A group of consumer, environmental and industry trade groups are pressing the Murphy administration to release an analysis they said the Board of Public Utilities commissioned to gauge whether three nuclear power plants in South Jersey need a combined $300 million subsidy.In just two days, the BPU is set to make a decision on whether to grant the subsidy to PSEG’s three nuclear plants, which the utility giant argues is vital to keeping the plants open.
If approved, the subsidies, which are called zero emission certificates, would be financed through an additional surtax on ratepayers’ annual electric bills.
“We believe the plants are highly profitable, are projected to be in the future, and that no subsidy can be reasonably justified except as a windfall handout to PSEG, that will have the primary effect of benefitting its stockholders,’’ reads the letter to the BPU.
The letter was signed by the AARP of New Jersey; the New Jersey Main Street Alliance; the Chemistry Council of New Jersey; Environment New Jersey, power suppliers trade organization PJM Power Providers Group; the New Jersey Petroleum Council; and the New Jersey Large Energy Users Coalition—all of whom oppose the subsidy.
Without the money, PSEG officials said they would have to close all three plants –which account for roughly 40 percent of the state’s electricity – within the next three years.
“While the closure of the plants will have material detrimental impacts on air quality in New Jersey, and will adversely impact the regional economy in the vicinity of the plants, the decision to retire is clear and straightforward from an economic standpoint,” reads a February letter to the BPU from Joseph Accardo, PSEG’s regulatory and deputy general counsel.
“While the commenters opposing PSEG Nuclear’s applications may believe that the company is bluffing, the reality is that after years of analysis, this difficult decision already has been made,” he added. Now, whether the plants continue to operate or retire is now in the hands of the BPU.
Casting doubt on the subsidy, the New Jersey Rate Counsel and the Independent Market Monitor PJM have repeatedly maintained that PSEG would need far less than $300 million to keep the three plants viable and profitable, if anything at all.
Stefanie Brand, director of the Rate Counsel, an agency tasked with keeping utility rates at a reasonable rate for residents, said PSEG overstated its costs, underestimated its revenue and does not qualify for that amount.
“When their assumptions are examined more closely, their claims of financial hardship fall away. Moreover, the applicants failed to demonstrate that closure of the units will have a significant and negative impact on New Jersey’s ability to comply with state air emissions reduction requirements,” Brand said in her February testimony to Board of Public Utilities President Joseph Fiordaliso.
A separate letter was also sent from the same seven groups to Gov. Phil Murphy on Monday, similarly urging the release of the analysis: “if the promise you made when you signed the ZEC legislation into law to have the BPU conduct an open, transparent evaluation process is to have meaning.’’
A spokesperson for the BPU said the report could be released only with the approval of the board, while a spokesperson for PSEG could not be immediately reached for comment.