The Supreme Court has declined to hear an appeal by the New Jersey Rate Counsel and others over a 2019 decision to award nearly $1 billion in subsidies from ratepayers to avert the closing of the state’s three nuclear power plants.
Without comment, the state’s high court on Friday denied certification of an appeal of the Board of Public Utilities award of surcharges on customers’ gas and electric bills. The subsidies, amounting to roughly $300 million a year, were upheld by a state appeals court in March.
The case involves one of the Murphy administration’s most contested decisions in the energy sector. The state supported Public Service Enterprise Group and Exelon, the co-owners of two of the three plants, to secure subsidies they said were needed to keep the units open, not just two years ago, but again to continue the subsidies this past March.
Rate Counsel Director Stefanie Brand called the high court’s decision a surprise and confounding. “We thought at least we could get a hearing,’’ Brand said. “It is hard to understand why this case is not in the public interest.’’
PSEG, which operates all three units in South Jersey and owns all of the Hope Creek plant, said the plants are no longer profitable, undermined by cheaper natural-gas facilities. Brand, along with business groups, argued otherwise, a position essentially supported by BPU staff and its own consultant.
But the appeals court ruling concluded the BPU had acted properly in awarding the subsidies and complied with the language of a law establishing so-called zero-emission certificates for nuclear plants seeking to obtain subsidies.
In New Jersey, the subsidies cost the typical residential customer about $3 per month, according to the company, but can cost large businesses who use a lot of energy as much as $1 million a year, according to business lobbyists.
In a statement, PSEG said it was pleased with the court’s denial of certification. “In New Jersey, nuclear provides more than 90% of the state’s carbon-free energy, and we believe that policies supporting nuclear energy are in the best interests of our state and people, especially as we witness the toll of climate change around the country.’’
For the administration, it is a critical ruling toward its goal of achieving 100% clean energy in New Jersey by 2050 and reducing global-warming pollution to 80% of 2006 levels by the same date. The state’s Energy Master Plan projects at least some of the nuclear plants will remain in operation until midcentury, a premise that may require renewal of the subsidies every three years.
It also could result in utility customers in Delaware and Maryland continuing receiving electricity subsidized by ratepayers in New Jersey, according to Brand. “There is going to be more than $1 billion of ratepayer funds going to Maryland and Delaware,’’ she said.