Exelon bill designed to bailout failing nuclear plants, transfer wealth, kill renewables, NEIS testifies
SPRINGFIELD, May 16, 2016— Nuclear Energy Information Service of Chicago testified today before the Illinois State Senate Energy and Public Utilities Committee that the new Exelon legislation amounted to a “corporate welfare bailout” designed to kill renewable energy and “transfer wealth from Illinois ratepayers to Exelon shareholders.”
Speaking at a Subject Matter hearing, NEIS Director David Kraft urged legislators to reject the flawed Exelon legislation – Amendment 3 to SB.1585, the so-called “Next Generation Energy Plan” – and fix the Renewable Energy Portfolio Standard (RPS) as soon as possible, and before considering any Exelon reactor bailout schemes.
“Exelon’s obstructionism has done real harm to Illinois renewable energy,” Kraft notes. “[Exelon] now suggests that it will continue to do that harm unless its failed and anachronistic business model is ‘rewarded’ – bailed out. It is simply inappropriate and irresponsible – and dumb energy policy – to reward such self-fulfilling prophecy,” Kraft told the Committee.
The RPS program has been unable to access millions of dollars in collected money to build new renewable energy generating facilities in Illinois due to an unforeseen glitch in the original law. Exelon lobbyists have helped stall that fix for the past 4 years, while at the same time creating pro-nuclear front groups to lobby the Illinois Legislators for a financial bailout of allegedly money-losing nuclear reactors in Illinois.
The original amount Exelon suggested was $1.6 billion over five years, an amount which has been scaled back in successive versions of their hardship story, in part due to positive gains in the local energy markets. While not stated directly in the current Exelon bill, the bailout ask is now estimated to be anywhere from $100 to $150 million per year for the money losing Clinton-1 and Quad Cities 1&2 reactors. While pleading financial hardship at these reactors, Exelon’s Christopher Crane pledged to shareholders in Exelon’s 4Q report earlier this year that they would receive an annual 2.5% increase in dividends over the next three years.
“Some hardship,” observes Kraft. “These reactors are Exelon’s private assets. There is no rational justification for ratepayers – the public – to subsidize these private assets, and certainly not without getting some kind of equity for use of their money,” Kraft asserts. “If Exelon keeps the assets, let their shareholders pay for their operation,” he said.
Exelon claims that their legislation would “level the playing field for all clean energy sources to compete…” and “…recognize the zero-carbon benefits of nuclear power.”
“Why single out the low-carbon benefits for reward?” Kraft asks. “Should not RE/EE be rewarded for the facts that they not only are lower-carbon emitters than nuclear, but they eliminate the costly and risky societal burdens of radioactive waste production and disposal, and nuclear proliferation of materials, expertise, technology and ultimately nuclear weapons and terrorism. Should not these positive societal benefits be compensated for additional reward?” Kraft points out.
Kraft also criticized the Exelon threat of job and economic loss stemming from their proposed closure of Clinton and Quad Cities, noting that renewable energy and energy efficiency, sectors which the Exelon nuclear bailout could severely damage and Exelon’s obstruction of the RPS fix already has, account for 12 times the number of direct jobs statewide as would be lost at the two reactors, and as much as 25 times the total number if including indirect jobs. “If legislators are concerned about jobs across the State, they should focus on fixing the RPS,” Kraft maintained. He also recommended establishing “just transition funds” for all reactor communities which will inevitably face reactor closures when the reactor licenses expire. This suggestion has received positive response from some legislators.