Exelon Corporation says it may close two nuclear power plants in Clinton and the Quad Cities due to operating losses.
The company claims an abundance of natural gas has pushed down the price of electricity so much that their nuclear operations can no longer remain profitable. To hold off the closure, Exelon and ComEd are sponsoring legislation that would subsidize these two plants through rate increases. Exelon spokesman Paul Dempsey explains.
“We think that a small charge of 25 cents monthly on average is really a small price to pay for making sure these units keep running. They’re a large contributor to Illinois’ carbon-free power output. A little bit more than 90% of the carbon-free power in Illinois comes from the nuclear plant," he says.
The money would be targeted specifically for these plants, subject to verification by the state.
"The independent verification would make sure only those plants that are in the negative would receive it and, if there was a point where they became profitable, it would no longer be there," Dempsey says.
Some additional funds may come from PJM, the local transmission organization. Former Illinois Commerce Commission Chairman Doug Scott says it auctions off capacity, where utilities promise a guaranteed supply of power for several years.
"They’re willing to allow capacity payments to go to companies, and so Exelon gets some more dollars for the Quad City nuclear plant," he says.
If the legislation doesn’t pass by May 31st, and if the Quad Cities plant doesn’t clear PJM’s capacity auction, the plants may close. While there’s a possibility for the facilities to be sold, Scott says it's unlikely.
“It’s not easy to restart a nuclear plant so, once it’s shut, you can fairly well assume it’s going to stay shuttered. I think just on that basis I’m not sure that you would expect a new buyer to come in," he says.
Because Illinois is a net exporter, plant closures wouldn’t necessarily affect grid capacity. However, there would be a loss of jobs.