State Rate Counsel President Stephanie Brand said nuclear plant owners Exelon and Public Service Enterprise Group should not qualify for Zero Emission Credits, according to testimony she gave to the Board of Public Utilities last week.
Brand, in testimony that was given to BPU President Joseph Fiordaliso, said she came to the conclusion based on a review completed by her department.
“In making their case for ZEC subsidies, however, PSEG and Exelon have overstated their costs and understated their revenues,” she said in the testimony.
“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 also fought against the legislation that would pave the way for up to a $300 million subsidy for the utilities — a fight that was handled largely by PSEG.
In March last year, PSEG and Exelon filed a statement with the Securities & Exchange Commission that they would be forced to close their three New Jersey plants if the subsidy bill did not pass.
Brand said in her testimony that the companies have not shown that they will need the financial boost — funded by taxpayers and ratepayers — and that the loss of the state’s three nuclear plants would not significantly affect New Jersey’s energy supply.
“They have not modeled the interactive effects on price if one unit shuts down, rather than all three simultaneously,” she said. “They have also failed to take into account several initiatives at both the state and federal level that are likely to result in increases to energy and capacity prices. In short, they skewed the analysis of future revenues in order to deflate those revenues and support their claim 3 of financial distress.”
Michael Jennings, a spokesman for PSEG, said the documents provided to the BPU show otherwise.
“Consistent with the legislation, the documents we have provided demonstrate that the plants satisfy the requirements of the ZEC Act,” he said.
“The information submitted makes clear that the financial problems facing the nuclear plants are real and that there would be significant degradation of New Jersey’s air quality if the plants were to close.”
Jennings said the company stands by its report.
“We are confident in the accuracy of the financial and environmental data we submitted to the BPU,” he said. “The plants face a genuine economic crisis that would lead to their closure without economic support that recognizes the benefits nuclear power provides. The legislation recognizes that preserving nuclear power is essential to achieving New Jersey’s clean energy goals. It is New Jersey’s largest and one of the least expensive sources of carbon-free generation. The comments made disregard that policy objective.
“The Salem and Hope Creek nuclear plants produce 40 percent of state’s electricity and approximately 90 percent of its emissions-free generation. The premature retirement of just one nuclear plant would increase New Jersey greenhouse gas emissions by 40 percent, while the retirement of all three facilities would increase emissions by about 75 percent. The resulting increases in air pollution would disproportionately affect New Jersey’s most vulnerable populations. In addition, preserving the plants would protect customers. Economists estimate that electric bills would increase by $400 million a year if the nuclear plants were to close, which would be more than the cost of the ZEC program.”
The BPU is set to present a final list of qualifying utilities for approval in April.
Read more from ROI-NJ:
- Murphy signs controversial nuclear subsidy bill
- Energy bill signings are about more than just nuclear subsidy
- Izzo explains why PSEG is asking for nuclear subsidy
