Gov. Phil Murphy approved massive new subsidies for the nuclear and solar power industries last month, without modifications sought by many, including this newspaper, to protect electricity customers from unnecessary cost increases.
Now it is up to the state Board of Public Utilities to allow full participation by the Division of Rate Counsel in the process of determining whether the nuclear subsidy is needed.
Stephanie Brand, the division’s director and commonly known as the ratepayer advocate, would normally have a central part in such an action directly affecting how much people pay in their monthly electric bills. But legislators stripped the division of that right in this case to help ensure nuclear plant owner Public Service Enterprise Group gets the $300 million a year subsidy. The BPU can still give Brand special permission to participate and must if consumers are to have any faith that their interests are represented.
The new law also blocks the BPU from reducing the subsidy to a more reasonable or accurate level — it can only grant the $300 million a year in full or deny it. Once granted, the subsidy automatically renews for the next three years before being reviewed for subsequent three-year periods. PSEG says it needs the subsidy to keep its three nuclear plants in Salem County open, but maybe it needs less. It hasn’t opened its books and only will as part of the BPU’s subsidy consideration.
The BPU should make public what it and the rate counsel figure PSEG actually needs. Given that its hands are tied, if the legitimate need is significantly less than the $300 million a year, the BPU should reject the initial approval and take it into account when the next three-year subsidy is considered.
A $300 million a year solar subsidy twinned with the nuclear subsidy and signed at the same time by Murphy makes even less sense and is not subject to a BPU review.
It is being added on top of $700 million a year in existing solar subsidies. This $1 billion will subsidize just 4 percent of New Jersey’s power (nuclear at least provides more than 30 percent). The ratepayer advocate says New Jersey gets the second-worst return on its solar spending in the nation.
“We can get the same amount of solar at a lower cost,” Brand told The Star-Ledger. “The cost of solar has dropped tremendously, but the cost to ratepayers has not. Other states are re-examining how they pay for solar, and I think we need to as well.”
We agree. Solar is good clean energy, but it’s ridiculous for residents and businesses to way overpay for it in already high-cost and over-taxed New Jersey.
Utility bills are going to balloon from these subsidies for nuclear, solar and the soon-to-arrive giant offshore wind energy installations.
The best thing the Murphy administration could do to ensure popular support for these green projects is to reform their government support system to ensure they are cost-effective, with the full help and support of the ratepayer advocate. As matters currently stand, utility customers may assume clean energy is mainly a smokescreen for lavishing government largesse on insiders and political supporters.