Dominion faces March 15 deadline to secure utility contracts for Millstone nuke
- Dominion Energy's Millstone Nuclear Power Station is negotiating power prices with utilities in Connecticut, and according to reporting from the Hartford Courant, the plant could close if no agreement is reached.
- Dominion needs to reach an agreement with Eversource and United Illuminating ahead of a March 15 deadline to place a bid for retirement with regional grid operator ISO-New England. Although Millstone has been ready to complete negotiations for the past month, this week was the first time Dominion representatives had scheduled a face-to-face meeting with utilities, a spokesperson told Reuters.
- The plant's operator has raised the specter of early retirement before, saying the plant was not economically viable without financial support. Determining it was "at risk," Connecticut regulators in November allowed the plant to bid into the state's carbon-free procurement auction, resulting in a 10-year bid in January from state officials for 50% of the plant's output.
ISO-New England faces a big shift in its generation mix from conventional fuel sources to renewables and distributed resources. In its regional electricity outlook, the grid operator deemed Millstone and a NextEra Energy Resources' Seabrook nuclear plant in New Hampshire plant as "critical components of the hybrid grid."
Dominion has pressed Connecticut lawmakers for years to approve higher payments for Millstone, which it says is not economically viable due to competition from cheaper natural gas and renewables. In June 2017, the legislature passed a measure directing state regulators to study the plant's economics, which led to the "at risk" determination and 10-year bid from the state.
The price for the first three years of the 10-year agreement with the state's Department of Energy and Environmental Protection is nearly equal to the wholesale power price in New England. That "is not an acceptable result to the company," Thomas Farrell, CEO of Dominion, said during the company's Q4 call with analysts.
As the only nuclear plant in the state, Millstone generates about a third of the electricity in the state and is the primary source of carbon-free energy, according to the Energy Information Administration. It provides 90% of zero-carbon power to the state, Farrell said during the Q4 call.
"In order to ensure the plant's viability, we must have pricing that recognizes energy security, environmental and economic benefits," he said.
Follow Iulia Gheorghiu on Twitter