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Archive for the ‘Nuclear’ Category

Zuckerberg

In response to the Cambridge Analytica/data-scraping crisis, Facebook’s CEO Mark Zuckerberg has said he’s open to “the right regulation.”

You should be very afraid.

Companies as big as Facebook don’t recoil from regulation. They seek it. Regulation brings inestimable advantages, chief among which is the opportunity to capture the regulator. One need not look far to find prior examples.

In the run-up to the Great Recession of 2008, the Federal Reserve under Alan Greenspan treated the largest banks and mortgage lenders not as entities they regulated but as clients they had to help.

The Nuclear Regulatory Commission would be better known as the Nuclear Plant Approval and Preservation Commission.

Nuclear regulators in Japan looked forward to employment with Tokyo Electric Power Company, which had predictable effects on their reviews of plants like Fukushima. These are just a few examples, and we haven’t even touched Big Pharma.

Creation of some new commission to regulate privacy matters on social media would provide a juicy target for cooptation by Facebook’s immense wealth. No federal agency (and presumably it would be a federal, rather than a state, agency) can compete with Facebook’s immense resources, and Zuckerberg’s friends in Congress could control its funding levels year by year. As with Fukushima, regulators would view their time at the agency as a rung on the ladder to a higher-paying job with Facebook. A new statute granting this commission jurisdiction over privacy issues in social media could insulate Facebook from class actions if such matters were reserved to the new agency’s expertise.

When Facebook talks about “the right regulation,” he has in mind a well-trained regulatory spaniel that will run and fetch the frisbee no matter how far Zuckerberg flings it.

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NYC Substation

The New York Times today reported that Russian hackers had gained access to nuclear plants and electricity grid controls, and would have been able to shut off the power in the United States at will.

That is deadly serious stuff.

More amazing still, it was the Trump Administration, that leveled the accusation against Russia. Putin may regard that as an act of disloyalty by Trump, perhaps triggering his release of kompromat on the Donald.

Perhaps he’ll announce a 25% tariff on Steele dossiers.

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S Korea Nuke plant

On Tuesday, ISO New England, which operates the electric grid for certain states in that region (other than New York), issued a report that New England’s average annual real time wholesale electricity price for 2017 at $33.94 per megawatt-hour was the second-lowest price in fifteen (15) years. ISO New England stated that these low prices were driven chiefly by low prices for natural gas, the principal fuel used for generation at the margin, as well as reduced demand levels.

As earlier stated on the Sparkspread, for several years Exelon CEO Chris Crane has played the role of Peter the Hermit in the electric utility industry’s Crusade to rescue nuclear generation fleets from the infidels of the wholesale market. That is, he wants to make sure that electricity consumers make Exelon and other nuke operators whole for any losses they suffer because, contrary to their expectations, electricity prices have been hitting record lows in a number of markets, mainly due to low natural gas prices. When prices fell, Crane and his cohort lost no time in complaining about the “flawed market” for wholesale electricity.

If things had gone the other way – if electricity prices had risen to record highs instead of fallen to record lows – you can bet that Mr. Crane and his fellow nuke CEOs would be saying that electricity consumers must simply accept the results of the perfectly self-regulating free market in electricity, and if prices rise, that’s just, as they say in Brooklyn, T.S., Elliott.

 

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Today’s edition of Utility Dive discusses our pending appeal in the Illinois Zero Emission Credit Case. You may read the article here.

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Exelon CEO Chris Crane

Exelon CEO Chris Crane

Chicago, IL February 14, 2017:  Chicago energy attorneys, Patrick N. Giordano and Paul G. Neilan, announced they filed a lawsuit in the U.S. District Court Northern District of Illinois today against Anthony Star in his Official Capacity as Director of the Illinois Power Agency.  Village of Old Mill Creek, et al. v. Anthony Star was filed on Tuesday, February 14, 2017 at the U.S. District Court Northern District of Illinois.

Attorneys Giordano and Neilan represent Plaintiffs that are governmental, residential, commercial, and industrial electricity consumers located throughout the State of Illinois. Plaintiffs claim that P.A. 99-0906, executed by Governor Rauner on December 7, 2016, violates the U.S. Constitution’s Supremacy Clause, Commerce Clause, and 14th Amendment Equal Protection Clause. The underlying basis for the constitutional claims is that the prices charged by electricity generating plants are subject to federal rather than state regulation. A similar case has already been filed in federal court in New York challenging that state’s subsidy of Exelon nuclear plants by the law firm Boies, Schiller & Flexner, LLP, which is headed by preeminent attorney David Boies.

Among other things, P.A. 99-0906 is designed to subsidize Exelon Corp.’s Quad Cities and Clinton nuclear plants. This subsidy will be charged to all Illinois electricity consumers beginning June 1, 2017 regardless of what company supplies the consumer’s electricity. The lawsuit specifically asks that the U.S. District Court grant a permanent injunction blocking the charges from going into effect as scheduled on June 1, 2017. According to Mr. Giordano: “These additional charges will reverse twenty years of deregulation in Illinois which have given us perhaps the one advantage we have over neighboring states: relatively low electricity charges due to an effectively functioning competitive market.” Mr. Giordano also said: “We’re challenging the nuclear bailout provision of the legislation because the prices charged by electricity generators have already been established by the competitive wholesale electricity market subject to federal jurisdiction and cannot be increased by the State of Illinois.”

The estimated impact to all Illinois consumers will be about $3.3 billion over the ten years of the nuclear bailout. Mr. Neilan points out that: “This nuclear bailout is one of four rate increases to Illinois consumers this year, including increased delivery charges, increased renewable energy subsidies, increased energy efficiency subsidies, and these nuclear energy subsidies.” When the nuclear subsidies go into effect on June 1, 2017, Illinois residents and businesses can expect to see an average 3% increase in their electricity bills due to the nuclear subsidies alone.”

Giordano & Associates, Ltd. is Chicago’s first law firm devoted to energy issues. We provide clients with experienced counsel on regulatory, litigation, transactional, and legislative matters in the areas of electricity and natural gas. Pat Giordano can be reached at pgiordano@dereglaw.com.

The Law Offices of Paul G. Neilan, P.C. represents commercial, industrial and governmental energy users in disputes against public utilities, as well as in litigation and transactional matters with non-utility competitive energy suppliers.

FACT SHEET

  1. Village of Old Mill Creek, et al. v. Anthony Star was filed in the United States District Court for the Northern District of Illinois on February 14, 2007.
  2. The Plaintiffs are: Village of Old Mill Creek, Ferrite International Company, Got it Maid, Inc., Nafisca Zotos, Robert Dillon,Richard Owens, and Robin Hawkins, both individually and d/b/a Robin’s Nest.
  3. The Defendant is Anthony Star in his official capacity as Director of the Illinois Power Agency.
  4. This case arises from unlawful Illinois legislation that invades the exclusive jurisdiction of the Federal Energy Regulatory Commission (“FERC”) over “the sale of electric energy at wholesale in interstate commerce” pursuant to the Federal Power Act. 16 U.S.C. 824(b)(1).
  5. The unlawful legislation is contained in subsection (d-5) Zero Emission Standard of Illinois Public Act 99-0906 (“P.A. 99-0906”), which was enacted on December 7, 2016 and is available at http://www.ilga.gov/legislation/99/HB/09900HB65761v.htm.
  6. Subsection (d-5) Zero Emission Standard of P.A. 99-0906 requires the Illinois Power Agency to procure contracts for Illinois utilities Commonwealth Edison Company, which serves northern Illinois, and Ameren Illinois Company, which services central and southern Illinois, for purchases of Zero Emission Credits (“ZECs”) from nuclear-fueled generating plants.
  7. The ZEC payments will be passed through by the utilities to all Illinois consumers through automatic adjustment tariffs.
  8. A. 99-0906 is designed to provide additional revenues to the Illinois-based Quad Cities and Clinton nuclear plants.
  9. Exelon Corp. owns both the utility ComEd and Exelon Generation, which owns the Quad Cities and Clinton nuclear plants that will sell the ZECs to the utilities.
  10. Although P.A. 99-0906 has many other provisions, this case concerns only subsection (d – 5) Zero emission standard.
  11. Plaintiffs are not challenging any other provisions of P.A. 99-0906. Section 97 of P.A. 99-0906 provides that the provisions of the Act are severable under Section 1.31 of the Illinois Statute on Statutes. 5 ILCS 70/1.31.
  12. In New York, ZEC payments to Exelon nuclear plants in that state are being challenged on the same grounds set forth by Plaintiffs in Illinois. Coalition for Competitive Electricity, et al. v. Audrey Zibelman, et al. was filed in the U.S. District Court Southern District of New York on October 19, 2016.
  13. A typical residential customer using 1 mWh (1,000 kWh) per month would pay an additional $2.64 per month beginning June 1, 2017 based on the initial ZEC price established in P.A. 99-0906.
  14. A manufacturing company using 10,000 mWh per month would pay an additional $26,400 per month beginning June 1, 2017 based on the initial ZEC price established in P.A. 99-0906.

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Clinton Nuke Plant

Clinton Nuclear Plant

The history of the Big Bank Bailouts of 2008-09 is now repeating itself as farce. The 2016 tsunami of crony capitalist entitlement is scheduled to hit Illinois tomorrow in Clinton, where according to news reports Gov. Rauner will sign the Exelon Dividend Protection Act. We’ll have to more to say on the legislation, but one may read the story here.

 

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Today’s  Chicago Sun-Times discusses the Exelon Bail-Out Bill.

What began as a means of rewarding Exelon Corp. for generating “clean” nuclear energy and  keeping unprofitable plants in Clinton and the Quad Cities open has evolved into a far-reaching and  contentious revamp of state energy policy.

Check out the article here.

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