By Ralph Izzo
The national nuclear energy crisis has arrived at New Jersey's doorstep. The economic conditions that have endangered nuclear power plants around the country, already forcing several to close, now are threatening the economic viability of PSEG's Salem and Hope Creek plants.
The perils of rising air pollution, reduced resiliency, lost jobs and higher energy bills -- all foreseeable impacts if New Jersey's nuclear plants are allowed to close -- are real. These risks warrant a greater share of the public's attention.
Some, including this newspaper's editorial board, believe the issue is being rushed through the end of the legislative session -- what the media like to call "lame duck." Nothing could be further from the truth. Rather, the Legislature's immediate consideration underscores the urgency of the situation -- and the closing window to act. (An Assembly-Senate hearing on the legislation is set for Wednesday.)
In addition to numerous conversations this past year with regulators, legislators, environmentalists, labor leaders, business leaders and consumer groups, the Legislature recently held a hearing on the issue. Any legislation will undoubtedly be heard in both Assembly and Senate committees prior to floor consideration. It is interesting that many of the proponents for further delay in Trenton also are taking the same approach in Washington before federal regulators.
The time for delay is past. The time to act is now.
PSEG has been warning the public about the problems with energy market pricing rules for more than a decade. As early as 2007, I called on Congress to support nuclear and other non air-polluting energy sources as a way to begin to address our environmental goals.
Since then, as flaws in the design of U.S. energy markets grew more apparent, I have reminded legislators, regulators, investors and reporters that nuclear energy is in economic trouble and that, without a safety net, PSEG could be forced to take drastic action -- including closure of the Salem and Hope Creek nuclear plants.
Nuclear is responsible for almost half of all the electricity generated in New Jersey, and more than 90 percent of our air emissions-free energy. But economic forces have put our Salem County plants in danger of closing for good.
PSEG's nuclear plants will soon be losing money and, if nothing changes, I will have a fiduciary duty to close them, as I would any underperforming asset. Once a nuclear plant is closed, it can't be reopened. Its benefits to New Jersey - for the environment, economic activity and reliable, resilient electricity - will be lost for good.
Nuclear power helps keep our air clean -- allowing New Jersey to avoid 14 million tons of air pollution each year, the equivalent of taking 3 million gasoline-burning cars off the road.
Five years post-Superstorm Sandy, thanks to improvements by PSE&G and other electric utilities, New Jersey's grid is more resilient than ever. Without nuclear, we would depend on natural gas for more than 90 percent of our electric power - the energy equivalent of putting all our eggs in one basket.
We also cannot forget that thousands of workers depend on these nuclear plants for their livelihoods.
Or that two independent studies each concluded that, if New Jersey's nuclear plants were to close, the overall impact on New Jersey's economy would total more than $800 million per year, including higher costs for electricity.
In New York, Illinois and most recently Connecticut, state legislators recognized these benefits and prevented the closure of their nuclear plants by providing public support. We must also protect these benefits for New Jersey.
That's why I have called for a safety net that would help preserve New Jersey's nuclear plants so they can continue to work for New Jersey -- together with strong consumer protections that include opening our books to state regulators, reducing support if a regional or federal safety net is enacted, and ending support if economic conditions improve.
PSEG has been serving this state for 114 years. We're committed to New Jersey. Our goal remains to help make the state a better place to live and work. Nuclear energy's role in that effort should not be overlooked.
The economic threat to New Jersey's nuclear plants, and the risk of losing half of New Jersey's energy production, is urgent. Action is needed now. Waiting is no longer an option.
Ralph Izzo is chairman, president and CEO of Public Service Enterprise Group Inc.
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