The Board of Promoting Utilities (aka BPU) approves a Public Subsidized Extortion Grab (aka PSEG)

“The board is being directed to pay ransom, and the hostages are the citizens of New Jersey. – BPU Commissioner Bob Gordon on the PSEG nuclear subsidies.

“What’s good for New Jersey is what’s good for PSEG. What’s bad for New Jersey is bad for PSEG.” Ralph Izzo, chairman of PSEG, addressing the Legislature in December 2017. 

The state Board of Public Utilities on Thursday voted in favor of charging utility customers $300 million per year, with no sunset provision, to subsidize three South Jersey nuclear plants controlled by Public Service Enterprise Group. Without this pirate’s ransom Mr. Izzo threatened to close the facilities. Sierra Club countered, “Their stock and bond holders will never allow it [to close] because it is a $10 billion asset.” Nonetheless, because of a bill previously passed by the Legislature the BPU decided it had no choice but to surrender and gave PSEG the full amount it demanded.

AARP, Sierra Club, Clean Water Action, Empower NJ: No Fossil Fuel Projects, and NJ Coalition for Fair Energy, were among the groups which opposed PSEG’s demand. Most importantly Stefanie Brand, Director of the Division of the Rate Counsel, a state-appointed advocate for utility customers, insisted the award should not be made and indicated she is considering a lawsuit.

 Key supporters of PSEG’s demand were Senate President Steve Sweeney, Deputy Assembly Speaker John Burzichelli and Assemblyman Adam Taliaferro (all D-Gloucester, Salem & Cumberland). They said, This will “preserve the benefits of nuclear energy for all New Jersey customers – and will do it in a way that will cost less than allowing our nuclear plants to close.” They omitted saying that probably such could have been achieved with a lower payment. Jeff Tittel of Sierra Club explains, “This subsidy will not be used to move forward with renewable energy, instead it will go out as PSE&G dividends to its stockholders.”

As a regulated industry, PSEG is barred from making direct political contributions to New Jersey candidates. So its employees established PSExec PAC, a state political action committee that supports state and local candidates. Senator Sweeney received $15,000 from the PAC during the 20017 election cycle. POLITICO reported that PSEG in September attempted to donate $55,000 to General Growth Fund, a nonprofit “issues-advocacy” group that is not required to disclose its donors. Instead, the utility accidentally cut the check to General Majority PAC, an affiliated super PAC that does disclose its donors. Over the course of 2017 and 2018 PSEG spent $4 million lobbying the Legislature on the nuclear subsidies.

In an opinion piece Tom Moran concludes, “If New Jersey is serious about fighting climate change, it cannot allow PSEG to shut down its three nuclear power plants in Salem County, which provide more than one-third of our electricity without emitting a speck of carbon. But the rescue bill approved by the Democratic legislature last year is an inexcusably sloppy piece of work costing families and businesses in New Jersey about $300 million a year. As mistakes go, this one is a whopper.

In spite of Mr. Izzo’s patronizing statement, what’s good for PSEG is not necessarily good for New Jersey. $300 million over a period of say six years is $1.8 Billion. With our stretched budget, imagine what could be done with $1.8 Billion.    

Preview photo: The Salem Nuclear Power Plant and Hope Creek Nuclear Generating Station on the Delaware River in Lower Alloways Creek Township, New Jersey.

Comments (3)

  1. deciminyan

    Nuclear energy is neither safe nor cheap. And by subsidizing these plants, the incentive for PSE&G and others to accelerate their move to renewable energy is removed. This is among the most stupid initiatives the legislature has passed.

    Reply
  2. NJBlech

    The quote by Commissioner Gordon (top of article) is extraordinary by itself, as he admits that the BPU is being extorted by political forces with the general citizens of NJ being the hostages. However, what makes it damning, and, I hope, the cause for litigation is that Commissioner Gordon could have said no to the extortion and he didn’t — he voted yes for the subsidies! Kudos to Commissioner Upendra Chivukula, the lone board member to vote no, commenting ” “It is a sad day for the U.S.”.

    Reply
  3. Kate McLaughlin

    This is no different than NJs hospitals price gouging patients and the state refusing to set regulations in regards to cost, patient safety laws and consumer protection. Theses politicians are not helping NJ. Vote them out! Enough of the hostage taking!

    Reply

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