For Immediate Release: January 12, 2018
NEW PSEG FILING TO SEC CONFIRMS COMPANY STANDS TO MAKE AS MUCH AS $650M UNDER NEW FEDERAL TAX LAW, DEMONSTRATES PREVIOUS DEMANDS FOR NJ SUBSIDY ARE UNNECESSARY
8-K DOCUMENT SIGNED BY PSEG SHOWS CORPORATE TAX CUT WILL ENSURE WINDFALL, WORTH OVER DOUBLE PROPOSED CONSUMER-FUNDED HANDOUT
Trenton, NJ - A newly signed 8-K filing made by PSEG shows that the company is poised to make several hundreds of millions of dollars under the recently enacted federal tax law, confirming arguments made by the NJ Coalition for Fair Energy that a New Jersey ratepayer-funded subsidy for the company’s two nuclear plants is unnecessary and wrong.
“The contents of PSEG’s latest SEC documentation are astonishing, and should motivate every New Jersey consumer to write their legislator,” said coalition spokesperson Matt Fossen. “What this filing shows is that PSEG, by its own admission, is set to receive a major corporate tax cut and make hundreds of millions of dollars along the way. More importantly, the amount PSEG will make off the new tax law is significantly more than what they’d be given under a ratepayer-funded New Jersey subsidy. This is no small detail, and proves once and for all why a special state handout is unwarranted.”
The filing, signed by PSEG Power Vice President and Controller Stuart Black, outlines the effects of the recently passed federal tax bill. On page 2, the company acknowledges it will enjoy a financial benefit because of the policy, worth between $530 million and $650 million. Observers have been quick to notice that this number is significantly higher than the value of a proposed subsidy in New Jersey, which is put around $300 million (of which PSEG would take roughly $200 million).
“The question for New Jersey is simple: if in fact PSEG’s plants truly need financial assistance, where is that help best found?” asked Fossen. “One option is a special, ratepayer-funded deal in the state legislature, which by all accounts will hurt consumers and businesses while breaking Governor-elect Murphy’s environmental promises. Another is the windfall the company will make under the new tax rules, which gives them more than double what they were asking consumers for just a few days ago. Everyone knows the answer to this question, and if PSEG is telling the truth about their plants’ condition, they should be the first to now acknowledge that a state subsidy is unnecessary.”
The question of PSEG’s New Jersey plants’ financial health has been thoroughly debated, with swaths of data showing they remain secure. Company officials are on the record saying the plants are and will remain profitable through at least 2019, while Ralph Izzo, PSEG’s CEO, has reiterated elsewhere that both are undeniably “in the black.” Further evidence shows that the company earned $3 billion in gross profits during 2017 alone, while a recent study by Energyzt Advisors demonstrated that the plants “have always been profitable and will continue to be so through at least 2021.”
“In the end, the facts are definitive,” concluded Fossen. “Neither PSEG nor its plants are struggling, and yet should they ever land on hard times, the place to go would be the money made under their new corporate tax cut - not the pocketbooks of everyday New Jersey ratepayers.”