NEIS: ILLINOIS ENERGY TRANSFORMATION #25: NUCLEAR BAILOUT UPDATES - The “Bailout Blues Show” Continues
As posted by Nuclear Energy Information Service (NEIS) of Chicago, IL director Dave Kraft on Sept. 3, 2021 (NEIS just celebrated its 40th anniversary as Illinois's nuclear power watchdog in June):
ILLINOIS ENERGY TRANSFORMATION #25:
NUCLEAR BAILOUT UPDATES
The “Bailout Blues Show” Continues
Sept. 3, 2021
This originally was going to be a “summer summary” of NEIS’ work. However, the importance and prominence of the proposed nuclear bailouts at both the Illinois-State and federal levels argued for a delay of that idea, and an update report to people committed to safe-energy and a less-nuclear world and the negative effects of the continued “nuclear hostage crisis” on our carbon-free/nuclear-free future.
ILLINOIS ENERGY BILL MOVES FORWARD, STILL IN LIMBO:
The omnibus energy bill (SB18, amended; now SB1751, House Amendment 1, no link available yet) continues to lurch forward with the surprise Senate passage on Tuesday Sept. 2 in the wee hours of the morning. It now has to be approved by the Illinois House before it can get to Illinois Governor JB Pritzker’s desk for signing. There is no guarantee that this scenario will play out. If it doesn’t, it leaves Illinois with no cogent, climate-oriented energy policy moving into an increasingly climate disrupted world.
While many hail the numerous and gargantuan compromises that led to the Senate adoption, from a climate perspective it seems to represent a “the operation was a success, but the patient died” type situation. After all, the climate does not compromise.
THE ILLINOIS NUCLEAR BAILOUT -- ONCE MORE, WITHOUT FEELING:
In the most recent iteration, the legislation provides for a $694 million bailout for Exelon’s Byron, Dresden, and Braidwood nuclear power plants, to be paid by Illinois ratepayers over a 5 year period (by comparison, renewables only get ~$600 million in the recently passed Senate bill). Reportedly this amount was negotiated between Exelon and the Governor’s office, the latter largely assuming responsibility for nuclear bailout negotiations with the company in drafting the bill.
While this amount was a far cry from the amount proposed by organized labor’s Climate Jobs Coalition in their bill – as much as $500+ million per year, for up to 10-15 years! – it was also nearly twice the amount that an independent audit commissioned by the State suggested was needed. In April Synapse Energy Economics stated that at most Exelon should receive a maximum of $350 million over five years, possibly less if energy prices changed in favor of Exelon’s unprofitable nuclear plants. No justification was ever publicly made to account for doubling this ratepayer financed bailout.
In exchange Exelon ostensibly has agreed to keep open the three nuclear plants for the next five years, temporarily saving the jobs and tax bases tied to their operation. Hopefully, communities will use this time to finally implement closure contingency plans to soften the economic blows of the inevitable reactor closures.
However, if the Illinois House can’t agree to the already-passed Senate bill, and no legislation is put forth, Exelon states it will close its Byron nuclear power station on Sept. 13; and Dresden in November. It claims these are hard date limits, although the media has quoted Exelon spokespeople as saying that “ the company has "established off-ramps" that will allow contingencies for continuing operations if legislation is passed "with enough time for us to safely refuel the plants". Exelon made similar threats prior to the 2016 passage of the Future Energy Jobs Act, which resulted in a $2.35 billion nuclear bailout for two nuclear plants.
NEIS has repeatedly pointed out to media, legislators and officials that Exelon’s threat of closure is a lot squishier than it sounds and appears. NEIS provided a 2016 letter from the Nuclear Regulatory Commission proving that any reactor can in fact be relicensed and reopened, even after it has been closed and de-fueled, provided it would meet safety requirements and standards. No one has responded to this information.
All of this is played out against the totally undiscussed backdrop of Exelon’s intention to jettison its unprofitable nuclear plants into a separate LLC company, currently called “Spin-Co”. For all the Exelon bluster of how important nuclear power is – at least important enough to require perpetual state bailouts -- it seems the Company can’t wait to put as much distance between itself (or at least its balance sheets) and unprofitable nuclear power.
NUCLEAR BAILOUTS AT THE FEDERAL LEVEL – RECONCILIATION AND INFRASTRUCTURE BILLS LOADED WITH NUCLEAR PORK:
The Biden Administration is considered by many, especially within the nuclear industry, to be one of the most pro-nuclear administrations to come along in a long time. This is apparently confirmed by the funds dedicated to nuclear bailouts and other nuclear programs in the proposed Infrastructure and Reconciliation packages in play.
The $1.5 trillion Infrastructure bill allocated ~$12 billion towards nuclear power -- $6 billion towards bailing out the failed nuclear plants around the country, and the rest to go primarily for “new” nuclear proposals, such as the so-called “small modular nuclear reactors” (SMNRs).
The Reconciliation package thinks on a much grander scale. Proposals offered in the Senate Energy and Public Works Committee by Sen. Benjamin Cardin (D.-MD) call for up to $46 billion in nuclear spending, much of this to rescue economically unviable nuclear plants around the country. It is interesting to note that Sen. Cardin has received ~$80,000 in campaign contributions over the last five years from the IBEW and Exelon Corporation, according to Open Secrets.
An analysis done by Washington groups suggests that nearly 60+% of these funds -- ~$30 billion -- would be eligible to go to Exelon and Energy Harbor (the former First Energy in Ohio). Both companies have recently been besmirched by FBI investigations and indictments, and admission of guilt for lobbying irregularities. In both cases the scandals resulted in the Speakers of the House in Illinois and Ohio losing their positions.
A virtual press conference was conducted on July 15 by Friends of the Earth, Nuclear Information and Resource Service (NIRS), and NEIS featuring a report done by Dr. Mark Cooper of the Vermont School of Law dealing with these revelations and nuclear bailouts. It was entirely ignored by Illinois media and officials.
On August 24, 2021 240+ organizations sent a sign-on letter opposing subsidies for nuclear power in the Reconciliation (S.2291/H.R.4024) and Infrastructure bills. The letter was sent to Senate and House leadership, and to President Joseph Biden. The 240+ organizations demanded that these bailouts be omitted from the budget and funds be directed to investments in carbon-free, nuclear-free clean energy.
OUTCOMES, IMPLICATIONS, AND ACTIONS:
Every dollar spent – no, wasted – on bailing out aging, degrading nuclear plants is a dollar not spent on brand new, proven renewable energy resources, efficiency, storage and transmission improvements which will be the backbone of the 21st Century energy infrastructure. The number of jobs temporarily “saved” in the short term by nuclear bailouts are costly, and are dwarfed by the number of jobs in the renewables and efficiency sectors – jobs that will not be created if nuclear power gets more bailouts. The ignored Cooper Report demonstrates the negative effects of nuclear bailouts, as did renown physicist and energy analyst Amory Lovins in remarks at a Congressional Briefing held in March 2021 (@ 55:20).
At the Illinois state level, we will soon know whether a bailout will occur, and whether or not Exelon was sincere or bluffing about its intention to close Byron if they do not get one. What is clear is that they – or their successor SpinCo – will most certainly be back for future bailouts if the plants continue to operate, definitely so if they get this bailout.
Once the bailout issue is resolved, an opening will occur to again raise issues that the current legislative debate and negotiations again unwisely failed to examine: the implications of SpinCo, radioactive waste production, reactor decommissioning, and proactive just-transitions programs to protect reactor communities and workers from future “nuclear hostage crisis” episodes.
At the federal level there is time to confront and defeat the hugely wasteful proposals in the Infrastructure and Reconciliation bills. Spending $46 billion on aging, deteriorating reactors, which create radioactive waste, and which may close anyway, or new unproven ones which have no chance of becoming commercially available in time or in numbers sufficient to fight the climate crisis is dumb and wasteful energy policy, especially when (for example) the same amount spent on wind turbines alone would get you >300,000 brand new turbines, with an intermittency-adjusted output of electricity equal to nearly twice the output of the entire current nuclear industry, without adding to the nation’s continually growing radioactive waste problem. As a climate intervention, trading plutonium for carbon is simply irrational energy policy.
WHAT YOU CAN DO:
Since this continues to be dealt with in the political arena, it is imperative that you let your elected officials know your position on nuclear power. You can find out who they are at all levels of government by clicking here. Then – contact them. Over and over. And remind them: 2022 is an election year, and you are watching.
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David A. Kraft, Director
3411 W. Diversey #13Chicago, IL 60647(773)342-7650neis@neis.orgwww.neis.orgSKYPE address: davekhamburgNEIS is a member of EarthShare Illinois
No more Chornobyls! No more Fukushimas!
Invest in a nuclear-free world -- today!
admin
As posted by Midwest Energy News on Sept. 8, 2021:
NUCLEAR:
• The Illinois House is expected to consider a sweeping energy bill tomorrow that could prevent two Exelon nuclear plants from closing while also prioritizing renewable energy and utility ethics reforms. (Reuters)
admin
Update/Alert from Dave Kraft/NEIS, Chicago:
NEW EXELON DEVELOPMENTS; EXPECT SOME ACTION TODAY
Greetings All --Well, the pace quickens; today could be the day for the House:
- labor and ICJC have endorsed bill #SB2408
- House Committee hearing this morning at 11 a.m.
- new version includes some compensation for Zion holding radwaste, but no other reactor communities
- Gail and George finishing up the cartoon
- Trib reporter used some of our previous let-eds that didn't get published in his article today; got the "good quotes" in for a change (see below)
- the path forward:
- if the House accepts the Senate bill AS IS, it'll go to Pritker to be signed
- if there are changes, the Senate has to come back tomorrow (Friday) to vote on the House version to meet the Exelon deadline of Monday, Sept. 13; then Pritzker has to sign
- votes require 3/5 majority for passage now, for things to take immediate effect
Will keep folks updated.--Dave--
Byron’s nuclear plant has generated jobs and revenue for decades. Now its future is on the line in Springfield: ‘We’re pawns in a big chess game’
By Dan Petrella -- Chicago Tribune | -- Sep 09, 2021 at 5:00 AM
Thank you for supporting our journalism. This article is available exclusively for our subscribers, who help fund our work at the Chicago Tribune.
BYRON, ILL. — The economic future of this community nestled along the Rock River in northwestern Illinois very well could be decided in the next few days at the state Capitol in Springfield.
Exelon, the parent company of scandal-plagued Commonwealth Edison, has given the Democratic-controlled General Assembly and Democratic Gov. J.B. Pritzker an ultimatum: Pass an overhaul of state energy policy that includes a nearly $700 million bailout for three of its nuclear power plants, or its Byron Generating Station will begin shutting down on Monday.
It’s an anxious time for local officials and residents in Byron, a city of about 3,600, and surrounding communities in Ogle County and beyond as they wait for action in Springfield. If Exelon follows through on its threat, there’s little hope for replacing a plant that has powered the area’s economy, along with millions of homes across northern Illinois, for close to four decades.
The Byron Generating Station is seen through a cornfield in Byron, Illinois, on Sept. 7, 2021. If state lawmakers are unable to approve an energy plan ncluding a bailout for three Exelon nuclear plants in the upcoming days, the company has said it will shut down the Bryon plant permanently after Sept. 13. (Antonio Perez / Chicago Tribune)
“We’re pawns in a big chess game,” Byron Mayor John Rickard said Tuesday. “We do not control our fate. And that’s not a good place to be.”
The Illinois House is set to reconvene Thursday to take up a proposal approved last week in the Senate that has the backing of organized labor, as well as a separate plan introduced late Friday that has the support of Pritzker and allied environmental groups.
Unless the House approves the Senate plan without any changes, the Senate would have to return as well to send a final agreement to the governor’s desk. Because any proposal would need to take effect immediately upon Pritzker’s signature, a deal will require approval from a three-fifths majority in each chamber.
Without the nuclear plant, the Byron region stands to lose more than 700 high-paying jobs and an estimated $487 million annually in related economic activity — nearly 3% of the area’s gross domestic product, according to a study last year from a researcher at Northern Illinois University.
The plant’s twin cooling towers rise amid rolling farmland across the river from Byron, so the city doesn’t receive any direct tax revenue from it. But it generates about $19 million annually for the local schools — nearly three-quarters of the total property tax revenue collected by Byron Community School District 226.
Exelon has argued that subsidies tacked on to customers’ power bills are justified because its nuclear plants, which produce large amounts of energy without spewing climate-damaging carbon dioxide, can’t compete with cheaper, dirtier fossil fuels and subsidized renewable sources such as wind and solar. Without nuclear power, Pritzker’s goal of reaching 100% carbon-free energy by 2050 — one of the main drivers of the current energy debate — wouldn’t be within reach, the company and its supporters say.
Exactly how much consumers would be asked to pay to subsidize nuclear and renewable energy and cover other costs associated with the plan has been difficult to pin down, but one estimate pegs the cost of the Senate proposal at about $3.50 per month for the average residential customer.
The timing of Exelon’s closure threat loaded heavy political baggage onto to the already complex task of setting statewide energy policy that balances the often competing demands of labor unions, environmentalists and power customers, among others.
Exelon first said in August 2020 that, without a deal, it would close Byron this month and its Dresden nuclear plant later this year. That was about a month after its ComEd subsidiary agreed to pay a $200 million fine and admitted in federal court that it engaged in a yearslong bribery schemed aimed at advancing its agenda in Springfield — including a previous nuclear plant bailout in 2016.
A truck drives near the Byron Generating Station in Byron, Illinois, on Sept. 7, 2021. (Antonio Perez / Chicago Tribune)
ComEd’s bombshell acknowledgment led to the ouster in January of longtime House Speaker Michael Madigan, who has not been charged and has denied wrongdoing, and then to his resignation after a half-century in the legislature.
After tense negotiations throughout the spring, Pritzker’s office reached an agreement with Exelon in the waning hours of the legislature’s spring session in late May that would put power customers on the hook for nearly $700 million in subsidies over five years for the Byron and Dresden plants, along with a third plant near Braidwood in Will County.
But legislation didn’t reach the floor before the General Assembly adjourned its spring session, and talks have dragged on throughout the summer. Lawmakers and the governor’s office, along with their allies in organized labor and the environmental movement, so far have failed to reach an agreement on phasing out two other power plants: the coal-fired Prairie State Generating Station in southern Illinois, which serves communities across the state, and the city-owned coal plant in Springfield.
The Senate plan would force the plants to shut down in 2045 — 15 years later than other coal plants. But Pritzker has said he won’t sign that plan because he also wants the plants to cut emissions in the interim. The House proposal, which has the governor’s support, would require those plants to cut carbon emissions by 45% by 2035 and entirely by 2045.
While officials in Byron don’t lack sympathy for the impact those shutdowns would have on other communities, the threat they’re facing can be counted in days, weeks and years, not decades.
“If the coal plant were sitting 5 miles from here and generating economic income, we’d be having a slightly different conversation,” Rickard said. “I would still want to say, ‘We need to stop doing that. Can we gear it down in such a way? Can we do job replacement programs?’”
Those are the kinds of questions Byron and other communities that rely on nuclear plants should have been asking themselves and attempting to answer for years, said David Kraft, director of the Nuclear Energy Information Service, a longtime Exelon critic and opponent of atomic energy.
“Exelon’s business model has depended on the company-town dependency fostered by their ‘nuclear hostage crisis’: threaten closures, declare ‘crisis,’ get the locals to pressure the legislature for bailouts; get bailouts paid for by everyone else. Repeat cycle,” Kraft said in a statement responding to a letter to editor from Rickard published in the Tribune in July. “It worked in 2016. But this is a cycle of failure. You can’t build an energy future by bailing out the past.”
For Rickard, though, the heart of the issue is that “we do not have a comprehensive energy plan in this country, let alone this state.”
President Joe Biden has pushed for federal action to combat climate change and boost clean energy, and a $1 trillion infrastructure plan approved last month in the U.S. Senate includes federal aid for nuclear power plants. The measure hasn’t received final congressional approval, and Exelon has said any federal help won’t come in time to change its course in Byron.
Byron District 226 School Board President Christine Lynde has grown frustrated waiting for elected officials in Springfield to take action, particularly over the summer. She felt Pritzker and the legislature’s Democratic leaders, Senate President Don Harmon of Oak Park and House Speaker Emanuel “Chris” Welch of Hillside, were sitting on the sidelines while their allies in labor and the environmental community fought it out.
“They need to be leading,” said Lynde, whose youngest child just graduated from Byron High School and whose husband works in operations at the plant. “If there’s a divide between the so-called (environmentalists) and the labor (unions), then they need their leadership to figure out a compromise. For them to sit back and have a hands-off approach, that’s not leadership.”
Lynde’s criticisms aren’t limited to the Democratic side of the aisle.
Like most of the nuclear plants in Illinois, Byron is in heavily Republican territory, and a local campaign hasn’t succeeded in convincing all of the area’s GOP lawmakers to support efforts to keep the plant open.
Republican state Sen. Brian Stewart of Freeport, whose district is home to the plant, voted against the measure approved in the Senate last week, as did Sen. Dave Syverson of nearby Rockford.
“I think he understands the nuclear situation,” Lynde said of Stewart. “I think there’s probably other things in that bill he disagrees with. But I would ask and implore him to put his constituents first. At some point, you should be representing the people who elected you.”
Stewart did not respond to an interview request through his district office, but in a statement last week, he pointed to the ComEd bribery scandal as one of his reasons for voting against what he called a “lose lose” proposal.
Stewart also raised concerns about continued subsidies for renewable energy companies and the closure of coal plants across the state, among other issues.
“I would have strongly supported provisions to protect the Bryon nuclear power plant if they were presented in a stand-alone bill,” Stewart said. “What they aren’t telling you is that (the Senate plan) also has a number of bad provisions, poison pills that will ultimately hurt Illinois ratepayers, businesses and consumers by significantly increasing utility rates.”
State Rep. Tom Demmer of Dixon, a Republican whose district includes the city of Byron and borders the power plant, understands — and to some extent shares — the concerns of fellow GOP lawmakers.
“The ethical failures at ComEd in the past have absolutely made this situation much more difficult,” Demmer said, adding that he also has concerns about what the overall package will cost power customers.
But that has to be weighed against the risks of inaction, he said.
“The choice to do nothing in Springfield also would have an impact on the energy market,” Demmer said.
In addition to devastating job losses for the region, he said, closing the nuclear plants could result in the need to buy energy from out-of-state producers that burn fossil fuels in order to meet demand, undermining the state’s economic and clean energy goals and potentially costing customers more.
“It’s not going to be Illinois jobs, it’s not going to be zero-carbon, and it’s going to be more expensive too,” Demmer said.
Elected officials aren’t the only ones fretting over the future of the plant.
Restaurants, bars and other businesses throughout Byron are displaying signs urging residents to contact their legislators about saving the plant, and everyone encountered Tuesday afternoon seemed to have an opinion about the situation, whether or not they were willing to share it publicly.
Longtime area residents Bill and Karen Sikorski, who were having lunch at Sunrise II Family Restaurant on Second Street in downtown Byron, have lived outside of town since a few years before the nuclear plant opened.
“This town changed immensely,” Bill Sikorski said, pointing to the “three great big state-of-the-art schools.”
Were they surprised lawmakers haven’t acted with Exelon’s deadline so close at hand?
“Yes, but no,” Karen Sikorski said. “It’s all political.”
Two doors down at 2nd Chance Tavern, bartender Joanie Carlson was more blunt in her assessment, comparing the situation to bovine excrement.
“Once it’s shut down, it’s done,” Carlson said. “It’s stupid.”
Power plant workers will likely move away in search of other jobs, resulting in higher taxes for those who stay, she said. Businesses also would lose out on the boost they get from the extra workers that come to town for refueling or other scheduled outages.
“I’d hate to see Byron be a ghost town,” Tami Rapp, a longtime resident who has worked construction jobs at the plant, said while seated at the bar.
The concerns go beyond economics, she said. The plant has become part of the area’s identity, and its steam-billowing cooling towers serve as guideposts that mark the way home.
“I wouldn’t know what to do without those smokers smoking in my backyard,” Rapp said.
Chicago Tribune
Contact
A Lombard native, Dan Petrella has written for newspapers from Chicago to Carbondale. Before joining the Tribune in 2017, he was Springfield bureau chief for Lee Enterprises newspapers. He's also been an editor and reporter at The State Journal-Register in Springfield. He is a graduate of the University of Illinois at Urbana-Champaign.
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David A. Kraft, Director
3411 W. Diversey #13Chicago, IL 60647(773)342-7650neis@neis.orgwww.neis.orgSKYPE address: davekhamburgNEIS is a member of EarthShare Illinois
No more Chornobyls! No more Fukushimas!Invest in a nuclear-free world -- today!
admin
ILLINOIS: A sweeping clean energy plan that phases out coal and gas plants while providing nearly $700 million in subsidies to save two Exeleon nuclear plants passes in the state House and heads back to the Senate for consideration. Gov. J.B. Pritzker has said he will sign the bill. (Chicago Tribune, WTVO)
ALSO: Federal prosecutors seek to halt fact-finding in a civil case related to the ongoing bribery investigation involving ComEd, while a judge tosses a separate case alleging ties between the utility and former House Speaker Michael Madigan. (Chicago Sun-Times)