A proposed merger between two utility giants could have big implications for the future of nuclear power in New England.
NextEra Energy, the owner of New Hampshire’s Seabrook Nuclear Power Station, announced plans last month to acquire Dominion Energy, the owner of Connecticut’s Millstone Nuclear Power Station, in a deal worth nearly $67 billion.
If approved, the sale would create one of the world’s largest utility companies with control over all of the nuclear power produced in New England.
That power accounts for roughly one-quarter of the region’s energy supply, and half of all of its carbon-free power, according to data from ISO New England, the regional grid operator. NextEra also owns solar, battery and natural-gas fired power plants throughout the region.
The proposed sale was announced in May, several months after Connecticut’s Department of Energy and Environmental Protection, or DEEP, launched its latest round of clean energy procurements from power plant operators, including Millstone and Seabrook. At the direction of the state, utilities currently purchase power from both plants through contracts that are set to expire in 2029.
As the result of a state law passed in 2024, DEEP is required to coordinate with at least two other New England states on contracts to purchase nuclear power.
In this year’s procurement process, the state drew bids from both NextEra and Dominion on behalf of their respective nuclear plants, officials at both companies said this week. The merger isn’t expected to be finalized before the winning bids are announced — limiting the deal’s impact on the companies’ negotiations with the state.
“DEEP is aware of the proposed merger between NextEra and Dominion,” DEEP spokesman Will Healey said in a statement. “We continue to monitor and assess the details of this merger, and will look to ensure that any change of control provision would continue to facilitate the safe and economic operation of Millstone. We will also assess what if any implications this merger could have for ongoing proceedings.”
Until the transaction is complete, Dominion and NextEra will continue to operate as separate entities with the ability to negotiate their own long-term contracts to sell power to utilities in Connecticut and elsewhere, according to spokespeople for both companies.
“Seabrook and Millstone are among the most important sources of safe, reliable, around-the-clock electricity in New England,” NextEra spokesman Neil Nissan said in a statement Wednesday. “We continue to believe that securing Seabrook’s long-term future through the outstanding (Connecticut procurement) process will provide long-term benefits to the region.“
Ryan Frazier, a spokesman for Dominion, echoed that sentiment, telling the Connecticut Mirror that the company “considers Millstone Power Station a very valuable asset that provides clean energy to hundreds of thousands of homes in New England.”
Millstone, the older of the two plants, was first opened in the 1970s and currently consists of two reactor units with a total capacity of 2,100 megawatts of electricity, enough to power roughly 2 million homes. Seabrook consists of a single unit opened in 1990 with a capacity of 1,246 megawatts.
Nana Ayensu, a non-resident fellow at Columbia University’s Center on Global Energy Policy, said the proposed merger could result in operational and maintenance efficiencies for NextEra, which also owns several nuclear power plants in Wisconsin and Florida.
Those cost savings could be passed along to customers through cheaper electricity, Ayensu said. At the same time, he said, both Millstone and Seabrook are located in areas of high energy demand and limited supply, which can drive up the cost of electricity and give plant owners more leverage during negotiations.
“I think the biggest element to it is that these these two clients are in strategically important areas for the ISO, and so they are critical for the reliability of the grid,” Ayensu said. “That, in and of itself, separate from who owns them, is what may give them additional market power.”
Connecticut Gov. Ned Lamont announced the state’s existing deal with Millstone in 2019, after Dominion threatened to close the plant due to competition from cheaper gas-fired power plants. Under that deal, the state agreed to purchase half the plant’s output at a fixed price of $50 per megawatt-hour. The state’s deal with Seabrook, for a smaller amount of power, has a “levelized” price of around $39 per megawatt-hour, according to Nissan.
Customers pay a premium for that power whenever that set price is higher than the wholesale price of electricity on the New England market. When the contracted prices are lower than the wholesale market, customers receive a credit back on their bills.
The Millstone contract, in particular, was widely blamed for a surge in electricity prices during the summer of 2024. But more recently, the high price of natural gas has resulted in significant savings from the state’s contracts for renewable energy. In all, DEEP estimates that the two nuclear deals have saved customers $153 million over the last six years.
The high price of natural gas has also reduced the competition nuclear plants face, making it less likely that the owners of Millstone and Seabrook would seek to shutter either plant, experts say. Two years ago, Dominion signaled its intention to seek approval from federal regulators to continue operating Millstone until 2065.
Both NextEra and Dominion have also explored expansions of their nuclear fleet through the development of smaller, modular reactors that proponents say will cut down on costs compared to older, highly-individualized reactor designs.
Dominion, however, has focused its interest in small modular reactors near its headquarters in Virginia, citing the presence of vertically-integrated utility markets. Ayenso said that NextEra, the larger of the two companies, has more experience operating in deregulated energy markets like Connecticut, where power plants are operated separately from the utilities that buy and distribute electricity to customers.
“They develop assets all over the country, and I think I’ve got great comfort in working with deregulated markets. And, you know, they are pretty smart about how they go about it,” Ayenso said.
Nissan, the NextEra spokesman, said that while there are no current plans to expand Seabrook — including through the use of small modular reactors — the company “will continue to evaluate future expansion opportunities.”
Bill Quinlan, the president of transmission at Eversource Energy, said that NextEra is also a key supplier of large quantities of wholesale power intended to meet all the demand from a local utility, known as full requirements service.
“NextEra is a huge player in that in New England,” Quinlan said. “So, do they want to tie up their nuclear output in long-term PPAs? That’s one option — that’s what Dominion did — or do they want to use it to serve load, full requirements where they’re very competitive? I don’t know how they’re going to view this going forward. They’ll probably do both, if I have to guess.”
Nissan said that NextEra will continue to honor any existing agreements to provide full requirements service to local utilities in New England, while waiting to finalize its purchase of Dominion.
“The merger would not alter the fundamental structure or obligations of those agreements, and counterparties should expect continuity of service and relationship,” he said in a statement.
New England was once home to as many as six nuclear power plants in every state except Rhode Island. Most of those plants shuttered during the wave of nuclear decomissionings during the 1990s and 2000s.
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This story was originally published by The Connecticut Mirror and distributed through a partnership with The Associated Press.
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