Let’s be careful out there
Monday, May 9, 2016 - Posted by Rich Miller
* I can’t disagree with any of this…
Gov. Bruce Rauner said Friday he hasn’t had a chance to review legislation proposed to help financially struggling nuclear power plants in Clinton and the Quad-Cities, but he considers nuclear power important to the state’s “energy mix.”
Answering questions during a visit to Bloomington, Rauner said, “Nuclear plants have have a lot of good-paying jobs” that he doesn’t want to lose.
But he added, “I’m concerned when a big company says in order to stay in Illinois, they need a big taxpayer subsidy.”
Exelon Generation, owner of the two plants, said the Next Generation Energy Plan unveiled Thursday contains financial relief needed to keep the two nuclear plants open, along with other steps to promote low-carbon energy sources and energy efficiency. The company on Friday laid the groundwork for closing the plants if the proposal fails.
I was given a briefing on this bill last week, but was left with more questions than answers. It’s complicated, to say the least.
For instance, ComEd complains that “net metering” for solar isn’t fair to its other customers. In essence, they’re paying rooftop solar producers the full cost of not only the electricity, but also the cost of delivering that power through the grid. That drives up costs for everyone else (although, solar is such a tiny segment right now that it hardly matters). But instead of just making net metering truly “net,” they’ve come up with a murky rebate plan that the solar companies hate. Solar has not taken off here, partly because of ComEd’s policies. This plan of ComEd’s doesn’t look like it’ll change things much.
The company wants to offer similar rebates to business customers, claiming it’ll spur rooftop solar on big box stores, but they don’t have a single company they can point to that has expressed any interest.
* Crain’s…
The choice: Allow hard-to-come-by jobs to disappear, with the economic hit striking mainly downstate, or in an election year pass legislation that can be characterized by opponents as an electricity rate hike mainly benefiting profitable companies.
Of course, the other complicating factor is the budget impasse between Gov. Bruce Rauner and Democratic leaders that is resulting in layoffs at colleges and universities and social service providers dependent on state funding.
Rauner says he hopes the General Assembly will balance job losses in particular communities against hitting everyone in Illinois with higher rates. House Speaker Michael Madigan’s spokesman, Steve Brown, says he senses little alarm among lawmakers and notes “there’s a pretty crowded plate already” of demands on elected officials.
Robert Flexon, CEO of Houston-based Dynegy, is highly critical of the state government for “fighting with itself” while industries like his are in trouble. “It’s a disgrace to the people of Illinois and the hardworking men and women at our plants,” he says.
When times were good, they demanded deregulation. Now that wholesale prices are down, they demand re-regulation.
- Union Man - Monday, May 9, 16 @ 10:19 am:
Typical Capitalist selfishness.
- wordslinger - Monday, May 9, 16 @ 10:21 am:
–When times were good, they demanded deregulation. Now that wholesale prices are down, they demand re-regulation.–
And they usually get what they want.
Lots of jobs, contracts and campaign cash to toss around when you collect a monthly check from virtually everyone in Northern Illinois (except the state, that is.)
- energist - Monday, May 9, 16 @ 10:26 am:
How is net metering a cross-subsidy but rate-basing their rebate across all customers not a cross-subsidy? Also, they want to build 5 microgrids in very distinct locations but make all customers pay for them…again, how is this not a cross-subsidy? I guess the utility gets to define which cross-subsidies are good and which are bad.
- Dan Johnson - Monday, May 9, 16 @ 10:27 am:
I still think the easiest way to make nuclear whole is to implement a carbon tax of some kind to make nuclear relatively cheaper. Plus it helps balance our budget.
It’s the wave of the future. Would be nice to be a part of that wave.
- cover - Monday, May 9, 16 @ 10:30 am:
–When times were good, they demanded deregulation. Now that wholesale prices are down, they demand re-regulation.–
No, they just want a subsidy to cover their losses during the bad times. They still want to rake it in when times are good.
If they were truly asking for re-regulation, I might have a different opinion of their request.
- BEST Dave - Monday, May 9, 16 @ 10:30 am:
Exelon privatized their profits when they were huge. Now that the markets have turned against them, they want to socialize the risks…to all of us.
This bill is an astonishing array of greed and over-reach. More to come…
- Qui Tam - Monday, May 9, 16 @ 10:32 am:
In the late 1990’s ComEd promised that if they got their deregulation passed, they would never be back again. It passed, was signed and enacted….. How soon we forget, the campaign cash and patronage jobs causes amnesia.
- Anon221 - Monday, May 9, 16 @ 10:33 am:
Talked with someone who works at one of the targeted plants this weekend. Exelon has promised to offer jobs, somewhere, to all of Exelon’s employees. It will be the contractors who will be left out. What percentage of the “jobs lost” mix that is, I don’t know. But be aware of that fact in the spin coming from Exelon.
http://www.thestreet.com/story/13562139/1/exelon-exc-earnings-report-q1-2016-conference-call-transcript.html
*****
Rauner- “I’m concerned when a big company says in order to stay in Illinois, they need a big taxpayer subsidy.”
What does the ILBEDC think of that statement??? What does Bill Mitchell think of that statement???
” “So in terms of from the state legislative standpoint, I want to look into for instance EDGE tax credits. That’s a development tool the state uses to keep and create jobs and also attract new jobs. I want to look and see how EDGE tax credits can help DeWitt County, right here and now,” said Rep. Bill Mitchell (R-Forsyth).”
http://foxillinois.com/news/local/plan-proposed-to-save-clinton-power-plant-04-28-2016
- Honeybear - Monday, May 9, 16 @ 10:33 am:
Corporate welfare must end, yesterday. I hate with unbridled passion the economic stripmining corporations are doing and the requisite blackmail of “losing jobs” that comes with it. It must must must stop. ON ALL LEVELS! Rauner should not give goodies to other companies through the illegitimate and currently non-FOIA, non Not-for-profit 501c3 ILBEDC. IRS rules explicitly state statutory and funding of an EDC must be authorized by the legislature.
https://www.irs.gov/pub/irs-tege/eotopicg92.pdf
Look at the part on Lessening the Burdens of Government.
- Beaner - Monday, May 9, 16 @ 10:35 am:
With Dynegy filing for permission to close a few coal plants and take 1,835 megawatts offline, maybe the situation is fluid and events will take care of themselves. Sometimes, the best thing to do, is sit on your hands and do nothing. The Magic Invisible hand of the all knowing Free Market will take care of it. Besides, their CEO is making $16 million, so they are a corpulent corporation, and until they Turnaround their bloated pay, they do not deserve any help. It seems to me a big bluff, because they cannot just turn out the lights. The have no interest in the eating the decommissioning costs, for which they have not properly provided with all those dividends, stock-buybacks, and paying execs $10s of millions.
- Abe the Babe - Monday, May 9, 16 @ 10:46 am:
Have to agree with Cover. They don’t want re-regulation. They want a subsidy for the bad times while still having the opportunity to benefit when/if energy prices rebound.
Privatize profit. Socialize risk.
it would be funny if it weren’t so blatant.
- Not Rich - Monday, May 9, 16 @ 10:51 am:
they want rate payers to bail out their unprofitable plants, and the whole world knows that Clinton plant is closing regardless in 5 years.. PIGS….
- Beaner - Monday, May 9, 16 @ 10:52 am:
Dynegy wants to shut down 1,835 megawatts which is 70% greater than the 1,078 megawatts produced in Clinton. Hey, let’s not all turn off the turbines at once.
- Bill Halloran - Monday, May 9, 16 @ 10:56 am:
In my lifetime, one of the best things that happened was the break up of AT&T’s monopoly and the *phone company*. But they should have left it there. I think the 7 *Baby Bells* as regulated monopolies were far superior than what we have today. This has led to the de-regulation of other industries like electricity…and you can see the result here.
Our economic system is Capitalism. And without regulation we have what we have now, the big keep getting bigger and with more voice and influence.
I, for one, have no problem with enforcement of the Sherman Anti-Trust Act and for regulation of certain industries that provide utilities.
Thank you,
Bill
- Mama - Monday, May 9, 16 @ 10:57 am:
Someone should tell Rauner that deregulation does not work for businesses.
- Energy guy - Monday, May 9, 16 @ 10:57 am:
State after state and study after study has shown that net metering is not a subsidy. That’s why California and New York chose to keep net metering in place.
- Johnny Pyle Driver - Monday, May 9, 16 @ 11:23 am:
I can see the argument that net metering at a retail rate is not fair to the utility. However, they don’t have to build new capacity or infrastructure the more people that go solar. Probably somewhere near the “avoided cost” would still be ok.
Why would businesses need more incentives? Currently, Illinois has some of the most lucrative incentives, but some of the lowest deployment rates of solar. I’m not familiar with the northern region as much, but I’m told ComEd is a big reason we don’t get more deployment. However, for businesses, they can take advantage of the 30% federal tax credit, the state SREC auction that can cover another 30% of the installation, the MACRS depreciation, and in some cases a USDA REAP Grant. There are businesses getting paid to put up solar. Why we’d want to focus on putting solar on big box stores that don’t even have headquarters here, when we should be focusing on homeowners and local businesses, is beyond me
- Johnny Pyle Driver - Monday, May 9, 16 @ 11:31 am:
ComEd’s rebate scheme is a more cynical version of the health care voucher debate. They are hoping that the allure of a $1,000 per kw check up front distracts you from the fact that net metering provides more money long term. Would you rather have $1,000 now or much more money later?
- Larry Durkin - Monday, May 9, 16 @ 11:46 am:
The first candidate for office that says we are going to implement a “Marshall” style plan in this country to go to solar power, gets my vote.
I find it hard to believe that the technology doesnt exist to do this today. But I digress.
- Ghost - Monday, May 9, 16 @ 12:40 pm:
let them close. seize the plants paying next to nothing since they are rundown and shut dow. as being valueless. bond them out as state or local power companies and reopen them as go t power stations. CWLP is cheap compared to the for profit power companies because they are not paying millions extra to profit a few ultra wealthy top execs and stockholders. power is way overpriced from the private sector….. th ceos make ridiculous wages, they dont need more money. let em close, take the plants and lets make some reasonable priced power like CWLP
- Going nuclear - Monday, May 9, 16 @ 12:54 pm:
The utilities are starting to freak out over solar, especially with energy storage just around the corner. ComEd, the solar industry and CUB should sit down and work a deal on rate restructuring that is fair to everyone. Like was mentioned earlier, Exelon’s nukes would benefit from a carbon tax, but it needs to be economywide and set at the federal level.
- BEST Dave - Monday, May 9, 16 @ 1:07 pm:
Two quick thoughts.
1) Nobody should worry that the lights will go off with the Exelon and Dynegy announcements. There is a robust process in place with the grid operators. Once Exelon and Dynegy formally give notice of their intent to close, the relevant grid operator (MISO for Southern IL and PJM for Northern) does an analysis to determine if the plants are needed and for how long. If the answer is yes, they will be offered contracts for their costs plus a guaranteed profit.
The other point. The idea that ComEd is freaking out over solar is laughable. Given how effective they’ve been at keeping the RPS broken, there are literally only about 500 Net Metering customers out of millions of ComEd households. 500. No that’s not a typo.
Exelon and ComEd have more than 50 lobbyists under contract right now. That’s millions they’re spending a month. There’s a reason for it and it ain’t out of the goodness of their hearts.
- walker - Monday, May 9, 16 @ 1:58 pm:
Bill Halloran sums it up for me.
- more information - Monday, May 9, 16 @ 3:05 pm:
click the “Say No to Demand Charges” ad above for a video on the issue.
- Thunder Fred - Monday, May 9, 16 @ 4:03 pm:
Deregulation has saved customs about $40 billion since 1999. The savings are pretty evenly split between residential and commercial. The only people not benefiting are those in municipal electric systems exempted from deregulation. Ask someone in Batavia why their power bill is 40% higher than a neighbor in Geneva.
Illinois has some of the lowest electricity prices in the nation thanks to deregulation. Only a fool would want to see that end.
- Robo - Wednesday, May 11, 16 @ 11:12 am:
- Ghost - Monday, May 9, 16 @ 12:40 pm
“CWLP is cheap compared to the for profit power companies”
That was true on May 9, 2006 and the song Bad Day was #1 on Billboard.