Regulators size up new gas-fired plants

TRENTON — Proposed construction of natural gas-fired power plants in Woodbridge, Old Bridge and Newark face challenges in federal court, but New Jersey’s chief energy regulator says he’s hopeful work on the projects will get under way.

Developers of the power plants are scheduled to receive aid from statewide ratepayer subsidies, a mechanism other energy suppliers at a state Board of Public Utilities hearing Friday cited as creating an unfair competitive advantage.

The power industry has launched a legal challenge and PJM Interconnection, the operator of the regional power grid, also has weighed in with a claim that subsidies would artificially depress capacity prices and disrupt wholesale energy markets.

BPU President Lee Solomon said there may be no turning back on the state’s plans, however.

Gov. Chris Christie signed the controversial subsidy pilot program law in January.

“It’s policy,” Solomon said. “It’s our obligation to carry out the policy set out by the governor and the Legislature.”

Senate President Stephen Sweeney wrote the bill designed to expand the state’s megawatt capacity with construction of the three new power plants, touting new jobs as one of the benefits.

One of the facilities was to be sited in West Deptford, part of the Democrat’s home district in Gloucester County. But a March decision by the BPU, based on a consultant’s recommendation, picked Old Bridge, Woodbridge and Newark as the sites, leaving West Deptford off the list.

Former South Jersey Democratic Assemblyman Edward H. Salmon said Sweeney’s aggravation was self-inflicted.

Salmon, now chairman of the New Jersey Energy Coalition, said the Legislature had no business in ordering up the subsidies. Salmon said the other critics are right: That the subsidies can upset the regional energy market.

“I’ve known the Senate president a long time,” Salmon said. “Sometimes politics delivers strange legislation.”

Solomon said the state needs to modernize its power plants. The Friday hearing was scheduled after the BPU first met in June to investigate why new generation is not being built in the state.

Solomon said BPU staff will issue recommendations based on the hearings.