Illinois legislature saves Exelon nuclear plants
Both chambers of the Illinois General Assembly passed a sweeping energy bill last week that includes financial support for two failing Exelon nuclear plants.
In what is described as the largest energy bill the state has seen in over two decades, Illinois lawmakers agreed to require ratepayers statewide to provide $235 million in annual subsidies to keep Exelon’s nuclear facilities in Quad Cities and Clinton open for at least another 13 years. The bill also expands the state’s energy efficiency programs and makes changes to the state’s renewable portfolio standard.
The bill was passed at the tail end of a marathon legislative session December 1. The bill was poised to fail if not for an 11th hour concession by Exelon to allow the bill to take effect June 1, 2017, which required it to meet a lower voter threshold than if it were to take effect immediately.
Shortly before the final vote, the bill was amended to limit cost impacts on all business classes at 1.3 percent compared to 2015 rates. The costs of the bill are also capped at 25 cents per month for an average customer. Other last minute changes include the elimination of a controversial residential demand charge as well as retail net metering and a measure to provide capacity payments for coal plants in the southern part of the state.
“This legislation will save thousands of jobs. It protects ratepayers, through guaranteed caps, from large rate increases in years to come. It also ensures taxpayers are not on the hook to keep the power plants open and online,” said Gov. Bruce Rauner in a statement. “This process shows that when all parties are willing to negotiate in good faith, we can find agreement and move our state forward.”
Environmental groups and consumer advocates lobbied heavily on behalf of the revised bill, which included ratepayer-generated funding to support renewable energy projects and energy efficiency programs across the state. Large businesses and rival power generators opposed the bill on the grounds it provided unnecessary financial support for nuclear plants at the expense of more profitable energy sources.
“Illinois legislators and the governor have decided that nuclear jobs are more important than coal-mining and coal-generation jobs as well as all other industrial jobs in the state by throwing hundreds of millions of dollars in subsidies at the feet of Exelon, a multi-billion dollar company located in Chicago,” Dynegy CEO Robert Flexon said to Crain’s Chicago Business.
Flexon said that the company is planning to sue to overturn the law on the grounds it cedes federal control of wholesale power markets to state entities. A similar subsidies program enacted in New York last summer is already subject to such a lawsuit.
“By the state giving corporate welfare to Exelon, it is absolutely going to accelerate retirements of plants in central and southern Illinois,” Flexon said.
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