Coalition Urges Governor Murphy to Veto Ratepayer Nuclear Bailout (S2313):
PSEG is a company that can’t be trusted

Trenton, NJ — Today, Clean Water Action joined a broad coalition of business, community, and environmental groups at a Statehouse press conference to urge Governor Murphy to veto out right or conditionally veto the nuclear bailout bill, S2313 (Sweeney, D-Gloucester).

If S2313 is signed by the governor as written, PSEG would receive a guaranteed ratepayer bailout no strings attached at $300,000 per year for the next ten years even if the company is profitable and able to have enough bids to sell its power at auction this month.

“This legislation is designed to prop up PSEG profits for its stockholders and puts a roadblock in front of Governor Murphy’s plan to achieve a 21st Century renewable energy – 100% renewables by 2050 – and corresponding green jobs future,” said Amy Goldsmith, Clean Water Action State Director.

In April, it was reported that PSEG will be paying a $39 million settlement as part of a consent decree signed with the Federal Energy Regulatory commission (FERC). PSEG submitted erroneous bids to PJM Interconnection, operators of the regional power grid, dating back to 2005. These bids are the principal determinant for setting rates for how much consumers should pay for electricity. The consent decree includes payment of $26.9 million in unjust compensation (or profits unjustly received) for the incorrect bids, as well as $4.5 million in interest.

“We should not be rewarding PSEG, a company that has already been fined for financially misrepresenting themselves,” continued Goldsmith. “How can we trust PSEG to be honest about its claim of financial hardship regarding its nuclear plants? S2313 allows PSEG, the fox, to watch over itself instead of by an independent body such as the Ratepayer Advocate. It is the job of the governor to protect NJ utility customers, both large and residential, from corporate wrongdoing. He can do this by vetoing or conditionally vetoing S2313 with consumer safeguards.”

“Is this some kind of bad B-movie script?” said Janet Tauro, Clean Water Action NJ Board Chair. “PSEG is fined for misrepresenting bids. Their CEO repeatedly tells shareholders this week that the company’s out of state nukes could benefit from a New Jersey bailout. And Exelon, which owns a stake in the Salem/Hope Creek nukes, reported to its shareholders that the company is doing just fine financially.”

“Remind us again please just why the NJ Legislature gifted them $300 million a year in ratepayer dollars? Why are we funding out of state nukes? Why are we forking over millions to companies making a profit? What were legislators thinking?” added Tauro.  “Looks like the nuclear industry is doing just fine thanks to corporate welfare with citizens footing the bill.”

Clean Water Action has been mobilizing the public to let the governor know that they are also concerned about the bailout and rate increases. Every day our community outreach staff knocks on doors throughout the state generating hundreds of letter of concern. “We hope the governor gets the message loud and clear,” said Goldsmith.

Residential ratepayers are not the only ones concerned about their utility bill. Some of the State’s largest employers, would be especially hard hit by S2313. Their portion of the bailout could be in excess of $500,000 annually, with some paying more than $1 million each year.

“We should consider how many jobs are lost when businesses are forced to pay these higher electric rates or leave the state,” said Goldsmith. “Passage of S2313 could turn into a state-wide job buster and offer no protection for nuclear workers from job loss when the plants eventually close.”

“If we want to truly help families of utility workers, then PSEG should mandate a just transition plan and fund for their workforce to do a proper, full and speedy decommissioning (15-20 years to complete), provide early retirement for others, or prepare them for new employment,” said Goldsmith.

A joint letter (download final letter here – pdf) to the governor includes specific recommendations for establishing consumer safeguards as part of a conditional veto of S2313 if he does not veto it outright.

The overarching principals of the provisions outlined below include ensuring that:

• PSEG does not receive one penny more than is needed
• PSEG annually opens their books to both state regulators and the public for review
• any subsidies provided by FERC, PJM and/or regional initiatives offset either in part or in its entirety NJ taxpayer and employer funded subsidies.

“Let’s be honest,” said Goldsmith, “PSEG claims it is in financial trouble, when it has not proven that it is. It claims nuclear power is ‘renewable’ when it isn’t. Ultimately, this bill provides a subsidy to an old, dying industry for the sake of stockholder return rather than giving birth to a sustainable, more resilient energy future for New Jersey that will create more jobs and keep us moving forward. We shouldn’t be shoring up a Frankenstein and those that profit from it.”

“Exelon (43% owner of the Salem Nuclear Units) and PSEG have known for years that nukes are a dying industry, and we shouldn’t be drying their tears with ratepayer money,” said Tauro. “Any company with a history of radioactive tritium leaks, fish kills, and radioactive releases into the environment and now financial misreporting worth of $39 million settlement does not deserve to be rewarded or bailed out. Quite the contrary, they should give money back to ratepayers, fined for environmental wrongdoing, and forced to clean up their radioactive mess.”

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Since our founding during the campaign to pass the landmark Clean Water Act in 1972, Clean Water Action has worked to win strong health and environmental protections by bringing issue expertise, solution-oriented thinking and people power to the table. We will protect clean water in the face of attacks from a polluter friendly Administration and Congress. Clean Water Action has 150,000 members in NJ and nearly 1 million nationwide.  www.cleanwater.org/nj