SB 2814, which parallels a recent law passed in New York State, contains a cross-subsidization program for electric markets across Illinois to support the continued operations of two nuclear power plants in Clinton and Cordova, Illinois (“Quad Cities”). Due to ongoing operating losses, Exelon had previously announced plans to close the Clinton plant in 2017 and the Quad Cities plant in 2018. One underlying theme of the legislation is the preservation of important carbon-free generating capacity for Illinois to meet power demands in the future.
As a result of passage of the Future Energy Jobs Bill, 1,500 direct jobs were saved at the Clinton and Quad Cities plants, with a total of more than 4,000 jobs impacted. In addition to the jobs saved, keeping Illinois’ nuclear plants in operation will prevent large increases in energy prices. Closure of the plants would have had a detrimental effect on electric rates, on the reliability and capacity of the grid, and on jobs and economic activity. The Illinois Commerce Commission had studied the effects of nuclear plant closures and in almost every scenario, rates would increase across the state. A report released in November by leading Illinois business organizations, including the Illinois Retail Merchants Association (IRMA), the Chicagoland Chamber of Commerce and the Hispanic Chamber of Commerce, indicated that preserving the Clinton and Quad Cities nuclear plants will save Illinois businesses and consumers over $3 billion in electricity costs over the next ten years.
SB 2814 also contains complex provisions intended to maintain and reorganize the way Illinois and its power companies generate and buy Illinois solar power and wind-generated power. Critics have pointed to elements in older Illinois law that seemed to encourage Illinois power distributors and customers to buy wind power from Iowa and other states west of Illinois. The complexity of the bill, and its effects on future electricity rates to be paid by Illinois homeowners and commercial/industrial users, pulled many Illinois lawmakers in different directions.
While electric rates will increase in order to fund a Zero Emission Standard and expanded energy efficiency programs, Governor Rauner successfully negotiated language that places a “hard cap” on the rate increases. A total cost rate cap of $0.25/month for ComEd residential customers and $0.35/month for Ameren residential customers were included at the Governor’s insistence. Large industrial users, as well as smaller commercial and industrial users, have a total cost rate cap of 1.3%.
Thursday’s House vote of 63-38-0, followed by the Senate’s concurrence vote of 32-18-0, will send SB 2814 to Governor Rauner for his signature.