By STEVE DANIELS
Exelon's energy bill has landed at last, containing ratepayer-financed benefits for virtually every energy interest in Illinois, including now Dynegy's large but financially ailing coal-fired fleet of plants downstate.
So why are so few happy? Because some interests getting goodies don't want certain other interests to get any.
The last-minute addition of provisions aimed at keeping coal plants running and even maybe allowing one mothballed unit to be reopened has environmental groups that were previously prepared to support the bill now in opposition. They include the Sierra Club and the Natural Resources Defense Council, which have been negotiating with Exelon for months over language to support new wind farms and solar development in Illinois, as well as a major expansion of utility-run energy-efficiency programs.
The 446-page measure also would raise electricity rates statewide to save two Exelon-owned nuclear plants that the company says will close otherwise.
It would dramatically overhaul how Commonwealth Edison's power-delivery rates are set, charging households and small businesses based on their usage during high-demand periods of the day rather than their overall consumption per month as happens now. Some rooftop solar-panel installers say that provision will kill any chance of household solar power taking off in Illinois.
Other key business interests are opponents as well, like the largest industrial consumers of power in Illinois and the Building Owners and Management Association of Chicago, which object to the costs the bill would impose on them. Opponents say with all the additions the bill will raise rates statewide by at least $24 billion through 2040. Supporters say cost savings due to a ramp-up in efficiency programs will mitigate those increases, but the opponents counter that the rate hikes are definite while the savings are projections.
Said Exelon in an email: "These claims (of huge costs) are blatantly false, failing to acknowledge or factor in any of the benefits of the legislation. ... The Future Energy Jobs Bill achieves several critical goals—jobs, clean energy, energy savings and greater grid security—at a modest increase of about 25 cents per month for the average ComEd residential customer."
Another key opponent, said participants in the discussions: Ameren, which delivers electricity downstate. (An Ameren spokeswoman didn't respond to an email requesting comment.)
Illinois Attorney General Lisa Madigan has been an ardent foe of the bill throughout its gestation as has AARP Illinois, which warns that seniors on fixed incomes will suffer.
Now, the Citizens Utility Board, which has been negotiating with Exelon and ComEd for months and had been generally supportive, can be counted among the opponents. Executive Director David Kolata, though, said this isn't likely to be the final bill before it comes to a vote in the Legislature.
A WORK IN PROGRESS?
“The amendment contains very strong energy efficiency provisions and a real (renewable portfolio standard) fix,” he said. “There are still parts of it that need significant work. … In Springfield we all know things happen in stages, so we'll see what happens.”
All of the opposition raises the odds against getting the energy bill passed by Exelon's deadline of mid-December. That's when Exelon said it will have to move forward with the closure of its money-losing Clinton nuclear plant. Likewise, it plans to shutter its Quad Cities nuclear plant in 2018 without financial support from the state.
So who does that leave as supporters? Exelon, of course, and its subsidiary ComEd.
Exelon said it was pleased to see the "forward momentum" on what it has dubbed the Future Energy Jobs Bill. "As with any piece of major legislation, it will continue to evolve as stakeholders weigh in. But at its core, we know the bill will bring significant benefits to consumers and the environment in Illinois."
Houston-based Dynegy, which thanks to the coal additions could see hundreds of millions in additional revenue per year to support its operations in Illinois, said it's reserving judgment on the entirety of the bill. But it supports the language benefiting coal, of course.
Many of these interests will converge on Springfield Nov. 16 to testify at a House Energy Committee hearing on the measure. Exelon hopes for a vote in the second week of the fall veto session, which is scheduled for the week after Thanksgiving.
The new language benefiting Dynegy would require the state to purchase power “capacity” downstate from power generators, as well as big users of electricity who promise not to consume power during peak-demand periods when it's at a premium. Capacity prices—effectively payments in return for a pledge from a power plant that it will run when most needed during the course of a year—are embedded in the energy prices all households and businesses pay.
The provisions would require the state to purchase the capacity over four-year periods, giving the coal-fired plants mainly responsible for keeping the lights on downstate four years of predictable revenues.
It “would provide us much more certainty to make large capital investment decisions,” said Dean Ellis, senior vice president of regulatory affairs at Dynegy.
He said it's not fair to label the new policy a subsidy for power generators like Dynegy and Exelon, whose Clinton plant could benefit as well.
“It's not just for coal plants,” he said. “There's no guarantee any resource is selected in this process.”
The addition of the language is enough to move the Sierra Club from a supporter of the bill, even with hundreds of millions annually from ratepayers to support Exelon's nuclear plants, to an opponent, confirmed Jack Darin, Illinois director. The Sierra Club has pushed hard in recent years to close down old coal plants that are primary sources of carbon emissions contributing to climate change.