February 9, 2006
News Release 06-04
Brad Peck, Corporate Communications Officer
(509) 377-8247 / 727-2808
RICHLAND, Wash. – Energy Northwest, owner and operator of the region’s only nuclear power plant, has carved more than $114 million off its nuclear fuel costs and assured long-term access to fuel supplies by revamping its approach to nuclear fuel purchases.
The savings are expected to benefit BPA and the region’s ratepayers since Columbia Generating Station delivers all its power, at-cost, to BPA who in turn uses it to serve ratepayers throughout the region.
As recently as 2001, the public power Joint Operating Agency purchased all its uranium fuel supplies for Columbia Generating Station on the spot market. Relying solely on the spot market to fuel the 1,150-megawatt power plant exposed Energy Northwest to significant supply and price fluctuations, and therefore financial risk.
In 2001 the agency took a proactive stance in its fuel acquisitions by retaining The Ux Consulting Company, LLC, and Energy Resources International. The companies provided Energy Northwest with fuel acquisition strategy recommendations in early 2002, beginning a cost-saving transition from mostly spot market purchases to a mixture of spot and long-term contracts.
From April 2002 through January 2006, Energy Northwest’s nuclear fuels acquisition team executed 20 agreements with a combined market value of over $500 million. Those agreements have effectively reduced Columbia Generating Station’s projected 2003 – 2015 costs for fuel, or enriched uranium product (EUP), by $128 million.
The fuel agreements are also providing immediate returns, having already generated approximately $2 million in net value due to market fluctuations. Another $16 million in value gains is projected by 2015 based on anticipated increases in the value of uranium fuel.