(Reuters) - A joint committee in the New Jersey Legislature voted unanimously on Wednesday to support a bill that could cost $300 million to subsidize nuclear power plants in an effort to keep them in service longer in a low natural gas price environment.
- The reactors in question include Public Service Enterprise Group Inc’s Salem and Hope Creek plants in New Jersey
- PSEG said it might be forced to close the reactors in a couple of years if it does not receive some kind of assistance
- New Jersey is one of several states exploring ways to keep reactors in service to preserve carbon-free energy, jobs and taxes as cheap and abundant gas from shale fields keep power prices low, making it less profitable or even unprofitable for generators to keep the units operating
- Ohio, Pennsylvania and Connecticut have also considered proposals to protect reactors. In 2016, New York and Illinois adopted rules to subsidize some reactors in danger of closing
- The bill would provide a financial credit for nuclear operators capable of demonstrating to state regulators that financial support is needed to keep their plant or plants online
- New Jersey regulators would determine which plants are eligible to receive support according to six criteria, including plant operators’ ability to show their facilities contribute to carbon-free power generation, fuel diversity and grid resiliency
- “There has been no demonstration that PSEG’s nuclear plants are in financial difficulty other than bald assertion and ultimatums issued by the company,” Stefanie Brand, New Jersey’s ratepayer advocate, told the committee. She urged the legislature to “not simply succumb to the company threats.”
- PSEG has said economic studies show the loss of its plants would result in $400 million a year in higher electricity rates, 14 million tons a year of additional air pollution and the loss of 5,800 or more jobs
- ClearView Energy Partners, an energy research firm, said in a statement the New Jersey program could provide as much as $300 million per year for at least four years for qualifying nuclear plants, translating to a value of about $10 per megawatt hour
- The bill will now go to the full legislature for a vote. ClearView said the legislature could vote on the bill before the end of next week. ClearView also said it thinks Governor Chris Christie would sign the bill into law before he leaves office on Jan. 16.
Reporting by Scott DiSavino; editing by Jonathan Oatis
Our Standards: The Thomson Reuters Trust Principles.