N.J. regulators formally approve ZEC program application, review process for nuclear plants

The New Jersey Board of Public Utilities (BPU) on Nov. 19 formally approved the Zero Emission Credit (ZEC) program application and review process for nuclear power plants, immediately opening the application window, which will close on Dec. 19.

The creation of the ZEC program is a requirement of legislation signed by New Jersey Gov. Phil Murphy in May, the BPU added, noting that the new law will help maintain the state’s nuclear energy supply, which contributes nearly 40% of New Jersey’s electric capacity.

The application process requires that nuclear generating stations applying for ZECs demonstrate a clear need for those credits, ensuring ratepayer funding is allocated appropriately, the BPU said.

The BPU noted that in its application review, it will determine the eligibility of any of the nuclear generating stations applying for ZECs, and will establish a rank-ordered list of the nuclear plants selected to receive ZECs per the law. A list of those eligible to receive ZECs, including their ranking, will be presented to the BPU for approval at its April 19, 2019 agenda meeting, the BPU said, adding that only those nuclear generating facilities that have sufficiently demonstrated a need for ZECs will receive the credits.

To determine eligibility, applicants must answer questions and provide supporting documents, studies, certifications, and/or narratives, the BPU said, adding that each unit must also:

  • Be licensed by the U.S. Nuclear Regulatory Commission through 2030
  • Demonstrate a significant and material contribution to New Jersey air quality (minimizing emissions)
  • Demonstrate anticipated plant shutdown within three years due to its financial situation
  • Certify that the facility does not receive any subsidies from other entities or agencies

Two teams will evaluate the ZEC program application requirements to ensure consistency with the applicable law, the BPU said, noting that the first team will conduct an initial review, and if eligible, provide the application to the second team for ranking, scoring, and comparison.

According to the Nov. 19 order establishing the program, application, and procedural process, each “Zero Emission Certificates (‘ZECs’)” represents the fuel diversity, air quality, and other environmental attributes of one megawatt-hour of electricity generated by an eligible nuclear power plant selected by the BPU to participate in the program.

Under the program, certain eligible nuclear energy generators may be approved to provide ZECs for the state’s energy supply, which in turn will be purchased by New Jersey’s four investor-owned electric distribution companies – Atlantic City Electric; Jersey Central Power & Light; Public Service Electric and Gas; and Rockland Electric Company – as well as municipal electric distribution company Butler Electric Utility.

The BPU also noted in its order that it approved an order in late August initiating the creation of the ZEC program.

Consistent with the law, the BPU sought stakeholder input on the method and application process for determining the eligibility and selection of nuclear power plants, and on the establishment of a mechanism for each EDC to purchase ZECs from selected nuclear power plants. The BPU added that that process included stakeholder meetings to review the legislative requirements, as well as solicitation and review of stakeholder comments, toward the goal of establishing a ZEC application and selection process.

Among other things, the BPU said that it sets Dec. 31 as the deadline for requests for access to information submitted on a confidential basis, and sets Jan. 31, 2019, as the deadline for comments on applications.

In its statement, the BPU said that is also approved tariff modifications to implement a rate for collection by the electric utilities for the ZEC funding, as prescribed in the law. The rate will be $0.004 per kWh, but collection of the tariff charge will start only if a nuclear plant is deemed eligible, the BPU said.

About Corina Rivera-Linares 3065 Articles
Corina Rivera-Linares, chief editor for TransmissionHub, has covered the U.S. power industry for the past 15 years. Before joining TransmissionHub, Corina covered renewable energy and environmental issues, as well as transmission, generation, regulation, legislation and ISO/RTO matters at SNL Financial. She has also covered such topics as health, politics, and education for weekly newspapers and national magazines. She can be reached at clinares@endeavorb2b.com.