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Exelon uses clout to block wind-energy law in Illinois

Exelon Corp. is using its clout in Springfield to fight the Illinois wind energy industry - and winning. Opposition by the Chicago-based nuclear power giant has killed legislation to extend an expiring state law that gives preference to Illinois green energy projects as part of the state's push to purchase more electricity from renewable sources like wind and solar.

Exelon Corp. is using its clout in Springfield to fight the Illinois wind energy industry - and winning.

Opposition by the Chicago-based nuclear power giant has killed legislation to extend an expiring state law that gives preference to Illinois green energy projects as part of the state's push to purchase more electricity from renewable sources like wind and solar.

And now Exelon, parent company of Commonwealth Edison Co. and Illinois' largest power generator, says it won't support an eleventh-hour effort by the wind power lobby to ensure its members get at least some of the 20-year contracts set aside for green projects in 2012 - a special procurement that Gov. Pat Quinn fought for late last year as a way to foster more wind farm development in Illinois and to create jobs.

ALLIES IN SENATE

If Exelon succeeds in blocking that measure, it could bring wind development in Illinois to a halt. And while the moves could protect Exelon from subsidized competition - and hold down prices for Illinois power consumers - they could damage Exelon's carefully crafted image as a proponent of sustainable energy.

The legislator who drafted the extension says he believes Exelon has nixed it. "I think it... more [truncated due to possible copyright]  

Exelon Corp. is using its clout in Springfield to fight the Illinois wind energy industry - and winning.

Opposition by the Chicago-based nuclear power giant has killed legislation to extend an expiring state law that gives preference to Illinois green energy projects as part of the state's push to purchase more electricity from renewable sources like wind and solar.

And now Exelon, parent company of Commonwealth Edison Co. and Illinois' largest power generator, says it won't support an eleventh-hour effort by the wind power lobby to ensure its members get at least some of the 20-year contracts set aside for green projects in 2012 - a special procurement that Gov. Pat Quinn fought for late last year as a way to foster more wind farm development in Illinois and to create jobs.

ALLIES IN SENATE

If Exelon succeeds in blocking that measure, it could bring wind development in Illinois to a halt. And while the moves could protect Exelon from subsidized competition - and hold down prices for Illinois power consumers - they could damage Exelon's carefully crafted image as a proponent of sustainable energy.

The legislator who drafted the extension says he believes Exelon has nixed it. "I think it would be very difficult to achieve the five-year extension (of the preference for Illinois wind developers) in the current climate," says Sen. Don Harmon, D-Oak Park. Attempts to move the bill through the Senate Energy Committee collapsed for lack of votes.

Exelon has powerful allies on that committee, including the chairman, Sen. Michael Jacobs, D-East Moline, whose father, Denny Jacobs, formerly a senator from the same district, is a registered lobbyist for ComEd.

"Why should I put nuclear plants out of business?" says Sen. Jacobs, whose district includes Exelon's Quad Cities nuclear plant. As for his father's lobbying role, he says, "No one is going to be able to tell me what to do."

Still, Mr. Harmon says, he hopes Illinois wind farms get a guaranteed cut of the 20-year contracts, which will go out to bid within weeks. Wind developers say they need that guarantee to obtain financing. Speaking of Exelon, Mr. Harmon says, "I hope we can come to some accommodation."

Wind power advocates, including Chicago multimillionaire Michael Polsky's renewable energy firm, Invenergy LLC, warn that future development in Illinois - currently the seventh-largest wind producer in the U.S. - could halt if Exelon continues to block the legislative initiatives. The cost of Illinois wind energy is higher than in other states like Texas, North Dakota and Iowa, where property taxes are lower and the more consistent breeze gives turbines more capacity.

Without the legal advantage for the state's wind producers, the Illinois Power Agency, which buys electricity on behalf of customers of ComEd and Downstate utility Ameren Corp., says it can satisfy the renewable requirements by buying wind power from other states or even Canada.

Mr. Polsky didn't return a call requesting comment. Kevin Borgia, executive director of the Illinois Wind Energy Assn., of which Invenergy is a member, says jobs are at stake. "If we want to promote wind energy in Manitoba, let the Illinois preference expire," he says.

The first 1,119 megawatts of wind capacity installed in Illinois created 6,019 construction jobs and 292 permanent jobs in rural parts of the state, according to the Center for Renewable Energy at Illinois State University. Some 12,000 megawatts of additional wind power are on the drawing board.

Exelon says it's fighting for Illinois consumers, trying to spare them higher electric bills, and opposes protectionist measures as a matter of principle.

WIND COULD DEPRESS PRICES

But a continued influx of homegrown wind power could hit Exelon where it hurts the most, reducing wholesale power prices in Illinois. That's because wind tends to blow hardest at night, when power demand is lowest. In recent years, real-time prices at night have turned negative at times, requiring generators to actually pay to unload their juice, because supply has outstripped demand. More local wind power likely would exacerbate that effect. Exelon's nukes run around the clock, making them more vulnerable to these price swings, while natural gas- and coal-fired plants can shut down when demand is weak.

"Wind projects are competition," says Paul Patterson, a utility analyst at Glenrock Associates LLC in New York. "They pose a problem for merchant generators operating in the same region."

Joseph Dominguez, Exelon's senior vice-president for state governmental affairs, acknowledges more wind power in the market could hurt prices the nuclear plants could charge, but he said it could hurt higher-cost coal-fired plants more.

Still, the state's largest producer of coal-fired power, Midwest Generation LLC, backs extending the preference for Illinois wind producers, a spokesman says. MidwestGen, a unit of California-based Edison International, wants to build wind projects here as it diversifies from coal.


Source: http://www.chicagobusiness....

MAR 29 2010
https://www.windaction.org/posts/25975-exelon-uses-clout-to-block-wind-energy-law-in-illinois
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