Ameren scrap plans for second Callaway reactor
Energize Weekly, August 5, 2015
Noting declining costs for alternative generation and nonexistent load growth, Ameren officials confirmed this week that they have pulled the plug on plans to build a second reactor at its Callaway nuclear power plant in Missouri.
Ameren CEO Warner Baxter cited in a conference call with analysts “our assessment of long term capacity needs, declining costs of alternative generating technologies and the regulatory framework in Missouri,” as some of the reasons behind the decision.
“We continue to believe nuclear power must be an important, clean energy source for our company and country as evidenced by the 20-year license extension we received this past March for our Callaway Energy Center,” he said.
The move comes seven years after Ameren filed its application with the U.S. Nuclear Regulatory Commission to build the reactor. The project was plagued with cost issues, with Ameren going so far as to petition state lawmakers to overturn a 40-year old ban on billing customers while construction is in progress so it could secure financing for the reactor. That effort ultimately failed, while an attempt to build a small modular reactor (SMR) with Westinghouse also was abandoned in 2013 after the company was passed over for a series of federal grants.
Earnings for Ameren were weak this quarter, with the company generating $141 million in net income compared to $150 million at the same time last year. Baxter cited weak electricity sales due to mild weather for driving the earnings lower than last year, along with “seasonal rate redesign and variances in the timing of revenue recognition.” Baxter said these effects are expected to reverse over the remainder of the year.
Baxter also said that the company intends to reduce its reliance on coal-fired power plants by retiring a third of its coal fleet by 2034, and adding about 500 megawatts (MW) of wind and gas-fired generation. Coal accounts for 76 percent of Ameren’s generation mix, followed by nuclear at 21 percent.