December 8, 2017 / 9:46 PM / 10 months ago

N.J. Governor Christie eyes nuclear power subsidies, sparks criticism

Dec 8 (Reuters) - New Jersey Governor Chris Christie said he would consider a bill in his last month in office that would subsidize the state’s nuclear power plants to prevent them from retiring early, sparking criticism from some energy companies and environmental and public interest groups on Friday.

Christie said at a press conference on Wednesday that he would like to see nuclear power plants continue to operate.

“I think having nuclear power in the state is an important thing to have and I think it’s important for our energy security to have it and I think it’s a positive thing from an environmental perspective to have nuclear here,” Christie said.

There was also some backlash to his comments especially since they came about a month before Gov.-elect Phil Murphy takes office on Jan. 16.

“We don’t see the wisdom in hastily hammering out a nuclear-bailout bill during the lame-duck legislative session for something this important,” said Dave Gaier, a spokesman for New Jersey-based power company NRG Energy Inc, which owns natural gas and other generating plants that would likely earn less revenue if the state subsidies nuclear plants.

Natural gas provided more than half the electricity generated in New Jersey last year, while its four nuclear reactors provided 39 percent, according to federal energy data.

“Citizens across New Jersey are up in arms over the latest move to ram through a multibillion-dollar subsidy package for the state’s (currently thriving) nuclear plants,” the Natural Resources Defense Council, an environmental group, said in a statement on Friday.

Other environmental groups, however, said they support state efforts to keep nuclear plants in service because the units do not produce carbon emissions.

New Jersey is one of several states exploring ways to keep reactors in service to preserve carbon-free energy, jobs and taxes.

In 2016, New York and Illinois adopted rules to subsidize some reactors that were in danger of closing.

Ohio, Pennsylvania and Connecticut have also considered proposals to protect their reactors.

This issue comes at the same time federal energy regulators are considering a proposal by U.S. Energy Secretary Rick Perry to protect so-called fuel secure plants, like coal and nuclear, from early retirement.

Ralph Izzo, chief executive of Public Service Enterprise Group Inc, which operates three of the state’s nuclear reactors at the Salem and Hope Creek plants, warned on Monday that he may be forced to shut them unless the state provides subsidies.

Izzo, who made his comments at a joint committee session in the New Jersey legislature, said the reactors were profitable now but could start losing money over the next couple of years because cheap natural gas prices are depressing power prices.

“Unless market prices change, we will no longer be covering our costs, within the next two years,” Izzo said.

Oyster Creek, the fourth nuclear reactor in New Jersey, is owned by Exelon Corp and is scheduled to retire in 2019. It entered service in 1969, making it one of the oldest operating reactors in the country. (Reporting by Scott DiSavino; Editing by Marguerita Choy)

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