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A Tried-and-True Businees Plan



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If you can’t grow your business on your own, lobby the government to tilt the playing field in your favor. Here’s a classic case of rent-seeking from Exelon:

John Rowe, the 64-year-old chief executive of Exelon Corp., has pledged that his utility will drastically reduce its “carbon footprint,” including emissions from power plants, vehicles and other sources. Recently, the company retrofitted the 10 stories it occupies in a high-rise Chicago office building, cutting its energy use there in half.

His support of carbon-emission reductions recently led him to clash with the U.S. Chamber of Commerce, and he pulled Exelon out of the group last month. That won him praise from some and enmity from others.

Certainly, as the country’s largest operator of nuclear power plants, which don’t spew carbon dioxide, Exelon could potentially emerge as a winner if Congress passes legislation to reduce carbon emissions.

However, his company has hit some bumps recently as it attempted to expand. Industry pundits say the best way for utilities to achieve growth is through consolidation, but Exelon has failed in its attempts to acquire Illinois Power Co., Public Service Enterprise Group Inc. of New Jersey and most recently NRG Energy Inc.

WSJ: You’re outspoken about the need for carbon-emission reductions. You dropped out of the U.S. Chamber of Commerce because it opposed legislation. But you own 17 nuclear reactors that would benefit.

Mr. Rowe: We don’t flinch from the charge that, yes, some of our motivation and enthusiasm comes from the fact that we should make money on it if it happens. I started dealing with this problem more than a decade ago, long before I had a sense of how much money I could make for Exelon. A good solution to a societal problem is one where the winners help solve the problem.

Don’t get me wrong: I’m all for expanding our nuclear-power supply — but not at the expense of the rest of our energy economy, in particular the losses that will occur in the transportation-fuel arena. Nuclear power would, barring similar heavy-handed government regulations, grab a greater share of our electricity-supply mix; but, as almost all of our transportation-fuel needs are met by petroluem-based (i.e. carbon-based) fuels, our energy sector overall will take a hit, since alternative fuels and vehicles aren’t ready to make a meaningful contribution toward our transportation needs, and since our grid isn’t now capable of handling an expanding share of electricity production from intermittent sources like wind and solar.

More nuclear is good. More nuclear because of burdensome carbon-reduction mandates, on balance, is not.



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