September 26, 2013

Vermont Yankee Nuclear Power Plant Closing

The Vermont Yankee nuclear reactor, one of the oldest nuclear plants in the country and the subject of heated battles over the decades, will close late next year, the company that owns it announced, less than two weeks after winning a protracted legal fight against the State of Vermont to keep it open.

The company, Entergy, said a long depression in natural gas prices had pushed the wholesale price of electricity so low that it was losing money on the reactor, which is on the Connecticut River in Vernon just north of the Massachusetts border. So far this year, owners have announced the retirements of five reactors, with the low price of gas being cited as a factor in all of the cases. Three of the five have substantial mechanical problems.

Tearing down the old reactor will require many years and hundreds of millions of dollars. Using an option approved by the Nuclear Regulatory Commission, Entergy intends to seal the plant and leave it for years, while some of the radioactivity dies down and a trust fund established for its decommissioning — now with about $582 million on hand — grows.
But Vermont Yankee and one in Wisconsin, Kewaunee, represent a more significant trend because they have no major physical needs beyond the typical requirements for continuing capital investments. Vermont Yankee did face some expenses for improvements prompted by the Fukushima Daiichi meltdowns in Japan in March 2011, but these do not appear to have been decisive.
The latest closing would leave the United States with 99 operating reactors, presuming no others are shut before the fourth quarter of next year, when Vermont Yankee is to close. Four reactors in Georgia and South Carolina are under construction, and the Tennessee Valley Authority is finishing a fifth in Tennessee. But the industry is in a period of rapid decline.
"This was an agonizing decision and an extremely tough call for us," said Leo Denault, Entergy's chairman and chief executive, in a statement.
The Vermont plant has 630 permanent workers and employs a large number of contractors. In a midday press conference, Peter Shumlin, Vermont's governor, said "my heart goes out to the hardworking employees and their families" but nonetheless said: "This is the right decision for Vermont, and it's the right decision for Vermont's energy future."
Red Marker shows location of Vermont Yankee and its proximity to the Quabbin Reservoir
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