Nuclenor Ratifies Decision To Shut Down Garoña Over Taxes

Posted by NucNet on 3 January 2013 in NucNet

The operator of Spain’s Santa María de Garoña nuclear power plant says its board of directors has ratified its decision to shut down the facility in northern Spain.

Nuclenor, a joint venture between Iberdrola and Endesa, said last month that it would close the single-unit plant ahead of the implementation of a law which imposes a retroactive tax on energy production and spent nuclear fuel. Nuclenor said the measures could force it to the point of bankruptcy.

Nuclenor said it had a balance sheet of 147 million euro (EUR) (about 190 million US dollars) on 30 September 2012, but would face paying taxes under the new law of EUR 153 million, leaving it with negative equity if operation of the reactor were to continue into 2013.

The company said the amount of tax payable would put it “well below” the equity necessary to prevent dissolution of the company”.

The 446-megawatt boiling water reactor unit, which until it shut down was the oldest commercially operating nuclear unit in the country, was disconnected from the grid on 16 December 2012.

Nuclenor initially said that a final decision to stop operations by the end of 2012 could be averted if the proposed law was not enacted, or if “substantial” changes to the law were made.

However, a statement on Nuclenor’s website says the company’s board ratified the closure decision on 28 December 2012 after considering the final draft of the law.

The reactor was scheduled to be shut down on 6 July 2013, but Nuclenor decided to stop plant operations before 31 December after analysing the impact of the new law.

Garoña was first connected to the grid in March 1971. In July 2012, an order to close the plant in 2013 was revoked by the country’s industry ministry. This paved the way for Nuclenor to apply for a licence to run the plant until2019. However, Nuclenor told the ministry last September that it would not make the application, owing to uncertainty about the impact of planned energy sector reform.