Malloy orders viability study of Millstone

Dominion Millstone Nuclear Power Station in Waterford is seen from the air July 9, 2011.  (Sean D. Elliot/The Day)
Dominion Millstone Nuclear Power Station in Waterford is seen from the air July 9, 2011. (Sean D. Elliot/The Day)

Waterford — Gov. Dannel P. Malloy signed an executive order Tuesday that tasks state agencies with studying the "current and projected economic viability for the continued operation of" the Millstone Power Station.

A resource assessment is necessary for Connecticut to decide if — and how — it should take action to support nuclear power facilities and other emissions-free energy sources, the order states.

“Connecticut has become a leader in building a 21st century approach to energy, and we must not stop,” Malloy said in a statement. “We are deploying more renewable power resources and energy efficiency measures, while pursuing new, clean technologies such as battery storage and fuel cells."

"And in order for our state to have an efficient and comprehensive approach in how our energy future should be advanced, we must objectively and thoroughly review and evaluate the relevant information and market conditions of the Millstone facility and the sustainability of legacy zero-carbon generation in the context of reducing costs for consumers and moving our clean energy strategy forward,” he said.

The state Department of Energy and Environmental Protection and the Public Utilities Regulatory Authority are slated to present the results of the study to the governor and the General Assembly by Feb. 1, 2018.

The executive order follows Dominion Energy's announcement in June that the company is proceeding with a "strategic assessment" of its plans for Millstone, after legislation it had sought failed in the General Assembly. The House did not move forward with legislation, passed in the Senate, that would have enabled the state to review nuclear power plants and then determine if a competitive procurement process for nuclear power should begin.

Dominion said Tuesday that it will continue its "strategic assessment" of Millstone and make a "business decision," regardless of the study announced on Tuesday.

“Dominion appreciates the Governor’s leadership in helping to ensure Millstone continues to provide critical energy, environmental and economic benefits for Connecticut," Paul Koonce, the CEO of Dominion Energy Power Generation Group, said in a statement. "However, the time for a study without action has passed."

"We remain committed to working with the Governor and legislative leaders this special session to find a solution that benefits Connecticut and ensures Millstone’s viability," he added. "We have now been engaged with Connecticut leaders for more than 21 months on this issue. Without action this year, the prospects for continued operation of Millstone diminish."

Koonce referenced that Dominion had engaged with numerous parties for 18 months about the viability of a nuclear power station in Wisconsin, without coming to an agreement. Dominion then "made a business decision to close the plant."

State Sen. Paul Formica, R-East Lyme, co-chair of the General Assembly's Energy and Technology Committee, had championed the proposed legislation that called for the state to complete a report of the nuclear energy environment in New England by Jan. 1, 2018, and then take whatever action was necessary by May 1, 2018.

Formica said in a statement Tuesday that he appreciated the governor's efforts to study Millstone — which he said is a "vital energy source" for ratepayers and a provider of thousands of jobs in the community — but he also stressed the need to take action.

"Studying the situation Millstone is facing is just one step forward, but we also need action," he said. "It's apparent that there is a problem in the market. Given the many nuclear facility closings around the country, it's clear we need to act now before we become the next state where such a closure occurs — which would cause not only the loss of a stable power source and lead to higher energy rates, but would also eliminate many jobs we cannot afford to lose."

"Those who have invested in campaigns that try to discredit Millstone's concerns are often those who would profit from the plant closure," Formica said. "We have to look at this situation objectively, and we have to act to preserve Millstone's presence over the next few years and do what is in the best interest of all ratepayers to preserve energy stability while we work towards a renewable energy future. Inaction could prove devastating."

Matt Fossen, spokesman for the Stop the Millstone Payout coalition, a group that has opposed the legislation, issued a statement Tuesday that Malloy "made the right call today in seeking additional information from Millstone" before a decision is made to support the company.

"A number of studies, from the New England States Committee on Electricity (NESCOE) to MIT and others, show that Millstone is the most profitable nuclear plant in the country and that a subsidy would cost consumers hundreds of millions annually," he said in the statement. "The only claims to the contrary have come from executives of the plant's parent company, Dominion Energy, and to date they have declined to document actual financial need."

The legislation does not provide any subsidies, according to Formica. Rather, the bill would have allowed DEEP and the Public Utility Regulatory Authority "to determine if it is in the best interest of ratepayers to remove the middleman and allow nuclear facilities to sell power directly to utilities to lock in long-term stable prices through a competitive process," according to a June news release from the state senator's office.

Under Malloy's order, the state agencies will study the economic viability of Millstone by considering information that includes audited financial statements and data requested by the agencies.

The agencies also will analyze the role of nuclear power plants, as well as other emissions-free energy sources and initiatives, "in helping Connecticut meet interim and long-term carbon and other emissions targets, at the least cost and with the greatest net benefit to Connecticut ratepayers, while maintaining the reliability of Connecticut's electric grid," the order states.

The agencies will identify the "best mechanisms" to continue to move toward these goals, and whether and how these mechanisms should be implemented, the order states. They also will study whether or not these mechanisms are compatible with competitive wholesale and retail electricity markets and their potential financial impact on ratepayers.

k.drelich@theday.com

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