PSEG to sell fossil fuel assets in pursuit of decarbonization

August 16, 2021, 6:59AMNuclear News
Hope Creek nuclear power station.

In the latest step toward its recently stated goal of achieving net-zero carbon emissions by 2030, Newark, N.J.–based Public Service Enterprise Group, owner of the Hope Creek and Salem nuclear plants, has entered into an agreement to sell its 6,750-MW fossil generating portfolio to newly formed subsidiaries of ArcLight Energy Partners Fund VII—a fund controlled by ArcLight Capital Partners. (ArcLight Capital is a Boston-based private equity firm, founded in 2001 and focused on energy infrastructure investments.) The $1.92 billion deal, announced by PSEG on August 12, is expected to be completed late in the fourth quarter of 2021 or the first quarter of 2022.

The sale of PSEG Fossil, part of the company’s Strategic Alternatives process announced last year, comprises 13 generation units in New Jersey, Connecticut, Maryland, and New York. The transactions are subject to, among other things, approval by the Federal Energy Regulatory Commission and certain state regulatory bodies.

From the top: “A year ago, we announced the strategic review of PSEG’s non-nuclear generating assets in line with our long-term focus on regulated utility growth, improving our business mix, and enhancing an already compelling environmental, social, and governance profile,” said Ralph Izzo, PSEG’s chairman, president, and chief executive officer. “With today’s agreement, which is the result of a robust sale process, PSEG is on track to realize a more predictable earnings profile. Further, this transaction continues our evolution toward a clean energy infrastructure–focused company that will enable our increasingly low-carbon economy.”

In case you missed it: In late April, New Jersey’s Board of Public Utilities voted unanimously to extend, for an additional three years, the zero emission certificate (ZEC) program benefitting Hope Creek and Salem—the two PSEG facilities responsible for more than 90 percent of the state’s carbon-free electricity and about 40 percent of its overall power.

Also, early last month, the New Jersey Supreme Court declined to hear an appeal from the New Jersey Division of Rate Counsel arguing against a lower court’s decision upholding the ZEC program.

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