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* Crain’s…
In a sign of how the state’s energy policy dynamics have changed, a senior executive at the clout-heavy company now says Exelon is open to an alternative to a bailout—creating a state or regional market to put a price on power plant carbon emissions. That wouldn’t benefit Exelon’s nukes as directly or immediately as a subsidy but assuredly would boost the company’s finances over time.
The company continues to say that it wants Springfield to increase electricity rates statewide or it may have to close plants. But Exelon repeatedly has postponed acting after lawmakers failed to meet its deadlines for new legislation. And a brighter financial outlook for plants previously pegged as money-losers is making for a difficult sale.
Five of Chicago-based Exelon’s six Illinois nukes now are projected at least to break even within the next few years. Until recently, the company had said red ink at three of the plants—Quad Cities, Clinton and Byron—would persist, forcing Exelon to close the facilities unless it got almost $300 million in help from ratepayers through a state-mandated surcharge on their electric bills.
OK, that’s good news. No bailout is preferable. Charging for carbon plant emissions won’t be an easy thing to do in a coal-producing state like Illinois, however.
* But check this out…
Exelon is deferring all but the most immediate capital projects at Quad Cities and slicing other costs at all of its power plants as part of an upcoming cost-cutting initiative, Dominguez says.
Since I live about 50 miles from a nuclear power plant (Clinton), I would rather that they not skimp too much.
Just sayin…
posted by Rich Miller
Monday, Nov 9, 15 @ 3:02 pm
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Don’t worry Rich. You are upwind of the plant on most days.
Comment by very old soil Monday, Nov 9, 15 @ 3:09 pm
iirc, they hit jackpot during the grid auction. Profits surpassed projections.
How about no corporate welfare or tilting the scales for one decade as ==an alternative==?
Comment by Formerly Known As... Monday, Nov 9, 15 @ 3:11 pm
Exelon is already on track to make $1 Bill in ==extra== revenue. I would also rather they not skimp too much with their ==bonus==.
https://capitolfax.com/2015/09/02/todays-number-118-billion/
Comment by Formerly Known As... Monday, Nov 9, 15 @ 3:20 pm
-Since I live about 50 miles from a nuclear power plant (Clinton), I would rather that they not skimp too much.-
My father works at the QC plant around the reactors, so ditto.
Comment by Quad City Gal Monday, Nov 9, 15 @ 3:29 pm
Not sure why my comments didn’t post. I’ll be briefer (?)- the Exelon/Pepco merger will continue to be key to whether how quickly Exelon proceeds with plant shutdowns in Illinois. As will the MISO investigation.
Comment by Anon221 Monday, Nov 9, 15 @ 3:45 pm
As many analysts have pointed out including on the most recent earnings call, Exelon is the boy who cried wolf.
First, Exelon told legislators nothing about the capacity auctions and revised rules which would lead to a huge windfall for them until we pointed it out. They said it wouldn’t be enough to make a difference, that they would still be forced to close the plants and they attacked us.
We showed folks our projections on the expected auction revenues and pointed out that Exelon did not need to close these plants given the incredibly profitable nature of the Illinois fleet. Exelon said we didn’t know what we were talking about, claimed we were wrong about our numbers and attacked us again.
Now, lo and behold, the auctions produced the kind of revenue we said they would and Exelon has pulled closure of all their supposedly troubled plants off the table.
As we’ve said from the beginning, Exelon does not need a bailout from struggling Illinois ratepayers to keep the plants open. We are very pleased the legislature wisely chose to wait for the auction results before acting.
Exelon promises to be back in the spring to renew their bailout push. Stay tuned.
Comment by BEST Dave Monday, Nov 9, 15 @ 4:32 pm
Anon221, since we’ve been told repeatedly that each of these plants has to live or die on their own, the Pepco merger should have nothing to do with Illinois. Right?
Comment by BEST Dave Monday, Nov 9, 15 @ 4:33 pm
BEST-
Sarcasm? I hope so, because that merger has required Exelin to really go out on a limb to finance it. the legislative “buyout ” they want from Illinois is part of the whole plan.
Comment by Anon221 Monday, Nov 9, 15 @ 4:45 pm
The words “bailout” isn’t an accurate term to use. The words”fair market” is. Wind power is only profitable because of the production tax credit which tax powers pay. You remove that incentive and no one will build wind farms. Do you like electricity to your house on non windy days, because I do. Or electricity when it’s bitterly cold because I do. Because a company makes money doesn’t mean they shouldnt have the right to increase their earnings by reducing non profitable assets. That’s what America is founded on…capitalism. Grid stability and the clean air act is far more important than tax payers being “burdened” by a “bailout”. Make the market fair and see who builds wind mills…no one.
Comment by jdub Monday, Nov 9, 15 @ 4:58 pm
jdub- Exelon is “windy” as well, and they don’t seem to have a problem with those “subsidies”.
http://www.exeloncorp.com/assets/newsroom/downloads/docs/CompanyFactSheets/fact_excwind.pdf
Comment by Anon221 Monday, Nov 9, 15 @ 5:03 pm
Anon221, the Pepco merger got stopped initially, and Exelon renewed the effort and upped the ante by offering HUGE benefits to Pepco consumers. Is Exelon effectively financing those breaks in MD through its proposed surcharges on IL consumers? Wow our state is dysfunctional…
Comment by Anon Monday, Nov 9, 15 @ 5:30 pm
I would rather that they not skimp too much
The NRC wont allow it
Comment by foster brooks Monday, Nov 9, 15 @ 6:19 pm
Exelon is “windy” too because it pays…if you were Starbucks but the government paid you to open a dunken donuts wouldn’t you?
Comment by jdub Monday, Nov 9, 15 @ 7:07 pm
This would be the time to put a price on carbon pollution. Most state legislators do not have a coal plant in their district.
Comment by Dan Johnson Monday, Nov 9, 15 @ 8:23 pm
To the deleted commenter “HammerTime.” I have your IP address. I know where you work. Post another comment like that and I’ll have someone visit your office.
Comment by Rich Miller Tuesday, Nov 10, 15 @ 12:16 pm
I’ve never been able to get a simple answer to the simple question — if they close down the plants - will my lights go out? If the answer is NO, then by all means, shut it down - evidently we dont need the planets “not making money” - silly me - I thought they were here for a service - not really make a huge profit.
Comment by The Doctor Tuesday, Nov 10, 15 @ 1:24 pm
The Doctor, the answer is no. Once a plant gives notice, the grid operator does a study to determine if the plant is needed for reliability, if other upgrades could compensate (transmission or other generation) or if it’s not needed at all. If they are not needed, they will be told they can shut down. If they are needed for some period of time, the plant operator will be offered a reliability must run contract. But no, your lights will not go out.
Comment by BEST Dave Tuesday, Nov 10, 15 @ 2:25 pm