Exelon's generating capacity gets boost

WASHINGTON -- Exelon Generation Co. has received federal approval to boost generating capacity at four Illinois nuclear power plants to help meet growing customer demand.

The Nuclear Regulatory Commission on Dec. 21 approved plans to increase the power at the Dresden 2 and 3 plants near Morris by 17 percent each, and the Quad Cities 1 and 2 plants near Moline by 17.8 percent. The move would raise power production at each plant to 912 megawatts.

Exelon projects Illinois' demand for electricity to increase 28 percent from 2000 to 2014. Regulators say Exelon also has indicated that it wants to sell power to other providers in order to remain competitive.

The generating capacity changes were approved after hearings produced no critical public comments and staff findings that there should be no significant safety or environmental problems, records showed.

Exelon spokeswoman Kristen Wallach said Wednesday the new capacity will provide almost 400 megawatts of additional power -- almost half the 900 megawatts overall the company hopes to add by 2005 at its 17 nuclear reactors in Illinois and Pennsylvania. Some of that additional capacity already has been added at several other plants in Illinois, Wallach said.

An application is pending to increase generating capacity at the company's Clinton nuclear plant in central Illinois.

More affordable

Federal officials have said adding capacity was more affordable for Exelon than purchasing power elsewhere or building a new power plant.

A nuclear power plant typically provides about 900 megawatts of power -- the same as about two gas-fired power plants. The cost of increasing capacity at an existing nuclear plant can be about 1 percent of the cost of building a new nuclear plant or clean-coal-fired one, according to Steve Kerekes, a spokesman for the Nuclear Energy Institute.

Wallach said the increased generating capacity won't translate into immediate rate cuts or increases for existing Illinois customers because of deregulation. A 1997 state law capped electric rates for all Illinois users until Jan. 1, 2005. Residents who use the largest utilities were guaranteed a roughly 20 percent rate decrease during that time.

"The cost of these power (generating capacity changes) were planned, so they won't be passed on to customers," Wallach said.

She did not know if Pennsylvania customers would be equally unaffected.

Help keep down rates

Wall Street analyst Danielle Seitz of Salomon Smith Barney said greater generating capacity should enable Exelon, through competitive pricing, to keep rates down while reaping more money for shareholders.

Exelon has already begun taking advantage of the federal approval.

By last weekend, its Dresden 2 reactor was at its new capacity, Wallach said, and the three other reactors were expected to reach their new levels during the coming year.

Wallach said she did not know the cost of making the necessary plant improvements. According to federal documents, the cost for the Dresden modifications alone is $26 million.

In their environmental assessment, federal regulators indicated that increasing the generating capacity of the 1970s-era reactors should enhance their value and reduce the likelihood of their early retirement and resulting negative impact on the local economies.

At present, operating licenses for the Dresden and Quad Cities reactors are scheduled to expire between 2009 and 2012, but Wallach said Exelon has told regulators it plans to seek extensions.

Exelon distributes electricity to about 5 million customers -- 3.4 million in northeastern Illinois and the rest in Pennsylvania.

Exelon Generation is a division of Exelon Corp., the Illinois-based electricity giant created by the October 2000 merger of Commonwealth Edison parent Unicom and Pennsylvania-based PECO Energy.