Entergy 2002 Annual Report Download - page 17

ENTERGY CORPORATION AND SUBSIDIARIES 2002 15
y achieving success in our nuclear strategy,
we’re proving the value of nuclear power
through economical, safe, and secure operations.
We’re driving growth through increased
productivity and generating capacity.
Strong execution of a successful strategy
In 2002, our nuclear business achieved high
capacity factors and record-breaking refueling
outages to create value from our growing fleet
of nuclear plants.
Entergy Nuclear continued to grow its capacity
to generate both power and income. Vermont
Yankee – Entergy’s tenth nuclear unit and fifth in
the Northeast – was acquired in July 2002.
In 2002, Entergy’s nuclear plants performed
at an average capacity factor of 96 percent,
despite seven refueling outages. The capacity
factor measures the percentage of potential
generation actually produced by a plant.
Capacity factors have increased more quickly
than expected at Northeast plants acquired in
the past four years. The increase in capacity
factors at newly acquired plants, compared with
the average for the three years before each
plant was acquired, produces an additional
7 million megawatt-hours a year.
Entergy has reduced average costs for
scheduled refueling outages. In 2002, we
completed seven refueling outages, most in near-
record time and without lost-time accidents.
A refueling outage at Arkansas Nuclear One
Unit 2 set a world record for units designed by
Combustion Engineering. A 21-day outage at
Vermont Yankee improved on the previous
record by more than two days, and a 32-day
outage at Indian Point 2 was less than half the
duration of the previous record.
We’re managing market risk. Each time
Entergy has acquired a nuclear plant, the seller
has entered into a power purchase agreement
for the initial years we own the plant. These
PPAs create a stable revenue stream from
creditworthy counterparties. So our nuclear
plants have a risk profile distinctly different
from that of merchant power plants.
A key goal, as existing agreements roll off, is
to close new PPAs at attractive prices or otherwise
hedge plant output. To date, we have sold forward
under contracts 100 percent of output for 2003,
92 percent for 2004, and 25 percent for 2005.
A commitment to safety and security
Entergy is successfully meeting the challenges of
safety and security at our nuclear plants, while
continuing to reduce overall costs.
We conducted thorough inspections to
confirm the safety of Entergy’s pressurized
water reactor units, after corrosion at another
company’s nuclear plant raised questions about
PWRs. We found no problems at three plants,
and we repaired minor problems during a
refueling outage at ANO Unit 1.
We’ve ordered a new reactor vessel head for
ANO Unit 1, to be installed during a scheduled
outage in 2005. The cost to replace the reactor
vessel head is approximately $20 million. By
having a replacement ready, we’ll avoid the risk
of a much more costly extended plant shutdown.
We’ve improved safe performance at Indian
Point 2. In September, the Nuclear Regulatory
Commission lifted its “red” finding on Indian
Point 2. The red designation was placed on the
plant in February 2000, under previous ownership.
BB
Employee
Lost-Time Accidents
Entergy is keeping the
focus on employee safety.
Since 1998, we’ve
reduced the number of
lost-time accidents by over
50 percent. We also
achieved significant
reductions in less severe
restricted duty accidents
and cases requiring
medical attention in 2002.
RECOGNITION
Generating Plant Safety
In 2002, Sterlington Plant
earned Voluntary
Protection Program Star
status from the U.S.
Occupational Safety and
Health Administration, for
protecting employees’
health and safety. Eight
Entergy plants are among
approximately 30 U.S.
electric and gas facilities
with the VPP Star rating.
Entergy sites include the
first electric generating
plants (Little Gypsy and
Waterford 1 & 2), the
first nuclear plant
(Arkansas Nuclear One),
and the first nuclear fleet
(Entergy Nuclear South)
to earn VPP Star status.
98 99 00 01 02
76
45 46
33 36
Prior year numbers have been
updated to reflect OSHA Guidelines
Another area of focus for the utility is
productivity improvements. For example, fossil
plant operations employees completed more
than 40 “Six Sigma” projects in 2002, achieving
over $6.4 million in realized fuel savings and
$542,000 in reductions in direct capital and
operating and maintenance expenses.
In addition, we’re pursuing economic
development to maintain and grow our
commercial and industrial customer base.
NUCLEAR: PROVING THE VALUE