Exelon sets its price for keeping Everett plants open
Region's grid operator warns of rolling blackouts without them
EXELON GENERATION told federal regulators on Wednesday that it is willing to keep operating two power plants and a liquefied natural gas facility in Everett from 2022 to 2024 if the company is allowed to collect less than $1 a month from all of the electricity customers in New England over the two-year period.
Chicago-based Exelon said in a press release that the actual amount could end up being “considerably less” than a dollar a month if revenue from operating the plants is significant. The company agreed to offset its estimated costs with the revenue it receives from running the plants. The revenues will be dependent on weather conditions and energy prices from 2022 to 2024, the company said.
The so-called Mystic gas-fired generating plants in Everett are some of the biggest in New England, but they cannot compete in today’s energy markets – their costs are too high. Exelon said in March that it planned to retire the plants at the end of May 2022 rather than continue to lose money.
But the operator of the regional power grid said it needs the 1,700 megawatts of electricity the plants are capable of generating. In its own filing with federal regulators, the grid operator, ISO-New England, warned that without the two Mystic plants it would be forced to impose rolling blackouts over the two-year period if the region faced a winter comparable to the one in 2014-2015.
Much of Exelon’s filing focused on its estimate of the costs of operating the two power plants and the adjacent liquefied natural gas facility it is in the process of acquiring. Exelon said its annual fixed revenue requirement for the two plants totals nearly $219 million in 2022-2023 and nearly $187 million in 2023-2024. The company said its cost estimate includes an overall rate of return of 8.46 percent, based on a cost of debt of 4.76 percent and a return on equity of 10.26 percent.