Is Quad Cities uneconomic or making money? Probably the former, but some of Exelon’s other reactors may be doing better than the company has let on.
The nation’s largest nuclear utility, Exelon, has launched a new website intended to encourage people in Illinois to write their state legislators in support of Exelon’s nuclear reactors–especially the five the utility has said are currently uneconomic and need financial help to keep open. Despite its repeated protestations that it isn’t asking for a bailout, Exelon has asked the state for $580 million in rate increases for those reactors, although it hasn’t promised it will keep them open in any case. Couldn’t sound more like a bailout to us…
But it turns out that Exelon made a lot of money in the third quarter of this year, making its claims of needing, yes, a bailout, somewhat suspect. In fact, according to the Chicago Tribune, Exelon’s profit rose 26% in the quarter and its income rose more than $200 million–from $738 million to $993 million.
According to the article, “Exelon also benefited from the phase out of a fee the Department of Energy has been charging since 1982 in anticipation that it would be responsible for moving and permanently storing spent nuclear fuel.”
Figures. That was the (probably temporary) end of the Nuclear Waste Fund, which was supposed to be a pass-along in which nuclear ratepayers were paying a small amount on their electric bills to be deposited into the fund. The nuclear industry has long complained that its ratepayers were being ripped off because the Fund has not so far succeeded in paying for an operational high-level nuclear waste dump. But it seems that instead of reducing its rates to end that horrible ratepayer rip off, Exelon is just pocketing the money. Greed knows no bounds.
Exelon’s CEO Christopher Crane says the company is not looking for a “bailout” because it wants a market-based solution to its supposedly uneconomic reactors. Crain’s Chicago Business recently examined Exelon’s finances in some detail and finds that claim suspect.
What Exelon really wants is either a regional cap and trade system, in which its reactors could allow continued carbon releases from coal plants elsewhere in the Midwest by trading emissions credits from its reactors, or establishment of a “clean energy standard” in Illinois that would treat nuclear power the same as renewables which, unlike nuclear, actually are clean.
The other thing Exelon really, really wants is an end to the wind production tax credit, as we have noted before, and as Bloomberg News wrote about at some length yesterday. That’s because, to the extent some of its reactors are in fact uneconomic, it’s because they can’t provide electricity as cheaply as wind power in the Midwest. And continued growth of wind power means even more competition for Exelon’s aging nuclear fleet.
The reality is that Exelon bet big on nuclear power a decade or so ago, and it lost that bet. Now it wants a bailout–whether by “market-based” solution or rate increase or whatever other means it can find.
Since Illinois legislators did not jump aboard Exelon’s bandwagon when it suggested the $580 million rate increase, Exelon is now taking its case to the public to help it lobby. Fair enough, we do the same thing (even, somewhat distressingly, on the same Salsa platform)–although we don’t try to mislead the public into what they’re supporting by sending letters to their legislators. People taking action on behalf of Exelon are being told on Exelon’s new website: “Illinois nuclear energy facilities face a perfect storm of counterproductive energy policies, market-distorting subsidies, and other economic challenges that threaten their continued operation. You can help by making your voice heard. Contact your state legislator to let them know that the continued operation of nuclear power is vital to Illinois communities and to the entire state.” They’re not being told that it’s going to cost them–a lot–if Exelon wins this battle.
Activists outside Illinois should also check out Exelon’s website and see the arguments the company is making. Those arguments, or some version of them, are likely to surface in your state soon, if they haven’t already. You’ll want to be prepared to address them. As the saying goes, know thy enemy.
October 31, 2014
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Read more here:: http://safeenergy.org/2014/10/31/exelon-fights-back/