In the face of state inaction on nuclear subsidies, the imminent retirement of Exelon Generation's Byron and Dresden nuclear plants in Illinois is expected to boost coal- and gas-fired generation and make it harder to achieve state and federal carbon reduction goals.
Receive daily email alerts, subscriber notes & personalize your experience.Register Now
Exelon has said it plans to shut the two-unit, 2,346-MW Byron plant Sept. 13 and the two-unit, 1,805-MW Dresden plant in November unless the Illinois General Assembly approves subsidies to keep the plants from losing money.
The state legislature adjourned in June without passing a bill to financially support the units. Illinois lawmakers are slated to return Aug. 31 for a special session to redraw state legislative maps, but it is unclear whether they will discuss other issues.
If the Byron and Dresden plants retire, average hourly coal-fired generation would increase 2.3 GW and average hourly gas-fired generation would increase 1.6 GW across 2022 in the Eastern Interconnect and the Electric Reliability Council of Texas, said Kieran Kemmerer, an analyst with S&P Global Platts Analytics.
The impacts to ComEd generation are limited, as modeling shows the retirement simply results in reduction in exports, Kemmerer said. But reliance on local generation in times of higher demand could increase ComEd power prices, he added. The around-the-clock price impact from the nuclear retirements would be $3-$4/MWh in the Northern Illinois Hub across 2022, Kemmerer said.
The loss of the two nuclear plants and the resulting increase in emissions from fossil-fired generation could make it harder to achieve national and state climate goals.
At the state level, Illinois Governor JB Pritzker in 2019 committed to cutting greenhouse gas emissions consistent with the UN Paris Agreement, including reducing GHG emissions by 26%-28% below 2005 levels by 2025.
As of 2016, the most recent data available, Illinois had cut its GHG emissions by 16%, more than half of the reduction needed by 2025, according to a 2020 report by the Brattle Group. Losing the Byron and Dresden plants would cause a 20 million mt increase in annual CO2 emissions from the power sector, erasing more than half of the progress the state has made so far, the report said.
If the Byron and Dresden plants close, the majority of the lost generation would be replaced by gas-fired generation, and a smaller amount would be replaced by coal-fired generation, Dean Murphy, an economist with the Brattle Group who coauthored the report, said in an interview.
While the state could try to replace the nuclear plants with renewables, it would take years because it takes several megawatts of renewables to replace each megawatt of nuclear, Murphy said. From a climate perspective, it would make more sense to use the renewables to replace fossil-fired generation first, and then replace nuclear generation.
"Anytime you lose a lot of nuclear and you have to replace it with renewables, you are just making the hill higher that you have to climb," Murphy said.
While the nuclear retirements point to upside in fossil-fired generation in the immediate future, Kemmerer said he anticipates further build of renewables, particularly wind, to displace the incremental fossil-fired generation resulting from the retirements.
"Hitting the state's clean energy targets will certainly be made more challenging by the nuclear retirements, but our modeling suggests the state may simply rely more on interchange with surrounding regions while building out the in-state renewables needed to meet the stated targets."
Retiring nuclear plants before their licenses expire could also make it difficult to achieve the Biden Administration's target to reduce economy-wide GHG emissions 50% below 2005 levels by 2030, said Jessica Collingsworth, a senior policy analyst with the Union of Concerned Scientists.
UCS estimates that if the generation from the Byron and Dresden plants were replaced by an average natural gas plant, CO2 emissions would increase by 14.4 million mt/year, Collingsworth said.
UCS has argued that financial support for nuclear plants should be conditioned on consumer protection, safety requirements, and investments in renewables and energy efficiency.