Dive Brief:
- Exelon Corp.'s Clinton nuclear plant in Illinois has cleared the 2016-2017 MISO capacity auction and is committed to operate through May 31, 2017. However, officials warn that market changes will be necessary if the plant is to continue operating beyond that date, Platts reports.
- Chris Crane, Exelon's president and CEO, warned in a statement that absent "urgent action on the policy front," the plant would be forced to close down. Last year, Exelon delayed a decision to mothball the facility so it could bid into the MISO capacity auction.
- But the plant is continuing to lose money, officials say, and a decision on the plant's future is expected this year. Shutting down the plant would make it harder for Illinois to achieve carbon reductions, Exelon said.
Dive Insight:
Last year, Exelon delayed a decision on the Clinton nuclear facility after a MISO plan to engage stakeholders on market reforms in southern Illinois convinced the generator to remain in operation. The plant cleared MISO's capacity auction and will run for at least another year, but the company warns that's likely to be the end.
“Without urgent action on the policy front, we will have no choice but to prepare for a potential early retirement in the face of continued financial losses at our Clinton nuclear plant,” Crane said in a statement. “The loss of this plant would have significant economic impacts on southern Illinois and erase the environmental benefits equal to 80% of the wind installed in Illinois, making it significantly harder and more expensive for the state to meet its carbon reduction goals.”
The plant continues to lose money "and will have to be shut down unless a combination of market and energy policy reforms are implemented to level the playing field for all zero carbon resources," the company argued.
Analysts have predicted Exelon will likely announce plans to shutter the facility later this year, Platts reports, and the auction results has done little to sway their prediction.
Closing the Clinton facility would cause wholesale energy prices to rise by $236 million to $341 million annually for families and businesses in the region, Exelon said, citing a study on the plant's closure. And, it added, the cost increases do not include hundreds of millions that would need to be spent on new transmission lines.
Allowing Clinton to shut down, the report concluded, would result in the loss of almost 1,900 direct and indirect jobs and raise carbon emissions in Illinois by almost 8 million metric tons per year. The analysis found that the societal cost of the increased emissions would be almost $4 billion between 2020 and 2029.