Plug pulled on Exelon bill
Tuesday, May 31, 2016 - Posted by Rich Miller
* The Turnaround Agenda and the budget aren’t the only things crashing and burning this year. Exelon’s bill isn’t being called for a vote…
The sponsor of a bill aimed at remaking Illinois’ electric utility landscape and saving the Clinton nuclear power plant said Monday the legislation won’t be passed before today’s deadline set by Exelon Corp.
And Exelon officials said they’d reveal “within the next few days” how the failure to pass the bill would affect the future of the power plant and its 700 employees.
Exelon had warned earlier that it needed the Legislature to act by May 31, or it would begin a lengthy process to shut down the 29-year-old nuclear plant by next summer. The plant about 30 miles west of Champaign makes up about half of the assessed valuation in DeWitt County. […]
The chief sponsor of SB 1585, Sen. Donne Trotter, D-Chicago, said groups involved in its negotiations had met as recently as last Friday.
“Time has run out,” said Trotter. “I’m disappointed because I saw and heard, by sitting in those meetings, that there was some movement. It was just one or two entities — and I’m not going to name them — who I think were intentially slowing the process down.
* The Peoria Journal Star’s editorial board doesn’t think that’s a bad thing, and they point to a local employer for proof…
Keystone Steel & Wire, which employs 1,000 here in the Peoria area and is among the last of its kind in the United States, has objected to the $1.1 million cost to its bottom line and the degree to which it imperils its workforce. The bill “threatens to put us at a competitive disadvantage in a fragile economy,” Keystone Vice President Mark Brachbill testified before a legislative committee earlier this month. “These cost increases will not be realized by neighboring states or our international competitors, which will make passing along the increased costs impossible in the current business climate.”
Meanwhile, the Illinois Attorney General’s Office opposes the current legislation, as does the Citizens Utility Board (CUB), the consumer watchdog group. Among the concerns is that there are not enough consumer protections, especially if prices rebound for the utility. Meanwhile, they think there is still time to explore better, perhaps market-based solutions to keep those plants open. Exelon seems to think not, saying “the capacity market alone can’t preserve zero-carbon emitting nuclear plants that are facing the lowest wholesale energy prices in 15 years.” We’d still prefer that all other options be exhausted first.
For its part, CUB acknowledges that the threat of plant closure is real, that this is a better bill than previous efforts — last year’s version would have sent $300 million annually Exelon’s way whether the plants were profitable or not, this year’s about half that — that it’s important to keep this more environmentally friendly, reliable energy source around. Nonetheless, “there is still significant work to be done relating to consumer protections, the role of Ameren, ensuring that there is a full and functional Renewable Portfolio Standard, and giving customers the tools to better manage their energy use … This is a step forward, but we’re not there yet.”
* Related…
* Why is Dynegy idling Illinois coal plants? It’s more complicated than ‘the war on coal’: Every year, MISO, the grid manager for Southern Illinois, Eastern Missouri and parts of 13 other states, holds a so-called “capacity auction” that determines the price paid to power plant operators that agree to be ready to pump electricity into the grid when demand is highest. Downstate Illinois is deregulated, so Ameren Illinois customers can shop for power from different sources. Most of MISO, on the other hand, is made up of regulated utilities such as Ameren Missouri that own both the wires and the power plants. They’re guaranteed a rate of return by state commissions. Dynegy argues that those regulated utilities don’t rely on the capacity auctions to recover costs but can sell their electricity into a deregulated market such as Southern Illinois at low prices that depress rates.
- Ghost - Tuesday, May 31, 16 @ 10:18 am:
they reduced the stated peofit to only a 150 mil a year, not includudng the hidden profit from tranfer pricing, paid for perks that dont count as profit like bonuses and salaries etc. how generous.
have the state seize the valueless nuke plant since its closing and tirn it into a state utility. also i wouldnt call nuclear clean energy…. they all leak some radiation into the world…. and if there is a failure they can take out many states. see cherynoble, 3 mile island, japan….. a coal plant with scrubbers has a problem, and the environmental impact is a lot less severe
- Anon221 - Tuesday, May 31, 16 @ 10:24 am:
Exelon can pay for Exelon. They wanted to own nuclear power plants, they own the costs (at least those that aren’t already being paid for by US taxpayers such as waste storage). They wanted deregulation, by golly they got it! If now those are too expensive… they should have planned better. And, it is also hypocritical of a company to decry wind and solar when they also receive those subsidies for their own projects.
- cdog - Tuesday, May 31, 16 @ 10:27 am:
Not a good business model to expect to continue to privatize profits (exec comp, etc) and publicize your losses and problems.
One could say, Excelon needs to catch up.
- jdub - Tuesday, May 31, 16 @ 10:51 am:
Next generation energy plan is a good bill with a 6 year life. I see comments about 25 cent monthly power bill increases, but higher if the nukes close…so easy math there. Illinois will not be a better state with the job loss and loss of economic activity, no one can argue that. We all enjoy air conditioning when it’s hot, heat when it’s cold and light when it’s dark. Nuclear power has to be part of national energy plan with the renewables. Wind and solar do not provide reliable base load yet taxpayers are all paying for there construction and operation via subsidation. Exelon wants a fair market and the next generation energy bill is the answer.
- NorthsideNoMore - Tuesday, May 31, 16 @ 11:15 am:
The state and federal gov should dump all the wind and solar subsidies and see what the value of the nukes coal and natural gas plants are. The utility providers getting stiffed under the guise stimulating green energy. If wind and solar were so great and efficient they wouldn’t have to have all the subsidies. If power plants close see what happens to the price of electricity then. Supply and Demand. Pay a little now to save a bunch later.
- Nip and Tuck - Tuesday, May 31, 16 @ 11:17 am:
This editorial is a must read for every large energy user in the state. T?heir bills will increase under this legislation and their IL operations will be more expensive than their competitors in other states. BUT, Exelon will be OK so…
As an aside, CUB must not have read the new bill. Exelon would still be able to collect the same amount, under the same rate cap under either version of the bill. Of course under the old version that money would have been spread across all of Exelon’s plants. Under the new version, that same amount would have only gone to two plants (at least initially) BUT IT’S THE EXACT SAME AMOUNT OF MONEY. Not sure how CUB missed this. Surely it was an oversight.
- BEST Dave - Tuesday, May 31, 16 @ 11:52 am:
Jdub,
25 cents a month is a lie. It’s several dollars a month, particularly in the latter years. When we took their numbers and put them in a spreadsheet - just basic math - we found that between just three items in the bill - energy efficiency, microgrids and solar rebates, they will be collecting $1 BILLION in guaranteed profits on $2.4 billion in program spending. It’s an astonishing money grab by Exelon.
This bill didn’t fail because of the budget distraction. This bill failed because it was an outrageous demonstration of greed by an already very profitable company. Even the Quad Cities own paper recognized how awful this was in their editorial.
http://qctimes.com/news/opinion/editorial/editorial-no-choice-but-to-back-exelon-s-bailout-with/article_4b097102-550d-513d-b75d-af89c6f760f3.html
“But make no mistake, the massive overhaul Exelon is hoping to ram through the General Assembly is, at its core, a bailout.”
and
“In addition, the plants would receive $2.6 billion in state subsidies over the next decade — cash, under the current draft — that the state couldn’t claw back if the two facilities started making money.”
and
“Bailing out — on the backs of rate and taxpayers, alike — a profitable company reeks. It hits at the core of every one of our most populist ideals. Exelon, after all, was one of the nation’s biggest proponents of deregulation in the 1990s. Now, with the rise of natural gas, it’s coming back to bite the power producer.”
- Mama - Tuesday, May 31, 16 @ 12:09 pm:
- Anon221 @ 10:24 am: -
+1
- knuke - Tuesday, May 31, 16 @ 1:40 pm:
Nuclear plants do not “all leak radiation”. IF a plant has any type of fuel leak, it is contained INSIDE the plant. Clinton is one of very few that has NEVER had a fuel leak. And Chernobyl could not happen in the US. Plants here are a completely different design, maintained much better, and oversight of procedures precludes this happening. Furthermore, based on what happened at Fukushima, all plants have made modifications to make sure beyond design basis events do not result in the event that happened there.
All Exelon is asking for is a level playing field. Reliable base load plants cannot sell their power but a few wind mills go up and the state is forced to pay for their meager amount of electricity and support them when they can’t produce (when there is no wind). They are not reliable for grid stability. With Dynegy closing 4 of their downstate plants, the loss of Clinton and Quad Cities will be noticed on the grid and in state resident’s pocketbooks.
- nadia - Tuesday, May 31, 16 @ 1:40 pm:
As far as the problems with the MISO market goes it comes down to electric rates going up while saving Illinois jobs, State & local tax revenue and the overall Illinois economy or let the jobs and taxes go away, see the economy suffer some more and still see electric rates go up.
- Rich Miller - Tuesday, May 31, 16 @ 1:44 pm:
===With Dynegy closing 4 of their downstate plants, the loss of Clinton and Quad Cities will be noticed on the grid===
With Dynegy closing 4 of their downstate plants, the loss of electricity on the grid could very well mean prices will improve for Clinton and Quad Cities.
FIFY
- Anon221 - Tuesday, May 31, 16 @ 2:07 pm:
knuke- “All Exelon is asking for is a level playing field.”
No.They.Are.Not.
Their “ask” is much, much bigger than that. They may want to level the playing field off until they can gain more advantage, then they will work to tilt it even more their way. Deregulation has not been kind to Exelon, even though they pushed for it before. Now they are working to consolidate and merger more and more in the regulated energy markets. See the PEPCO merger for instance.
- BEST Dave - Tuesday, May 31, 16 @ 2:42 pm:
“With Dynegy closing 4 of their downstate plants, the loss of Clinton and Quad Cities will be noticed on the grid and in state resident’s pocketbooks.”
Possibly, but it’s actually not clear. First, the lights will stay on. If closing any or all of these plants will present a problem for reliability, they will be offered reliability must-run contracts for their costs plus guaranteed profits.
Second, Clinton is either closed now for refueling or will be closed soon. It will be interesting to see the effect on prices during the outage. By contrast, when Quad was down for several weeks for refueling, electricity prices in the area WENT DOWN by about 40 cents a MWH.
In short, this is just not as simple as Clinton closes and prices skyrocket. Not remotely.
- The Doctor - Tuesday, May 31, 16 @ 2:45 pm:
Just Riddle me this, Exelon….tell me yes or no, no, no lengthy debate…will my power go out, will there be brownouts? Will Chaos reign?
I. AM. SO. TIRED. of hearing how they need money to stay open….just to stay open and keep 700 people employeed AND regardless of the fact they makde 2 BILLION in profits.
- Anon11 - Tuesday, May 31, 16 @ 2:50 pm:
BEST Coalition = NRG + ELPC. That’s quite the combo, coal and environmental groups ..
- Ok - Tuesday, May 31, 16 @ 4:03 pm:
The reality is that BEST is funded by people (NRG and Invenergy) who want to build new gas plants where Clinton and Quad Cities are standing now. BEST Dave and ELPC tried to sell Springfield years ago on a project to build a new gas plant (Tenaska) and guarantee that they would get paid more than 5 times the market rate for power. So they aren’t against outlandish subsidies.
I don’t know if the nuke plants need a bailout, but the irrelevant BEST-NRG-INVENERGY-ELPC natural gas coalition have no principles to stand on here.
- BEST Dave - Tuesday, May 31, 16 @ 5:03 pm:
Thanks OK. Just a couple of questions.
1) Which company was it that secretly funded the almost the entire “STOP Coalition” and the “CORE Coalition” and at least 1/2 dozen other coalitions that have been against subsidies for every other energy project? Oh right, it was that same energy company that now comes to Springfield pleading poverty.
2) Which of our facts are wrong? The part about how ComEd Exelon stands to make $1 billion in profits over ten years on the $2.4 billion solar, microgrid and EE portions of their bill? Nope - that came straight out of their presentation. Might it be how Exelon got caught with their hands in the cookie jar when they stripped RPS funding out of their legislation? Nope - that two page drafting error was repeated in other parts of the bill and has been well reported.
You guys keep attacking the messenger because you can’t attack the facts - all of which we make sure are accurate before we put them out.
- Anon221 - Tuesday, May 31, 16 @ 5:31 pm:
Ok- are you sure you have your “Clintons” right?
http://www.agprofessional.com/news/iowa-biodiesel-plant-purchased-mega-energy-company
The only gas plant I know of in DeWitt County sits in the Clinton Landfill, and is run by an Indiana company
http://icl.coop/new-illinois-landfill-gas-plant-added-co-op-energy-source/
- Anon11 - Tuesday, May 31, 16 @ 6:11 pm:
Radio silence from BEST Dave .. Again.
- Anon11 - Tuesday, May 31, 16 @ 7:29 pm:
Oh, kill the messenger sob story. You you keep dancing around who is funding you. By the way, it is totally relevant to the situation, because the companies that you represent will benefit from the higher prices. That takes us back to the point of why you won’t disclose in a public forum of who they are. You cry about Exelon funding past coalitions to justify what you are doing is right. It doesn’t make you any better than the company you are complaining about. Nowhere has anyone seen this presentation except for I guess BEST Coalition, how ironic.
- Anon11 - Tuesday, May 31, 16 @ 9:19 pm:
Isn’t it interesting that BEST Dave commented back to OK and totally failed to address the part about NRG Invenergy and ELPC? One deceitful individual if you ask me.
- BEST Dave - Tuesday, May 31, 16 @ 9:59 pm:
The presentation was given to the Gov, AG, legislative leaders and key stakeholders. That’s why nobody has questioned our numbers. It’s just math.
- Mike - Wednesday, Jun 1, 16 @ 9:50 am:
The bill would increase electricity rates marginally, just wait until 3 gigawatts are removed from the power grid, I wager prices will increase considerably more. When Vermont Yankee was forced to shut down due to environmental group pressure, electric rates tripled over night in Vermont.