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FirstEnergy Corp. selling or closing all its nuclear power stations

nuclear-dominoesFirstEnergy Corp. to sell or close its nuclear power plants By John Funk, The Plain Dealer  February 22, 2017 AKRON, Ohio — FirstEnergy made it clear Wednesday that it is leaving the competitive power plant business, closing or selling all of its plants, including its nuclear plants, by the middle of next year.

The sale of the nuclear plants to another company would have little immediate impact on customer bills.

Closing the plants, which would probably take several years, would also have little impact on customer bills or power supplies….

The company’s acknowledgement Wednesday during a teleconference with financial analysts  that it plans to sell or close its three nuclear plants came 24 hours after an Ohio lawmaker revealed that the FirstEnergy is seeking what amounts to additional and unprecedented rate increases.

The money from these first-of-a-kind charges would be earmarked for Davis-Besse, located east of Toledo, Perry, located east of Cleveland, and Beaver Valley, northwest of Pittsburgh.

FirstEnergy is proposing that the state create a program awarding “Zero Emission Credits” to the three plants ……

If lawmakers approve the plan, consumers would see an estimated 5 percent increase in their monthly bills. Commercial and industrial customers would see bills increase by 5-to-9 percent to reflect the value of the millions of megawatts the nuclear plants generate.

The Zec program would give the company’s nuclear fleet an increase of about $300 million a year, maybe enough to offset the losses competitors running gas turbine power plants have inflicted. …….

Even if the state creates a Zec program to subsidize FirstEnergy’s nuclear plants, the company acknowledges that it intends to try to sell them because it no longer wants to operate in competitive markets……

The company’s background materials accompanying Wednesday’s financial report show that FirstEnergy Solutions has a total value of  $1.6 billion But the subsidiary carries a long-term debt of $3 billion.

The nuclear power plants are now valued at $900 million — with a debt of about $1.3 billion, the documents show.   …..

The new charges would be “non-bypassable,” meaning a customer could not avoid the ZEC charges by purchasing power from another supplier.

The Ohio Zecs would be similar to a program Illinois created last fall to assist nuclear plant owners there. Opponents immediately sued in federal court, claiming an unconstitutional subsidy because the state is deregulated and power prices are set on competitive markets.

A piecemeal state-by-state Zec program to bail out nuclear plants could pose a problem for PJM, said PJM’s top executive in an interview earlier this week. …….http://www.cleveland.com/business/index.ssf/2017/02/firstenergy_corp_to_sell_or_cl.html

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February 25, 2017 - Posted by | business and costs, USA

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