Entergy agrees to sale of Palisades

The Palisades nuclear power plant in Covert Township is slated to shut down in 2022. The plant's owners will then sell it to a company that specializes in decommissioning nuclear power plants.

COVERT — Palisades nuclear power plant will get an accelerated decommissioning after it closes in 2022, Entergy Corp. announced Wednesday. 

Entergy, which owns Palisades and other nuclear power plants around the country, has agreed to sell Palisades and Pilgrim Nuclear Station in Massachusetts after their shutdowns and reactor defuelings to a Holtec International subsidiary for accelerated decommissioning.

The sales will include the transfer of the licenses, spent fuel and Nuclear Decommissioning Trusts (NDTs) as well as the site of the decommissioned Big Rock Point Nuclear Power Plant near Charlevoix, where only the Independent Spent Fuel Storage Installation (ISFSI) remains.

The transactions are subject to conditions to closing, including approvals from the U.S. Nuclear Regulatory Commission (NRC) of the license transfers, according to Entergy. 

Holtec will develop a timeline for the decommissioning of Palisades closer to its shutdown. Pilgrim is set to close in 2020 and all major decommissioning work is expected to be completed in about eight years.

Holtec expects to move all of the spent nuclear fuel out of the spent fuel pools and into dry cask storage at Palisades and Pilgrim within about three years of the plants’ respective shutdowns. 

Entergy Chairman and Chief Executive Officer Leo Denault said in a news release that transferring Pilgrim and Palisades to Holtec, with its vast experience and innovative use of technology, will lead to their decommissioning faster than if they were to remain under Entergy’s ownership.

He said company officials believe accelerated decommissioning will benefit the surrounding community by returning the site to productive use sooner.

“Entergy will continue to make all necessary investments to ensure Palisades’ safe, secure and reliable operations,” Palisades spokeswoman Val Gent said in an email Wednesday. “That investment includes two more planned refueling and maintenance outages. The first is scheduled to occur this fall. During that time, Entergy will invest tens of millions of dollars into both refueling the plant and performing numerous maintenance activities.”

Selling the plants for decommissioning is part of Entergy’s strategy to exit Entergy Wholesale Commodities and move to a “pure play” utility. “Pure play” refers to a company producing a single product.

Holtec President and CEO Kris Singh said the company intends to deploy cutting-edge technology to carry out plant deconstruction with minimal impact on the environment and maximum personnel safety, “which are our core competencies.”

“As a growing company, we look forward to exploring employment opportunities for Entergy employees dislocated by the plant’s decommissioning,” he said. 

Holtec is finishing contracts with Comprehensive Decommissioning International (CDI), a newly-formed U.S.-based joint venture between Holtec and SNC-Lavalin, to perform the decommissioning, including the demolition and cleanup of the two plants and sites.

Holtec will transfer all of the used nuclear fuel to its cask systems to be stored at the ISFSIs, which will remain under guard at the sites, monitored during shutdown and decommissioning and subject to the NRC’s oversight, until the U.S. Department of Energy removes it, in accordance with its legal obligations.

Holtec and Entergy expect to file a license transfer request with the NRC closer to Palisades’ planned shutdown in the spring of 2022, with transaction closing expected by the end of that year.

Entergy will receive nominal cash consideration for its transfer to Holtec, according to the news release. Each transaction is expected to result in a non-cash loss based on the difference between Entergy’s net investment in each subsidiary and the sale price plus any agreed adjustments. As of June 30, 2018, the adjusted net investment in Entergy Nuclear Palisades LLC was $131 million. 

Palisades employs about 600 people and began generating electricity in 1971. The plant generates more than 800 megawatts, enough to power more than 800,000 homes. Entergy bought the plant in 2007 from Consumers Energy and continues to operate under a 15-year power purchase agreement that expires in the spring of 2022.

Contact: anewman@TheHP.com, 932-0357, Twitter: @HPANewman