30 Jul (NucNet): The single-unit Duane Arnold nuclear power station in Iowa will be permanently shut down before the end of 2020 after NextEra Energy Resources, the wholesale power generating subsidiary of Florida-based NextEra Energy, struck a deal to shorten its power purchase agreement (PPA) with Alliant Energy.
The 601-MW boiling water reactor, which began commercia operation in February 1975, is the only commercial nuclear plant in Iowa. It is licensed by the US Nuclear Regulatory Commission to operate until 21 February 2034, but was expected to close in 2025 when the PPA with Alliant was originally scheduled to expire.
The NRC approved a 20-year operating licence extension for the plant in December 2010.
Alliant Energy said in a statement that it has agreed to make a $110m buyout payment to NextEra Energy Resources in September 2020 to cover the cost to shorten the term of the PPA from 2025 to 2020.
Alliant Energy applied to the Iowa Utilities Board on 27 July 2018 for approval of recovery of the buyout payment.
“Alliant Energy’s Iowa customers are expected to save nearly $300m, on a net present value basis, starting on or before 1 January 2021, contingent on the Iowa Utilities Board’s approval of Alliant Energy’s request,” the statement said.
NextEra Energy Resources plans to invest approximately $650m in existing and new renewables generation across Iowa by the end of 2020, including approximately $250m to repower the four wind facilities.
The US has the largest number of nuclear plants in the world – 99 in commercial operation providing 20% of its electricity generation – but efforts to build a new generation of reactors have been plagued by problems and aging plants have been retired or closed in the face of economic, market, and financial pressures.
Six US nuclear plants have been shut down permanently since 2013 and 13 more – including Duane Arnold – are slated to retire over the next seven years. That means a total of 19 shutdowns that will remove more than 16 GW of generation from the grid, or around 15% of existing nuclear capacity.
The nuclear energy industry has long argued that electricity markets should be reformed to recognise the ability of traditional baseload generation with onsite fuel supplies – including nuclear power plants – to provide grid resiliency during extreme events like hurricanes or extreme winter weather.
A recent report by the Washington-based think-tank the Atlantic Council issued a stark warning, arguing that the US nuclear energy industry is facing a crisis that the Trump administration must immediately address.
