The New Jersey Board of Public Utilities (NJBPU) on April 27 approved three-year zero emission certificates (ZECs) for the Hope Creek, Salem One and Salem Two nuclear power plants in the state.
The NJBPU said that the certificates ensure that the plants, which supply the state with over 90 percent of in-state generation and 37.5 percent of its overall in-state energy supply, will remain operational.
Operated by PSEG Nuclear, a subsidiary of investor-owned Public Service Enterprise Group, Salem is located along with Hope Creek Generating Station on a 740-acre site in Salem County, N.J.
PSEG owns 57% of Salem, while Exelon Corporation owns the remaining 43%. Hope Creek is entirely owned by PSEG.
The collection of funds to pay for the credits the NJBPU approved on April 27 will begin immediately and will amount to approximately $100 million in annual subsidies for each plant for three years, at the rate of $0.004 per kilowatt hour.
At the end of three years, the board will reevaluate the program and if more money is collected than needed, those funds will be returned to ratepayers, the NJBPU noted in a news release.
In addition, if the companies receive funding via other state or federal subsidies in the future, those funds will be reconciled against the ZECs and returned to ratepayers, it said.
The NJBPU in November 2019 approved a ZEC program and application process for nuclear power plants.
The creation of the ZEC program was a requirement of legislation signed by New Jersey Gov. Phil Murphy in May 2018. Murphy signed a bill (S-2313) that created a ZEC program to support nuclear generation in the state -- the 2,468-MW Salem plant and the 1,240-MW Hope Creek facility.
The application process for the second three-year ZEC eligibility period opened in August 2020. In October 2020, the NJBPU received applications for the Hope Creek, Salem One, and Salem Two plants. NJBPU Staff evaluated the applications for eligibility and ranked the applications.
As part of the evaluation process, the Board published a redacted version of all applications on its website, held public meetings and an evidentiary hearing, opened a public comment period, and provided an independent market monitor and New Jersey Division of Rate Counsel access to confidential financial information in order to assess each application. The public also had access to a redacted analysis completed by Levitan, a consulting firm.
Prior to this, the NJBPU held a public stakeholder input process in July 2020 on the ZEC application form, which was revised from the version used in 2018 during the first three-year eligibility period.