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Chester County Press

Chamber luncheon focuses on the future of energy production

10/25/2016 10:55AM ● By J. Chambless

A large crowd filled a meeting room at Hartefeld National Golf Club last week to hear about the future of energy production.

By John Chambless
Staff Writer

The state of energy production and future goals for cleaner energy were the big topics addressed at the Oct. 20 Annual Fall Luncheon of the Southern Chester County Chamber of Commerce.

The packed meeting, held at Hartfeld National Golf Club in Avondale, featured keynote speaker Ron DeGregorio, the senior vice president of Exelon Generation and president of Exelon Power. In his opening remarks, DeGregorio sketched out the basic facts about Exelon.

The company serves customers in 16 states and Alberta, Canada. Exelon Generation is headquartered in Kennett Square. “Exelon is a big player nationally. We are a Fortune 100 company now,” DeGregorio said. “We are America's number-one low-carbon producer. We have more than 34,000 employees and we generate 32.7 megawatts of power. I'm sure you're thinking, 'Wow, that's a lot.' But to put that in perspective, in Philadelphia Electric Company's territory – they're about a 5,000 megawatt load. We could do about seven Philadelphia region utilities and provide for that kind of load.

Ron DeGregorio, senior vice president of Exelon Generation, and the president of Exelon Power.

 DeGregorio said Exelon pays $250 million in taxes each year in Pennsylvania. “It's a pretty significant footprint in Pennsylvania, and this is a very important region for us,” he said. “Exelon Generation is headquartered here in Kennett Square. PECO is an Exelon company,” DeGregorio said. “We have six different utilities – in Chicago, PECO here, Baltimore Gas and Electric, Potomac Electric, Atlantic City Electric, and Delmarva Power. We maintain their names for branding purposes, but they're Exelon companies. In Pennsylvania, we have 640 employees in Kennett Square. We still maintain our PECO headquarters in Philadelphia. We maintain the whole Exelon Generation Company headquarters here, and our corporate headquarters is out in Chicago. Overall, we employ 6,000 Pennsylvanians.”

Looking back just over 15 years ago, he addressed the result of deregulation on the energy industry that opened the doors to competitive energy suppliers for consumers.

“About six years ago, lot started to change,” he said. “We had disruptors in our industry. In 2008, fracking really didn't exist. Back then, natural gas prices were very high and the United States was constructing multiple-billion-dollar projects to build liquified natural gas facilities to import natural gas. We didn't think we had enough. And then fracking starts to make a difference. Right now, the estimate is that we've got about 100 to 150 years worth of natural gas to provide all of our energy needs. So what happens is, with the abundant supply, prices crashed. Today in this country, we're beginning to look at exporting natural gas. So in a short period of time, we've seen a significant shift.”

There has been a move away from heavily polluting coal power to cleaner natural gas in our region, and DeGregorio discussed some of the main alternative energy sources.

“For 10 years, we've had production tax credits provided for wind farms,” he said. “Now, people think we should continue those tax credits to deal with the issue of climate change. It's easy to say that we should be 'all green' with our power production, without getting into the fact that wind and solar are non-dispatchable resources. That means that if you need more power, I can't go out to my wind farm and blow more on the turbine to satisfy your energy needs. That creates some challenges.

“Where the wind blows most predominantly is South Dakota, Iowa, places where I can get about 37 to 40 percent capacity out of that unit. That's a lot better than in Pennsylvania, where we might get a 32 percent capacity factor,” DeGregorio said. “The regions where the wind resources are the greatest happen to be the regions that are farthest from the load. So now we need to invest in transmission – the big towers.”

Since 2005, he said, coal generation has dropped by 35 percent, while natural gas has increased 66 percent, and wind and solar have increased 242 percent in the last decade. Nuclear, meanwhile, generates 20 percent of our power nationwide.

The state of nuclear energy production and facilities “will be a topic in 2017-18 in Pennsylvania,” DeGregorio said. “We're going to get to this conversation with the Governor and the PUC.

“We think the energy industry is not only challenging, but fun and exciting,” he added. “We think there are a lot of interesting things going on, and a bright future for us in this country. I believe that natural gas abundance is really good for our country from an energy independence perspective, and as a bridge fuel for cleaner power.

“We want you to know that we recognize safe, clean, reliable, cost-effective power enables your businesses. It enables the Chamber to advocate that more factories and companies move into this region. We know it's important, and we want to continue to be there for you.”

To contact Staff Writer John Chambless, email [email protected].