Throughout the summer and into the fall, the nuclear industry and like-minded advocates have been urging the passage of massive legislation that would implement aggressive changes to Illinois’ energy economy — with costly impacts to energy consumers.
Advocates are telling state legislators that if they do not vote on the legislation this fall, the public’s electricity bills will increase.
The Illinois Chamber of Commerce believes this opinion is based on a mischaracterization of the facts. Two bills proposed in the spring session would implement these changes: the Clean Energy Progress Act, backed by nuclear giant Exelon, and the Clean Energy Jobs Act, backed by environmentalists.
No matter what you call them, these bills both would benefit Exelon and, if passed, would raise Illinois resident and business’ (ratepayers) electricity bills significantly in the process.
Proponents argue the urgency comes from the need to protect against a proposed technical change by federal energy regulators to the “capacity market auction.” “Capacity” is the guarantee that we have access to electricity in the future and the “capacity auction” is the market process used to set rates for power companies to provide that capacity.
In 2016, Illinois passed the Future Energy Jobs Act, requiring Illinois ratepayers to pay Exelon, a profitable company projected to make nearly $1 billion in Illinois over the next three years, to support two of its nuclear facilities. Because of these unnecessary subsidies, the capacity auction process has been distorted and federal energy regulators must now rethink the process in order to support competitive electricity costs and ensure state policy goals are respected.
There is a false narrative being promoted by the nuclear community and environmental advocates that uses a set of figures presented by an independent energy market monitor during this regulatory proceeding as the basis for saying electricity prices in Illinois will increase significantly. Those numbers are wildly mischaracterized and being used as fear-mongering to scare legislators and the public into rash decisions that will have costly consequences.
Proponents are not just conveniently ignoring the fact that, if either of the two proposed bills passes, electricity rates are guaranteed to increase, but they are actively saying the opposite.
Capacity charges account for 21 percent of your electricity bill. The capacity market reforms championed by Exelon would ultimately make Illinois acquire its own capacity, increasing those charges. As seen in other states, capacity charges would be double or more compared to what is acquired through the competitive market.
Take 21 percent of your bill and double it. That’s the size of the impact you can expect. To boot, Exelon’s proposed changes to the capacity market process will likely have little measurable benefits to the environment.
A thorough and technical proposal on this issue is currently under review with federal energy regulators. They are engaged in a regulatory proceeding to find a solution. It is vital that Illinois wait for federal energy regulators to rule instead of hastily voting on such a large energy package this fall based on unfounded assumptions.
We can support a low carbon future with many technologies that exist today, and we need to support an environment that allows innovation to flourish so solutions are realized. This environment is created through a competitive marketplace and low electricity costs to support continued growth and adaptation.
Competitive markets have resulted in lower electricity prices and reduced emissions. We should continue to support flexible and practical policies to manage climate risks, maintain low-cost energy and invest in innovative solutions to help our planet.
Exelon already receives hundreds of millions of dollars in subsidies from hardworking Illinois families and businesses — costing businesses in things like jobs and investments in technologies to lower emissions.
One thing is clear, if the legislature passes the proposed capacity market reforms, Exelon’s profits will increase and it will be the public’s increased electricity bills that pay for it.
Profits are a good thing and a sign of a strong economy. The Illinois Chamber of Commerce champions an economy where these profits are realized, but that are realized in an environment that allows businesses to compete on a reasonably equal basis.
A fair economy ceases to exist when one company convinces the government to ensure their profits at the expense of others and the public.
We encourage readers to dig a little deeper and decide for yourselves if the capacity market changes in the Clean Energy Jobs Act are really about lowering electricity bills and emissions — or just another way for the nuclear industry to increase their profits at the ratepayers’ expense.
Todd Maisch is president of the Illinois Chamber of Commerce.
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