EnergySolutions on Tuesday said it had sealed the deal for acquisition of reactor Unit 2 (TMI-2) at the Three Mile Island nuclear power plant in Pennsylvania, which famously partially melted down 40 years ago.
Under the newly signed contract, the Salt Lake City-based nuclear services firm will buy TMI-2’s assets and obtain its licenses from reactor owner FirstEnergy Corp. It would then be in charge of decommissioning the reactor via a subsidiary, TMI-2 Solutions.
This would make EnergySolutions the third major player in a suddenly popular model for dealing with retired U.S. nuclear power plants – the operator turns over all responsibility for decommissioning, spent fuel management, and site restoration to a new owner, which also acquires a cleanup fund worth hundreds of millions of dollars.
The U.S. Nuclear Regulatory Commission and New Jersey Board of Public Utilities will have to sign off on the TMI-2 ownership transfer, according to an EnergySolutions press release. New Jersey is involved because Jersey Central Power & Light is one of several FirstEnergy subsidiaries with a stake in the Harrisburg-area reactor.
“We expect to file for required approvals and license transfer before the end of 2019, with the final transfer of the property expected to take place in the second half of 2020,” FirstEnergy spokeswoman Jennifer Young said by email Thursday.
The companies first announced the pending deal in July. Terms of the sale, along with the anticipated schedule for decommissioning under EnergySolutions, were not made public this week.
FirstEnergy’s current decommissioning schedule has work starting in 2041 and wrapping up by 2053. It will be up to the new owner to decide whether to revise that timeline, Young said. EnergySolutions declined to comment on Thursday.
Unit 2 never resumed operations following its partial meltdown and small radiation release in March 1979 after a few months of operations. Ninety-nine percent of its nuclear fuel was shipped in the 1980s for storage at the Department of Energy’s Idaho National Laboratory, where it remains. The reactor itself has been in post-defueling monitored storage mode for 26 years.
Reactor Unit 1 at Three Mile Island continued to provide power until Sept. 20, when it was retired by owner Exelon. The Chicago-based power provider has said it intends to retain ownership of the reactor, putting off the start of active decommissioning until the 2070s.
EnergySolutions will partner with New Jersey construction company Jingoli for decommissioning Unit 2, under the ES/Jingoli Decommissioning joint venture.
The company is conducting or preparing for nuclear power plant decommissioning projects under separate business models. In a joint venture with AECOM, it is a hired contractor for the upcoming cleanup of two reactors at the San Onofre Nuclear Generating Station (SONGS) in California. EnergySolutions in April completed the contract to decommission the Southwest Experimental Fast-Oxide Reactor in Arkansas.
Two EnergySolutions subsidiaries expect next spring to complete decommissioning of the Zion nuclear power plant in Illinois and La Crosse Boiling Water Reactor in Wisconsin. For those jobs, the subsidiaries assumed the plant licenses, but will return them to the owners when decommissioning is complete.
Three U.S. nuclear power plants have been sold in the last year to separate decommissioning providers: Entergy’s Vermont Yankee site to demolition company NorthStar Group Services; plus Exelon’s Oyster Creek Nuclear Generating Station in New Jersey and Entergy’s Pilgrim Nuclear Power Station in Massachusetts to Holtec International. Holtec, a New Jersey-based energy technology company, plans to buy additional facilities in Michigan and New York state.
Accelerated Decommissioning Partners, a partnership of NorthStar Group Services and the U.S. branch of French nuclear firm Orano, is also pursuing business in this area. Its first major contract, for decommissioning Duke Energy’s retired Crystal River plant in Florida, does not involve taking ownership of the property.
NorthStar Group Services paid a nominal $1,000 for Vermont Yankee. Terms of the other sales have not been released, but they are likely to follow the same approach. The central source of potential profit would be money left in the trusts after decommissioning is complete.
For the companies and other advocates of this business model, the upside is clear: Expedited remediation of radioactively contaminated facilities, generally within a decade, that otherwise could remain in place for decades. Removing that contamination opens the door for other uses for the properties, and it strengthens the case for building new nuclear power plants, said Rod McCullum, senior director for used fuel and decommissioning at the Nuclear Energy Institute industry trade association.
Residents near the impacted communities, plus local and state officials, have not uniformly been as enthusiastic. One concern raised for most of the projects is ensuring the new owners won’t run out of money and abandon a site before decommissioning is complete. In approving the Vermont Yankee sale, the NRC required Entergy and NorthStar to establish several additional financial backstops to ensure completion. Meanwhile, the Massachusetts Attorney General’s Office sued the NRC last month for approving the license transfer for Pilgrim before ruling on the commonwealth’s petition for a hearing on the application.
Holtec has faced scrutiny resulting from problems in its job as the hired contractor for transferring used fuel to dry storage at San Onofre. Most prominently, the fuel offload was halted for nearly a year after one canister was left at risk of an 18-foot drop into its storage slot in August 2018. Observers have also questioned its choice for a partner in the reactor decommissioning projects, Canadian engineering firm SNC-Lavalin, which has been embroiled in a bribery scandal at home.
“It’s been one incident after another” at SONGS, Gary Headrick, founder of the advocacy group San Clemente Green, said Thursday during a NRC meeting Thursday on Holtec’s pending application to acquire the Indian Point Energy Center in Buchanan, N.Y. “They make is feel like we’re an experiment at San Onofre.”
Holtec executives at the meeting emphasized the company’s technical capabilities to carry out an efficient decommissioning, but did not directly address concerns raised by Headrick and other callers.
McCullum played down the likelihood that any company would simply walk away from an unfinished decommissioning job. That would essentially destroy any chance of picking up future work, he said. The company would also still own the NRC license, which would open it up to fines and even prison sentences for violating federal nuclear regulations, McCullum added.
“As long as you hold the NRC license you are accountable,” he said.
There is room for growth in this business model and potentially new participants, McCullum said. He noted AECOM’s role in decommissioning at San Onofre, but said he could not speculate on which companies might aim to buy properties and which might choose to work as subcontractors to those buyers.
AECOM, the Los Angeles-based engineering and infrastructure multinational, this week announced it would sell its Management Services business to two investment firms. That branch of the company’s manages its commercial decommissioning work.
Five U.S. additional nuclear power plants are scheduled to close by 2025, according to the Energy Information Administration. But McCullum said the greatest opportunities might be on the international market. Just 19 of the 181 retired power reactors around the world have been decommissioned, according to one new report on the industry.
“I think they continue to build their businesses here and then they look internationally,” McCullum said.
