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Feb 20, 2003 to Feb 6, 2013

Entergy Press Release on Closing VY


NEW ORLEANS, Aug. 27, 2013 /PRNewswire/ -- Entergy Corporation (NYSE: ETR) today said it plans to close and decommission its Vermont Yankee Nuclear Power Station in Vernon, Vt. The station is expected to cease power production after its current fuel cycle and move to safe shutdown in the fourth quarter of 2014. The station will remain under the oversight of the Nuclear Regulatory Commission throughout the decommissioning process.

"This was an agonizing decision and an extremely tough call for us," said Leo Denault, Entergy's chairman and chief executive officer. "Vermont Yankee has an immensely talented, dedicated and loyal workforce, and a solid base of support among many in the community. We recognize that closing the plant on this schedule was not the outcome they had hoped for, but we have reluctantly concluded that it is the appropriate action for us to take under the circumstances."

The decision to close Vermont Yankee in 2014 was based on a number of financial factors, including:

-- A natural gas market that has undergone a transformational shift in supply due to the impacts of shale gas, resulting in sustained low natural gas prices and wholesale energy prices.

-- A high cost structure for this single unit plant. Since 2002, the company has invested more than $400 million in the safe and reliable operation of the facility. In addition, the financial impact of cumulative regulation is especially challenging to a small plant in these market conditions.

-- Wholesale market design flaws that continue to result in artificially low energy and capacity prices in the region, and do not provide adequate compensation to merchant nuclear plants for the fuel diversity benefits they provide.

Making the decision now and operating through the fourth quarter of 2014 allows time to duly and properly plan for a safe and orderly shutdown and prepare filings with the NRC regarding shutdown and decommissioning. Entergy will establish a decommissioning planning organization responsible for planning and executing the safe and efficient decommissioning of the facility. Once the plant is shut down, workers will de-fuel the reactor and place the plant into SAFSTOR, a process whereby a nuclear facility is placed and maintained in a condition that allows it to be safely secured, monitored and stored.

"We are committed to the safe and reliable operation of Vermont Yankee until shutdown, followed by a safe, orderly and environmentally responsible decommissioning process," Denault said.

Commenting on the future of nuclear power, Denault said: "Entergy remains committed to nuclear as an important long-term component of its generating portfolio. Nuclear energy is safe, reliable, carbon-free and contributes to supply diversity and energy security as part of a balanced energy portfolio."

Financial Implications

Entergy plans to recognize an after-tax impairment charge of approximately $181 million in the third quarter of 2013 related to the decision to shut down the plant at the end of this current operating cycle. In addition to this initial charge, Entergy expects to recognize charges totaling approximately $55 to $60 million associated with future severance and employee retention costs through the end of next year. These charges will be classified as special items, and therefore, excluded from operational results.

The company noted that the estimated operational earnings contribution from Vermont Yankee was expected to be around breakeven in 2013, and generally declining over the next few years. As a result of this decision and based on continuing operations into fourth quarter 2014, the estimated operational earnings change, excluding these special items, is expected to be modestly accretive within two years after shutdown, and cash flow is expected to increase approximately $150 to $200 million in total through 2017, compared to Vermont Yankee's continued operation.

Regarding decommissioning, assuming end of operations in fourth quarter 2014, the amount required to meet the NRC minimum for decommissioning financial assurance for license termination is $566 million. The Vermont Yankee decommissioning trust had a balance of approximately $582 million as of July 31, 2013, excluding the $40 million guarantee by Entergy Corporation to satisfy NRC requirements following the 2009 review of financial assurance levels. Filings with the NRC for planned shutdown activities will determine whether any other financial assurance may be required and will specifically address funding for spent fuel management, which will be required until the federal government takes possession of the fuel and removes it from the site, per its current obligations.

Vermont Yankee, a single unit boiling water reactor, began commercial operation in 1972. Entergy acquired the plant from Vermont Yankee Nuclear Power Corporation in 2002. In March 2011, the NRC renewed the station's operating license for an additional 20 years, until 2032.

Additional information regarding today's announcement is available in the Frequently Asked Questions section of www.entergy.com.

Entergy Corporation, which celebrates its 100th birthday this year, is an integrated energy company engaged primarily in electric power production and retail distribution operations. Entergy owns and operates power plants with approximately 30,000 megawatts of electric generating capacity, including more than 10,000 megawatts of nuclear power, making it one of the nation's leading nuclear generators. Entergy delivers electricity to 2.8 million utility customers in Arkansas, Louisiana, Mississippi and Texas.

Additional information can be accessed online at

www.entergy.com.

In this news release, and from time to time, Entergy makes certain "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Except to the extent required by the federal securities laws, Entergy undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Forward-looking statements involve a number of risks and uncertainties. There are factors that could cause actual results to differ materially from those expressed or implied in the forward-looking statements, including (a) those factors discussed in this release and in: (i) Entergy's Form 10-K for the year ended Dec. 31, 2012, (ii) Entergy's Form 10-Q for the quarters ended March 31, 2013 and June 30, 2013 and (iii) Entergy's other reports and filings made under the Securities Exchange Act of 1934; (b) uncertainties associated with rate proceedings, formula rate plans and other cost recovery mechanisms; (c) uncertainties associated with efforts to remediate the effects of major storms and recover related restoration costs; (d) nuclear plant relicensing, operating and regulatory risks, including any changes resulting from the nuclear crisis in Japan following its catastrophic earthquake and tsunami; (e) legislative and regulatory actions and risks and uncertainties associated with claims or litigation by or against Entergy and its subsidiaries; (f) conditions in commodity and capital markets during the periods covered by the forward-looking statements, in addition to other factors described elsewhere in this release and subsequent securities filings and (g) risks inherent in the proposed spin-off and subsequent merger of Entergy's electric transmission business with a subsidiary of ITC Holdings Corp. Entergy cannot provide any assurances that the spin-off and merger transaction will be completed and cannot give any assurance as to the terms on which such transaction will be consummated. The spin-off and merger transaction is subject to certain conditions precedent, including regulatory approvals.

SOURCE Entergy Corporation

/CONTACT: Media Relations, (802) 258-2143,(802) 258-2144, mburns@entergy.com, or Paula Waters (Investor Relations), (504) 576-4380, pwater1@entergy.com

/Web site: http://www.entergy.com

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I'm hearing that Entergy sent

I'm hearing that Entergy sent out this press release before it had told it's employees they would be losing their jobs. If that's true it's a pretty despicable way to treat the people that have been loyal to you for years.
But, I'm not surprised. It's always been about the dollars -not the people.

 
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Low power costs

Interesting that low power costs in the marketplace are cited as a reason for closing. One promise of nuclear energy was that it would be an extremely low cost energy source.

The news is a bit shocking, though not entirely unexpected. I'm glad that it was a company decision and not a legal recourse. I'm sorry for employees that were surprised by this news and hope the company has plans in place to ease the transition. Brattleboro is experiencing a bit of an uptick, it seems, so perhaps new opportunities will in place.

Looks like employees will be shifted about, but many will be needed for the lengthy decommissioning process.

This is a moment many have been looking forward to, and one many have been dreading. Now we get to move into a new phase of discussions about impacts on the community.

 
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Bloomberg has a good story

Bloomberg news has a good story on the closing:

“The plant was no longer financially viable,” Entergy Chairman and Chief Executive Officer Leo Denault said in a phone interview. “We did everything we could to try and keep this plant open from a financial standpoint. That’s why we fought the battles we fought legally.”

Vermont Yankee is the fifth U.S. nuclear reactor this year to announce plans to permanently close, the highest-ever annual total, as power prices have slumped amid booming gas production. Reactors also face higher maintenance costs from stricter regulations following Japan’s 2011 Fukushima nuclear disaster. Nuclear units in New Jersey, California, Wisconsin and Florida are being shut, reducing the U.S. total to 99 from 104.

The story says closing VY will increase our reliance on gas.

 
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Decommissioning: DECON or SAFSTOR?

According to one newsfeed http://www.sys-con.com/node/2769498

"Once the plant is shut down, workers will de-fuel the reactor and place the plant into SAFSTOR, a process whereby a nuclear facility is placed and maintained in a condition that allows it to be safely secured, monitored and stored."

SAFSTOR would delay reuse of the plant site for up to 80 years and withhold the benefits of work crews doing decommissioning work soon after closure.

Reference:
http://www.nrc.gov/reading-rm/doc-collections/fact-sheets/decommissionin...

 
 #

Poetic Justice

That would be sweet. I would love to see Entergy follow through on their promise to Montepeculiar, a few years ago,that decommisioning would not start until every last penny was raised in the fund.

And with our current economy that fund may be losing interest. I would love to see Entergy pull the plug and just leave the facility sitting there for years with an idle reactor in limbo.

 
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Benefits?

Abd how would that benefit anybody, including you?

 
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Promises, promises

*** I would love to see Entergy follow through on their promise***
There's no telling what they might do. They might even start keeping their promises.

 

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