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Archive for October, 2013

According to Crain’s (see link below) Exelon’s CEO Crane says that if power prices don’t rise $2 to $4 by the end of 2014, Exelon will start to shut down unprofitable nuke plants, likely beginning with its Clinton station.

At least this is a determination to take action, which is an improvement over Crane’s previous efforts to blame “flawed markets” for Exelon’s woes. Goldman Sachs and a few other Wall Street firms marked Exelon’s stock to a “sell” based on continued low power prices.

As we’ve said here before, the market in which Exelon now finds itself is structured precisely the way Exelon pushed for back in 2003-04. They opened up the market to competition in electricity, stripped the generating assets out of the traditional utilities, and planned to sell the power at prices higher than what they would get under regulated rates — or so they thought. But Exelon’s plans miscarried when prices for power were hit by the one-two punch of the gas glut and the Great Recession.

Just don’t try to blame “flawed markets.” That’s just another form of shooting the messenger.

Exelon’s CEO Christopher Crane responds to Wall Street’s downgrade – Utilities News – Crain’s Chicago Business.

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Let’s not overlook the bright side of the current controversies over the new Healthcare.gov web site and the NSA’s extensive surveillance of everyone on the planet.

NSA Chief James Clapper

NSA Chief James Clapper

HHS Secretary Kathleen Sebelius

HHS Secretary Kathleen Sebelius

If Healthcare.gov loses all your personal medical records, not to worry because NSA is sure to have copies.

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S Korea Nuke plant

There’s a YouTube video in which one boxer tries to punch his opponent, but his glove skids off the other man’s face and he winds up hitting himself just above his own eye.

Players in the nuclear generating industry are distressingly similar to this poor boxer, with one notable exception: there’s no opponent whom they’re slugging away at. Rather, the nuclear industry just keeps hauling off and punching itself in the head. Here’s the latest example.

South Korea, with little in the way of natural resources, has twenty-three commercial nuclear power plants that together supply about one third of that nation’s electricity supply requirements. Over the past ten years those plants have had to shut down 128 times because of faulty parts. That’s more than once a month, on average.

Yesterday, the government in Seoul announced that it had indicted 100 people, including a former chief executive of Korea Hydro & Nuclear Power, one of the country’s biggest electric utilities, for faking certifications of safety equipment used in nuclear reactors.

Yes, you read that right. Safety equipment. For nuclear reactors. Faked.

It’s difficult to believe that anyone could be that shortsighted, but look again at that video of the boxer hitting himself in the head. That symbolizes the current state of the nuclear generation industry.

Imagine that an event like Fukushima happened at one of Korea Hydro & Nuclear’s nuke stations. As the plant’s engineers frantically try to keep the disaster from spiraling out of control, they attempt various operations in the control room, only to find that the power switches, fuses or control cables aren’t working. They aren’t working because the equipment didn’t meet the minimum standards required for use as safety equipment in a nuclear generating station. As bad as Fukushima was, substandard equipment would only have made it worse.

Nuclear power should be part of a varied array of United States generation assets, but as we’ve said before, the industry needs to address and resolve two critical flaws before that type of diversification begins to get back on track: disposal of spent fuel and regulatory capture. Fukushima embodied both of these problems.

If the U.S. nuclear industry discounts these incidents in South Korea, then they are viewing the events through far too narrow and legalistic a perspective. Only the most insular of minds could maintain that Fukushima did not adversely affect the perception of commercial nuclear generation in the United States. As far as the public is concerned, a Japanese nuke, a South Korean nuke and an American nuke are one and the same as far as anything that could go wrong is concerned.

Protesting nukes in South Korea

Protesting nukes in South Korea

And for any project that takes at least 10 years to go from the drawing board to energization, its promoters should understand that perception is reality. The nuclear generation industry needs to broadly clean up its act. Doing so will help it to stop hitting itself in the head.

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On Thursday, October 10, 2013, we argued ComEd’s motion to dismiss the smart meter class action lawsuit before Judge Mary L. Mikva. The court focused on the issue of whether it had jurisdiction over the plaintiffs’ claim that ComEd damaged consumers in the amount of $182 million by delaying smart meter deployment in violation of a June 2012 ICC order.

ComEd claimed that the ICC had exclusive jurisdiction of the matter. Paul Neilan and co-counsel Stuart Chanen, attorneys for the plaintiff class, argued that the ICC already exercised its jurisdiction when it ordered ComEd to start smart meter installations in September 2012, and that the circuit court now has jurisdiction to award damages caused by ComEd’s violation of the June 2012 order. Plaintiffs’ attorneys stressed that ComEd had requested the ICC to stay enforcement of that order, a request the ICC denied. The plaintiffs therefore urged the Court to retain jurisdiction and move on to the issue of the substantive damage that ComEd had caused through its smart meter delay. Mr. Neilan added that ComEd’s customers can’t recover these damages at the ICC.

Judge Mikva took the case under advisement and stated that she would issue a written ruling prior to a November 6 status.

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The WSJ reports that President Obama’s nominee to head the Federal Energy Regulatory Commission, Ron Binz, has withdrawn his name from consideration. With opposition to Binz from Sen. Joe Manchin (D. W. Va.), and almost certain unanimous opposition from Republicans on the Energy and Natural Resources Committee, it was clear that the nomination would not make it to the Senate floor. Manchin and the Republicans had zeroed in on Binz’s prior positions against fossil fuel-fired generation.

FERC Nominee Ron Binz Pulls Out – WSJ.com.

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