November 15, 2016 Read More →

Exelon Pushes for Illinois State Subsidies for Its Coal and Nuclear Plants

Kari Lyderson for Midwest Energy News:

Illinois legislators today introduced a long-awaited massive energy bill that would provide subsidies to keep nuclear plants and coal plants running and introduce a controversial demand charge, along with fixing the state’s Renewable Portfolio Standard, increasing energy efficiency investments and other measures.

For more than a year, Exelon has been pushing a bill mandating ratepayer supports— now pegged at up to $265 million a year — for two nuclear plants the company says would close otherwise.

This bill, dubbed the Future Energy Jobs Bill, is an attempted collaboration between Exelon and other generators, utilities ComEd and Ameren Illinois, and environmental groups and renewable energy companies.

Negotiations between these stakeholders have been going on for many months, but people familiar with the negotiations say that the most controversial provision, which would keep downstate coal plants running, was just added recently and could be a deal-breaker for environmental groups.

The proposed FRAP, or Fixed Resource Adequacy Plan, would put the state in charge of determining capacity prices paid to generators, most notably two downstate coal plants owned by Dynegy. Under the proposed bill, these prices would likely be significantly higher than the capacity prices that would otherwise be paid through auctions run by the Midcontinent Independent System Operator (MISO).

The costs will be passed on to ratepayers, and are expected to mean the coal plants would keep running, rather than closing.

The provision is widely seen as an attempt to gain support from downstate lawmakers who see keeping the coal plants open as a way to preserve jobs. But critics say the measure will do little or nothing to help downstate economies and will burden ratepayers with higher bills.

Full article: Illinois lawmakers introduce energy bill with controversial coal supports

Robert Walton for Utility Dive:

Exelon is continuing its push for Illinois legislation that would support a pair of its struggling nuclear facilities, and is reportedly in talks with Dynegy over capacity provisions for its coal plants that might bring the company on board with its proposal, the Illinois Times reports.

Dynegy has opposed the proposed nuclear subsidies, but the Times reports Exelon is negotiating a provision that could raise capacity payments to the independent power producer’s coal facilities.

Exelon wants to push the bill through during Illinois’ veto session, which begins this week. The company is calling its bill the Future Energy Jobs Bill, to emphasize the role the preservation of the nuclear plants would play in the state’s economy.

The capacity purchase proposal and nuclear supports are part of a broader campaign from leaders of major investor-owned utilities to revise the structure of organized power markets to deliver higher payments to baseload nuclear and coal plants.

Exelon says its Quad Cities and Clinton nuclear plants are at risk of closure without support. The Clinton plant cleared a preliminary MISO reliability auction, but the resulting price was not enough to cover operating costs and returns to shareholders, according to the utility. Exelon says it will shut Clinton and Quad Cities in June of 2017 and 2018, respectively, if support legislation fails.

Full item ($): Report: Exelon Illinois nuclear bill could subsidize Dynegy coal plants

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