New York State Electric & Gas Corp. has decided against selling its 18 percent stake in the Nine Mile Point 2 nuclear power plant, the Binghamton-based utility said Friday.
With electricity generating capacity in short supply in New York, NYSEG executives said this may not be the best time to be selling power plants. "There is too much market uncertainty to justify the sale of our 18 percent interest in Nine Mile Point 2 at this time, said Michael German, NYSEG's president and chief operating officer.
NYSEG's decision to bow out of the sale will not keep other New York utilities, led by Niagara Mohawk, from auctioning off their stakes in the pair of nuclear plants located in Scriba, on the shores of Lake Ontario.
NiMo plans to sell its 41 percent stake in the Nine Mile Point 2 plant and its 100 percent ownership stake in the Nine Mile Point 1 unit as a condition of its pending acquisition by British power company, National Grid Group Plc., for $3 billion.
Rochester Gas & Electric Corp., which owns 14 percent of the Nine Mile 2 unit, and Central Hudson Gas & Electric Corp., which owns 9 percent, also are selling their stakes in the nuclear plant.
NYSEG will join the Long Island Power Authority, which owns an 18 percent stake in Nine Mile 2, as the plant's partial owners who plan to hold on to their positions.
"As experience in New York over the last year has shown, the competitive wholesale electricity market has demonstrated both unexpectedly high prices and considerable price volatility," German said.
"Keeping our ownership interest in Nine Mile Point 2 in order to maintain reliability and price stability may be preferable to a sale," he said.
NYSEG said it will cooperate with NiMo, Central Hudson and RG&E to help them auction their stakes in the plant.
AmerGen, a joint venture of PECO Energy Co. and British Energy, had agreed in June 1999 to pay $163 million for Nine Mile 1 and 59 percent of Nine Mile 2, which are located 40 miles north of Syracuse.
But the sale fell through in May, a month after the state Public Service Commission said the price wasn't high enough to adequately compensate utility customers still paying building costs of the plants.