Nebraska Utility Head Recommends Closing Nuclear Power Plant
The head of a Nebraska utility recommended shutting down the nation’s smallest nuclear power plant by the end of the year, saying Thursday that it doesn’t make economic sense to keep it open.
Tim Burke, the president and CEO of the Omaha Public Power District, told the utility’s board that Fort Calhoun Nuclear Station isn’t financially sustainable.
Shuttering the plant would represent a major shift for the utility, which serves more than 310,000 customers in 13 counties in southeastern Nebraska. Utility officials previously maintained that Fort Calhoun would be a valuable part of its plans because of its ability to generate power without adding to carbon dioxide emissions.
The board is expected to vote on the recommendations at its June 16 meeting.
The district spends about $650 million a year on generating power, which includes about $250 million on Fort Calhoun. Burke said closing the nuclear plant will help keep the utility’s rates low compared to the average power cost in the region.
The utility also has to make sure its mix of power plants can comply with environmental rules and restrictions on carbon dioxide emissions. The district typically gets about 34 percent of its power from the Fort Calhoun plant, but utility officials said Thursday that other carbon-free options, such as wind power, now make better financial sense.
The economics of the utility business have changed significantly in recent years because of new environmental regulations and cheaper natural gas prices due to hydraulic fracturing. Fort Calhoun’s small size and single reactor contributed to the recommendation to close it.
“It’s just not viable. It’s just not economically viable,” board member John Green said.
Smaller nuclear plants, like Fort Calhoun, have the most difficult time competing on the price of power, especially if they have had serious safety problems, said Mark Cooper, a senior fellow for economic analysis with the Institute for Energy and the Environment at Vermont Law School.
“The older, smaller reactors are really uneconomic,” Cooper said.
That description fits several reactors that closed in recent years, such as the Vermont Yankee in Vermont plant that was shut down in 2014 or the Kewaunee Power Station in Wisconsin that shut down in 2013.
New Orleans-based Entergy Corp. has announced plans to close two more of its smaller, older plants by the end of the decade — Fitzpatrick nuclear plant near Syracuse, New York, and Pilgrim nuclear plant near Boston. Entergy also owns Vermont Yankee.