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Latest New Jersey Nuclear Subsidy Bill Still Places Purchase Obligation Only On Utilities, Not Retail Suppliers

January 26, 2018

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Copyright 2010-17 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com

As-filed text of the latest bill (S877) in New Jersey to provide certain subsidies to nuclear generation would still place the obligation to procure nuclear diversity certificates (NDCs -- the mechanism for the subsidy) on, "electric public utilities," for their distribution customers, and would not impose an obligation on, "electric power suppliers"

S877 provides that, "Each electric public utility in this State shall be required to begin to purchase NDCs on a monthly basis from each selected nuclear power plant with payment to follow within 90 days after the conclusion of the first energy year in which selected nuclear power plants receive NDCs and within 90 days after the conclusion of each subsequent energy year."

"The board shall order the full recovery of all costs associated with the electric public utility’s required procurement of NDCs, and with the board’s implementation of the NDC program under this act, through a non-bypassable, irrevocable charge imposed on the electric public utility’s retail distribution customers. Within 150 days of the effective date of this act, each electric public utility shall file with the board a tariff to recover from its retail distribution customers a charge in the amount of $0.004 per kilowatt hour, unless the board elects to reduce this charge pursuant to paragraph (3) of this subsection," the bill provides

S3560 defines "electric public utility" as having the same meaning as provided in section 3 of P.L.1999, c.23 (C.48:3-51). That cited section of the public laws defines "electric public utility" as, "a public utility, as that term is defined in R.S.48:2-13, that transmits and distributes electricity to end users within this State." R.S.48:2-13 provides that the term "public utility" shall, "include every individual, copartnership, association, corporation or joint stock company, their lessees, trustees or receivers appointed by any court whatsoever, their successors, heirs or assigns, that now or hereafter may own, operate, manage or control within this State any railroad, street railway, traction railway, autobus, charter bus operation, special bus operation, canal, express, subway, pipeline, gas, electricity distribution, water, oil, sewer, solid waste collection, solid waste disposal, telephone or telegraph system, plant or equipment for public use, under privileges granted or hereafter to be granted by this State or by any political subdivision thereof."

In contrast, 3 of P.L.1999, c.23 (C.48:3-51) also sets forth the definition of an "electric power supplier", which means, "a person or entity that is duly licensed pursuant to the provisions of this act to offer and to assume the contractual and legal responsibility to provide electric generation service to retail customers, and includes load serving entities, marketers and brokers that offer or provide electric generation service to retail customers." The term electric power supplier excludes an electric public utility that provides electric generation service only as a basic generation service

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