Public Service Enterprise Group announced Wednesday that it is retiring two coal plants, in Jersey City and Hamilton Township, on June 1, 2017.
The parent of Public Service Electric & Gas and other utilities said the plants, the Hudson Generation Station and the Mercer Generation Station, have faced pressure from sustained low prices of natural gas.
“In that context, we could not justify the significant investment required to upgrade these plants to meet the new reliability standards,” Bill Levis, president and chief operating officer of PSEG Power, said in a prepared statement. “The plants have been infrequently called on to run, and neither plant cleared the last two PJM capacity auctions. The plants’ capacity payments have been critical to their profitability, and PSEG’s ability to continue to invest in modernizing them.”
PSEG said it is committed to fair treatment for the two plants’ approximately 200 total employees.
“These plants have played a critical role in powering the growth and economic expansion of New Jersey, and PSEG is grateful to our employees who have played a part in building and running them for the past 50 years,” Levis said. “We will work with our union and PSEG leadership to ensure that the plants continue to operate safely through their retirement dates and to place as many employees as possible within PSEG’s family of companies.”
The company said that, with the retirement of the coal plants, statewide energy will now be split almost evenly between nuclear and natural gas power, with a small but growing renewable energy sector.
“We continue to believe that it is unwise for New Jersey to become to overly dependent on one source of energy,” Levis said. “With the continued low cost of natural gas, it is important that we recognize and support the full value of non-carbon, non-polluting nuclear and renewable energy.”
PSEG said it is evaluating its options for the plant sites. The Mercer station was opened in 1960, while the Hudson station was opened in 1968.
Jersey City Mayor Steven Fulop was pleased by the announcement, saying in a statement: “We have worked with environmental groups over the last few years to advocate for the closing of the Jersey City station, which contributed to pollution and dangerous air quality for residents in Jersey City. We commend PSE&G for this decision that will improve quality of life in Jersey City.”
The state’s Sierra Club echoed the mayor’s comments in its own statement.
“This is a victory for the environment and the people of New Jersey and the region,” Director Jeff Tittel said. “The closing of these two plants is a turning point in our battle against dirty coal and for clean air in the entire region. With Mercer and Hudson closing, there will not be any coal plants from Trenton all the way to Maine and Jersey City to Buffalo. We want to thank (PSEG’s) Ralph Izzo for his leadership on the environment and working to close these plants.”
The company said it will suffer a series of one-time charges related to the closures.
