Crystal River reactor repairs could reach $1.3 billion

Progress Energy Florida said it will repair damage to its 860 MW Crystal River nuclear station at a cost of $900 million to as much as $1.3 billion. The unit could return to service in 2014.

Progress Energy will meet with the FPSC July 14 to discuss the company's plan in more detail and determine the appropriate timing for moving forward, in coordination with regulators.

"This would be a major repair, requiring significant cooperation and coordination with state and federal regulators and others," said Vincent Dolan, Progress Energy Florida president and CEO. "Based on our initial review, our objective is to return the plant to service."

The plant went into service in March 1977 and has a Babcock & Wilcox pressurized water reactor. Its current license expires in 2016. The company filed for a license renewal with the Nuclear Regulatory Commission (NRC) in 2008, requesting an additional 20 years of operation.

Initial damage to the plant's containment building occurred in late 2009 while workers were creating an opening in the structure to facilitate the replacement of the steam generators inside. The work to create the opening caused a delamination (or separation) in the concrete at the periphery of the containment building. The unit was already shut down for refueling and maintenance at the time the damage was found.

In mid-March 2010,during the final stages of returning the unit to service, work was suspended while engineers investigated and determined that a second delamination had occurred in another area of the structure. Similar to the initial delamination, the second separation occurred about nine inches from the outer surface of the concrete. The Crystal River Nuclear Plant containment structure is about 42 inches thick, contains both horizontal and vertical tensioned steel tendons and is lined with a 3/8-inch-thick steel plate.

Progress Energy engaged outside engineering experts to perform an analysis of possible repair options for the second delamination. The consultants analyzed 22 potential repair options and ultimately narrowed those to four. Progress Energy, along with independent experts, reviewed the four options for technical issues, constructability and licensing feasibility as well as cost.

Based on that initial analysis, the company selected the repair option. The option would entail removing and replacing concrete in the containment structure walls. The planned option does not include the area where concrete was replaced during the initial repair. The preliminary cost estimate for this repair is between $900 million and $1.3 billion.

Progress Energy said it maintains insurance for property damage and incremental costs of replacement power resulting from prolonged accidental outages through Nuclear Electric Insurance Limited (NEIL). As of May 31, 2011, the company has spent around $214 million on the repair and $375 million on replacement power costs. NEIL has paid claims of $265 million during that period. Of the $265 million received, $103 million covered repair costs and $162 million covered replacement power. Progress Energy is insured for up to $2.25 billion per event for property damage and up to $490 million for replacement power.

On Jan. 11, 2011, Duke Energy announced a $13.7 billion acquisition of Progress Energy pending

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