Three Mile Island owner threatens to close ill-fated plant

HARRISBURG, Pa. -- Cheap natural gas could do what the worst commercial nuclear-power accident in U.S. history could not: put Three Mile Island out of business.

Three Mile Island's owner, Exelon Corp., announced Tuesday the plant that was the site of a partial meltdown in 1979 will close in 2019 unless the state of Pennsylvania comes to its financial rescue.

The plant, along with other nuclear-power installations around the U.S., has struggled to compete in an electricity market booming with inexpensive gas.

The Chicago-based energy company's announcement came after what it called more than five years of losses at the single-reactor plant and Three Mile Island's recent failure to be selected as a guaranteed supplier of power to the regional electric grid.

Exelon wants Pennsylvania to give nuclear power the preferential treatment and premium payments that are extended to renewable forms of energy, such as wind and solar. It has not said how much it wants.

Pennsylvania Gov. Tom Wolf has made no commitment to a bailout but said Tuesday he is concerned about layoffs at Three Mile Island and open to discussions. Exelon employs 675 people at the plant.

So-called nuclear bailouts have won approval in Illinois and New York, but the potential for higher utility bills in Pennsylvania is generating resistance from rival energy companies, manufacturers and consumer advocates.

Exelon and other nuclear-plant owners have made the pitch to states that such installations are big employers and sources of tax revenue, and their zero-carbon energy can help fight climate change better than gas or coal.

"Like New York and Illinois before it, the commonwealth has an opportunity to take a leadership role by implementing a policy solution to preserve its nuclear-energy facilities and the clean, reliable energy and good-paying jobs they provide," Chris Crane, Exelon president and CEO, said.

In December, Illinois approved $235 million a year for Exelon to prop up nuclear plants in the Quad Cities and Clinton, six months after the company threatened to shut them down.

Around the U.S., nuclear plants have been hammered by the natural gas boom that has slashed electricity prices in competitive markets.

FirstEnergy Corp. has said it could decide next year to sell or close its three nuclear plants -- Davis-Besse and Perry in Ohio and Beaver Valley in Pennsylvania. PSEG of New Jersey, which owns all or parts of four nuclear plants, has said it won't operate ones that are long-term money losers.

Three Mile Island's license does not expire until 2034.

Built during a golden age for nuclear power, Three Mile Island's Unit 1 went online in 1974 and Unit 2 in 1978, coughing steam into the air above its sliver of land in the Susquehanna River, about 10 miles from Harrisburg.

In March 1979, equipment failure and operator errors led to a partial core meltdown of Unit 2, leading to several days of fear and prompting an estimated 144,000 people to flee their homes amid conflicting or ill-informed information from utility and government officials.

Scientists worried at one point that a hydrogen bubble forming inside the reactor would explode with catastrophic consequences.

Scientists have come to no firm conclusion about the health effects or the amount of radiation released, though government scientists have said the maximum individual dosage was not enough to cause health problems.

Regardless, the accident had a powerful effect, undermining support for nuclear power. No nuclear plant that was proposed after the accident has been successfully completed and put into operation.

The damaged reactor has been mothballed, but the other reactor is still in use. Exelon says the operating costs for just the one unit are high, further straining Three Mile Island's financial health.

In the past decade, natural gas has been flooding the market from the Northeast's Marcellus Shale formation, the nation's most prolific gas field. That has given a big competitive advantage to power plants that burn gas to produce electricity, with dozens of new ones coming online or being planned.

Meanwhile, electricity consumption hit a wall after the recession, while states have emphasized renewable energy and efficiency.

Because of the rapid growth of gas-fired power generation, closing Three Mile Island would have little or no effect on electricity bills, analysts say. But the power may be replaced by electricity generated by carbon-emitting fuels such as coal or gas.

Pennsylvania is the nation's No. 2 nuclear power state, after Illinois. Decommissioning the plant could take years.