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Nuclear fallout: Crystal River area tops nation in GDP loss after plant closure

Only now are we starting to realize the profound economic impact of losing a nuclear power plant before its time.

In an assessment of the gross domestic product growth in each of nation's largest 382 metropolitan areas, the one metro whose GDP contracted the most in 2014 was Florida's Homosassa Springs — an area that includes Citrus County and the town of Crystal River, home of the now-defunct Crystal River nuclear power plant owned by Duke Energy.

U.S. Commerce Department figures released this week show the Homosassa metro area suffered a 7.5 percent loss in gross domestic product in 2014, the worst decline among 382 metros.

That drop, the Wall Street Journal reported this week, "likely reflects Duke Energy's 2013 closure of a nuclear power plant in the area, one of the region's key economic engines."

The metro area's GDP in 2014 fell to $2.75 billion, a stunning dollar loss of economic output in one year of more than $206 million.

The Crystal River nuclear plant was the sole nuclear power plant in Central Florida providing electricity since the late 1970s. It was taken offline in 2009 by then-owner Progress Energy, but problems developed after the power company tried a do-it-yourself fix to mend cracks in the plant's containment vessel. The plant never reopened and current owner Duke Energy, which had purchased Progress Energy during this period, said plant repairs could approach $2.5 billion — a sum not much smaller than Citrus County's now diminished GDP.

Duke opted to shut down the nuclear plant permanently. Duke's Florida customers will continue to pay for part of the shutdown costs via higher rates.

Before the bungled repair, it was anticipated the plant would actually win regulatory approval to extend its operating life an additional 20 years, until 2036. Instead, the plant was effectively shuttered with 27 years left to provide low-cost electricity to west-central Florida and provide hundreds of good-paying jobs to Citrus County area workers.

The plant, now starting a long-term decommissioning process, was Citrus County's biggest single economic asset and Duke's lawyers have fought hard to seek sharp cuts in the taxes the dormant plant would pay to the county. Duke plans to build a natural gas plant in the near future to replace some of the electricity no longer generated by the nuclear plant.

Coming in last with a shrinking GDP among hundreds of growing metro areas is hardly the branding Citrus County needs at the moment. The rural metro area has continued to struggle in the weak economic recovery since the recession.

It is ironic that the country's fastest-growing metro areas in 2014 enjoyed huge gains thanks to energy. Half of the 16 U.S. metro areas where the economy grew at a 6 percent rate or better last year were in Texas with the energy-rich Midland region's 24.1 percent advance putting it at No. 1 in GDP growth in the country.

As energy gains helped many counties last year, the loss in Citrus of its major energy producer doomed it to last place in the GDP race.

Contact Robert Trigaux at rtrigaux@tampabay.com.

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