The Pilgrim Nuclear Power Station, the sole nuclear power plant in Massachusetts, will close by June 2019, according to its owner Entergy Corp.
Entergy is an integrated energy company headquartered in New Orleans, Louisiana. Entergy is one of the leading nuclear generators in the U.S., with nearly 10,000 megawatts in nuclear generating capacity as well as about 20,000 megawatts of other electric generating capacity, as well as serving retail utility customers in
Arkansas, Louisiana, Mississippi and Texas.
The company's Entergy Wholesale Commodities business owns and operates five nuclear power units located in the northern United States, and sells
electricity produced by those plants to wholesale customers. Those units include Pilgrim Station's Unit 1, a boiling water reactor with a maximum dependable capacity of 688 megawatts. The Pilgrim Station unit was installed in 1972, and is currently licensed through June 8, 2032.
Today Entergy announced plans to close Pilgrim Station by June 2019. In its press release, Entergy cites "poor market conditions, reduced revenues and increased operational costs." In Entergy's view, low current and forecast wholesale energy prices "brought about
by record low natural gas prices, driven by shale gas production" hurt Pilgrim's revenues; wholesale energy market design flaws mean merchant nuclear power plants are inadequately compensated, while "unfavorable state
energy proposals ... subsidize renewable energy resources at the
expense of Pilgrim and other plants." Entergy also cites "increased operational costs and enhanced Nuclear
Regulatory Commission oversight" following a recent NRC decision to give Pilgrim a higher level of scrutiny.
The announcement resembles a 2013 decision by Entergy to close the Vermont Yankee Nuclear Power Station, a plant similar in vintage to Pilgrim Station. Entergy announced Vermont Yankee's closure in 2013; that plant ceased commercial operation at the end of 2014, and Vermont Yankee's decommissioning is now underway. In announcing the Vermont Yankee closure, Entergy pointed to 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", high plant cost structures, and wholesale market design flaws.
According to Entergy, it has notified regional electric grid operator ISO New England Inc. of its intent to exit the region's capacity market. Entergy said the exact timing of plant shutdown will be decided in the first half of 2016.