On August 27, I stood in front of small groups of socially distanced employees at our Dresden Generating Station in Illinois, announcing plans for the premature retirement of the nuclear facility next fall. A hundred miles away, our chief operating officer was delivering a similar, equally somber announcement to employees at the Byron Station.
Despite being among the safest, most efficient, and reliable nuclear plants in the nation, Dresden and Byron face revenue shortfalls in the hundreds of millions of dollars because of declining energy prices and market rules that allow fossil fuel plants to underbid clean merchant nuclear resources in the PJM capacity auction, even though there is broad public support for sustaining and expanding clean energy resources to address the climate crisis.
As we said in our announcement, the plants’ economic challenges were further exacerbated by a recent ruling by the Federal Energy Regulatory Commission that undermines longstanding state clean energy programs and gives an additional competitive advantage to polluting energy sources in the auction. Sadly, as a result of these market rules, Exelon Generation’s LaSalle and Braidwood nuclear stations in Illinois, each of which house two nuclear units and together employ more than 1,500 skilled workers, are also at high risk for premature closure.
Despite the sad news, our Dresden and Byron employees listened intently, asked good questions, processed the information, and went back to work. As some of the most engaged and high-performing employees in the Exelon Generation nuclear fleet, they know that nuclear is vital to the country’s ambitious economic, environmental, and social equity goals.
For these and other reasons, we remain hopeful. We know there’s no match for nuclear technology in the global fight against the climate crisis, and there have been a slew of exciting developments recently to justify our optimism.
In August, TerraPower launched its “cost-competitive sodium fast reactor combined with a molten salt energy storage system.” On August 28, the U.S. Nuclear Regulatory Commission completed the technical review of the design certification application for NuScale’s groundbreaking small modular reactor with the issuance of the final safety evaluation report. These are exciting developments for the industry that should be recognized.
And, amid the many challenges of COVID-19, U.S. nuclear plants have delivered outstanding reliability and flexibility, powering hospitals and treatment facilities 24/7 while protecting plant workers and host communities, even during refueling outages.
We executed several record-setting outages this spring that set the stage for a summer capacity factor of over 97 percent. Our average duration for the spring outages clocked in at 17 days, a full two weeks shorter than the national average. This efficiency alone generated carbon-free power for an additional 4.6 million homes, hospitals, and other essential businesses during a critical time. We continue to make our nuclear facilities even safer, more effective, and cost-efficient than ever before, reinforcing nuclear’s enormous value. All while minimizing the spread of contagions for our communities, employees, and families.
America’s nuclear plants continue to set the bar higher year over year for safety, reliability, and operational excellence, while driving costs down. Across the industry, we’ve identified hundreds of millions of dollars in efficiencies to cut total costs by an average of 25 percent, according to a Nuclear Energy Institute study from 2019. This is a far cry from my early days at the Quad Cities station, where we thought that refueling outages lasting fewer than 100 days were a stretch and that maintenance budgets of less than $100 million were impossible to improve reliability.
With these innovations and industry improvements as a backdrop, many state and federal policymakers on both sides of the aisle are starting to understand, engage, and espouse the value of nuclear power. The Nuclear Powers America Act is a great example of bipartisan support to get nuclear energy recognized for its clean air contributions.
I have a long-term positive outlook for our industry. For our short-term challenges, we will need the full force of our nuclear professionals and supporters. After the Byron and Dresden announcement, one of the top questions I received was, “How can I help?” In addition to focusing on operating all nuclear plants at top levels of operational excellence, we need everyone to yell from the top of every hill about the importance of carbon-free nuclear energy. Our climate is depending on us.
Bryan Hanson is executive vice president and chief generation officer at Exelon Generation