Nuclear Subsidy Bill Stalls in Senate, Enviros Say Delay is Needed

It's not clear what's next for contentious bill, but there's been talk about reverting to original, which would only award $300 million annual subsidy to PSEG

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In an unexpected setback, a bill to subsidize nuclear power and clean energy yesterday failed to advance in the Senate, a reprieve, if only temporary, for an unwieldy coalition of opponents.

The legislation (S-877) could face significant revisions, including the possibility it might revert to its original intent — a bill that could provide subsidies of $300 million a year to nuclear power plants while omitting clean-energy initiatives backed by Gov. Phil Murphy.

The bill, or earlier versions of it, has been pushed by Public Service Enterprise Group to prop up three nuclear units it operates in South Jersey. Without an infusion of ratepayer subsidies, the company has threatened to close the plants.

Further review needed

Senate President Stephen Sweeney, the sponsor, told reporters after yesterday’s session the bill is complex and needs further review, and did not rule out going back to his original legislation. That bill had bipartisan support in the lame-duck session, but got held up by the governor, who wanted the bill to include parts of his clean-energy agenda.

In any event, many groups opposing the bill viewed the delay as a win, giving them more time to correct what they argue are major flaws in the bill, which helped scuttle plans to put it up for a floor vote. Those concerns were aired during the majority Democratic caucus earlier in the afternoon.

The issues ranged from problems with the review process established to determine whether the nuclear subsidies are justified and why the Division of Rate Counsel has been excluded from the process. Lawmakers are also worried that the nuclear and clean-energy subsidies could cost consumers billions of dollars over the long term.

‘Delay is good’

“Delay is good. Maybe they will start to listen,” said Dennis Hart, executive director of the Chemistry Industry Council of New Jersey. His organization and others are particularly concerned that the rate counsel, which represent ratepayers in utility cases, is excluded from the review process in the current bill. “Somebody has to be sticking up for the ratepayer.”

For some environmentalists, stopping the bill from moving forward gives them more time to convince lawmakers to revise key provisions they fear will scuttle the Murphy administration’s clean-energy program. That agenda scales down reliance on fossil fuels and increases dependence on solar, offshore wind, and energy-efficiency programs that reduce energy use.

“For us, anytime we get a bill like this held is a good thing,” said Jeff Tittel, director of the New Jersey Sierra Club.

But others fear peeling off the clean-energy items in the bill from the nuclear subsidy will jeopardize prospects to pass renewable-energy initiatives in standalone legislation.

“We are better off at looking at everything together,” said Ed Potosnak, executive director of the New Jersey League of Conservation Voters. He opposes any move to separate the nuclear and green initiatives.

“It’s the wrong way. They tried it back earlier this winter and it got held up,” Potosnak said. “With some time, I think folks can get it right.”

The legislation sets aggressive targets for renewable energy — like mandating 50 percent of the state’s electricity comes from sources such as offshore wind and solar by 2030. But many environmentalists believe a cap in the bill to limit energy spikes for consumers will undermine those goals.

“We need the right policies in place to move New Jersey toward an affordable, efficient clean-energy future, and this legislation fails to do that,” said Tom Gilbert, campaign director for ReThink Energy NJ.

Neither the governor’s office nor PSEG responded to requests for comment. It is uncertain when the bill, or a new version, will come up.