By Laila Kearney and Seher Dareen
(Reuters) -NextEra Energy is conducting engineering studies and speaking with federal regulators about the possible restart of its Duane Arnold nuclear power plant in Iowa, company executives said on Wednesday.
Growing power demand from AI data centers, and the electrification of buildings and transportation, has propelled the country’s electric utility industry and led to unprecedented power contracts.
NextEra is assessing the Duane Arnold plant and speaking with regulators with the Nuclear Regulatory Commission and local groups, CEO John Ketchum said on a company earnings call.
“We’re very interested in recommissioning the plant,” said Ketchum, adding that the site uses a boiling water reactor, which can be simpler than other systems to revive.
“That gives us optimism of being able to do this at an attractive price and without as much risk,” Ketchum said.
After struggling for decades with poor economics and safety concerns that led 13 reactors to shut since 2012, the nuclear industry is experiencing a revival driven by a sudden turnaround in electricity demand.
Two shut U.S. nuclear power plants, including Three Mile Island in Pennsylvania, are in the process of being restarted. If the plants are resurrected, it will be the first re-launch of a retired reactor.
The longer a nuclear plant is shut, the higher the chances of corrosion and other issues that could prevent a restart, and analysts broadly project that only a few of the country’s shut nuclear sites could be relaunched.
“We think NextEra’s Duane Arnold nuclear plant is among those in the U.S. that is most likely to restart given it closed fairly recently,” said Mike Doyle, senior equity analyst for utilities at Edward Jones, citing the plant’s August 2020 closure.
Still, NextEra said it was focused on growing its renewable energy business. Nuclear power uses uranium to produce carbon-free electricity and is not renewable like wind and solar power.
NextEra, which includes the world’s largest renewables business and one of the biggest U.S. regulated electric utilities, has entered into “incremental framework agreements” with Fortune-50 to develop 10.3 gigawatts renewable energy and storage.
The company’s third-quarter profit beat Wall Street estimates on Wednesday, helped by strength in its renewables unit. The S&P index tracking utilities jumped 18.4% in the third quarter, compared to a 5.5% rise in the S&P 500.
NextEra’s renewables arm, NextEra Energy Resources, projected a backlog of 24 gigawatts (GW) in the third quarter, up from nearly 22.6 GW in the second quarter.
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