Lessons Learned From Kewaunee's Closing

Kewaunee nuclear power plant closes Dominion Resources Wisconsin NEI

The Kewaunee Plant under construction in the 1970s. Photo courtesy: Dominion Resources

 

“How can you have a top performing plant and still see it being shut down?”

This is a question that many people are still asking a year after the 556-MW Kewaunee nuclear plant in Wisconsin shut down for good. Kewaunee has long been considered a well-run power plant, one that rarely had operational or regulatory issues. Yet, it still permanently closed on May 7, 2013 after 39 years of operation. It wasn’t regulations or public opposition that shut it down, but economics.

The Numbers Behind Kewaunee

Virginia-based Dominion owns three other U.S. nuclear power plants: North Anna and Surry in Virginia and Millstone in Connecticut. The utility acquired the Kewaunee plant in Carlton, Wisconsin in July 2005 from joint owners Wisconsin Public Service Corp. and Alliant for $192 million. Kewaunee was run as a merchant power plant that sold its generated power to two companies, but when those companies did not renew power contracts, and Dominion was unable to buy other nuclear plants in the region to help make the purchase of Kewaunee economical, the utility put the plant up for sale in April 2011. No buyers took the deal, so Dominion made the decision to close the plant in October 2012.

“This decision was based purely on economics,” said Thomas Farrell II, chairman, president and CEO of the Virginia-based utility, in a statement released at the time the closing was announced. “Dominion was not able to move forward with our plan to grow our nuclear fleet in the Midwest to take advantage of economies of scale.”

Mark Kanz, local affairs manager at the Kewaunee plant for Dominion, said the utility estimates decommissioning to cost a total of $937 million, which includes the costs for license termination, spent fuel management and site restoration. The process also allows the decommissioning fund for Kewaunee to continue earning interest.

Despite losing a major tax provider, the economy and employment levels in Carlton have not yet been directly impacted. The town is still receiving the state utility tax, but that will be phased out over a five-year period.

“Employment levels in the town are still fairly high and the state utility tax that has come back to the township has not been cut,” Kanz said. “For 2014, the utility tax payment is still at 100 percent.”

However, the tax payment will gradually decrease by 20 percent each year until 2019. Kanz said Dominion is also working with the municipalities to appraise the buildings so the values can be used to determine property tax bills for 2015.

Employment at the plant has decreased, but there is still staff on hand performing decommissioning activities. At the time of the plant’s closing, there were 632 employees. Currently, there are 260 on-site, but that will go down to 140 by the end of October.

“These are the workers who will be needed in 2015 and 2016 to empty the spent fuel pool and move it to dry storage,” Kanz said. “They will continue to do those things to put the plant into SAFSTOR.” SAFSTOR is an option that essentially mothballs the plant for 50 to 60 years until decommissioning is completed. It allows the radiation to decay to safe levels for workers to dismantle equipment and to restore the land.

“We are continuing to do what we can for those employees who are leaving,” Kanz said. “Our U.S. congressman held a job fair, and the 120 people who know they are done in October were given time off to go there and make connections. We will also be holding our own job fair in the future.”

Kanz said there is no negative stigma attached to seeing Kewaunee on someone’s resume.

“Employers know the people here are good workers and do the job right,” Kanz said.

Read the rest of this story in the upcoming May/June issue of Nuclear Power International magazine

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