Reflections on the recent Illinois energy bill

By Drs. Robert & Sonia Vogl
President and Vice President,
Illinois Renewable Energy Association

Several points of contention have been settled for now with this month’s passage of Illinois’ energy bill. Mandatory demand charges have been eliminated; net metering for those producing their own electricity and sending it back to the utility will be reinstated; and the state’s Renewable Energy Portfolio will be revised. More of the state’s energy will come from renewable sources; community, rooftop and other distributed sources will add to utility-scale wind and solar.

Additionally, Exelon will receive generous subsidies to maintain its aging, uncompetitive Clinton and Quad Cities nuclear plants.

ComEd’s engaging in large scale nuclear buildup during the 1980s led to a dramatic increase in the cost of electricity in Illinois. Signs appeared at the Wisconsin border inviting Illinois companies to move to Wisconsin and benefit from low cost electricity. Political leaders in Chicago expressed interest in generating their own power or buying it from Wisconsin.

At that time, control of electrical rates was exclusively managed by the Illinois Commerce Commission. Critics of high rates were appointed to the Commission with the backing of industrial interests concerned about the adverse impacts of higher costs on their competitive position.  Firms which had installed their own independent co-generation facilities reached an agreement with ComEd to continue buying electricity from the utility and put their co-generation facilities on standby to be used during times of peak demand.

The cost of electricity was shifted to commercial interests assuming they would find it easier to pass on the costs to their patrons. With costs under control critical members of the Commerce Commission were no longer needed and were asked to resign, which they did.

The latest struggle involving the high cost of keeping the Clinton and Quad Cities nuclear power plants operating appears to be settled for now but the consequences of the agreement will become clearer with time. Some supporters of renewable energy, energy efficiency and limiting consumer price increases expressed approval of the decision to bail out the nuclear power plants. Others raised concerns about Illinois consumers being asked to subsidize aging nuclear power plants to improve the economics of a very profitable corporation. With rising costs of maintaining an aging nuclear fleet the concern has also been raised regarding the precedent set by the most recent subsidies.

One issue not raised is whether the need for large centralized generation facilities and an expanding national grid could become a burden on ratepayers if evolving decentralized services based on renewable energy, efficiency, energy storage and microgrids continue to drop in price and improve technologically.

The current compromise might represent the best solution possible considering the diverse interests involved in arriving at it and the limited amount of time to sort out conflicting interests.

As the new legislation is implemented, its impacts will become apparent to all involved. If our neighboring states once again gain a competitive advantage from lower cost electricity, pressure will rise from within Illinois to correct the imbalance.

For now, renewable energy advocates such as The Alliance for Solar Choice have expressed their approval of the outcome.

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