December 20, 2004
RICHMOND, Va. – Dominion (NYSE: D), one of the nation’s largest energy companies, Monday asked the Public Service Commission of Wisconsin to reconsider its decision regarding the sale of Kewaunee Nuclear Power Plant.
The commission on Nov. 19 voted 2-1 to deny the sale of Kewaunee from Wisconsin Public Service Corporation, a subsidiary of WPS Resources Corporation (NYSE: WPS), and Wisconsin Power & Light Company (WP&L), a subsidiary of Alliant Energy Corporation (NYSE: LNT), to Dominion. The commission issued its written order on Dec. 16. Dominion announced in November 2003 that it would pay $220 million in cash for the 545-megawatt single-unit station, which is located on Lake Michigan about 35 miles southeast of Green Bay.
Thos. E. Capps, Dominion chairman and chief executive officer, said:
"Throughout this process, we have remained convinced that purchasing Kewaunee is the right thing to do for both Wisconsin’s electric customers and Dominion’s shareholders. The commission spelled out three specific issues that led to its decision. We believe our action today answers those concerns."
Both WPS and WP&L joined Dominion in making the rehearing request. In its motion, Dominion said it would:
- Grant WPS and WP&L and record a right of first refusal to repurchase Kewaunee in any future sale on the same terms and conditions as another company. Through operation of the right of first refusal, the obligations assumed by Dominion would also bind subsequent purchasers of the plant. In addition, WPS and WP&L would first have to ask the Wisconsin commission whether it was prudent to exercise or waive their rights before a sale to a third party could proceed.
- Return to WPS and WP&L, for distribution to their customers, any excess ratepayer funds contained in the qualified decommissioning trust fund upon final completion of all decommissioning activities at the power station.
- Increase the total level of guaranties of Dominion Energy Kewaunee, the Dominion unit that will own and operate the power station, to WPS and WP&L.
"The grant of the [right of first refusal], and the exercise or waiver of [WPS’s and WP&L’s] rights thereunder, will provide the Commission a mechanism for the review of all subsequent sales of [the power station]. By requiring successive buyers … to agree to be bound by the Proffered Conditions, including the [right of first refusal], the Commission is assured of a 'meaningful role' in all future sales of the plant," Dominion said in its request for a rehearing.
The three new conditions are being added to seven already introduced as a part of the previous filing. These seven included assurances that the commission would have approval regarding the creditworthiness of a subsequent owner and that there would be a prohibition of storing nuclear waste at Kewaunee from any other source.
The proposed sale has received significant support from station employees, electric customers, community organizations, lawmakers and many local governments. All other regulatory bodies, including the U.S. Nuclear Regulatory Commission, have approved the sale.
Dominion is one of the nation's largest producers of energy, with an energy portfolio of about 25,500 megawatts of generation, 6.4 trillion cubic feet equivalent of proved natural gas reserves and 7,900 miles of natural gas transmission pipeline. Dominion also operates the nation's largest underground natural gas storage system with more than 960 billion cubic feet of storage capacity and serves retail energy customers in eight states. For more information about Dominion, visit the company's Web site at www.dom.com.