By Suzanne Herel

Exelon will close its Clinton and Quad Cities nuclear plants after the Illinois General Assembly adjourned this week without acting on a bill that would have subsidized the money-losing stations, the company said Thursday.

Clinton will shut down next June 1, and Quad Cities will close the following year. Together, the plants have lost $800 million in the past seven years, Exelon said.

The company will be submitting permanent shutdown notifications to the Nuclear Regulatory Commission within 30 days. Among other steps toward closure, Exelon will be ending capital investment projects at the plants, taking a one-time charge of $150 million to $200 million for the year, accelerating about $2 billion in depreciation and amortization and canceling fuel purchases and outage planning, Exelon said.

Ceasing the investment projects will impact more than 200 workers, and more than 1,000 outage workers will be affected, according to the company.

“We have worked for several years to find a sustainable path forward in consultation with federal regulators, market operators, state policymakers, plant community leaders, labor and business leaders, as well as environmental groups and other stakeholders,” CEO Christopher Crane said. “Unfortunately, legislation was not passed, and now we are forced to retire the plants.”

Crane had given legislators a May 31 deadline to help shore up the struggling generators if the 1,819-MW Quad Cities station did not clear the PJM Base Residual Auction for delivery year 2019/20. It failed to do so. (See Absent Legislation, Exelon to Close Clinton, Quad Cities Nukes.)

While the 1,065-MW Clinton plant won contracts in the MISO auction, its clearing price was insufficient to cover operating costs, Crane said.

According to Exelon, their closures will represent a $1.2 billion loss in economic activity and 4,200 direct and indirect jobs. The plants employ 1,500.

Next Generation Energy Plan

The Exelon-backed legislation, called the Next Generation Energy Plan, incorporates pieces of a similar bill the company proposed last year as well as part of the competing Clean Jobs Bill. The latter proposal aimed to reduce energy demand by 20% through energy efficiency; increase the renewable portfolio standard from 25% by 2025 to 35% by 2030; and create an estimated 32,000 jobs annually by creating a market mechanism to reduce carbon emissions.

A key element of the new plan is a shift to a zero-based emission standard, which would provide financial support for struggling nuclear plants in recognition of their lack of carbon emissions.

Exelon said the standard would address stakeholder concerns by requiring state regulators to review plants’ expenses to ensure that only those whose revenues are insufficient to cover their costs and “operating risk” would receive compensation.

On Friday, the bill received the endorsement of Ameren Illinois, but on the condition of an amendment changing energy efficiency targets that could make it unpalatable to environmentalists.

In introducing the energy plan, Exelon said it was an outgrowth of discussions among it, Commonwealth Edison and members of the Clean Jobs Coalition, a group representing Illinois’ environmental, business and faith communities.

The coalition supports the bill’s expansion of ComEd’s energy efficiency programs, which it said would save customers at least $4 billion over a decade. But it said the Ameren amendment would exclude that utility’s customers from the expansion.

“While ComEd has offered a strong energy efficiency plan, the Ameren proposal … is a half-measure that will leave downstate customers with fewer jobs and higher bills than people in Chicago and Northern Illinois. Ameren is really leaving Central and Southern Illinois in the dark,” the coalition said in a statement.

Exelon said it will continue to push the legislation.

“While these needed policy reforms may come too late to save some plants, Exelon is committed to working with policymakers and other stakeholders to advance an all-of-the-above plan that would promote zero-carbon energy, create and preserve clean-energy jobs, establish a more equitable utility rate structure and give customers more control over their bills,” it said.

A ‘Tragedy’

Marvin Fertel, CEO of the Nuclear Energy Institute, issued a statement calling the plants’ closure “a tragedy” that threatens the “nation’s ambitious clean air commitments.”

“At-risk nuclear plants are struggling because the electricity markets do not appropriately value the attributes of nuclear plants, including reliable electricity generation and their carbon-abatement value. This is fixable, but federal and state policymakers, the Federal Energy Regulatory Commission and regional electric system operators must address these shortcomings with urgency to prevent other power plants from shutting down prematurely.”