Thursday, February 21, 2019

No Quick Action Seen on Report’s Options to Save Illinois Nukes

By Suzanne Herel

illinoisIllinois legislative leaders haven’t decided on their next move following a report that offered options for improving the finances of Exelon’s nuclear power plants.

“The report just came out. We’re still examining it,” Steve Brown, spokesman for House Speaker Michael Madigan, said Friday. Madigan, a Democrat, introduced Resolution 1146, which passed with bipartisan support last spring, asking state agencies to investigate “potential market-based solutions to guard against premature closure of at-risk nuclear plants and associated consequences.”

The resulting 269-page report, released Jan. 8, advised legislators that they could keep the status quo; establish a cap-and-trade program with other states; tax fossil fuel-burning generators; adopt a low-carbon portfolio standard; or embrace a sustainable power planning standard. (See Illinois Considering Carbon Tax, Cap-and-Trade to Save Exelon Nukes.)

All of the options are likely to result in higher power prices for consumers.

Asked whether there would be meetings or public hearings, Brown said, “I don’t know if any of that has been decided yet.”

Brown said the recent turnover in the state’s executive branch will play a part in what happens next. Republican Gov. Bruce Rauner took office last week, replacing Democrat Pat Quinn.

“I’d say later rather than sooner regarding the timetable,” Brown said, adding that it was premature to say which of the five options will gain traction.

“I have not heard any discussion suggesting that there’s a consensus around any of the different ideas,” he said. “It’s an important issue and will take some time to sort out.”

Likewise, the office of House Republican Leader Jim Durkin, who co-sponsored the resolution, offered no timetable for a response to the report.

Exelon has said that its nuclear generating stations in Byron, Clinton and Quad Cities are unprofitable in the current market and that government subsidies and tax credits afforded the wind and renewable energy sectors have created an unfair market advantage for its competitors.

The nuclear power giant argues that its stations should get credit for producing carbon-free electricity.

While Exelon lauded the report as validating its view, others interpreted it differently.

“These reports clearly demonstrate that the economic situation for multiple nuclear facilities is much more manageable than originally thought. The report also finds that the retirements of the Illinois nuclear fleet will not cause reliability problems with the state’s electric supply, except under extreme scenarios never before seen in U.S. energy markets, including PJM,” said David Gaier, spokesman for NRG Energy.

Gaier said the best course of action would be to keep the status quo. “Allowing the market to work, which means no ‘subsidy legislation,’ will save ratepayers more than $120 million per year,” he said.

Much of the Illinois report addresses the potential costs to the state if the plants are retired, which would result in the loss of jobs and tax revenue and the possibility of having to burn more fossil fuels to replace the lost generation.

It was produced by the Illinois Commerce Commission, the Illinois Power Agency, the Illinois Environmental Protection Agency and the Illinois Department of Commerce and Economic Opportunity.

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