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PSEG sells off fossil fuel plants for $1.9B

Daniel J. Munoz//February 18, 2022//

PSEG sells off fossil fuel plants for $1.9B

Daniel J. Munoz//February 18, 2022//

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With its eye on clean energy alternatives – like offshore wind and its three existing nuclear plants – utility giant formally sold off its 13 Mid-Atlantic fossil fuel plants for a combined $1.9 billion.

The plants generate a combined 6,750 megawatts of electricity and span New Jersey, Connecticut, New York and Maryland. ArcLight Energy Partners Fund VII, which is controlled by the Boston-based venture capital fund ArcLight Capital Partners LLC, now owns the 13 plants.

Combined with PSEG’s sale of Solar Source in June, the deal is expected to bring in $2.15 billion for the Newark-based provider as it looks “toward a clean energy infrastructure,” according to an August statement from PSEG Chief Executive Officer Ralph Izzo.

Ralph Izzo, chairman and CEO of Public Service Enterprise Group.
Izzo

“PSEG already benefits from New Jersey’s robust policy support for carbon-free electricity, ensuring the viability and growth of nuclear, solar and offshore wind generation,” Izzo added in an online blog post.

The nuclear plants are in part taxpayer-funded, with New Jersey approving a second round of $300 million in state subsidies last April that PSEG said were vital to keeping the sites financially viable.

The subsidies were nonetheless controversial, and environmental groups questioned their benefit. PSEG officials, however, touted the plants’ carbon-neutral nature—as opposed to fossil fuel facilities.

The Murphy administration aims for the state to have a 7.5-gigawatt offshore wind capacity by 2035, which it and environmentalists argue is key to reducing the state’s carbon footprint.

PSEG’s electric car plans, which the New Jersey Board of Public Utilities approved over a year ago, call for 40,000 chargers in people’s homes, another 3,500 chargers in commercial locations, and 1,000 fast-charging stations at 300 sites off major roadways.

State officials also approved Atlantic City Electric’s $21 million plans last February to install 1,100 public charging stations, provide rebates for residential charging stations, and for stations at employee parking lots and commercial vehicle fleets.

Those are part of the state’s efforts to put 330,000 electric vehicles on its roads by 2025, with an infrastructure to support them.

But the clean energy proposals have met skepticism and opposition from all sides.

Business groups and fossil fuel trade organizations contend that the proposals are being rushed through without a serious consideration of any unintended consequences. Consumer advocacy groups along the Jersey Shore, meanwhile, warn that the wind turbines could seriously harm New Jersey’s commercial fishing and tourism industries, as well as the state’s fragile marine ecosystems, and are suing to block the efforts.

And, environmental groups typically supportive of Gov. Phil Murphy and his environmental policies charge that the state is not pursuing meaningful action in a fast enough manner to address climate change and build out a clean energy economy.