Richmond, Va., October 22, 2012 — Dominion today said it plans to close and decommission its Kewaunee Power Station in Carlton, Wis., after the company was unable to find a buyer for the 556 MW nuclear power facility.
Pending a grid reliability review by the Midwest Independent Transmission System Operator (MISO), the station is expected to cease power production in the second quarter of 2013 and move to safe shutdown.
Dominion announced in April 2011 that it would seek to sell Kewaunee as part of a regular review of its portfolio of assets to determine which assets fit strategically and support its objectives to improve return on invested capital and shareholder value. The company was unable to find a buyer for the facility.
"This was an extremely difficult decision, especially in light of how well the station is running and the dedication of the employees," said Thomas F. Farrell II, Dominion chairman, president and CEO. "This decision was based purely on economics. 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. In addition, Kewaunee's power purchase agreements are ending at a time of projected low wholesale electricity prices in the region. The combination of these factors makes it uneconomic for Kewaunee to continue operations."
The station will remain under the oversight of the Nuclear Regulatory Commission (NRC) throughout the decommissioning process.
Following station shutdown, Dominion plans to meet its obligations to the two utilities that purchase Kewaunee's generation through market purchases until the power purchase agreements expire in December 2013.
Dominion plans to recognize an after-tax charge of $281 million in the third quarter of 2012 related to the closing and decommissioning of the station. The one-time charge will be excluded from operating earnings.
Kewaunee Power Station, located on Lake Michigan about 35 miles southeast of Green Bay, began commercial operation in 1974. It has one Westinghouse pressurized water reactor. 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.
Farrell said Dominion still firmly believes that nuclear energy must play an important part in the nation's energy future.
Dominion operates a portfolio of about 27,400 MW of generation, 11,000 miles of natural gas transmission, gathering and storage pipeline and 6,300 miles of electric transmission lines. Dominion serves retail energy customers in 15 states.