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Archpundit takes down the Chamber on Illinois coal and “Clear Skies.” Go.

posted by Rich Miller
Monday, Mar 7, 05 @ 10:33 pm

Comments

Does the Chamber like it when the fish in Marquette park are too poisoned by coal for kids to eat without hurting their brains?

http://www.suntimes.com/output/news/cst-nws-merc07.html

Comment by Anonymous Monday, Mar 7, 05 @ 11:51 pm
I don’t think the Chamber thinks that deeply about it. They’ve literally ripped off the administration talking points without analyzing it themselves. They’d say they are against it, that Clear Skies will be more effective and not realize that mercury could be far more reduced far faster by current law or the Clinton proposal.

The entire policy area is interesting in that scrubbers and SCR would probably, in the long run, be a better investment, but because the utilities have gamed the system for so long, they can worry about short term profits first and avoid those kind of investments.

Markets can work, but one has to understand the time horizon being utilized often lead to suboptimal long term solutions because of short term incentives.

Comment by ArchPundit Tuesday, Mar 8, 05 @ 9:32 am
Re: “Long-Term”:

A few facts & then some comments:

1. Full electrical dereg kicks in 2006
2. The City of Chicago’s franchise agreement with ComEd, originally signed in October, 1991 and took effect on Jan. 1, 1992, extended ComEd’s longstanding contract to Dec. 31, 2020.
3. ComEd (Excelon) now holds only nuclear plants in IL. All the coal fired / heavy oil units were previously sold to Midwest Generating.
4. The heavy oil (Collins Station) outside of Morris, IL is now practically dismantled (non operating).
5. Excelon’s merger with PECO & now the upcomming acquisition of Public Service Enterprise Group (PSEG) in New Jersey.
6. IL has an electric power surplus today. The further East you go (like NY & surrounding areas) have a very limited surplus & are much closer to the margins.
7. The two areas of IL most dependent upon coal fired electrical generation are downstate IL and the City of Chicago.
8. The excess power generation capacity in IL is not located within the Chicagoland area (almost all coal fired), it’s in the nuclear facilities all located outside of Chicagoland proper.
9. ComEd has dropped their plans for new power transmission lines (April, 2004) from the West into Chicago proper so mass transmission of power into Chicago proper across the existing grid is limited without a dramatic increase in transmission capacity (long lead time).
10. Excelon (ComEd/PECO & soon-to-be PSEG) now allows them to wheel power in a fairly vast market area. And electric power can be economically transmitted up to around 1200 miles.

Nothing like creating a different marketplace…..

Observations:

A. Why is it that Excelon is playing Chess & everybody else looks to be playing Checkers?
B. What’s the City of Chicago going to do if Excelon decides it’s getting really uncomfortable with those existing Franchise Agreement terms & wants a new deal more to their liking?
C. Looks to me like the more government imposed restrictions that the Environmentalist movement puts on the coal fired generating stations, the more the primary victim (eventually) looks to be the consumers located in the City of Chicago proper.

Ask yourself - What’s going to be the electrical alternatives available for the City of Chicago down the road? (Maybe building a vast windmill farm all around the City-County Building?)

If you think Excelon hasn’t spent the last 2 years & millions in game planning out all the scenarios, well, you are being delusional.

Comment by Anonymous Tuesday, Mar 8, 05 @ 1:47 pm