Entergy Watch: UBS predicts "real retirement risk for units such as Vermont Yankee and FitzPatrick in '13"

In a report for shareholders, dated Feb. 4th by UBS Securities LLC, UBS "reiterate[s] expectations for nuclear retirements" in the Entergy Nuclear merchant fleet, due to low to negative free cash flow. UBS highlights that "We see Vermont Yankee as the most tenuously positioned," but adds "Fitzpatrick (sic) in upstate NY increasingly appears at risk as well," and "Pilgrim could be at risk too, depending on market development in New England." The report is based on a Feb. 2nd meeting between UBS analysts and Entergy Nuclear's new CEO, Leo Denault, and the rest of the Entergy management team. 

A large part of the UBS report then goes on to discuss the critical importance of decommissioning costs to Entergy shareholders, if/when Vermont Yankee (VY), FitzPatrick, and/or Pilgrim (near Boston) permanently shutdown.

UBS fails to mention that VY, FitzPatrick, and Pilgrim are General Electric Mark I Boiling Water Reactors, identical in design to Fukushima Daiichi Units 1 to 4. VY (nearly 41 years old), FitzPatrick (almost 39), and Pilgrim (around 41) are also age-degraded reactors, deep into their break-down phase, the same vintage as Fukushima Daiichi.

UBS did mention, however, in its "Statement of Risk," that "As a nuclear operator, Entergy is also subject to headline risk. We believe a nuclear accident (even in a non-Entergy nuclear plant) or a change in the Nuclear Regulatory Commission/Environment (sic) Protection Agency regulations could have a negative impact on our estimates."

NRC post-Fukushima "lessons learned" safety upgrades, such as the requirement for "hardened vents" at U.S. Mark Is like VY, FitzPatrick, and Pilgrim, could easily cost Entergy tens of millions of dollars per reactor to implement.

UBS does also mention the fact that VY (at 605 Megawatts-electric), FitzPatrick (838 MW-e), and Pilgrim (688 MW-e) are relatively small-sized, single reactor nuclear power plants, which several analysts have pointed out makes them most vulnerable to "early retirement." But this is a misnomer, given the fact that their initial 40-year operating licenses have already expired, and they are now operating thanks only to U.S. Nuclear Regulatory Commission (NRC) 20-year license extension rubberstamps. Dominion's 556 MW-e Kewaunee atomic reactor in WI serves as the "canary in the coal mine," showing the vulnerability of small, single reactor nuclear power plants to permanent shutdown due to "economic reasons" (such as the inability to make a profit while making hugely expensive, major safety repairs, for example). Dominion Nuclear announced last October that Kewaunee would permanently close in mid-2013.

The UBS report also discusses the future, or lack thereof, for Entergy's Indian Point (IP) Unit 2 (nearly 40 years old) & 3 (almost 38 years old) reactors near New York City. UBS highlights that "Building the case for IP remains centered on economic case," but concludes "we perceive limited ability to do so currently with NY gov't officials." New York Governor, Andrew Cuomo, has long called for IP's closure. UBS also highlights that "Relicensing remains bottom line on IP future," specifically the NRC Atomic Safety (sic) and Licensing Board 20-year license extension proceeding, and the New York Department of Environmental Protection (DEP) State Pollutant Discharge Elimination System (SPDES) water permit. The former is being contested not only by NY AG Eric Schneiderman's office, but also by such environmental groups as Riverkeeper and Clearwater (a member group of the Indian Point Safe Energy Coalition (IPSEC)). The latter could result in Entergy being required to build cooling towers, at a cost of hundreds of millions of dollars, to prevent large-scale, ecologically destructive thermal pollution of the Hudson River (a full two-thirds of the 6,432 Megawatts-thermal heat generated at the Indian Point nuclear power plant has, for decades, simply been dumped into the Hudson River).

UBS also concludes that Entergy's underlying nuclear business is "fundamentally un-financeable on a stand alone basis." UBS highlights that despite it being "the second largest nuclear power generator in the United States," Entergy's "[n]uclear business is sub-scale," and that "eventual spin-merge or JV [joint venture]" is "certainly a possibility." UBS reports "CEO Denault, in his first day on the job, suggested that in 5 years time the EWC [Entergy Wholesale Commodities] business would belong [as] part of a bigger portfolio -- either under Entergy ownership or otherwise." UBS summarizes that Entergy's "[g]oal is to gain greater scale in [nuclear] generation," and "ETR [Entergy] will either acquire or divest the [nuclear] generation subsidiary over Denault's tenure." UBS does not speculate as to which other atomic reactors Entergy might acquire, nor which other nuclear utilities might acquire Entergy in the next several years.

Hopefully, Entergy's VY, FitzPatrick, Pilgrim, and Indian Point atomic reactors will permanently shutdown long before then, along with the rest of its dirty dozen atomic reactors across the U.S.

Update on February 7, 2013 by admin

VT Digger has reported on this story.

"Endangered Snakes Prompt Hearing Over Fermi 3 Nuclear Plant"

The Monroe Evening News has reported on an environmental coalition's successful bid for hearing before the U.S. Nuclear Regulatory Commission (NRC) Atomic Safety and Licensing Board (ASLB) in opposition to Detroit Edison's proposed new Fermi 3 atomic reactor on the Lake Erie shore of southeast Michigan.

The coalition is comprised of Beyond Nuclear, Citizens for Alternatives to Chemical Contamination, Citizens Environment Alliance of Southwestern Ontario, Don't Waste Michigan, and Sierra Club Michigan Chapter.

It contends that the nuclear utility, federal government, and State of Michigan are failing to protect the endangered Eastern Fox Snake species (see photo, left) from extinction due to habitat destruction caused by the construction and operation of a 1,550 Megawatt-electric General Electric Hiticahi so-called "Economic Simplified Boiling Water Reactor" (ESBWR), as well as an associated 11-mile long, 300-foot wide transmission line corridor.

The State of Michigan has admitted the reactor construction will involve the largest impact on Great Lakes coastal wetlands in the history of state environmental protection law. Combined with the transmission line's destruction of more than 1,000 acres of undeveloped land, including forests and wetlands, the coalition contends the habitat loss could extirpate the endangered Eastern Fox Snake species in the region. More. 

Update on February 8, 2013 by admin

The Toledo Blade has also reported on this story.

Stop the Great Lakes Nuclear Dump!

Stop the Great Lakes Nuclear Dump billboard in Toronto

A new group has formed in opposition to the radioactive waste dump(s) targeted at the Great Lakes shoreline near the Bruce Nuclear Complex in Kincardine, Ontario, Canada. Stop the Great Lakes Nuclear Dump has a website, and has launched a petition drive.

As reported by Bayshore Broadcasting, Stop the Great Lakes Nuclear Dump has also erected a billboard on the Gardiner Expressway in the Greater Toronto Area (GTA), in order to draw wider attention to this national -- and even international -- threat. The report, which includes a short audio recording of Stop the Great Lakes Nuclear Dump spokeswoman, Beverly Fernandez, points out "The billboard, on one of Canada’s busiest commuter strips, could be seen by up to one million people a week."

Stop the Great Lakes Nuclear Dump encourages U.S. citizens to sign their petition. The petition is directed to Canada's Minister of the Environment, Peter Kent.

The Bruce Nuclear Complex "hosts" a total of 9 reactors (including a permanently shutdown prototype), one of the single biggest nuclear power plants, and concentrations of radioactive waste, in the world. For decades, all of Ontario's 20 reactors have "temporarily" stored their so-called "low" and "intermediate" level radioactive wastes at Bruce. Low-level radioactive waste has been incinerated. Now, Ontario Power Generation (OPG) proposes burying these low- and intermediate-level radioactive wastes on-site, just 400 meters from the waters of Lake Huron.

To make matters worse, Canada's Nuclear Waste Management Organization (NWMO) is considering applications from several Bruce area municipalities, which are volunteering to "host" a national high-level radioactive waste dump for all of Canada's 22 atomic reactors. These communities are disproportionately populated by Bruce Nuclear workers. They stand to receive substantial sums of money for being studied, and perhaps ultimately selected, as Canada's national high-level radioactive waste dumpsite. Kincardine, Bruce's "home town," has already received millions of dollars for agreeing to "host" OPG's proposed "low" and "intermediate" level radioactive waste burial dump at the Bruce Nuclear Complex.

In addition to the Bruce region, a number of municipalities in Canada's Lake Superior basin, and further north and west (including the Province of Saskatchewan, with one of the world's single biggest uranium mining industries), have also "volunteered" to "host" Canada's high-level radioactive waste dump.

Proponents have dubbed these proposed dumps "Deep Geologic Repositories," or DGRs. Critics refer to them, sarcastically, as Deep Underground Dumps, or DUDs.

The Great Lakes comprises 20% of the world's surface fresh water. It serves as the drinking water supply for 40 million people in 8 U.S. states (from west to east, Minnesota, Wisconsin, Illinois, Indiana, Michigan, Ohio, Pennsylvania, and New York), 2 Canadian provinces (Ontario and Quebec), and a large number of Native American First Nations.