Exelon Spin-off

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Stop Exelon’s Dangerous Nuclear Spin-Off Scheme

Exelon, the largest nuclear power company in the U.S., now wants to get out of the nuclear business. But not by shutting them down and replacing them with renewable energy, as it should. Instead, Exelon is trying to pull off one of the largest, most environmentally dangerous corporate schemes in history: spinning off 23 aging, uneconomical reactors to a completely new, totally separate company currently called “SpinCo”.

This new company will be under even greater pressure to cut costs on nuclear safety while operating a fleet of aging, embrittled reactors. And it will put five states and dozens of communities at risk that the new company will go bankrupt before cleaning up the highly contaminated sites after the reactors shut down. If Exelon gets away with this, it will set precedent for the rest of the nuclear industry.

Exelon needs government approvals for its nuclear spin-off scheme to succeed. The Nuclear Regulatory Commission and the New York State Public Service Commission (NY PSC) are both accepting public comments on

Exelon’s proposals:
For NRC to transfer the federal operating licenses for all of Exelon’s reactors to SpinCo
For NY PSC to approve the transfer of ownership of Exelon’s four New York reactors to SpinCo

Just fill out the form below to submit comments to the NRC and NY PSC opposing Exelon’s dangerous corporate spin-off scheme. Exelon should phase out its reactors, replace them with renewable energy, and clean up its radioactive mess safely and responsibly.

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Background:

Philadelphia Inquirer: Peco parent Exelon plans to separate into two firms

NIRS: “No More Bailouts” – NIRS and NEIS Statement on Exelon Nuclear Spinoff Plan

Maryland Matters: Opinion: Is Exelon Spinoff Prelude to a Nuclear Bailout?

Nuclear Resource Commission

Subject: Docket ID NRC-2021-0099: Exelon license transfer application

Message:

Dear Chairman Hanson and Commissioners Baron, Caputo, and Wright,

I urge you to reject Exelon’s petition to transfer all of its nuclear reactor licenses to a new, completely separate corporation (currently called SpinCo). The Commission must reject this corporate spin-off scheme, which is unprecedented in size, scope, and complexity. It places worker and public health and safety at immense risk from the transfer of aging, uneconomical reactors, thousands of tons of radioactive waste, and over $14 billion in consumer-funded decommissioning funds to a company that does not even exist yet.

In order to possess a reactor operating license, a company must demonstrate that it is financially qualified and can provide assurance of sufficient funds to fully decommission the reactor. Exelon’s proposed “SpinCo” meets neither criteria, and its license transfer application provides no evidence to the contrary.

Exelon states publicly and in its application that many of its reactors are not able to generate enough revenue to pay their operating and maintenance costs. Several others are financially dependent on temporary consumer subsidies from state governments. SpinCo will have no other sources of revenue except for electricity sales and subsidies, and cannot guarantee it will have sufficient funds to operate and maintain all of its reactors safely.

Neither can SpinCo provide assurance of decommissioning funding. In 2019, Callan Institute concluded that Exelon’s decommissioning funds were between $1.5 billion and $7.4 billion short of the amounts needed for decommissioning. The company will have no other sources of decommissioning funding than the decommissioning trust funds. Because the reactors themselves are unprofitable and dependent on temporary, out-of-market subsidies, SpinCo will not be able to make up for decommissioning fund shortfalls and cost overruns.

What is more, the application does not provide the state in which SpinCo will be incorporated, nor the names of its executives and officers, as it has not even been incorporated. In effect, Exelon is asking NRC to violate its own statutory and regulatory requirements (per 10 CFR 50.80 and 50.33), and allow 28 reactor licenses and billions of dollars in decommissioning funds to be transferred to an unknown company.

Exelon is proposing this spin-off because it no longer sees a future in nuclear power, which is increasingly risky and uneconomical. So Exelon has decided to get rid of its nuclear power plants because no other company sees a future in them either. But the Atomic Energy Act and NRC’s licensing requirements are intended to prevent exactly what Exelon is proposing. Putting nuclear reactors in the hands of financially unqualified companies that could put the public’s health and safety at risk. NRC must dismiss Exelon’s application: it is incomplete, SpinCo is not financially qualified, and cannot provide decommissioning funding assurance.

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New York Public Service Commission

Subject: Case 21-E-0130: Exelon nuclear spin-off plan

Message:

Dear Interim Chair Howard and Commissioners Alesi, Burman, and Edwards,

I urge you to reject Exelon’s petition and its proposal to transfer all of its nuclear power plants to a new, completely separate corporation (currently called SpinCo). The New York Public Service Commission must assert jurisdiction over this corporate spin-off scheme, which is unprecedented in size, scope, and complexity. New Yorkers are at immense risk from the transfer of aging, uneconomical nuclear reactors, thousands of tons of radioactive waste, and billions of dollars in consumer-funded decommissioning funds.

In 2010, PSC asserted its jurisdiction and wisely rejected a nearly identical proposal by Entergy to transfer its nuclear reactors in NY and other states into a SpinCo (eventually named Enexus). DPS staff and the Commission concluded “the transaction was not in the public interest due in part to concerns about the long term financial stability of the new company and a lack of ratepayer benefit from the proposed deal.”

The same concerns are true of Exelon’s proposal, to an even greater degree. New York consumers have already contributed over $2 billion in subsidies to Exelon since 2017, through mandated payments for zero-emissions credits (ZECs) on electricity bills. Consumers will continue paying up to $5.6 billion more in ZEC charges by 2029. New Yorkers deserve accountability, transparency, and protection against both nuclear dangers and economic risks, but Exelon’s proposal provides no transparency and accountability and greater risk to our environment and economic security.

Exelon is proposing this spin-off because it no longer sees a future in nuclear power, which is increasingly risky and uneconomical. So Exelon has decided to get rid of its nuclear power plants because no other company sees a future in them either. But transferring them to a new corporation that will only own 23 uneconomical reactors places New Yorkers at immense risk:

Nuclear Safety: The new “SpinCo” will be under even greater pressure to cut costs on maintenance and workers, putting profits before public safety.

Accountability and Transparency: Ratepayers are on the hook to pay $7.6 billion in subsidies for Exelon’s four NY reactors. We deserve to know that corners aren’t being cut on nuclear safety, that workers’ jobs are secure, and NYers’ dollars aren’t being used to prop up unprofitable reactors in other states when that money could be building renewable energy in NY.

Decommissioning: Exelon now holds over $2 billion in decommissioning funds for NY reactors --all of which comes from payments made by NY ratepayers. The new SpinCo will have no other assets or income to decommission NY reactors, placing host communities and the whole state at risk.

New York deserves to be protected against Exelon’s dangerous, short-sighted corporate spin-off scheme. Please reject Exelon’s proposal and protect our environment, safety, and economic security.

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