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PSEG files to close Salem nuclear plants days before NJ to decide on $300M subsidy

PSEG files to close Salem nuclear plants days before NJ to decide on $300M subsidy

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PSE&G’s Hope Creek Nuclear Generating Station cooling tower, Friday, Sept. 23, 2005, in Lower Alloways Creek Township Salem County.

Public Service Enterprise Group filed deactivation notices for three of its Salem County nuclear plants Tuesday, days before the state is set to decide on whether the energy company will receive hundreds of millions in subsidies it says it needs to keep the units open.

Opponents of the subsidies, including environmentalists, knocked the move as a “hardball tactic” used by PSEG to scare New Jersey officials into awarding it the Zero Emission Certificated credits totaling $300 million annually. PSEG owns three units in Lower Alloways Creek Township, Salem Unit 1, Salem Unit 2 and Hope Creek, which critics have said are making enough money to continue operations without support from ratepayers.

The state Board of Public Utilities is expected to make a decision during a meeting Thursday.

If PSEG receives the subsidy, the firm said it would withdraw the deactivation notices, according to the notice filed with federal regulators. Under the notices, Hope Creek would retire in Fall 2019, followed by Salem Unit 2 in spring 2020 and Salem Unit 1 in fall 2020.

“(PSEG is) trying to blackmail the BPU into giving them a $300-million-a-year subsidy. ... PSEG is trying to threaten and bully the BPU to get what they want,” said Jeff Tittel, director of the New Jersey Sierra Club.

In a statement, PSEG said it was required to notify PJM Interconnection, the regional power grid operator, by April 16 as to whether the units would be available for the next capacity auction.

“The proximity of this date to the BPU decision date is merely coincidental,” PSEG spokesperson Marijke Shugrue said in an email.

PJM spokesman Jason McGovern said PJM will begin looking at the reliability impacts of the units possibly closing if PSEG does not rescind the deactivation notices.

The BPU’s decision Thursday will come nearly a year after Gov. Phil Murphy signed legislation to authorize the yearly nuclear subsidies, which he argued were needed to reach the state’s renewable energy goals.

The Rate Counsel, an independent state agency representing consumers, has disputed PSEG’s claim it needs financial support from the government or it will close its nuclear units by 2022.

“I think (PSEG is) making money,” Rate Counsel Director Stefanie Brand said earlier this year.

Brand has reviewed PSEG’s applications, in addition to PJM’s Independent Market Monitor.

Meanwhile, PSEG has said the Salem County plants provide more than 90 percent of the carbon-free generation produced in New Jersey and that greenhouse gas emissions would increase significantly if just one of the units closed.

In January, PSEG made public the applications it sent to the BPU to prove its need for a subsidy, but all of the company’s financial information was redacted.

The BPU said the information was “confidential in nature.”

Electric utility companies will charge ratepayers an extra $0.004 per kilowatt hour if a subsidy is approved, and then pass the money along to PSEG. Annually, it would cost the average residential ratepayer about $31 to $41.

Contact: 609-272-7258 Twitter @AvalonZoppo

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