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JEA Board Approves Transaction with FPL to Close 848-MW Coal Unit in Georgia

LCG, June 30, 2020--The JEA Board of Directors in a special meeting last Friday unanimously approved a transaction that will result in closing an 848-MW unit at Plant Scherer and entering into a 20-year purchase power agreement (PPA) with Florida Power & Light Company (FPL).

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Analysis of Resource Adequacy in ERCOT - July - December 2020

LCG, June 30, 2020 - LCG Consulting just released its analysis of ERCOT for the second half of 2020, July through December.

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Industry News

Entergy's Palisades Nuclear Power Plant to Close in 2018

LCG, December 9, 2016--Entergy Corporation and Consumers Energy announced yesterday that they have agreed to an early termination of their power purchase agreement (PPA) for the Palisades Power Plant in 2018, when the nuclear facility will now be closed. The result is an estimated cost reduction to Consumers' customers by up to $172 million over four years. The 811-MW nuclear facility is located on the eastern shore of Lake Michigan and has been generating carbon-free electricity since December 31, 1971. The current operating license expires in 2031.

The companies entered into the original PPA in 2007, when Entergy acquired Palisades from Consumers Energy for $380 million. The PPA committed Consumers Energy to purchase nearly all of the power that Palisades generates through April 2022. Under the new plan - and given regulatory approval of the request to terminate the PPA in 2018 - Palisades will be refueled as scheduled in the spring of 2017 and operate through the end of the fuel cycle, then permanently shut down on October 1, 2018.

Market conditions have changed significantly since the original PPA was executed, and more economic alternatives are now available. The transaction is expected to result in $344 million in savings, $172 million of which is expected to lower Consumers Energy customers' costs over the early termination period from 2018 to 2022, and $172 million of which Consumers Energy will pay to Entergy for early PPA termination. The early termination payment to Entergy will provide funds for the plant's transition from operations to decommissioning.

Entergy's chairman and chief executive officer stated, "Entergy recognizes the consequences of a Palisades shutdown for our approximately 600 employees who have run the plant safely and reliably, and for the surrounding community, and we will work closely with both to provide support during the transition. We determined that a shutdown in 2018 is prudent when comparing the transaction to the business risks of continued operation."

Consumers Energy plans to ask the Michigan Public Service Commission to approve the early termination of the PPA, effective May 31, 2018. CMS and Palisades will sign a new PPA under which the plant would continue to operate until October 1, 2018. Entergy will notify the power grid operator, the Midcontinent Independent System Operator, as well as the Nuclear Regulatory Commission (NRC), of its intent to permanently shut down and decommission Palisades.
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