Illinois will have serious trouble complying with the U.S. Environmental Protection Agency (EPA) Clean Power Plan if any existing Exelon (NYSE:EXC) nuclear units are forced to retire prematurely, company officials told the Illinois Commerce Commission (ICC) on Sept. 23.
During the presentation, Exelon cited EPA data suggesting that nuclear plants are currently seeing up to a $6/MWh shortfall in covering their operating costs with electricity sales.
During the past year Exelon has been touting the benefit of its nuclear fleet in hopes of avoiding becoming a market casualty like two other merchant reactors – the Dominion (NYSE:D) Kewaunee unit in Wisconsin and the Entergy (NYSE:ETR) Vermont Yankee plant in Vermont.
As a result, Exelon says a “relatively modest” carbon price equal to $6/MWh “would preserve many existing merchant nuclear capacity that are currently unprofitable and at risk of premature retirement.”
“If the units at risk of closing today — representing 43 percent of the state’s nuclear generation — retire, they cannot be mothballed and later brought back online,” said Exelon Senior Vice President of Federal Regulatory Affairs and Wholesale Market Policy Kathleen Barrón.
She was addressing a forum sponsored by ICC to solicit input on EPA’s proposal to have states cut power sector carbon dioxide emissions 30% by 2030.
“Together they [the Exelon nuclear plants] represent more than 30 million metric tons of avoided carbon emissions, given that they will need to be replaced with fossil generation to provide the around-the-clock electricity needed to serve customers in the state,” Barrón said.
The figures offered by Exelon are based upon replacement generation assumed to have an emission intensity of roughly 1,475 lb/MWh.
The state’s six nuclear power plants generate 48% of its electricity supply – enough to meet the needs of 7 million Illinois residents.
“All zero-carbon resources should be treated similarly,” Barrón said, “and a state like Illinois that has invested in nuclear technology should be recognized for that clean energy investment.”
Exelon nuclear plants operating in Illinois include Braidwood, LaSalle, Dresden, Byron, Quad Cities and Clinton.
“Clean generation” is the third “building block” of the EPA proposal to have states curb CO2 emissions 30% by 2030. The rule was released in June under section 111(d) of the Clean Air Act.