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Environmental group rails at AG Madigan, environmentalists

Friday, Jun 10, 2016

* I received this press release yesterday from a group calling itself Environmental Progress Illinois…

Over the last few months we’ve seen growing recognition by Democratic political leaders that efforts to close nuclear plants prematurely are disastrous for the climate. Hillary Clinton said efforts to prematurely retire nuclear plants “put ideology ahead of science and would make it harder and more costly to build a clean energy future.” Energy Secretary Ernie Moniz said, “We’re supposed to be adding zero-carbon energy sources not subtracting them.” And Senator Cory Booker endorsed extending the nuclear the same subsidy wind energy receives: “I know the challenges global warming [presents]… We’ve got to support the existing fleet.”

But while a growing number of Democrats have come to see the importance of fair and equal treatment of clean energy sources to solve climate change, a handful of elected officials remain ideologically opposed to nuclear power — even as they advocate subsidies for wind and solar.

Case in point is Illinois Attorney General Lisa Madigan. Last month Madigan helped kill efforts in the Illinois legislature to support two nuclear plants that are suffering from being excluded from federal subsidies and the Illinois state Renewable Portfolio Standard — both of which Madigan supports. “This proposal would force consumers to pay more only to boost the companies’ profits further,” said Madigan.

Democratic legislators in Springfield were spooked by Madigan’s comments, and the bill died. Days later, Exelon announced it would close the two plants, which would be replaced by natural gas that would increase carbon emissions the equivalent of adding two million cars to the road.

And yet, Madigan has long advocated subsidies for wind and solar and has enjoys a close relationship relationship with wind and solar advocates — some of whom are supported by the very same natural gas, wind and solar corporations that would benefit from the legislation she endorses.

Last August, Madigan advocated for for “clean jobs” legislation that includes large subsidies for wind and and solar — subsidies that would be paid for by higher rates paid by Illinois ratepayers. The so-called “clean jobs” coalition members includes the Environmental Law and Policy Center, which accepts money from natural gas company Invenergy, as well as solar and wind companies that stand to benefit from the closure of Illinois nuclear plants.

And last February, Madigan joined a conference call on the clean power plan that was arranged by the Sierra Club — an organization working to shut down nuclear plants in Illinois and California and replace them with natural gas and renewables. In 2012, the Sierra Club was forced to admit that it secretly took $26 million from natural gas interests. Recently, the Sierra Club has been urging its members to buy solar panels from Sungevity, which turns around and gives $1,000 per homeowner signed up to the Sierra Club.

Notably, if Quad and Clinton are closed, the increased emissions will be one-third of total emissions Illinois is supposed to reduce under the Clean Power Plan.
Madigan needs to address the inconsistency of her position by making a clear statement about why she can justify subsidies for solar and wind but not for nuclear. If she’s ideologically anti-nuclear, as she appears to be, then she needs to explain why. If she’s not, then she needs to explain her double standard. The 2,000 Clinton and Quad workers at risk of being laid off, and the people of Illinois more broadly, deserve an explanation.

I was a bit surprised to find out this group is backed by a couple of Pritzker family members. So the whacks at Madigan, the Sierra Club and the pretty widely respected ELPC were interesting.

* I asked the AG’s office for comment…

We have consistently supported the development of clean energy as a way to reduce carbon emissions and grow our economy. But we’ve also always argued that as the state takes steps to comply with the Clean Power Plan, we must ensure that consumers are treated fairly.

The claim that Exelon’s “nuclear plants … are suffering from being excluded from” subsidies is false. So is the allegation that supporting the development of wind and solar technology while resisting a profitable company’s demand for a state bailout is a “double standard.”

Exelon’s nuclear plants have benefitted from two rounds of Illinois subsidies already. First, Illinois electricity ratepayers paid all of the construction costs for the Illinois nuclear plants. Illinois consumers then paid again when Exelon and others convinced Illinois lawmakers to create a competitive market for electricity and consumers were charged for additional costs associated with the transition to a deregulated supply market. Exelon’s current bailout demand would amount to a third round of subsidies for these plants.

Supporting emerging energy technology – in this case the development of wind and solar technology through the renewable energy portfolio standard – is nothing new. Nuclear power received much greater support when the plants were being developed.

We do not want to see the loss of any Illinois jobs. But the notion that the only way to preserve jobs is to boost Exelon’s profits is false – and ignores Exelon’s and ComEd’s role in creating the current regulatory structure. When electricity costs were higher, Exelon and ComEd pushed for a competitive market for electricity generation, without state regulation. As a result, beginning in 2005, Exelon Generation has posted profits every year, at times over 30 percent a year. But now that natural gas and progress on energy efficiency efforts have driven down electricity prices, Exelon is claiming that some individual plants are not profitable and demanding that Illinois increase consumer charges to protect it from the competitive market.

Notably, Exelon is not offering to pay back the subsidies if the plants once again generate profits. And its supporters never mention that Exelon is a profitable company that could choose to use the company’s profits to preserve the two plants that Illinois consumers have already paid for. What is more, at the same time Exelon has asked Illinois lawmakers for a subsidy, it has successfully encouraged federal ratemaking officials to increase capacity charges, resulting in an additional $264 million in Illinois revenue for this year alone.

Finally, while we are not advocating for nuclear plant closures, it’s false to claim that lost nuclear generation would necessarily be replaced going forward by Illinois gas and coal plants. It is important to remember that Illinois is a net exporter of electricity, and if Illinois nuclear plants are needed to maintain a reliable source of electricity, then federal operators of the power grid will work to prevent their closure. In addition, wind and solar are cost competitive with gas and coal and are only getting cheaper. Encouraging renewables and energy efficiency will allow Illinois to meet our Clean Power Plan obligations cost effectively and without putting ratepayers on the hook to further pad the bottom line of a profitable company.

There are two points in there to think more about. The first is the long history of subsidizing Exelon’s nuke plants. And second is that we produce lots more electricity in this state than we consume.

- Posted by Rich Miller        

  1. - Qui Tam - Friday, Jun 10, 16 @ 2:41 pm:

    One more point the many storage pools of nuclear waste are going to be “fun” for Illinois long after the profits are stripped away.

  2. - Anon221 - Friday, Jun 10, 16 @ 2:45 pm:

    AG’s office is spot on!

    Also, walking back at this point for Exelon will continue to become more difficult as time passes because the SEC will be closely watching the types of trades of stock, especially the insider trading documents that Exelon is required to file. Exelon has said this in a few articles, too. And, at Cordova and Clinton, they are interviewing their employees to start working out where the employee may want to be relocated within the Exelon “family”. They have guaranteed their employees positions. Contractors are being let go already. I think their next “pressure point” they would play would be Byron. Maybe Cordova will get a reprieve because of it’s double unit and complications with Buffet’s organization, but Clinton’s single unit is more likely than not on it’s way out.

  3. - Anonymous - Friday, Jun 10, 16 @ 2:46 pm:

    Here is another point to think about. Wind and solar are not new industries, they have been around for decades. Why do these industries continue to need State and Federal tax subsidies/mandates? Let’s be real, they don’t and will never produce enough power to cover their costs.

  4. - Rich Miller - Friday, Jun 10, 16 @ 2:52 pm:

    ===will never produce enough power to cover their costs===

    Did you work for the transistor industry, too?

  5. - Night Rider - Friday, Jun 10, 16 @ 2:55 pm:

    Lisa Madigan refuses to acknowledge that when you run a business, you don’t indefinitely prop up your cash-losing properties with profitable ones. She’s running this scorched Earth campaign against Exelon at the peril of Illinois’ environment and our climate. Good for this group for calling her and others out on it.

  6. - Rich Miller - Friday, Jun 10, 16 @ 2:57 pm:

    ===when you run a business, you don’t indefinitely prop up your cash-losing properties with profitable ones===

    OK, but most don’t run to the General Assembly for a gigantic bailout to prop up their currently cash-losing properties.

    Also, too, if you believe that energy prices will go back up, then good companies hang in there through the troughs.

  7. - Fred - Friday, Jun 10, 16 @ 3:11 pm:

    $2.6 Billion, 800 Jobs, that’s $3+ million/job.

    We could give the 800 employees $1 million each to compensate for any displacement, at less than 1/3 the cost.

    The cost/benefit ratio here is crazy.

  8. - Ghost - Friday, Jun 10, 16 @ 3:11 pm:

    the third point, the state paid for the plants!. so if they shut down eminent domain them and start them back up as state or local owned power

  9. - Anonymous - Friday, Jun 10, 16 @ 3:15 pm:

    You talk about a surplus of power in Illinois, why should the ratepayers have to continue to subsidize wind and solar if we don’t need the power? Lets face it, wind and solar get built for subsidies and not based off economics.

  10. - Biker - Friday, Jun 10, 16 @ 3:20 pm:

    This is not a statement from a real environmental advocacy group. This is a nuclear trade group pretending to be an environmental advocacy group.

  11. - Ghost - Friday, Jun 10, 16 @ 3:23 pm:

    Nuke pla ts ate becoming harder and harder to peotect as well from people seeking to cause mayhem. they pretty much can not be peotected from drones…. let them close, blowing up a windmill or coal mine wont contaminate multipme states

  12. - BEST Dave - Friday, Jun 10, 16 @ 3:33 pm:

    1) The Exelon Bill didn’t die because Lisa Madigan opposed it. It died because it was a poorly constructed bill that was 100% weighted in favor of Exelon and 0% in favor of consumers. Lisa Madigan joined other consumer organizations like AARP and ILPirg in opposing the legislation.

    2) Exelon repeatedly misled legislators as has been documented in numerous stories over the last month of session. From lying about the economics to stripping funding for renewables. Exelon proved themselves to not be credible.

    3) Exelon layered the nuclear bailout with other bad legislation that guaranteed $1 billion in profits on $2.4 billion in program spending over ten years. Add that to the $2.6 billion nuke bailout and you have a larded-up money grab of epic proportion.

    4) Exelon continues to mislead legislators and stakeholders on the rate impact should these plants close. They knowingly base their conclusions on the 1146 reports which continued assumptions that have proven to be wildly wrong. For example, they assumed natural gas prices in 2019 would be between $5-7.56. But natural gas contracts for 2019 are currently available for $3 - less than 1/2 the cost projected in the 1146 reports.

    Illinois is currently awash in excess power (30% more generated than consumed in Illinois). Simply put, there is zero actual evidence that power prices would go up at all.

    The 1146 reports projected demand that is about 30% higher than actual. Guess what happens when you project artificially high costs and artificially high demand? Yup - totally bogus numbers.

    5) Please don’t paint with a broad brush on the Pritzkers. Their interests are broad, bipartisan and varied.

  13. - BigAl - Friday, Jun 10, 16 @ 3:35 pm:

    As if ELPC is a real environmental group. Gas fired generation, really?

  14. - Retired Teacher - Friday, Jun 10, 16 @ 3:42 pm:

    Only in Illinois would someone claim that a group not be environmental because they support nuclear. Haha, that’s good. Must be another lobby group.

  15. - 1986 Bears - Friday, Jun 10, 16 @ 3:42 pm:

    Gas prices are below wind, solar, nuclear and coal. Gas is dispatchable so its available 24/7. There are hundreds of years of gas in the shale under Illinois soil. Why is using more gas a problem?

  16. - Retired Teacher - Friday, Jun 10, 16 @ 3:56 pm:

    Gas is cheap right now, yes. Why are gas directed rigs across the U.S. idled right now and at all time lows? That’s right, because gas drillers can’t make money at these prices. Hence, the shale bust. Oil and gas companies are filing for bankrupt left and right. What drilling have you seen here in Illinois? None, there may be decades of gas underground but if it’s not economical companies won’t drill for it. Nat gas may be temporarily cheap, but it won’t be for much longer.

  17. - BEST Dave - Friday, Jun 10, 16 @ 3:59 pm:

    Retired Teacher,

    Respectfully, the futures markets would beg to differ. I would encourage you to look at the futures markets. You can buy a year’s worth of natural gas prices at $3 - not the $5-7.65 assumed by the 1146 reports.

  18. - Anon11 - Friday, Jun 10, 16 @ 4:03 pm:

    BEST Dave continues to mislead Illinois consumers about who he really represents. Mr. Tenaska himself tried to push for this project that would of had ratepayers pay an absurdly high rate for power from this project and now all the sudden he’s on the ratepayers side? Doesn’t add up.

  19. - Retired Teacher - Friday, Jun 10, 16 @ 4:06 pm:

    Sure, the front years might be cheap. Most power companies have already hedged that power though. It’s long term, nat gas will rise with increased demand from the power sector.

  20. - Jim S - Friday, Jun 10, 16 @ 4:21 pm:

    1986 Bears-
    I’m sorry but your name is a dead giveaway you aren’t from IL. Nobody, and I mean. NOBODY, from IL references the 86 Bears. It’s the 85 Bears my friend.

  21. - Retired Teacher - Friday, Jun 10, 16 @ 4:34 pm:

    Busted ..

  22. - BEST Dave - Friday, Jun 10, 16 @ 5:04 pm:

    Jim S, I agree. It’s CLEARLY the 1985 BEARS!

    BTW, you continue to attack the messenger because you can’t attack the facts. BEST is not misleading anyone. We are a coalition of consumer and business groups, energy companies, and mom and pop shops throughout Illinois. This is not a mystery nor does it change the facts. And the biggest fact is that Exelon continues to push for a ratepayer bailout even as our state and its ratepayers struggles.

  23. - Anon11 - Tuesday, Jun 14, 16 @ 11:17 am:

    Keep on with your “kill the messenger them,” but until you openly answer whether NRG and ELPC are funding your campaign people will continue to question you and BEST Coalition. It most certainly does matter. You’ve had plenty of opportunities to answer that question in a public forum but you won’t, that says a lot. The only group that continues to put out bogus numbers is BEST.

Sorry, comments for this post are now closed.

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