Fort Calhoun Closure

Congratulations to OPPD management for making the difficult decision to close Fort Calhoun. As one who has been knocking on doors and talking about OPPD policies for that past few months, I can tell you that many OPPD customers I met expressed bewilderment and concern at OPPD’s decision to invest so much money into Ft. Calhoun.

                More than a few wondered about the decision to spend so much money to bring Ft. Calhoun back on line after being forced to close it. There is no going back now, but voters should reflect on the incumbent board members who advocated for its re-opening.

                According to the management recommendation presented to the board on May 12, “This recommendation is reflective of the changing energy market landscape, the economies of scale of a small nuclear plant, and existing nuclear was not considered in the CPP.” Set aside the predictability of the Clean Power Plan for the moment.

                The poor economies of scale, i.e. the high administrative costs associated with nuclear power production for this, the smallest nuclear plant in the nation, were well known. That poor ratio was worsened with the Exelon monthly payments that began October, 2012 with a payment of $1,736,008.48 and have been around $2 million each month.

                It would be hard to describe the “changing energy market landscape” as a surprise. I noticed in Sunday’s OWH article about Fort Calhoun residents said, “…the former employee said he wasn’t surprised by the news.” In fact, according to a March 2014 Chicago Tribune news story about Exelon, OPPD’s contractor, “…Exelon's reactors in Illinois … haven't made enough money to cover operating and ongoing capital costs since 2008.” While customers might not have known this, certainly the OPPD management and board working with Exelon should have known of the poor economics when they evaluated the wisdom of investing close to $200 million and hiring this private sector firm.

                At least OPPD hasn’t been knocking on the door of the state senate, looking for handouts, like Exelon has been doing in Illinois. It’s worth thinking about that difference when you hear some argue for privatizing public utilities.

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