Looks like most of this has been covered in comments, but just to make it official: moderator terms are for life unless a moderator resigns or we elect (ha!) to remove them for extended inactivity or misconduct.
We review moderators' activity periodically. Those who have been absent for 6 months...
In a nutshell SE's thinking is no reason to lose trained moderators even if they can't be as active or something. You already trained them so what's the harm in keeping them? If a site needs more help just add mods. (A mod who violates the terms of service or something is another story and can be removed.)
I haven't seen anybody mention nomination plans. There's no reason people can't informally discuss plans in advance of the actual nominations phase; please do feel free to discuss.
@Daniel @Shokhet I hope both of you are giving the idea some thought. You've both been solid contributors to the site for quite some time. (Other people too, but I'm addressing you two because you brought it up.)