Exelon Corp. (NYSE: EXC) said in its May 6 earning statement that it tentatively plans to retire two nuclear plants in 2017 and 2018 because they aren’t competing well in the Midcontinent ISO and PJM Interconnection markets.
Christopher M. Crane, Exelon’s president and CEO, said that the company is “announcing plans to retire the economically challenged Clinton and Quad Cities nuclear plants in Illinois on June 1, 2017 and June 1, 2018, respectively, without passage of adequate legislation in the current spring legislative session and Quad Cities clearing in the 2019-20 RPM capacity auction.”
Exelon hasn’t given up on legislation. On May 5, the company endorsed the Next Generation Energy Plan, which should help preserve the endangered nuclear plants while increasing Illinois support for solar power and energy efficiency.
In 2015, Exelon and Generation deferred retirement decisions on Clinton and Quad Cities until 2016 in order to participate in the 2016-2017 MISO primary reliability auction and the 2019-2020 PJM Interconnection capacity auction to be held in April and May 2016, respectively, as well as to provide Illinois policy makers with additional time to consider needed reforms and for MISO to consider market design changes to ensure long-term power system reliability in southern Illinois.
In April 2016, Clinton cleared the MISO primary reliability auction as a price taker for the 2016-2017 planning year. The resulting capacity price is insufficient to cover cash operating costs and a risk-adjusted rate of return to shareholders, Exelon said. The results of the 2019-2020 PJM capacity auction will be available on May 24, 2016.
On May 6, 2016, Exelon announced intentions to shut down the Clinton nuclear plant on June 1, 2017, and Quad Cities nuclear plant on June 1, 2018, if Illinois does not pass adequate legislation by May 31, 2016, and if Quad Cities does not clear the 2019-2020 PJM capacity auction.
The Quad Cities plant is built on a site along the Mississippi River. Units 1 and 2 began commercial operation in 1973. Exelon operates the power plant that is co-owned by Exelon (75%) and MidAmerican Energy (25%). Unit 1 is capable of producing 934 net MW and Unit 2 is capable of producing 937 net MW.
Clinton is located in central Illinois about six miles east of Clinton, Illinois, in DeWitt County. Clinton Power Station began operating in 1987. The single unit is capable of generating nearly 1,069 net MW.