Changes to a state bill that would have allowed AmerenUE to charge customers during the construction of a second nuclear plant at Callaway in Missouri last week prompted the company to pull the plug on the $6 billion project.
AmerenUE, the Missouri operating subsidiary of Ameren Corp., cited “financial and regulatory certainty before beginning construction of the plant” for its decision. It said in a press release that that the current version of the Missouri Clean and Renewable Energy Construction Act (SB228/HB554) being debated in the Senate “strips the legislation of the very provision [it] needed most to move forward.” It also said that it had asked the legislative sponsors of the bills to withdraw the provisions from consideration by the General Assembly.
“We want to thank the visionary leadership in both the Missouri House and Senate, where this legislation won strong initial support in committees in both bodies,” said AmerenUE President and CEO Thomas R. Voss. “Many representatives and senators understood the need for acting now to secure Missouri’s energy independence and security, agreeing with us that allowing these funding mechanisms is best for Missouri.”
The bills, as originally proposed, would have allowed regulators to authorize funding mechanisms for construction of clean energy plants in Missouri, including AmerenUE’s project in Callaway. A key element of the legislation is a funding plan known as Construction Work in Progress (CWIP), used widely across the U.S., to allow utilities to recover financing costs from customers while building a new plant.
But current Missouri law prevents Missouri investor-owned utilities from recovering any plant development costs until an energy plant is operating, the company said.
“A large plant would be difficult to finance under the best of conditions, but in today’s credit constrained markets, without supportive state energy policies, we believe getting financial backing for these projects is impossible,” Voss noted. “Pursuing the legislation in its current form will not give us the financial and regulatory certainty we need to complete this project.”
AmerenUE submitted its application to the Nuclear Regulatory Commission for the combined construction and operating license (COL) for a new AREVA EPR, a 1,600-MW reactor, alongside its two existing units at Callaway in July last year. The company has not announced changes to its COL application.
Since 2007, the NRC has received and is reviewing 17 applications for 26 new reactors, including Callaway.