High Repair Costs and Lower Power Prices Drive Nuclear Retirements
U.S. Energy Information Administration, September 23, 2013
Since October 2012, electric power companies have announced the
retirement of five nuclear reactors at four power plants. The five
reactors have a combined capacity of nearly 4,200 megawatts. The recent
retirements are the first since 1998. Decisions to retire the units
involved concerns over maintenance and repair costs and declining
profitability. Units that operated as merchant generators, meaning that
the costs associated with running and maintaining the plants cannot be
recovered through regulated cost-of-service rates, have been
particularly sensitive to declining profitability. Low wholesale
electricity prices, driven in part by lower natural gas prices, have
been cited more often in the retirement decisions of these plants while
repair costs have been drivers of retirements at nuclear power plants
owned by utilities. The recent reactor retirements will decrease the
total number of operating nuclear reactors to 99 and will reduce total
U.S nuclear net summer capacity by almost 4%.
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