Utility makes push for nuclear subsidies, drawing opposition

The explosion in the natural gas market that lowered utility rates and led energy companies across the country to seek multi-million dollar nuclear subsidies has New Jersey lawmakers scrambling to create them here, sparking intense lobbying campaigns both for and against the late-year push.

The state's biggest utility, PSEG, is pushing the Democrat-led Legislature and outgoing Republican Gov. Chris Christie to enact a subsidy for nuclear energy, arguing their profitable plants are in danger of going into the red and shuttering in two years.

While consumer advocacy and environmental groups are pushing back and say the legislation during the lame-duck session is rushed and unneeded, lawmakers have begun drafting it.

Christie says he would consider the idea, but unlike states like New York and Illinois that have married subsidies with clean-energy targets, the governor said he doesn't want a bill "larded" up with environmental priorities.

"I think having nuclear power in the state is an important thing to have," Christie said at a recent news conference.

The issue cuts across as many conflicting interest groups as it spans different levels of government and marketplaces.

Those conflicts have led to a late-year ad campaign, from both PSEG and advocacy groups.

Federal Communication Commission records show PSEG has spent nearly $80,000 on radio ads this month pushing for the subsidy. Those records don't reflect what the utility might have spent on a website and on cable ads promoting nuclear power. PSEG also spent more than $350,000 on lobbying in Trenton last year.

The ads promote nuclear energy's zero carbon emissions and that it's responsible for nearly half of the state's electricity production. PSEG is also arguing that the demise of nuclear power in New Jersey could lead to rate increases.

PSEG President and CEO Ralph Izzo told lawmakers that ratepayers could see $400 million in higher energy bills if the plants shutter, along with losing nearly 2,000 jobs at the two southern New Jersey plants.

Opponents are skeptical.

AARP, the interest group for retired Americans, has spent about $40,000 on radio spots this month to oppose the plan, FCC records. The group spent more than $700,000 on lobbying in Trenton on a variety of issues last year.

Their opposition boils down to concern that New Jersey taxpayers — among the most taxed in the country — would be left financing the subsidy, which they say PSEG has not convincingly shown a need for. AARP is calling on the utility to show financial need before any subsidy is granted.

Izzo told lawmakers he understands the need to be transparent and for PSEG to "open our books."

Environmental groups, like the New Jersey Sierra Club, oppose subsidizing nuclear over concerns that wind and solar electricity production would suffer.

"If we subsidize nuclear energy while continuing to have cheap natural gas, renewable energy will become the biggest loser," said Sierra Club state director Jeff Tittel.

The potential legislation comes as the Trump administration is pushing for new regulations to help protect the coal and nuclear industries, and as the regional marketplace that New Jersey is part of, known as PJM, is also considering protections for nuclear.

That's also a major sticking point for critics of a possible nuclear subsidy.

"PSEG may end up double or triple dipping, forcing New Jersey's ratepayers to spend significantly more than necessary to prop up coal and nuclear plants," said Stephanie Brand, the director of the state Division of Rate Counsel, an independent state agency.

PSEG points out that they've been pushing the issue for months, but the lame-duck timing suggests lawmakers and the governor might be trying to get around voters' opinion, experts said.

"Lame duck is just a great time to sneak things through or ram things through because there's no election looming," said Fairleigh Dickinson University political science professor Peter Woolley.

Nuclear energy provides the state with between 40 and 50 percent of its electricity production, with the rest coming from natural gas.

Cheap natural gas has been flooding the market from the Northeast's Marcellus Shale reservoir .

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