Entergy may take up more nuclear

27 August 1998

Entergy Corp has become the latest company to announce it is considering buying US nuclear plants and operating them for profit.

The announcement came in early August as Entergy unveiled a corporate plan to focus on fewer diverse businesses with potentially higher shareholder returns. The New Orleans-based company plans to sell British and Australian power distribution firms as well as other assets, including its security alarm and telecommunications businesses.

“It simply makes good business sense to maximise our investment in areas where we have top performance,” Entergy said. “Having established ourselves as a leading operator of nuclear power plants, we will expand this area into a profit centre and consider the acquisition of nuclear plants as they become available.” Entergy joins several other companies mulling the purchase of US nuclear plants. AmerGen, the joint venture of PECO Nuclear and British Energy, has already announced plans to buy the Three Mile Island 1 (819 MWe PWR) nuclear plant from GPU Corp. Duke Power Co has also expressed an interest in acquiring US nuclear plants.

Entergy hopes to capitalise on its reputation as an excellent operator of nuclear plants. The company currently operates five nuclear plants, with a combined capability of about 4900 MWe, at a below-industry-average cost. Meanwhile, a subsidiary, Entergy Nuclear, has offered the company’s nuclear power management expertise to other US utilities. Earlier this year, Entergy Nuclear won a contract to manage decommissioning activities at the Maine Yankee nuclear station.

One US nuclear plant that may be available for sale soon is the Clinton nuclear station in Illinois (933 MWe BWR) pictured here. Clinton is owned by Illinova Corp but it is currently being operated by a nuclear team from PECO Energy. On 4 August, Illinova CEO Charles Bayless said his company might be willing to sell Clinton to Entergy. A permanent shutdown of the plant is also a consideration, although Bayless said he hopes that does not become necessary. Clinton is expected to resume service in December after more than a two-year shutdown.



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