editing by Richard Chang

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