Deep inside the Zion Nuclear Power Station sit some particularly expensive, but deteriorating gadgets called “steam generators.”
Commonwealth Edison knows that the devices, house-sized bundles of tubes that make steam, must be replaced–at a cost of $235 million–if the plant is to keep running much longer.
Last year, though, the company quietly decided to put the repairs on hold. Their reason: Perhaps they won’t want the plant to be running much longer.
That decision is one of the best indicators of how seriously Edison has begun to weigh the possibility of closing one or more of its aging, problem-plagued nuclear power stations.
Ironically, Edison on Friday mailed off a plan intended to assure the Nuclear Regulatory Commission that despite past safety lapses, it is competent to run all six of its plants and should be allowed to do so.
Yet Edison executives now acknowledge that their planners are only waiting to fill in a few crucial variables on their spreadsheets before deciding whether some of their plants– most notably Zion and Dresden–are worth keeping open.
Just acknowledging that they are thinking about closing a nuclear plant represents a fundamental turnabout for Edison executives, who stood virtually alone in the 1980s in their bullishness on nuclear power.
As other utilities retreated from nuclear projects, Edison created the largest nuclear utility–and some of the highest electric rates–in the nation.
But Edison is now facing the reality that other, nearby utilities that canceled their nuclear plants will soon be able to come into northern Illinois peddling power for less.
In a telephone conference call with Wall Street analysts in January, vice chairman Leo Mullin said the company could decide within months to close some of those plants.
“We do expect at some point in the future to engage in a program of cost rationalization which would involve the possibility of shutting various of the plants,” Mullin said.
If Edison decided to close one or more plants, that would set into motion another vastly complicated and costly process: the multibillion-dollar decommissioning of the reactors, even before they were paid for.
About 80 cents of the average homeowner’s electric bill goes to a trust fund that now has about 10 percent of the $15 billion that will be needed to dismantle Edison’s nuclear plants.
The most important variable in the equation to determine if plants will close will be filled in by lawmakers in Springfield.
The General Assembly this year will at least begin to hammer out the deregulation laws that will end Edison’s monopoly on selling electricity in northern Illinois.
“If you tell me what is going to happen with that, I’ll tell you what I am going to do,” said Thomas Maiman, the Edison executive charged with making the nuclear program profitable.
A group led by Edison has submitted its own deregulation bill, which would phase in competition over many years.
Frank Clark, the Edison vice president who heads the utility’s deregulation effort, said the legislation would force the company to cut costs to compete in the marketplace.
Howard Learner, who has fought Edison rate increases for years and is now with the Environmental Law & Policy Center, said Edison has an incentive to keep its plants open until after the legislation is passed.
That would make it more likely that lawmakers would pass a law more favorable toward the utility’s attempts to recover the costs for its plants.
As it moves ahead with its deregulation effort, Edison planners have been establishing possible criteria for closing plants.
One consideration is size, Maiman said.
The Byron plant, for example, can produce more than 2,200 megawatts of electricity at any time, but Dresden can produce only about 1,600 megawatts. Both require about the same number of employees and have roughly the same day-to-day costs.
Between 1991 and 1995, Dresden was off-line for repairs and other problems so often that it produced at only 44 percent capacity–about half the level a plant would need to be a moneymaker.
Dresden, located about 60 miles southwest of Chicago, also has a history of safety problems and has been a lightning rod for NRC criticism.
Dresden has been on the federal watch list of troubled plants longer than any other plant in the country.
But Dresden is also the only place where Edison has been able to show improvement recently. NRC regional administrator A. Bill Beach told Dresden managers that “overall performance continues to improve.”
That’s more than Beach has been able to say about Zion. He called a recent blunder there–an operator turned off, then tried to turn on the nuclear reactor in violation of all procedures–one of the worst errors he has seen in his career.
The plant was placed on the federal watch list in January.
Zion, located on Lake Michigan just south of the Wisconsin border, also has the steam generator problem.
The company’s engineers estimate the units, which are cracking, will have to be replaced by 2005. The plant is scheduled to retire in 2013.
In a recent filing with the Securities and Exchange Commission, Edison said it was holding off with a replacement plan, which it had spelled out in a previous SEC filing.
Between 1991 and ’95, Zion operated at about 60 percent of its capacity, well below the national average.
Weighing against its candidacy, Maiman said, is its size: It can produce 2,080 megawatts, putting it in a class with the company’s big reactors.
The LaSalle plant, about 70 miles southeast of Chicago, is roughly the same size and is newer, operating since the early 1980s.
The LaSalle plant was also put on the federal watch list in January.
The Byron and Braidwood plants, Edison’s newest and its best performers, would not be considered for closure, Maiman said.
If Edison did move to close a plant, it would not be the first utility to do so.
Last year, the owners of Connecticut Yankee nuclear power plant crunched the numbers on their aging facility and decided it made more economic sense to shut it than to keep it running.
But the possibility of Edison closing a plant is more extraordinary, given the company’s long history as a leader in the nuclear industry.
In the 1970s and early 1980s, utilities across the country began canceling their plans to build plants.
But Edison held to its vision of a nuclear future. While it did scrap plans for one nuclear reactor, it forged ahead with others in the 1980s in the face of criticism.
“We are determined,” Edison chairman James O’Connor said in 1982.
Costs soared–when it proposed its Byron plant, Edison said it would cost $780 million to build. When it was finished, it actually cost $4 billion.
Time and again, Edison went before the Illinois Commerce Commission to ask for permission to raise electric rates to pay for the rising costs of projects that they said would ultimately save consumers money.
Furthermore, Edison said it needed the plants to meet its obligation to supply all the electricity needs of northern Illinois.
But the savings never materialized, and now, as deregulation becomes reality, Edison will no longer have the obligation to satisfy the area’s appetite for power.
The plants might no longer be needed.
