Entergy CEO says chance for new nuclear plant dim

Tue Nov 3, 2009 4:16pm EST
By Eileen O'Grady
FORT LAUDERDALE, Florida, Nov 3 (Reuters) - Entergy Corp (ETR.N:Quote, Profile, Research, Stock Buzz) Chief Executive J. Wayne Leonard said on Tuesday that the company is unlikely to pursue construction of new nuclear plant in its Southeastern U.S. utility territory.
"It's not off the table, but the economics are really not supportive and not likely to be supportive in the near future," Leonard said from the sidelines of the Edison Electric Institute financial conference.
In August, Entergy's Louisiana utilities notified state regulators that they intended to submit a request for a certificate of need for a new nuclear unit at Entergy's River Bend nuclear station in St. Francisville, Louisiana.
Entergy had also studied putting a new nuclear plant in Mississippi at its Grand Gulf nuclear station where it has an early site permit.
Both Louisiana and Mississippi lawmakers have passed legislation offering incentives for the recovery of costs to build new reactors.
New Orleans-based Entergy, the second largest operator of nuclear plants in the country, continues to work to obtain regulatory approval to spin-off its unregulated nuclear plants in the U.S. Northeast into a separate company.
Nuclear power plants generate about 20 percent of U.S. electricity and proponents say nuclear power is attractive because it emits none of the heat-trapping carbon dioxide that comes from coal-fired plants.
Even with the prospect of federal legislation to limit CO2 emissions and increase the cost of fossil-fueled generation, Leonard said a new nuclear plant can't be justified in the Southeast because of lower demand seen since Hurricane Katrina in 2005 followed by the recession and the abundance of independent power generation in the region that is underutilized much of the year.
Leonard indicated he's satisfied with the company's current generating fleet. "There's no need to embark on the riskiest piece of the business," he told analysts on Tuesday.
Entergy's nuclear plans stalled earlier this year when the company said it was unable to come to terms with its technology vendor, GE Hitachi Nuclear Energy (GE.N: Quote, Profile, Research, Stock Buzz) (6501.T: Quote,Profile, Research, Stock Buzz).
Entergy suspended its two license applications for the proposed new units in Louisiana and Mississippi filed at the Nuclear Regulatory Commission last year, but continues to study but continues to study the opportunity "sometime down the road," Leonard said. (Editing by Marguerita Choy)