While the legislature typically only meets on Monday and Thursdays, a special session is being convened tomorrow, Wednesday, December 20 for a joint meeting of the Assembly Telecommunications & Utilities Committee and the Senate Energy & Environment Committee. They will consider A-5330 (McKeon, Burzichelli, DeAngelo, Taliferro)/S-3560 (Sweeney, Smith, Van Drew), which would establish a nuclear diversity certificate (NDC) program.
If passed, the legislation would create a process for the New Jersey Board of Public Utilities (NJBPU) to develop regulations for nuclear power plants that deliver electricity to New Jersey. The bill would also establish a tariff of $.004 per kilowatt hour to cover the cost of the NDC.
NJBIA has long supported nuclear power and understands that it is an important part of our fuel diversity. Yet we also recognize the need for business to remain competitive and there must be safeguards for the business ratepayer.
In analyzing this legislation, NJBIA believes the following concerns must be addressed before the bill is considered:
1) Under the existing bill, any reduction in charge is applicable to residential customers only, not commercial and industrial customers. In addition, the load weighting calculation is also only based on residential customers. (Section 3 j 3)
NJBIA Position: Commercial and Industrial should be added to this section and given the same rate relief as residential customers.
2) The bill does not reflect any Federal regulatory actions, such as a FERC ruling, that would be subtracted from NJ subsidies. Furthermore, while the bill references a regional compact, it is not clear that PJM as an independent system operator would be considered as such.
NJBIA Position: Language should reflect that regulatory and ISO actions would also be subtracted from any ratepayer subsidy.
3) How will excess money be returned to ratepayers? On bill credit? Check? How do you handle customers that have moved or disconnected service?
NJBIA Position: The current bill does not address how refunds would be processed, only that they are to be given at the end of the energy year. Language should stipulate that for current customers an on-bill credit would be given, and if a customer has moved out of the utility service territory, a prorated refund would be mailed.
4) $250,000 application fee may not cover the Board’s full cost and any remaining costs are borne by ratepayers. (Section 3 j 1)
NJBIA Position: Instead of ratepayers shouldering the burden, the BPU should be given the flexibility to increase the application fee to cover necessary costs. Ratepayers should not have to pick up the excess charges.
5) The definition of nuclear plant is not limited to New Jersey facilities. A Pennsylvania nuclear power plant, for example, could also apply for credits arguing it delivers power to the state, helps improve NJ air quality, and could have an adverse impact on the grid.
NJBIA Position: Recognizing interstate commerce issues, there also needs to be an awareness that New Jersey ratepayers could subsidize out of state plants.
6) Effective immediately but no sunset.
NJBIA Position: Language should reflect a sunset through the three-year review process and set a timeframe for when the subsidy would no longer be applicable.