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Millstone nuclear plant threatens shutdown

Connecticut Post logo Connecticut Post 7/7/2018 By Bill Cummings

The Millstone nuclear plant is renewing threats to close its reactors — and potentially drive up the cost of electricity — after state regulators proposed delaying the company from making more money through clean energy contracts.

"Millstone is at risk now and must face critical business decisions regarding the future, irrespective of the consequences those decisions might have on Connecticut or the New England region," said Paul Koonce, CEO of Dominion Energy, which owns Millstone.

"We have deferred making these difficult decisions for three years, in good faith," Koonce said in objections filed with the state Department of Energy and Environmental Protection.

A draft request for proposals issued by DEEP proposed delaying Millstone’s ability to bid for zero carbon electric contracts until after 2023 — some five years from now.

Those contracts, designed primarily to grow clean power sources such as solar and wind, represent significantly higher electric prices than the Waterford-based Millstone now receives from the wholesale commodities market.

Millstone produces 2,100 megawatts of power through two operating reactors that distribute energy throughout New England. The company claims rising expenses and competition from cheaper natural gas has weakened its financial position.

State Rep. Lonnie Reed, D-Branford and co-chairwoman of the legislature’s energy committee, said she’s concerned about the future of Millstone and the impact on the state’s already high electric rates if the plant shuts down.

“It’s a 24/7 operation,” Reed said of Millstone’s reactors.

“Those plants are hard to come by and nuclear, coal, oil and natural gas are shutting down,” Reed said. ‘I’m very concerned this is being pushed back to 2023. It’s shortsighted and jeopardizing a sustainable base for the near future.”

a view of a city next to a body of water: FILE PHOTO -- Morgan Kaolian AEROPIX 9/07/06 -- Millstone Nuclear Power Station in Waterford, Conn. © Provided by Hearst Communications, Inc FILE PHOTO -- Morgan Kaolian AEROPIX 9/07/06 -- Millstone Nuclear Power Station in Waterford, Conn.

But not everyone agrees Millstone is at risk of financial failure.

Stop the Millstone Payout, a group backed by Midwestern coal plants and others, mounted an extensive campaign against legislation passed last year establishing zero carbon auctions, calling the move a "giveaway" to Millstone that will cost ratepayers millions in higher electric bills.

"Why should our residents and businesses pay hundreds of millions of dollars extra each year for a nuclear plant that is highly profitable and won’t even prove that it needs the money," Stop the Millstone Payout says on its web site.

Clean energy

The point of a zero carbon auction is to reward clean energy producers with higher prices for their electricity and encourage development of more emission free sources.

Millstone, which produces no harmful emissions but generates highly dangerous, radioactive waste, was granted an exception to enter the auction through an "at risk" designation, which signals economic hardship.

Under DEEP’s proposed rule, the designation cannot be used until after June 1, 2023.

The rules of the auction were left to DEEP and the Public Utility Regulatory Authority to figure out and implement. The draft RFP is a critical step in that process.

"We will carefully review comments submitted regarding the draft RFP before issuing the final RFP statement," said DEEP spokesman Chris Collibee. The comment period ends July 31.

Dominion said delaying Millstone from participating in the auction until 2023 violates the intent of the legislation.

"This is clearly not what the governor and the General Assembly envisioned after more than three years of combined legislative and executive work to chart a long-term path for Connecticut to retain the jobs, economic, environmental and energy security benefits produced around the clock by Millstone Power Station," Koonce said.

Reed said the intent was to allow Millstone to submit bids now, and warned that Connecticut must have a mix of power sources.

“We wanted to get ahead and let [Millstone] play in the zero carbon lane,” Reed said. “New York is putting in millions to keep three nuclear plants open. We feel regulators didn’t get the point. It can’t be all solar or all wind or all nuclear.”

Claire Coleman, a climate and energy attorney for the Connecticut Fund for the Environment, said delaying Millstone bids is reasonable and will help protect ratepayers.

"Forcing ratepayers to foot the bill for a bailout payment to Millstone at all — let alone during a time when Millstone will be committed to the regional market and there is no risk of retirement — makes no sense given our high electricity costs and need to invest in the zero carbon renewable energy technologies of the future: wind, solar and battery storage," Coleman said.

State Senate Majority Leader Bob Duff, D-Norwalk, said he’s willing to let the process continue.

"The intent was to provide a way for them to bid," Duff said, referring to Millstone.

"How that works out is between Millstone and the regulators," Duff said.

Closing down

Millstone is sending a clear message that if it does not get its way, the Waterford plant could be decommissioned — which means closed — in the coming years, a move Dominion says will cost electric customers across New England.

"The General Assembly chose to act now, recognizing that an inflection point is approaching in the future of Millstone Power Station that will require Dominion Energy to determine whether or not to commit hundreds of millions of dollars in additional spending to keep the station operating," Koonce said.

"These benefits exist now and should be valued accordingly," Koonce said. "Otherwise, any contract that results from the RFP is unlikely to be viable and the efforts of all involved will be wasted. The loss of Millstone would have impacts on electricity costs and carbon emission levels in Connecticut."

DEEP sees Millstone’s immediate future differently. A detailed assessment of the nuclear plant noted the facility is obligated to deliver energy to the New England grid through 2022.

The assessment added if Millstone closed before those contractual obligations were met it would incur huge costs to cover power shortages caused by its action.

"Dominion would have to find a large number of substitute megawatts from resources willing to assume the [existing contracts] or pay a very high price to buy its way out of its obligations," the report said.

bcummings@ctpost.com

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