June 1 , 2002
The CEO Power Forum: The Best of the Best
thereafter at about 5 percent per year. The Exelon Way initiative would be largely additive to these expectations.
What about Exelon's efforts to site and build another nuclear plant?
We intend to apply for an early site permit that would "bank" a site at the Clinton Power Station in central Illinois for future construction of a new nuclear unit, should we ever decide to build one.
What was wrong with the pebble bed nuclear design project that you pulled out of?
Nothing wrong with the idea, but the technology is still under development and we are not an R&D firm. If the technology is fully developed and proven, we would certainly consider using it.
Can building new nuclear be made economic in this environment?
With current technology, with current market conditions, no. But as with all things, both the technology and the market will change. We'll have to wait and see.
Some have said that it is patently unfair and uncompetitive for some utilities to be able to compete and take market share from other utilities in competitive states while their vertically integrated utility is being protected from competition by their state PUC. As a utility in a competitive state, what is your stance on the issue?
Regional wholesale competition provides numerous economic and reliability-related benefits to consumers. It is unfortunate that some states and some utilities view an open, competitive wholesale market as a threat. This is evidenced through recent actions by the Commonwealth of Virginia with respect to the expansion of RTOs and recent legislative proposals that call for a "clarification" of jurisdiction that would severely restrict FERC's authority over interstate commerce and overturn 75 years of Supreme Court precedent. Exelon remains committed to public policies that build competitive wholesale and retail markets to meet the needs of our customers.
We have learned a number of key lessons over the past few years: Retail competition works well for large customers; small customers need a reliable regulated service option in addition to a competitive choice; and utilities that provide the regulated service option must be allowed to make their own supply arrangements.
What do you believe is the future of retail? Has it been a success or failure?
In Illinois, open access has been available to all non-residential customers since Dec. 31, 2000. As expected, the largest customers have been among the first to enter the market. Indeed, the large customers participating in open access in ComEd's service territory today represent roughly 30 percent of all ComEd kilowatt-hour sales. Furthermore, market development at the large customer level has been so robust that the Illinois Commerce Commission allowed ComEd to declare the 3 MW and greater customer market "competitive" and abandon tariffed service offerings to these customers.
Competition has been a success in Illinois, at least in ComEd's service area, to date in the large C&I [commercial and industrial] market. As for smaller customers, the jury is still out. Time and market development will tell.
In Pennsylvania, the number of active suppliers operating in PECO's territory fell from 36 in January 2001