LACEY TOWNSHIP — The federal government has approved reductions in Oyster Creek Generating Station’s liability insurance by $1.45 billion, a little over three months since the nuclear plant shut down.
The Nuclear Regulatory Commission issued exemptions to plant owner Exelon in December, clearing the way for reductions in off-site insurance by $350 million and on-site insurance by $1.1 billion that the company must hold for Oyster Creek.
Formerly the oldest operating nuclear plant in the nation, Oyster Creek was shut down in September. It once supplied hundreds of jobs to nearby communities in Ocean County since it opened in 1969.
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“Our decision on both exemption requests was based on the significantly reduced risk of an accident at the plant following its permanent shutdown,” NRC spokesman Neil Sheehan said.
The NRC said no “reasonably conceivable potential accident exists that could cause significant off-site damage” at the plant.
The agency has previously granted insurance reductions to about two dozen other decommissioning power plants in the country, Sheehan said.
Like other plants around the U.S., economic troubles caused by cheap natural gas and the expanding renewable energy industry led to Oyster Creek’s shutdown Sept. 17. Holtec International, a Camden-based company, wants to buy the plant and decommission it.
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Decommissioning the plant involves removing buildings and infrastructure and safely storing leftover, highly radioactive spent fuel rods.
New Jersey Sierra Club Director Jeff Tittel called the reduced liability insurance for Oyster Creek a “red flag on safety.” The organization previously expressed safety concerns over how the decommissioning process could impact the environment.
“This raises a red flag on safety because what will happen if there is a catastrophic accident or storm on the site?” Tittel said in a statement. “Holtec will not be able to cover the damage costs.”
The NRC began reviewing a license transfer application in October that would allow Holtec to purchase the plant. The review is set to be completed within a year. Holtec could get control of a $900 million fund financed by ratepayers over the years meant to cover decontamination, demolition and handling of nuclear fuel.