Back in January, Memphis Gas, Light & Water signed a non-binding letter of interest to purchase power when Nuclear Development LLC completes Bellefonte nuclear plant. But now the company is under new leadership and Memphis Light is pushing away from Bellefonte.
Memphis Light has been asked to sign an updated letter of intent to the receipt of the study they have commissioned, which would bind them to the terms and conditions of a power purchase agreement. Since Memphis Light has not completed its due diligence with respect to the Bellefonte proposal and has not yet received independent feedback on a multitude of concerns, their management believes that it is premature to negotiate and commit to any terms of the agreement.
The deadline for Nuclear Development to close on the Bellefonte plant is Nov. 14. In order to do so though, the company has said it needs an updated letter of intent from Memphis Light, in order to receive the federal loan Nuclear Development is seeking to complete the plant.
Nuclear Development has offered to sell up to 1,340 MW of nuclear power to Memphis Light at an estimated cost of $39 per megawatt hour stating that it will save Memphis light customers $487 million a year over the course of the next 30 years.
Nuclear Development has already given TVA $22 million in earnest money for the Bellefonte plant. But now there is a possibility they would walk away from the deal if the DOE loan requirements aren’t satisfied by the deadline.