But how much of the industry's plight is due to the growth of wind power?
The website of Exelon's new front group, Nuclear Matters, identifies some of the factors undermining the industry's prospects, including depressed electricity demand, cheap natural gas, an outdated transmission system, and the fact that electricity markets don't provide preferential treatment for low- and carbon-free sources -- which is equally true for wind and other renewables. Exelon executives, however, are most exercised about what the website identifies as "federal and state policies [that] subsidize less reliable electricity sources, distorting competitive markets and causing otherwise economical, clean electric generators to operate at a loss."
Joseph Dominguez, an Exelon senior vice president, translated that last bullet point into plain English for the Chicago Tribune in March. "Natural gas prices are impacting nuclear assets, there's no doubt about that," he said. "We would be able to survive that problem — and survive low demand for electricity — absent this phenomenon of subsidized wind."
Dominguez cited a 2012 Exelon-sponsored study by the Northbridge Group that concluded the PTC encourages wind developers to keep their turbines spinning when electricity demand is low, particularly at night, allowing them to sell power at a loss and drive down the price other generators in the area can charge. In Illinois and other wind-rich regions of the country, there are times when demand is so low, wind, coal and nuclear plant owners have to pay grid operators to take their power. Utilities call it "negative pricing." Exelon claims its entire nuclear fleet experiences negative pricing 14 percent of the time.
A March analysis by the American Wind Energy Association (AWEA), however, documents that negative pricing at Exelon nuclear plants occurs much less frequently and is largely unrelated to wind. Most of the negative pricing, the report found, happened when wind output was extremely low. The more credible culprits, according to AWEA, were local transmission outages and bottlenecks — which caused more than half of the incidents — low electricity demand, and Exelon reactors' inability to ramp down when demand drops — which natural gas and even renewables can do.
Steve Clemmer, UCS's director of energy research and analysis, concurs. The Northbridge study "wildly exaggerates wind's contribution to negative pricing," he said, "and completely ignores the fact that Exelon's nuclear plants themselves may be responsible."
Even executives at Xcel Energy and NextEra Energy — which both own nuclear plants — aren't buying Exelon's argument.
"Negative pricing is not driven primarily by wind," Xcel's vice president of policy and strategy, Frank Prager, told Greentech Media in early April. Prager should know. Xcel owns wind farms and two nuclear plants in Minnesota.
NextEra Energy CEO James L. Robo, meanwhile, took a swipe at Exelon in a column in the April 7 issue of Roll Call, a political trade publication. "Blaming the wind industry for the challenges in the merchant nuclear business may be politically expedient," he said, "but it will not help any company or technology operate more successfully in a low natural gas price environment." NextEra is the largest U.S. wind and solar developer, but it also owns eight nuclear reactors and a slew of hydro-, gas- and oil-powered generating facilities.
The Real Culprits
So what's really responsible for nuclear power's economic woes?
Besides cheap natural gas, transmission is a key factor, said Mike Jacobs, a UCS energy analyst. "It's a classic supply and demand equation," he explained. "If there were more transmission lines, utilities could dispatch power from places with a glut to where there's higher demand.
"It's a problem for both nuclear and wind," he added. "Both contribute to an oversupply at night when demand drops, winds blow stronger, and nuclear plants can't cut their power. Exelon is essentially saying that it's OK for our nuclear plants to generate more power at night, but it's not OK for wind farms."
Exelon CEO Chris Crane knows transmission is a big problem. In late April, he told the Chicago Tribune that his company is considering building a $1.6 billion high-voltage transmission line linking its reactors to customers from northern Illinois through Indiana to Ohio. True to form, however, he also made it clear that Exelon doesn't support a proposed 500-mile transmission line, now pending state approval, that would deliver wind-generated electricity from Iowa to Illinois and compete with Exelon's nuclear plants.