Feb 19 (Reuters) - Dominion Resources Inc will retire the 565-megawatt Kewaunee nuclear plant in Wisconsin in the second quarter after the Midwest grid operator determined the plant is not needed to maintain electric reliability, the company said on Tuesday.
Dominion said last fall the plant was no longer economical in the face of growing competition from natural gas-fired plants.
“Kewaunee may retire immediately,” the Midwest Independent Transmission System Operator (MISO) said in a letter to Dominion after its review.
Earlier this month, Duke Energy, the largest U.S. power company, said it would retire the Crystal River reactor in Florida, which has been shut since 2009, due to rising repair costs.
Industry sources said these actions may signal the shutdown of other U.S. nuclear plants as weak natural gas prices make significant investment in older, single-unit reactors uneconomical.
Dominion said that after the Kewaunee reactor shuts in the second quarter it will use market purchases to meet its obligations to utilities that purchase Kewaunee generation until the contracts expire in December.
The station will remain under the oversight of the Nuclear Regulatory Commission throughout the shutdown and decommissioning process, Dominion said.
“We intend to take all steps necessary to ensure the protection of the public, employees and the environment. The station will have the resources it needs,” said Tom Farrell, Dominion’s chief executive officer, in a release.
Kewaunee began commercial operation in 1974. Dominion acquired the station in July 2005. In February 2011, the NRC renewed the station’s operating license for an additional 20 years, until 2033.
At that point, Dominion tried unsuccessfully to find a buyer for the station.