Article Summary
- The long-running debate over energy policy is heating up ahead of lawmakers’ fall veto session.
- Lawmakers are considering loosening nuclear power regulations and incentivizing battery storage.
- Advocates are pushing lawmakers to pass the bill in October, but some lawmakers are warning it could be delayed to the spring.
- One key lawmaker, however, indicated the issue could be pushed to the spring.
This summary was written by the reporters and editors who worked on this story.
(Capitol News Illinois) – After twice failing to pass an energy reform package this year, lawmakers and renewable energy advocates are aiming to reach a deal in time for a brief legislative session in October.
The bill, in its current form, would create a surcharge on electric bills to incentivize battery storage developments, loosen state-level nuclear regulations, institute new energy efficiency requirements and more.
Many advocacy groups are hoping to get a major bill passed this year, but one influential lawmaker is beginning to hedge as lawmakers’ veto session approaches.
“This is still a work in progress,” Sen. Steve Stadelman, D-Caledonia, said at a Thursday subject matter hearing on the bill. “Should the bills come back before the Senate, we will have another subject matter on the legislation or we could craft a different proposal in another bill.”
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Stadelman, who chairs the Senate Energy and Public Utilities, noted at the end of that hearing a final package could come “this fall or next spring.” He also said the committee will hold another hearing in early October.
House Bill 4116 contains the latest proposals, which are largely similar to legislation considered at the end of May, only with an updated timeline.
Nuclear power politics
In the latest round of negotiations, stakeholders have been largely focusing on the electricity demand created by data centers. These always-on, power-hungry facilities are a key aspect of Illinois’ economic development strategy, and the state has offered several data center companies tax incentives to locate here.
The data center industry has advocated for the use of increased nuclear energy to meet that demand.
Dan Diorio, head of state policy for the Data Center Coalition, pointed to a recent deal between Constellation Energy Corporation, the owner of Illinois’ nuclear power plants, and Meta, the parent company of Facebook. Starting next year, Meta will purchase “renewable energy attributes” from the nuclear facility in Clinton, providing the financial incentive to keep the plant open for two decades after state subsidies run out.
The industry is backing a proposal that would lift a state-level moratorium on new nuclear power stations.
Read more: Lawmakers seek ways to prevent data centers from straining Illinois’ power grids | Pritzker touts Illinois’ economic development at data center groundbreaking
“Data center companies are adding nuclear power to their energy portfolios because it’s carbon-free, scalable, safe and provides reliable base load power,” Diorio said.
But environmental advocates are wary of lifting the moratorium. Sierra Club Executive Director Jack Darin said he wanted the nuclear moratorium to be part of broader talks about data center regulations in the spring session.
“The other reason to maybe take a breath here is because of really significant changes that are happening to the federal regulatory oversight of the nuclear industry,” Darin said.
Earlier this year, President Donald Trump ordered sweeping changes at the Nuclear Regulatory Commission with the aim of quadrupling nuclear power capacity in the U.S. over the next 25 years.
The concept of lifting the moratorium has received bipartisan support, including from Gov. JB Pritzker, although the exact details would have to be ironed out in legislation.
Battery storage funding
The centerpiece of the proposed legislation is a new state funding mechanism to incentivize energy storage projects.
“Batteries can serve as an arbitrage mechanism, storing surplus energy during periods when electricity is ample and inexpensive and discharging it during high-priced peak periods,” Sarah Moskowitz, head of the consumer advocacy group Citizens Utility Board, said.
Moskowitz also said storage can help the grid maintain reliability by replacing or delaying the need for more expensive or slow-to-deploy energy generation.
“The sooner we invest in a solution, the sooner we can pull out of this cycle of record-breaking electricity price increases,” Stephanie Burgos-Veras, an organizer with the industry-backed Solar Powers Illinois campaign, said in a statement. “The most expensive path forward is to not pass anything in veto session.”
A May analysis from the Illinois Power Agency, which manages electricity purchasing in the state, found that adding 6 gigawatts of battery storage to the grid — the equivalent of several power plants worth of batteries — would reduce costs to consumers by about $2.70 per month in northern Illinois and about $7.50 in downstate Illinois.
Read more: Illinois bet on solar to meet its climate goals. Trump has the industry in his crosshairs.
The current proposal would incentivize battery storage in a similar way to renewable energy projects — by adding a surcharge to utility customer bills. This gives developers a financial guarantee that they can leverage to obtain private financing for the bulk of project costs.
Consumer advocates like Moskowitz are strongly in favor of this proposal. But some question cost savings claims.
“I think the IPA analysis assumptions were disingenuous to set up a narrative that this will save ratepayers money,” Sen. Sue Rezin, R-Morris, told Capitol News Illinois. “And that’s simply not true.”
Rezin advocated for cost caps to limit the amount of money charged to ratepayers if IPA procurements cost more than expected.
Others, notably industrial businesses and manufacturers, don’t want any surcharge on the bill. Instead, they propose requiring battery developers to get state-backed loans from the Illinois Finance Authority.
“This results in savings to them (battery storage developers) and savings to Illinois ratepayers and, more importantly, does not put another line item on the bill for Illinois consumers to pay for something,” Phillip Golden, chairman of Illinois Industrial Energy Consumers, said.
This proposal has sparked some dissent among Senate Democrats. Sen. Willie Preston, D-Chicago, earlier this month announced he was backing a proposal to use loans from the IFA as the finance vehicle for storage projects.
“Instead of soaking ratepayers for even more money, as some propose, the businesses that are going to reap the rewards should also take the risk,” Preston said in an early September statement.
Proponents of using a ratepayer surcharge say the model’s use in renewables is evidence that it can be successful. They also point to studies prepared for industry groups which found that more battery storage will save consumers money in the long run.
(Reporting by Andrew Adams, Capitol News Illinois)
Capitol News Illinois is a nonprofit, nonpartisan news service that distributes state government coverage to hundreds of news outlets statewide. It is funded primarily by the Illinois Press Foundation and the Robert R. McCormick Foundation.
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