The stock market recovery over the past year has helped America’s largest government utility replenish its fund to safely dismantle a half dozen nuclear reactors in Tennessee and Alabama.
In a new regulatory filing, the Tennessee Valley Authority said its nuclear decommissioning trust again is sufficient to handle the shutdown of its Sequoyah, Watts Bar and Browns Ferry nuclear power plants over the next three decades.
“The investment results were not good during the downturn, but our nuclear decommissioning fund is now back to 100 percent,” TVA President Tom Kilgore told the agency’s board last month. “That’s real good news.”
The Nuclear Regulatory Commission, the federal agency that oversees how utilities operate and dismantle nuclear plants, said last year that TVA’s fund for dismantling its reactors fell below acceptable levels. At the time, TVA had six of the nation’s 26 nuclear reactors with insufficient decommissioning funds, NRC Economist Michael Dusaniwskyj said.
“TVA unfortunately was on that list, and in the subsequent months … we had discussions and asked questions until finally they came up with a plant that provided decommissioning assurance,” he said.
The agency has pledged to provide $15.9 million a year to its decommissioning fund, including $6 million a year for the three reactors at the Browns Ferry plant, $8.5 million for the two reactors at Sequoyah and $1.4 million for its Watts Bar plant, according to an agreement letter with the NRC.
The federal utility could lessen the annual additions if investment returns come in better than expected or if TVA gains approval for its plans to extend the operating licenses at its plants beyond their original 40-year life, Mr. Dusaniwskyj said. But TVA also will have to add more to the fund once it completes its unit 2 reactor at the Watts Bar in 2012.
Utilities that operate nuclear plants are required by law to set aside decommissioning funds to pay to dismantle and clean up nuclear sites once they are shut down. NRC spokesman David McIntyre said 10 nuclear plants have completed their decommissioning process and another 13 permanently have shut down and are in some phase of being dismantled.
Dalton Utilities, which owns 1.6 percent of the Vogtle Nuclear Plant near Waynesboro, Ga., is above the $45 million needed for its decommissioning fund, according to Dalton Utilities President Don Cope.
BY THE NUMBERS* $6.8 billion — Amount in TVA’s retirement plan, which is up from a year ago but still only 84 percent of the recommended level.* $838 million — Nuclear decommissioning trust set aside for costs of dismantling nuclear plants* $15.9 million — TVA’s annual commitment to what it will add to the nuclear fund, including $6 million a year for its Browns Ferry plant, $8.5 million for its Sequoyah plant and $1.4 million for its Watts Bar plant.
The excess funds are invested with Wachovia Bank and the Bank of New York, Mr. Cope said, and he told his board last month he wants to keep the extra funds in anticipation of additional capital costs Dalton Utilities must pay for its share of another two reactors planned at Plant Vogtle.
“In 2016, it’s our conviction that we will need another $10 million (in the decommissioning fund) as that (Unit 3) goes on line,” he said.
From the low point reached in March 2009, the Dow Jones Industrial Averages have increased by more than 70 percent, although the Dow remains more than 20 percent below its record peak reached in October 2007.
The decline and rebound in stock prices also has hit TVA’s retirement plan — one of the largest in the South.
When the market slump cut the value of TVA’s investments in 2008 and 2009, the utility’s once-rich retirement plan shrunk to $3 billion below what actuaries said it needed to meet future obligations. Aided by a $1 billion contribution last year and plans to trim cost-of-living increases, TVA’s retirement program now has about $6.8 billion, or 84 percent of the desired level.
“We’re not quite there with our retirement fund, but it’s doing better,” Mr. Kilgore said.