Jeremy L. Dillon
RW Monitor
12/12/2014
Exelon’s Ginna Nuclear Power Plant in Ontario, New York may avoid shutdown after the New York Public Service Commission unanimously voted last month to establish a route for a support services agreement with Rochester Gas & Electric. Exelon had threatened to shut down the reactor if an agreement could not be negotiated, and the utility appealed to the Public Service Commission during this past summer in an effort to obtain an order to require RG&E to enter into negotiations with Ginna. The support services agreement would establish a constant price for electricity, avoiding the supply and demand market prices of the merchant model.
The Public Service Commission feared that should Ginna prematurely shut down, the state’s grid reliability would take a substantial hit. According to Exelon, the Commission’s decision correctly values the clean energy source and reliability the Ginna Station brings to New York. “Exelon Generation is pleased by the PSC ruling and ready to negotiate a timely reliability support services agreement that supports Rochester’s electricity needs and continues to provide jobs, tax revenues, and environmental benefits for the region,” Exelon spokesperson Maria Hudson said. “Meanwhile, we will continue running the plant at world-class levels, powering the local economy and working with policymakers to identify longer-term, market-based solutions.”
Exelon Emphasized Reactor Impact on Grid
More so than other utilities, Exelon has made its case to the public and government officials about the importance of its reactors to grid reliability and clean power generation in an attempt to gather support and government intervention to help fight against market powers dragging down the profitability of a nuclear plant. Besides Ginna, Exelon has also threatened to shut down plants in Illinois should current market forces continue unabated. According to multiple news reports, the utility has been in talks with the state government to help keep the plants open.
One way the state could help, an industry executive said, was to push the Illinois customer organizations like RG&E in New York to negotiate a pricing deal that would stabilize rates. Exelon had originally planned to make a decision on the future of its three plants in Illinois by the end of this year, but indications from the Illinois state legislature that it would be willing to engage in market-based reform has made Exelon willing to wait on the decision. That decision has now been pushed back to mid-2015.
