More than three years after it was shut down because of a crack in the outer layer of the containment building's concrete wall, Duke Energy (NYSE:DUK) officially announced today that it plans to retire the Crystal River Nuclear Plant in Citrus County, Fla. The plant is run by Progress Energy Florida, a subsidiary of Duke Energy.
"We believe the decision to retire the nuclear plant is in the best overall interests of our customers, investors, the state of Florida and our company," said CEO Jim Rogers in a statement today. "This has been an arduous process of modeling, engineering, analysis and evaluation over many months. The decision was very difficult, but it is the right choice."
Crystal River Nuclear Plant first came online in 1977, but was shut down in 2009 for refueling and replacement of steam generators; at that time, a crack occurred in the containment building's wall, according to the company. In 2011, the situation worsened when repair efforts caused additional cracking in other parts of the plant.
According to the company's Q3 2012 earnings report, estimates for repair options ranged from $900 million to $1.3 billion. In today's press release, Duke Energy reported that "the nature and potential scope of repairs brought increased risks that could raise the cost dramatically and extend the schedule."
Customers will receive $835 million in insurance proceeds in regards to the Crystal River plant, Duke said. The company is reviewing options including building a state-of-the-art natural-gas-fueled plant, which could come online as early as 2018, to provide power. The energy complex's four coal plants remain in service in Citrus County.
The Motley Fool has no position in any of the stocks mentioned. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.