Exelon hopes to close its $110 million purchase of the James A. FitzPatrick Nuclear Power Plant by late March or early April, a company executive said Thursday.
Site owner Entergy had planned to permanently close the 41-year-old facility this year, but the two utilities struck a deal in August following the New York Public Service Commission’s (NYPSC) approval of Gov. Andrew Cuomo’s Clean Energy Standard, an energy subsidy program expected to pay upstate nuclear power providers $8 billion over the program’s lifetime. Exelon stands to collect on all subsidies, as it would own all upstate nuclear plants with the FitzPatrick sale.
The transaction has received approval from the Federal Energy Regulatory Commission, the Department of Justice, and the New York Public Service Commission. The Nuclear Regulatory Commission is conducting its own review.
“Everything is on track,” Exelon Generation Senior Vice President for Northeast Operations Christopher Mudrick said at the Platts Nuclear Energy Conference in Washington, D.C. “We’ve gotten all the approvals, except for the NRC license transfer, which we don’t think will be an issue at all.”
NRC spokesman Neil Sheehan said by email Friday that the agency anticipates a decision on the application in the near future. The application was submitted in August, and license transfer decisions typically take about six months, Sheehan said. Exelon has requested NRC approval by March 1.
Mudrick said the primary hurdle in the transaction is information technology integration, primarily transferring Entergy payroll and other systems to Exelon.
“That’s a bigger feat than you might think,” he said. “That’s the day one initiative. And then over the next 18 months we’ll put them on a transition plan. We have an integration plan, where teams will meet, and we’ll convert them over to our process, our procedures, fully integrate them into our fleet.”
Exelon did the same thing after its 2012 acquisition of Constellation Energy and its three nuclear power plants: R.E. Ginna Nuclear Power Plant and Nine Mile Point Nuclear Station in New York and the Calvert Cliffs Nuclear Power Plant in Maryland.
“The fact that Nine Mile Point sits right next to (FitzPatrick) should be very helpful because Nine Mile Point went through that same integration plan a few years ago, so we have a lot of resource there,” Mudrick said.
Exelon, a Chicago-based utility, operates 16 nuclear power plants across the country, making it the United States’ largest nuclear generator. Despite the weak quarter, Exelon raised its full-year earnings guidance to $2.75 per share from $2.55.
Exelon Reports 14 Percent Increase in Net Income for 2016
Exelon on Wednesday reported $2.5 billion in adjusted net income for 2016, a 14 percent increase from the $2.2 billion reported in 2015. Adjusted diluted earnings per share increased year over year from $2.49 to $2.68. Adjusted fourth-quarter net income for 2016 was recorded at $410 million, an 18 percent increase from the $347 million reported for 2015.
“2016 was a monumental year for Exelon,” President and CEO Christopher Crane said in a statement Wednesday. “We made great progress in the ongoing transformation of our company, with a focus on meeting our commitments to stakeholders via the PHI merger and the creation of the ZEC programs in both New York and Illinois that compensate our nuclear plants for their carbon-free attributes. In addition, each of our operating companies turned in best-ever performance in a range of key metrics, which would not have been possible without the remarkable contributions of our 34,000 employees that work hard every day to keep the power and gas flowing for our customers.”
