ML20136E818

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Discusses 1995 4th Quarter Losses of Listed Amount by Neut
ML20136E818
Person / Time
Site: Millstone  Dominion icon.png
Issue date: 01/28/1997
From: Blanch P
AFFILIATION NOT ASSIGNED
To: Zwolinski J
NRC (Affiliation Not Assigned)
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ML20136C110 List:
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NUDOCS 9703130333
Download: ML20136E818 (7)
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fQ SN From PAUL BLANCH <PMBLANCH9ix.netcom.com> '

, To: WND2.WNP3(jaz)

] Date: 1/28/97 5:20pm i subject: r news 1

- NU REPORTS YEAR-END RESULTS l HARTFORD, Connecticut, January-28, 1997-Northeast Utilities

(NU) today reported a fourth-quarter loss of $76.4 million, or 4

60 cents a share, -compared with not income of $64.2 million, or 50 cents a share, in the fourth quarter of 1995.

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For the year, NU's unaudited results showed net income of-1- $1.8 million. or 1 centia share, compared with net income of-4 $282.4 million, or- $2.24 a share, in 1995.

1 Bernard M. Fox,;NU chairman and chief executive officer, attributed the weak fourth-quarter and year-end results

, primarily to the ongoing shutdowns of-the three nuclear power plants at Millstone Station in Waterford, Connecticut.  !

Primarily because of work undertaken to return the Millstone

, units to service, NU's non-fuel operation and maintenance (O&M) costs were $1.57 billion in 1996, compared with'$1.25 billion-

+. in 1995. Also, NU's fuel and pu.rchased power costs rose-to

, $1.14 billion' fin 1996, compared with $909 million in'1995, j- primarily because of the- need to replace the power those units-produce; A late-year increase in oil prices.added to those costs,.but those prices have abated in recent weeks.

Fox said the 1996 OEM figures include a $63 million accounting- reserve. to help pay for 1997 expenditures related to the company's nuclear program. . NU's nuclear expense in 1996, including the $63'million reserve, was about $620 million.

. Nuclear O&M expense to be reflected on the 1997 income r statement is expected tx) total about $600 million.

-Fox said the company expects to-operate on a roughly

-break-even basis in 1997 while'the three Millstone units are off line. None of the three units can resume operations until the Nuclear Regulatory Commission for mally votes to permit restart. NU currently expects at least one Millstone unit to begin operation in the ,

second half of 1997, but not until after the summer peak l electric demand season is over. l

Fox said factors hurting fourth-quarter results included
  • Replacement power costs for nuclear plant outages ($127 million, or 58 cents a share)
  • Higher nuclear O&M, including the

- addition of $23 million to reserves in the fourth quarter to

cover 1997 expenditures ($55 million, or 25 cents a share) a n y'1 O 7"I j 9703130333 970306 PDR ORG NRRA l PDR l

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  • Storm damage not covered by insurance ($15 million, or 7 cents a share)
  • A rate settlement approved by Connecticut regulators in July 1996 ($10 million, or 5 l cents a share)
  • Expenditures to ensure that Connecticut l l has adequate generation to serve peak electric demand

($8 million, or 4 cents a share)

For the year, the additional costs related to buying ,

replacement power, improving operations at the Millstone.

plants, creating the $63 million reserve, and ensuring that ]

i Connecticut has adequate generating supplies totaled l approximately $495 million and reduced earnings by $2.27 a l share.

! . Fox said those costs were only partially offset by higher l retail sales and lower financing costs. Despite cool weather in July and warm weather in December, retail sales were up 1.6 L percent for the year, 2.4 percent on a weather-adjusted basis.

Ongoing debt reduction and refinancing efforts lowered interest costs.on long-term debt by more than $30 million in 1996 and preferred dividends by about $5.5 million.

Also today, the NU Board of Trustees approved a common dividend of 25 cents a share, payable March 31, 1997 to shareholders of record March 1, 1997.

Fox said the Board will continue to review the dividend quarterly.

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l December 12, 1996 gg{

j .NEAC Meeting'

! Waterford Town Hall L i S.O.S

.My name is Charlie Luxton. I live at 180 Great Neck Rd. in Waterford, CP . , approximately 1.5 miles downwind, of the ,

Millstone Nuclear Power Complex. l I appreciate the~ opportunity to speak this evening. Several

-issues,are on-my mind tonight. The recent changes at the NRC, the continuing' managerial situation at Northeast Utilities, and the net effect of this situation on Connecticut's ratepayers are

,' all important considerations.

Since August of 1995, my wife and I have devoted considerable time and energy to finding the truth behind the diverse and

l l

l confusing matters which have brought us together this-evening.

l To our. dismay, this search revealed time and. time again the i

failings.of both the NRC and Northeast Utilities. It is no

! longer necessary to list in detail all their wrongdoing., At this point, such information should be well known to everyone

'here. . That the NRC has been guilty of promoting the industry at' l the expense of public safety is documented.

l That the-Utility has compromised our health for its own economic .!

l well being is known. These transgressions against the public '

are deplorable. Now we.should ask, how can we be assured such crimes will not be repeated. My answer is, and I hope you-will come to the same conclusion, through ACCOUNTABILITY !

Sadly, both the NRC and NU seem to be doing their best to avoid this consequence. Ibr. Kenyon and Dr. Shirley Jackson have j maneuvered .recently in strikingly similar fashion. Their i formula: Reorganize, scapegoat a few individuals, claim you've  !

learned your lessons, and move on. Such a transparent process 4 sets the. stage for a repeat performance, and my family is still  :

in harm's way. I Why are we not demanding an investigation into the actions.of those individuals under whose leadership and direction the NRC was allowed to become a pitifully inept and irresponsible regulator? Why, instead, do we shower them with praise as they leave? Why are we not demanding to know exactly which  ;

individuals, throughout the agency, contributed to its failure?

j Why do we allow the NRC to misuse the legal system where they  ;

bury issues and defer judgments indefinitely. )

Why is Mr. Bernard' Fox still CEO of Northeast-Utilities? Why is there no scrutiny of the Board of Trustees at NU? Why is.Mr.

Opeka not questioned for his involvement? Why does NU reward 1 Mr. Busch with more than a million dollars if indeed he was part of the problem. And if the Grant report is correct, why are we not investigating "line management at NU", each and every individual, for the part they played in putting the public at risk? Criminal activity has taken place here.  !

I suggest that before.we " move on", we see to it that justice is served first. My family was'placed at risk. I want to know by whom, and I~want those individuals held accountable.

Additionally, I hope that this Committee will be ever vigilant as we enter into the. era of deregulation,," stranded costs", and requestssto the DPUC for rate _ hikes associated with the current shut downs. Northeast Utilities has proven itself to be a corporate entity with no soul, no sense of ethics, and no regard for anything other than the bottom line. I have no doubt that NU will use every tactic, every dirty trick, every Machiavellian g~ ploy possible, to~make its ratepayers the financial fall guys.

i I know the powers and responsibilities of your committee are

-limited, but please, do everything you can. The cards are i stacked against us and the dealer has a gun. HELP !

S fO~

f l

Connecticut Yankee may set standard for nuke closings THE DAY, TUESDAY, JANUARY 28, 1997 Dispute over NRC guidelines could establish precedent By PAUL CHOINIERE Day Staff Writer.

Haddam - Connecticut Yankee could become ground zero in the fight over how the. nation should handle the decommissioning of its nuclear plants.

Connecticut Yankee Nuclear Power Station will be the first to go through the shutdown and dismantlement process.under a new set of federal Nuclear Regulatory Commission guidelines. Some groups contend the guidelines prevent the public from participating in the process.

The NRC feels they are sufficient to protect public safety .

The dispute.could very well end up in court. The outcome will set a precedent for how decommissioning of nuclear plants is handled over the next decade and there are indications there could be a lot of decommissioning.

l In January 1993 the investment house Shearson-Lehman Brothers predicted in a report on utility stocks that there could be a rash of closings, with'as many as 25 of the country's 110 nuclear plants shutting down by the close of the decade.

Since that report, both the Yankee Rowe plant in Rowe, Mass., and

,. now I

Connecticut Yankee, located on the banks of the Connecticut River here, have closed. The aging of the nation's nuclear plants, combined with the pressure to cut costs because of deregulation and increased competition,.will force many more plants to close, said Paul Gunter, director of the Reactor Watchdog Project, based in Washington, D.C.

.The likelihood of more closings makes what happens at connecticut i Yankee important, said Gunter. It also suggests that the

j. decommissioning process at l Connecticut Yankee will be a continuous and prolonged one.

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, 1 Northeast Utilities owns 49 percent of Connecticut Yankee, with seven other utilities making up the other 51 percent ownership. i The owners voted in ,

December to shut'the plant down for good, concluding it was l cheaper to buy energy on the spot market than to generate it at a l nuclear plant _that opened in l 1968.

The major issue dividing the NRC from its critics is the method of decommissioning. NRC regulations allow two types: " safe store," in which a plant is closed down and radiation levels  !

allowed to decay over several decades before the plant is  !

dismantled; or "immediate dismantlement," in which-the company over a few years removes all equipment from the plant and brings it to a low-level 1 radioactive waste dump for disposal.

The agency finds both options acceptable. If a utility submits a i plan for either option, and it meets all the criteria, then a company can go forward without any type of public hearing.

Groups like the Reactor Watchdog Project and the Citizens Awareness Network contend that the safe store plan is by far the better option. Immediate dismantlement forces workers to deal with equipment that has high levels of radiation contamination, said Rosemary Bassilakis of Haddam, director of the Citizens Awareness Network.

It also increases the chance of public exposure to radiation as the equipment is transported from the plant for disposal, Bassilakis said. At Connecticut Yankee large components may be transported by barge on the .

Connecticut River, the way they arrived.

Supporters of the safe store option are seeking a public hearing at which the two options can be debated and testimony presented.

Gunter said there is a "very strong likelihood" that the debate will end up in federal Court.

Attorney Jonathan Block of Putney, Vt., who represents the Citizens Awareness Network, said the new NRC rule that eliminates the public hearing process violates both the Atomic Energy Act and provisions of the U.S. Constitution.

NU has not made a final decision on which method to use, but its

~$425 million decommissioning estimate is based on immediate dismantlement, according to Anthony E. Nericcio, a spokesman for NU. Utility companies have an incentive to move forward with decommissioning. When a utility dismantles and removes a nuclear plant, it removes a degree of uncertainty. Property tax costs are reduced and the site becomes available for other uses.

A plant that remains in safe store is not only an ongoing expense

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I to maintain, but a liability-because of the potential for an i accident. There is also the chance some future problem could

( arise that is not currently foreseen.

i l Citizens Awareness Network also fought the decommissioning process at Yankee Rowe. The group filed a federal court action when dismantlement began without a public hearing. On July 20, 1995, the U.S. l Court of Appeals for the First circuit ruled in favor of the group and criticized the NRC for not following its own process, which then called for a hearing.

Block was the attorney for the Citizens Awareness Network in that case.

Since that ruling the NRC amended its rules to eliminate the public hearing requirement.

l l . Block said many Connecticut residents no longer trust the NRC or j NU because of the problems at the Millstone plants in Waterford, as well as those at Connecticut Yankee. NU has failed in its management of the I state's nuclear plants, and the NRC has failed in its job of regulating them, he said.

The public is not about to now allow the same company and regulator =to handle a decommissioning without public input, Block said.

l l "There is tremendous local support in Connecticut for challenging this," he added. "We did it before (at Yankee Rowe) and we'll do it again if we have to."

Paul; l

l Please put~this out as.it reflects just how bad things are at NU in that we can't put anything in writing any more and are chastised for reporting issues. The clear message is that you better not ever document your concerns. You are not a team player!

, Thanks, XXXXXXXXX From: XXXXXXXXXXXXXX9GWSMTP.NU.COM>

To:

Subject:

Expectations on Professionalism in Written Documentation L Mime-Version: 1.0 Content-Type: text / plain Content-Disposition: inline

! Please keep your emotions out of permanent plant paperwork. We l had one example of unprofessional conduct in engineering last i week and two additional instances were noted by Denny today in

ACR's:

"Six months ago, this issue was discussed with the department responsible for this procedure and still has not been revised" l

"If operations was concerned about temperature rise, why was the equiptment tagged out of service and the AWo released for l work?"

l Verbal discussions with the involved individuals is certainly appropriate, however documentation of such items in permanent l plant records is inappropriate.

l Thanks for your thoughtful consideration of these issues.

XXX l

l l

l l

. Paul M. Blanch Energy Consultant 135 Hyde Rd.

l West Hartford CT 06117 l Tel: 860-236-0326 Fax: 860-232-9350 l

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