Entergy (NYSE: ETR) said April 26 that it has taken a $356m pre-tax impairment charge against its Vermont Yankee nuclear plant, largely because of state efforts to force the unit to retire despite a 20-year license extension from the U.S. Nuclear Regulatory Commission.
The charge amounts to $1.26 per share after tax. This impairment is classified as a special item and is not included in operational results.
“In the case of Vermont Yankee, as described in our prior financial statement filings with the U.S. Securities and Exchange Commission, Entergy has performed quarterly impairment evaluations since early 2010, triggered by state actions to shut down the plant early,” Entergy said in an earnings press release.
A number of factors and inputs are used in the Vermont Yankee impairment evaluation, including the status of pending legal and state regulatory matters along with various other market and economic factors, Entergy said.
“As previously noted, the triggering event and impairment result are unique to Vermont Yankee. This impairment does not reflect a change in Entergy’s point of view of the economic value of the plant assuming continued operation through 2032, nor does it impact the company’s continued commitment to invest to assure safe operations of the plant, which is always the top priority,” Entergy said.
Earlier this year, a federal district court judge ruled against the state’s effort to force the plant to shut down in 2012, saying it is the NRC that has authority over nuclear plant safety. The state of Vermont has appealed.
Entergy had an as-reported loss of $151.7m, or 86 cents per share, compared with as-reported earnings of $248.7m, or $1.38 per share, for the first quarter of 2011.