Illinois Legislature saves at-risk nuclear plants with clean energy bill

  • Sep 14, 2021
  • Washington Examiner

The Illinois Legislature has approved legislation providing nearly $700 million in subsidies over five years to save unprofitable nuclear plants, acting in the final hour to stop at least one from shutting down.

The state Senate closed the deal on Monday, voting 37-17 on a massive clean energy package, sending the measure to Democratic Gov. J.B. Pritzker for his signature.

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The Illinois House approved the energy policy overhaul last Thursday by a wide margin, 83-33.

The nuclear aid is part of a larger clean energy bill putting Illinois on the path to a carbon emissions-free electric grid by 2045, one of the fastest timelines in the nation. The legislation's “carbon mitigation credit program” provides financial support to Chicago-based utility Exelon’s Byron, Dresden, and Braidwood nuclear power plants.

In response to the bill's passage, Exelon committed to refueling its Byron and Dresden nuclear plants, keeping them alive. The utility will also "move to immediately fill hundreds of vacant positions and resume capital projects required for long-term operation."

Exelon had said it planned to shut down its Byron nuclear plant in northern Illinois, one of the nation’s largest that has been operating for almost four decades, on Monday without state action.

Dresden was scheduled to close in November. The Braidwood plant was not scheduled to retire, but Exelon claimed it was also “at risk” due to low power prices resulting from competition from natural gas and renewables, the same factors imperiling Byron and Dresden.

The clean energy package stalled for months over the summer due to unrelated issues establishing a process for shutting down municipality-owned coal plants in the southern part of the state, including the Prairie State Generating Station, Illinois’s newest and largest coal plant.

But Pritzker, state legislators of both parties, environmental groups, and labor unions came together to act, motivated to preserve thousands of jobs associated with the plants and to maintain Illinois’s status as the largest producer of nuclear power, a central element of the state’s clean energy ambitions.

The legislative package, one of the largest energy policy bills ever pursued in a state legislature, would require most coal plants to close by the end of the decade and natural gas plants to shut down by 2045.

It would also create a Green Bank to support renewable power build-out, encourage the replacement of coal facilities with solar and energy storage systems, accelerate the electrification of homes and buildings, provide funding to fossil fuel-dependent areas, and invest in building electric vehicle charging stations and transmission lines.

“In signing this historic legislation, Governor J. B. Pritzker cements Illinois' role as a leader in the transition to a clean energy economy,” said J.R. Tolbert, managing director at Advanced Energy Economy, a clean energy industry group.

However, keeping the nuclear plants online is considered crucial to meeting the clean energy targets, as nuclear provides 90% of Illinois's carbon-free electricity.

Nine nuclear reactors have prematurely retired in the United States since 2012 due to economic factors associated with the low price of natural gas and renewables, according to the Clean Air Task Force.

To stave that off, at least five states with aggressive clean energy targets have implemented credit programs to reward nuclear plants for providing zero-carbon electricity.

That includes Illinois, which passed a law in 2016 providing 10 years of zero-emissions credits to the Clinton and Quad Cities nuclear plants operated by Exelon.

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Analysts warned that if Exelon had shut down its other nuclear plants before renewable energy was scaled up, coal and natural gas plants would have run more frequently to meet the power demand, as has happened historically when nuclear plants retire prematurely.

The action in Illinois comes as the Biden administration and Congress are interested in pursuing a federal program giving nuclear plants tax credits or other subsidies to keep America’s largest zero-carbon resource viable.

The bipartisan Senate infrastructure bill creates a $6 billion four-year credit program for nuclear reactors that would provide a big boost to existing nuclear reactors, potentially including others in Illinois.

Democrats are also looking to provide production tax credits for struggling nuclear plants as part of their infrastructure and social spending package.