As an early participant in the U.S. Environmental Protection Agency’s (EPA) Climate Leaders program:
- Exelon reduced direct and indirect greenhouse gas (GHG) emissions by 35% between 2001 and 2008, exceeding our voluntary commitment under that program.
- In 2011, we achieved more than 82% of our Exelon 2020 goal to annually reduce, offset and displace 15.7 million metric tons of GHG emissions.
- As we complete our integration with Constellation in 2012, we are building on the success of Exelon 2020, investigating alternatives for setting new goals for the combined company that more broadly address environmental performance, in support of the sustainable growth of our business.
For Exelon, cleaner generation is just part of the equation. We drive our Exelon 2020 program to consider broader environmental, social and economic goals, with the ultimate goal to provide clean, safe, reliable and affordable electricity.
Capitalizing on Environmental Leadership
Exelon’s early commitment to responsible, low-carbon energy investment has enabled us to create advantages for our stakeholders while minimizing our impacts on the environment. In support of our Exelon 2020 strategy, we plan to invest nearly $5 billion in cost-effective, clean energy projects from 2010 through 2015. The projects in Illinois, Pennsylvania and other states include energy efficiency and Smart Grid programs, economic renewable and cleaner-burning fossil energy investments, and increased output at Exelon’s nuclear plants.
- Our Opportunities
Understanding the Variables
How do we transition to a low-carbon, clean energy future without compromising reliability or affordability for our customers?
Due to the debate over carbon policy, we have expanded this year’s Exelon 2020 analysis to reflect options for reducing other pollutants as well. Exelon 2020 recognizes that success requires solving a multi-factor equation, and getting that equation right. We must solve for clean, reliable and affordable energy, simultaneously. We believe today’s public policy debates and business strategies fall short by looking for solutions in single dimensions and through short-term policy mandates that ignore market dynamics.
Exelon 2020’s analytical update for 2011 begins to layout this multi-variant equation:
- Clean: Every source of energy available to us today, including wind and solar, has its own environmental impact. The responsibility of energy suppliers as well as policy makers is to recognize those impacts, work to abate them and price the full cost into the product. The costs of pollution from energy production have traditionally been borne by society in health care costs and environmental damage but are not – yet – entirely included in the electricity price of coal generation.
- Reliable: Ensuring reliability of the power supply is the most fundamental responsibility of a power company. Exelon’s first goal in its Vision statement is “keep the lights on.” This means recognizing that:
- Trying to ensure reliability through reliance on intermittent and low-capacity-factor renewable technologies results in excessive costs to consumers.
- Reliability impacts of cleaning the generation stack via Clean Air Act regulations, and the anticipated coal plant retirements driven by both current economics and these new requirements, will not cripple the grid.
- Energy security is an element of reliability, and means stability of supply and of price, regardless of geopolitical events. It means the ability to manage our own energy (and therefore industrial) destiny.
- Affordable: Exelon’s experience and Exelon 2020’s analysis demonstrate that clean, reliable and affordable energy options are not mutually exclusive. The economics underlying Exelon 2020 demonstrate that current subsidies and mandates generally promote expensive options and neglect the cheaper ones.
- Shareholder value: While we take our public responsibilities seriously, Exelon does not approach this business strategy from an entirely altruistic perspective. We see value to be gained for our shareholders in Exelon 2020, both through providing a quality product and minimizing future business risks.
- Our Performance
Exelon's GHG Abatement Performance
We achieved over 82% of our goal, abating more than 12.8 million tonnes of CO2e in 2011.
Balancing our considerations of environmental, economic and reliability aspects to guide our actions, we are making steady progress toward achieving the goal we set in 2008: to reduce, offset or displace 15.7 million metric tons of GHG emissions per year by the year 2020.
Our success has been accomplished through aggressive efforts across all three pillars of the Exelon 2020 strategy:
- Our Goal
Initiatives to Reduce, Offset, or Displace GHG Emissions
We anticipate that the GHG abatement options we have already begun to pursue will allow us to meet and exceed our Exelon 2020 goal.
Retirement of four older, inefficient fossil units at Eddystone and Cromby was completed in May 2012. We have increased our renewable energy portfolio with solar and wind by 745 MW from 2008 to 2010, and are further replacing generation within our supply mix with cleaner natural gas generation such as Wolf Hollow, and other renewable assets such as Antelope Valley Solar Ranch, both acquired in 2011. Additionally, by 2014, we plan to add more than 400 MW of new low-carbon electricity through the implementation of nuclear uprates at our existing nuclear facilities. Beyond providing more clean low-carbon electricity, our customer energy-efficiency and programs are showing significant energy-use reductions, with the net impact of avoiding more than 750,000 metric tonnes of CO2e emissions in 2010. These programs, along with renewable/alternative energy credit (REC/AEC) programs and advancements in Smart Grid techonology will be significant contributors to meeting our goal in the most cost effective manner.
Based on Exelon heritage assets and operations prior to the 2012 merger with Constellation, we achieved 82 percent of the Exelon 2020 goal in 2011. Rather than modify the goal now, before the divestiture and other integration activities are complete, we will continue to report our Exelon 2020 performance based on the Exelon heritage assets and operations. Building on the success of this program, we will investigate alternatives for setting new goals for the combined company that more broadly address environmental performance, in support of the sustainable growth of our business.
Building on Strengths
Together the combined focus on environmental sustainability will become a powerful element of the company’s sustainable growth strategy.
Greening our Operations
- At the end of 2010, we achieved our goal to reduce energy consumption at commercial facilities by 25% two years ahead of schedule. We are also nearing our 7% reduction goal for auxiliary power use at our plants, closing 2010 with a 6% reduction.
- 10 Exelon facilities have received LEED certification. Some PECO sites are realizing savings of 50% on electricity and gas usage and have reduced water usage by 40%.
- ComEd and PECO have reduced SF6 releases over 70% since 2001 in our transmission and distribution infrastructure, and emit on average 7 percent less GHG emissions per mile traveled compared to 2005, when mileage information was first tracked.
- Exelon has become a national leader in supply chain-environmental management through our work with the Electric Utility Industry Sustainable Supply Chain Alliance. Through the Alliance, we have helped lead the development of industry standards for evaluating the environmental attributes of key materials and services as well as performance metrics for supplier companies.
Learn more about Green Operations at Exelon.
Helping Our Customers & the Communities We Serve Reduce Their GHG Emissions
By demonstrating that we are aggressively reducing our own emissions, we can help and encourage our customers to reduce their emissions.
- Through mid-2011, Exelon has spent more than $240 million on a range of innovative energy efficiency and demand response programs to help customers reduce their own greenhouse gas emissions.
- More than 1.5 million MWh of energy savings, which contributed to the abatement of more than 900,000 metric tons of GHG emissions, have been avoided through 2010 as a result of the Smart Ideas (SM) programs at our delivery companies, ComEd and PECO.
- ComEd and PECO have launched Smart Grid initiatives in Chicago and Philadelphia designed to give customers information and tools to better manage their energy use. Combined, the companies will deploy over 720,000 smart meters to customers.
Learn more about Customer Programs that help reduce energy consumption.
Offering More Low-Carbon Electricity in the Marketplace
Exelon continues to make important investments in lower-emissions energy generation and reducing the reliance on higher carbon fossil generation.
- We continue to seek smart investment in renewables. In 2010, we added 36 existing wind generating sites located in 8 states through the purchase of what is now Exelon Wind. The purchase included the opportunity to pursue 1,468 MW of additional new wind projects.
- The completion of Exelon City Solar on Chicago’s South Side added 10 MW of solar power to our portfolio, producing over 14,000 MWhs of emission-free electricity and displacing more than 20 million pounds of GHG emissions per year from fossil generation, since it came online in early 2010.
- In September 2011, Exelon announced the acquistion of Antelope Valley Solar Reach One, a 230-MW solar site under development in California.
- The nuclear uprates program increased output at our zero-emissions nuclear plants by more than 100 MW since 2008.
- We have begun the retirement of four inefficient, carbon-intensive fossil burning units in Pennsylvania, subsequently adding cleaner and more efficient natural gas units at newly acquired Wolf Hollow Generating Station in Texas.
Learn more about Exelon’s efforts to offer more Low-Carbon Electricity.
Managing our Impact
We diligently manage our environmental impact on the air, land, water and biodiversity. Our all-source generation portfolio air emission rates are well below industry averages because of our investment in, and commitment to, low-emission technologies for the majority of our owned generating capacity. In addition, we are challenging the future of energy generation by incorporating land use, water resources, waste generation and community interactions (including affordability and reliability) into our long term business analyses.
Exelon is able to meet energy needs while maintaining the quality of our air, land and water resources and minimizing our impacts on diverse species and habitats.
Learn more about Exelon's efforts to manage our environmental impact.