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Financial risk in Entergy’s nuclear plan

Greenpeace says beware of Enexus The Brattleboro Reformer By BOB AUDETTE 13 Oct 09 BRATTLEBORO — Despite the Department of Public Service’s assertion that recent concessions made by Entergy will benefit Vermont ratepayers, the company’s plan to spin off Vermont Yankee nuclear power plant into a new subsidiary is bad news for the Green Mountain State.Yankee is one of five power plants Entergy wants to place into its new subsidiary, which is called Enexus. Those other plants are Pilgrim in Massachusetts, Palisades in Michigan and Fitzpatrick and Indian Point in New York.

Each of the plants will become a limited liability corporation under the umbrella of Enexus. “Rather than benefiting the public good and the people of Vermont, Entergy has come up with yet another scheme to benefit its stockholders,” stated Greenpeace.

If and when the spinoff is approved, Entergy will offer $3.5 billion in shares to the general public. That money will go to pay off Entergy debt and to reward stockholders.

What this means, said Jim Riccio, Greenpeace’s nuclear policy analyst, is that Enexus will have more debt than equity……………….

“The NRC has a habit of placing corporate profits ahead of public safety,” stated Greenpeace.

NRC Chairman Ivan Selin acknowledged that economic pressure was providing utilities with an “incentive to cut corners” while the Wall Street Journal recognized that the nuclear industry, “is struggling to make its costs competitive without compromising safety,” stated Greenpeace.

The former consulting firm Arthur Andersen concluded that “the threat exists that nuclear utilities, in their desire to cut costs and increase competitiveness, will be forced to impair their operational safety and increase risk.”

Another problem is that Enexus will be considered below investment grade, said Riccio, meaning unless its value increases, it’s nothing but junk bonds.

Greenpeace says beware of Enexus – Brattleboro Reformer

October 13, 2009 - Posted by Christina Macpherson | 1, business and costs, USA | antinuclear, nuclear, nuclear costs, nuclear spin