Without financial help from ratepayers, Public Service Enterprise Group says it will have to begin shuttering its three nuclear plants in South Jersey by 2022.
On Tuesday, the state published applications PSEG sent to the Board of Public Utilities backing the company’s position that it should qualify for up to $300 million in annual subsidies, otherwise its three Salem County nuclear will close.
The Rate Counsel, an independent state agency representing consumer interests, has disputed PSEG’s claim it needs support to maintain its nuclear plants.
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The redacted filings do not include financial information PSEG provided in its application showing a need for subsidies. The firm owns three nuclear units in Lower Alloways Creek Township: the Hope Creek Generating Station and the two-unit Salem Nuclear Power Plant.
“Without a material financial change, Hope Creek will cease operations within three years,” one of the documents reads.
Gov. Phil Murphy signed legislation last year requiring the BPU to set up a program that would help maintain the state’s nuclear plants, which don’t emit greenhouse gases, and keep New Jersey on track to reduce carbon emissions by 80 percent by 2050.
Electric utility companies will charge ratepayers an extra $0.004 per kilowatt hour if a subsidy is approved and then pass the money on to the nuclear plants. That’s equal to about $31 to $41 per year for the average residential ratepayer, or $300 million in total.
The Salem County plants provide more than 90 percent of the carbon-free generation produced in New Jersey, PSEG said in its application. The state’s greenhouse gas emissions would jump by 40 percent if just one of the units shuts down, the company wrote.
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PSEG did not release the amount in subsidies the firm would need to keep the units open or any financial statements that prove their nuclear plants are in hard financial times.
“The financial information is confidential in nature and not available to anyone outside the proceeding, beyond Rate Counsel and the Independent Market Monitor,” BPU spokesman Peter Peretzman wrote in an email.
Some environmental groups have criticized the legislation, saying nuclear plants should not be considered “clean energy” because they release thermal pollution, radioactive waste, radioactive emissions and have other environmental costs.
Rate Counsel Director Stefanie Brand said her office is reviewing the applications and will submit comment later this month.
She has said the BPU needs to determine whether the $0.004-per-kilowatt-hour surcharge would create unfair and unreasonable rates. Under the law, ratepayers in New Jersey have the right to utility rates that aren’t excessive.
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The subsidies could be unfair for ratepayers, who would foot the bill for nuclear plants that are not truly in financial distress, Brand said Wednesday. PSEG has said the plants are making money but are not expected to earn the return they are seeking, Brand said in comments last April.
“I think (PSEG is) making money,” Brand said. “This bill was not a good idea. What the statute does is have ratepayers take risks for the market that PSEG should be taking on.”
In comments, the Rate Counsel has cautioned that a nuclear unit’s closing may not “significantly and negatively impact” the state’s ability to reduce greenhouse gases because power plants don’t account for a large amount of emissions.