Thursday, February 26, 2015

BiPartisan Supporters Announce Need to Pass HB-3293, to Apply "Clean Energy" Tax Credits to Nuclear Plants

HB-3293:   Background

ComEd is wanting to have tax credits for clean energy applied to nuclear plants, which now applies to Wind & Solar.  Because Illinois  is the LARGEST user of nuclear power, only 40% of Illinois' electricity production comes from Coal.  This compares with 80% use of coal for electricity in Kentucky.  

This bill would extend the clean energy tax credits to nuclear power, which would save ComEd money and make its nuclear fleet more affordable to operate.   It would apply to electric providers of greater than 100,000 customers, which would therefore apply to just ComEd and Ameren.

ComEd notes that last year at just the Clinton IL plant, it lost $100 million on the operation of the plant.   It says that without such relief as included in HB-3293, it would have to shut down some of its nuclear plants -- at a devastating result to local communities and schools, supported by the plants property taxes, in addition to the high-paying jobs provided at the plants. .  It operates six nuclear facilities in Illinois, including Clinton, Quad-Cities, LaSalle.

But critics point out that ComEd is already profitable and has opposed the tax credits for wind and solar in the past, saying that those energy sources should have to make it in the economy on their own financial merits and
not be subsidized.  NOW, that electric rates are lower and the nuclear plants are not generating as much profits, critics say ComEd is wanting to jump on the very Tax Credits they were critical of in the past.

Some say instead of granting a permanent tax credit for nuclear plants, that it might be provided on an "as need" basis.  Or that the state should have some sort of agreement that Excelon would pay back the tax credits IF electric rates shot up and profits increased.

Excelon, owner of ComEd says this bill has a sunset provision of 5 years, and does have a provision for returning credits if energy costs rise.

This bill, is being backed by both labor groups and some businesses.  But the concerns are that rates will also go up, in part because the Federal EPA is going to begin higher regulation of carbon under segment 111-D, of EPA rules. And to that end, ComEd can argue that Illinois's nuclear plants provide the very carbon free electrical generation that will keep the lights burning, while some coal-fired plants are forced to close down as they become too costly to operate.

ComEd argues the cost of providing the tax credits to nuclear power would be far less costly than if it were forced to close those nuclear plants that are no longer cost-effective to operate.