Senate Committee Holds Hearing on Profitability Audit of Exelon Nuclear Plants
Last week, the Senate Energy and Public Utilities Committee held a hearing on a recently completed audit of the profitability of Exelon’s nuclear units. The audit, done by Synapse Energy Economics, concluded that with a $355 million subsidy, there would be only a 5% chance that Exelon’s Byron and Dresden nuclear plants would be unable to cover their costs and realize an undisclosed level of additional profit.
PJM Independent Market Monitor Dr. Joe Bowring also testified that the capacity market revenue for the plants are understated in the audit because it improperly assumes that the units will not receive capacity revenue in 2021-22. According to Dr. Bowring, even with no subsidy, there is a 80% chance that Byron will not need any subsidy to be profitable. While there is a high chance that Dresden needs some subsidy to be profitable over the next 5 years, no subsidy would be required if profitability was viewed on a 10 years horizon. Conversely, supporters from the Climate Jobs Illinois Coalition also testified at the hearing, claiming that the $355 million subsidy is too low, and are asking that the General Assembly consider a “flat fee” 10-year contract regardless of financial need.
While the expectation by many is that there will be some omnibus energy bill incorporating parts of individual bills in this session of the legislature, the impact of the audit on pending legislative proposals remains to be seen. At the hearing, Senators were questioning why nearly half of the audit report provided to them was redacted. It is also expected that the Governor will release his legislative proposal later this week.