The Omaha Public Power District (OPPD) board of directors announced Thursday that they had decided in a unanimous vote to close the Fort Calhoun Station nuclear power plant, a 482-MW pressurized water reactor 19 miles north of Omaha that is rated by generation capacity as the smallest nuclear power plant in the country.
Senior management at Fort Calhoun had recommended in May that the board consider closing the plant as a follow up to a review of resource portfolio scenarios that was requested by OPPD Chair Mick Mines in April. Economic modeling conducted by Pace Global, an independent auditor, concluded that the district would save between $735 million and $994 million over the next 20 years if the plant were to close by the end of the year.
The board said it had chosen a deferred dismantling strategy for decommissioning, which is categorically known as a SAFSTOR method, because it offered the most regulatory and financial flexibility of the decommissioning plans. Current figures show the OPPD has $388 million available in decommissioning costs out of an expected expense of $1.2 billion. To allow for decommissioning before 2033, OPPD will add to its decommissioning fund annually, the board said, announcing that it expected to be able to cover the remaining costs without raising the existing rates for customers. Moreover, it is expected that there will be no general rate increase for the next five years.
The OPPD district board offered a short laundry list of reasons that economics are working against the plant, forcing what was called a very difficult decision. The plant's size means that against production costs it was not as well stationed as other plants to take advantage of economies of scale. Low natural gas prices contributed, as did the federal Clean Power Plan, which has no credits offered to existing nuclear power plants for their no-carbon emissions track record. In addition, demand for electricity is in a slow growth and even a diminishing pattern in some cases. Added to that list are slow load growth and increased regulatory and operational costs.
“As tough as this decision is, we cannot afford to ignore the changes happening around us. We must look to the future,” said OPPD President and Chief Executive Officer Tim Burke.
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