Originally created 04/08/00

Virginia utility abandons MOX project



A Virginia utility company has abandoned an agreement to use a controversial nuclear-reactor fuel that would be produced at Savannah River Site.

Virginia Power decided this week to leave its contract with Duke COGEMA Stone & Webster LLC, said Jim Norvelle, a spokesman for the utility.

Virginia Power had a contract with Duke COGEMA to use mixed-oxide, or MOX, fuel in its North Anna nuclear power plant in Virginia.

"This is indicative of the changes that are occurring in the electric industry today," Mr. Norvelle said. "Two years ago, when we joined the consortium, it fit our strategy. Today it does not."

The MOX plan is a cornerstone of a U.S. effort to rid itself, and Russia, of several tons of plutonium -- a radioactive, cancer-causing metal used in nuclear weapons.

MOX fuel, which would contain surplus plutonium, would be manufactured at SRS in a new plant being designed by Duke COGEMA. The proposed plant, to be completed in 2006, would cost between $500 million and $700 million.

The plant would employ about 400 people at the federal nuclear-weapons site, DCS executives have said.

Virginia Power's pullout will not derail efforts to design and build the plant, said Rebecca Apter, a DCS spokeswoman.

"From a consortium perspective, obviously we hate to lose Virginia Power as a partner," Ms. Apter said. "But from a project perspective, it doesn't change our schedule and plans at all."

But some nuclear watchdogs said Virginia Power's decision should cause the Energy Department to reconsider its commitment to MOX fuel. Some activists have criticized MOX fuel as too expensive and as dangerous in nuclear-power plants not designed for it.

"We certainly think this is going to cause the Energy Department to do a lot of reassessing about the direction of the program," said Tom Clements, executive director of the Nuclear Control Institute in Washington.

An Energy Department spokeswoman said the agency regrets Virginia Power's decision, but the department will continue along the MOX path.

"The U.S. is firmly committed to irradiating MOX fuel," Lisa Cutler said. "It provides the U.S. with flexibility and leverage in its negotiations with Russia, on the critical task of reducing Russian excess plutonium."

Russia has said that MOX use is mandatory if it is to agree to dispose of its own surplus plutonium.

Virginia Power chose to leave the MOX contract because it did not fit the company's new corporate vision, Mr. Norvelle said.

The utility's parent company, Dominion Resources, merged in January with Consolidated Natural Gas of Pittsburgh. In the merger's wake, Virginia Power will concentrate on the Midwest and Northeast, and the MOX mission did not jibe with those plans, Mr. Norvelle said.

"The new Dominion is so new, we want to remain true to the focus," Mr. Norvelle said. "We want to be aggressive in our target area."

The Duke COGEMA consortium will not immediately seek a utility to replace Virginia Power, Ms. Apter said.

Duke COGEMA first must find out how much plutonium will be used in MOX fuel, she said. The amount won't be final until the United States and Russia reach an agreement, she said.

The consortium's remaining utility, Duke Power, still is committed to using MOX fuel in its Catawba and Maguire nuclear-power plants near Charlotte, N.C., a spokeswoman said.

"We believe it to be a safe program," Guynn Savage said. "This particular decision will not change Duke Power's commitment or its support of the program."

But Duke Power's use of MOX fuel also faces a challenge -- from the utility's shareholders. Some stockholders have proposed formally that the utility abandon its agreement to use MOX fuel.

The company's stockholders will vote on the measure at their annual meeting April 20 in Charlotte. A similar proposal was defeated last year, with 92.4 percent of shareholders voting against it.

Reach Brandon Haddock at (706) 823-3409.