Exelon Corporation said Thursday it would defer any decision about the future operations of its Clinton nuclear plant for one year and plans to bid the plant into the Midcontinent Independent System Operator (MISO) capacity auction for the 2016-2017 planning year.
The company said that MISO’s announcement this week acknowledging the need for market design changes in southern Illinois was a key factor in the company’s decision to allow Clinton to remain running.
On Oct. 27, MISO posted an issues statement saying reforms to its capacity market process may be required to drive future investments and help ensure a reliable electricity supply for consumers, and it plans to engage stakeholders to consider such reforms.
In addition, recent positive results from the Illinois Power Agency’s capacity procurement for 2016 and the long-term impact of the Environmental Protection Agency’s Clean Power Plan contributed to the decision to defer, Excelon said, noting that the decision gave Illinois lawmakers more time to consider policy changes that could give nuclear power more of a fighting chance, given its ongoing benefits to grid reliability with carbon-emissions free electricity.
The EPA’s Clean Power Plan mandates significant reductions in carbon emissions from power plants, which will require states and the power sector to find the most cost-effective solutions to achieve the required reductions, the company said.
A report issued by the Illinois Environmental Protection Agency pursuant to Illinois House Resolution 1146 determined that the loss of two nuclear plants in the state would increase emissions by about 24 million short tons, more than doubling the emissions reductions required under the EPA’s carbon reduction rules and making it twice as costly to comply. The Illinois EPA calculated the incremental societal cost of losing two plants at more than $10 billion — a figure that does not include the additional billions of dollars early retirements would cost in the form of higher energy bills, reduced electric reliability and lost jobs.
MISO holds a capacity auction annually to ensure enough power generation resources are available to meet demand in its region covering southern Illinois and much of the Midwest. The next MISO capacity auction for planning year 2016-2017 is scheduled for late March 2016.