Entergy Corp., owner of the Indian Point nuclear power plant in Buchanan, has approved a plan to separate their nonutility nuclear businesses into a splinter company. The company will encapsulate only the nonutility nuclear businesses of Entergy including Indian Point.
Entergy”™s board of directors decided to proceed with the creation of the company, referred to inside the corporation as SpinCo, in an attempt to expand the operations and investment abilities of the nonutilities nuclear industry.
“The board of directors”™ decision to pursue a plan to spin off the nonutility nuclear business to shareholders reflects the same commitment to shareholder value that has produced the highest return in the industry over the last nine years,” J. Wayne Leonard, Entergy”™s chairman and chief executive officer, said in a prepared statement. “The company remains on track to realize its aspiration of growing earnings $1 per share per year.”
Though their plans are early in development, Entergy hopes that the nonutilities split from the regulated facets will be under way by the third quarter of 2008. Entergy filed on July 30 with the Nuclear Regulatory Commission, seeking indirect transfer of control of the operating licenses for the non-utility nuclear fleet.
“It”™s still about nine months to a year of this happening,” said Jim Steets, manager of external communications at Indian Point, “It”™s a move that will strengthen the financial position of the regulated companies and the nonutilities.”
Once the company is formed, Entergy plans to enter into a nuclear services joint venture with SpinCo. Entergy operations will remain in place as a wholly-owned subsidiary of Entergy and will continue to be the operator of the utility nuclear plants. The joint operation is also expected to offer nuclear services, like decommissioning, plant relicensing and plant operations, to third parties like Cooper Nuclear Station in Brownville, Nebraska.
Operations, staff and regulations under the NRC at Indian Point and the other plants involved in the splinter will remain the same. Included in the splinter company are the James Fitzpatrick reactor near Oswego, N.Y., the Vermont Yankee reactor in Vernon, Vt., the Pilgrim reactor in Plymouth, Mass., and a newly acquired Palisades plant in Covert, Mich.
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