PPL considers third reactor at Susquehanna

14 June 2007

PPL Corp has informed the US Nuclear Regulatory Commission (NRC) that it intends to submit an application for a combined construction and operating licence (COL) for a third reactor at its Susquehanna nuclear power plant in Pennsylvania.

By pursuing a licence in this timeframe, PPL will be preserving the potential for federal production tax credits and federal loan guarantees, said James Miller, PPL's chair, President and CEO. The 2005 Energy Policy Act provides incentives for the first six new US reactors or the first 6000 MW of new generating capacity to be licensed by the NRC. A production tax credit valued at up to $125 million will be available to companies starting construction by January 2014.

PPL said that it has not yet made a decision to construct a new unit. "A decision on construction could take as long as four years given the lengthy application process," Miller said. The company estimates that if it proceeds with the licensing phase it would cost about $70 million, most of which would be incurred by the end of 2008.

Miller pointed out that PPL would not undertake nuclear construction alone. "Given the market, construction and regulatory uncertainties, along with the large capital commitment for a nuclear project, we would proceed with construction only in a joint venture arrangement," he said.

PPL has also asked PJM Interconnection, the regional power grid operator, to study the need for additional transmission lines from the Susquehanna site. This is one of many studies necessary for PPL to evaluate the feasibility of any expansion.

"This effort is just one element of the company's comprehensive plan to create options for future growth in our generating fleet," said Miller. Those options, he added, also include the acquisition or construction of coal, hydro, natural gas and renewable energy facilities.

"Given the growing concerns regarding climate change around the world and the growing need for power plants in the PJM [region], it absolutely makes sense to create this valuable option - for the electricity users in the mid-Atlantic region and for the shareowners of PPL," Miller said.

PPL owns 90% of the 2360 MWe, two-unit Susquehanna plant, with the remainder owned by Allegheny Electric Cooperative. The plant, consisting of two boiling water reactors (BWRs), is operated by PPL Susquehanna. In September 2006, PPL requested permission from the NRC to extend the operating licences of the existing Susquehanna reactors by 20 years, to 2042 and 2044, respectively.

Further information

PPL Corp

US Nuclear Regulatory Commission

WNA's US Nuclear Power Industry information paper

WNN: Usec wins $200 million PPL Susquehanna contract