Synopsis: Would lock ratepayers into a guaranteed stream of payments to help finance construction of new natural gas-fired power plants.
Sponsors: Senators Bob Smith (D-Middlesex) and Chris Bateman (R-Somerset)
What it aims to do: The bill seeks to encourage the building of new power plants in New Jersey, a step advocates say would trim electric rates for consumers. More power plants, they argue, would lower capacity prices for companies that produce electricity. Capacity guarantees there will be enough power to keep the lights on. Because there is not enough capacity in New Jersey, ratepayers pay an extra $1 billion a year to suppliers to ensure power is available.
Why people don’t like it: Critics call it a special interest bill designed to help LS Power LLC build a power plant in West Deptford, backed by ratepayer subsidies even if the plant remains idle. It also has been criticized as an unwarranted intrusion into the wholesale competitive marketplace, which has been unregulated for a decade. If S-2381 passes, critics insist, others will seek similar guarantees, an argument that gains credence with expected amendments to broaden the bill beyond its current 1,000 megawatts of generation.
What’s happened so far: The bill, with the backing of Senate President Stephen Sweeney (D-Gloucester), is moving rapidly through the legislature. It was introduced in mid-October, voted out of the Senate Environment and Energy Committee less than a month later and by the full Senate one week after. It is now before the Assembly Utilities and Telecommunications Committee, where it is up for a vote on Thursday. Opponents, including big power suppliers, have mounted a robo-call campaign, urging voters to contact their legislators to oppose the measure
Prospects: With the backing of Democrats, the bill is likely to win approval from the legislature prior to the end of the year. Its fate with the Christie administration, however, is uncertain. The state Board of Public Utilities (BPU) backs efforts to promote new generation but was neutral on the bill in the Senate. If the committee adopts amendments broadening its scope, it could heighten opposition to the measure.