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Controversial legislation to subsidize unprofitable nuclear plants in Illinois may see a vote after the election as lawmakers return to Springfield for the fall veto session.
Characterized as a “bailout” by opponents, the bill may undergo last-minute changes, including a new way of charging customers for electricity and a roundabout subsidy for coal plants.
Power giant Exelon wants Illinois lawmakers to pass Senate Bill 1585, a proposal designating nuclear power as a “low-carbon resource.” The measure is aimed at keeping two of Exelon’s unprofitable nuclear plants at Clinton and the Quad Cities from closing.
Under Exelon’s proposed Low Carbon Portfolio Standard, 70 percent of the state’s electricity would have to come from low-carbon sources, and companies producing that power would be able to charge more for it through a system of “low-carbon credits.” Exelon says its plan would also help Illinois meet future requirements to reduce carbon dioxide emissions.
Opposition from environmental groups and coal plant operators has kept the bill from passing, but Exelon is reportedly in negotiations with Texas-based coal power company Dynegy. A potential bargain between the two companies could yield a proposal in which the state takes over what are known as “capacity payments” – agreements in which power grid operators pay power producers in exchange for a promise to provide electricity during peak demand. If state regulators take over that task, it would likely mean higher payments to power producers, ensuring income for Dynegy’s downstate coal plants which face possible closure as environmental regulations tighten.
posted by Rich Miller
Thursday, Nov 10, 16 @ 3:46 pm
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So Illinois Coal pays neither a royalty nor sales tax, but they need a further subsidy to continue to ship coking coal to make steel in China using our taxpayer subsidized rail and lock and dam systems. Shameful.
Comment by yeah Thursday, Nov 10, 16 @ 3:56 pm
This first half of this article sounds like it was written in 2015. The second half in 2016.
Comment by Ggeo Thursday, Nov 10, 16 @ 4:11 pm
Maybe if the attorney general hadn’t spent the past year attacking the union’s, clean energy companies and environmentalists on energy issues, she could have been spending her time trying to knock down the coal subsidies.
Comment by Ggeo Thursday, Nov 10, 16 @ 4:16 pm
Chris Crane needs another hobby. Sigh is right!
Comment by Anon221 Thursday, Nov 10, 16 @ 4:19 pm
Yeah.yeah.
Comment by blue dog dem Thursday, Nov 10, 16 @ 4:30 pm
Yes Ggeo, there is some confusion. Exelon has had three proposals - all under SB 1585. The first was the Low Carbon Portfolio Standard (LCPS). That was just a straight bailout of $300 million/year for all six plants. Exelon claimed all low carbon resources could apply, but that never passed the laugh test since the restrictions were so extreme that only companies that began with E, ended with N and had “XELO” in the middle were eligible.
So in May, LCPS gave way to NGEP, the Next Generation Energy Plan. This time NGEP also had several other components, but the nuclear bailout mysteriously remained around $290 million even though it now only applied to two plants (whose share of the LCPS was $75 million) instead of six.
And now, Exelon has given us the FEJB - Future Energy Jobs Bill. FEJB still has the nuke bailout of about $290 million/year, as well as the other NGEP components, ballooning it’s cost to more than $15 billion. But now, as we’ve written about here and as the article states, FEJB also is adding the FRAP - a massive subsidy for Dynegy’s closed or closing coal plants.
The FRAP (Fixed Resource Adequacy Plan) subsidy will add BILLIONS more to the price tag. What’s extra special about this one, is that two of the state’s “leading” environmental organizations have signed on to this bill to prolong the life of Illinois’ dirtiest coal plants. And so has the group supposedly protecting consumers - CUB.
Oh, and the best part for those that actually care about Illinois coal is it does nothing to help the Illinois coal industry as these plants all use Western coal.
Welcome to energy politics in Illinois.
Comment by BEST Dave Thursday, Nov 10, 16 @ 4:44 pm