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BPU Staff Seeks Comments on Straw Proposal on a Refund Mechanism for Nuclear Units that Received a Federal Production Tax Credit
New Jersey BPU Staff have issued a straw proposal and request for comments in the implementation of l. 2018, c. 16 regarding the establishment of a zero emission certificate program for eligible nuclear plants.
Staff seeks written comments regarding Board Staff’s (“Staff’s”) proposal of a refund mechanism for nuclear power plants (“Units”) that received or utilized a federal production tax credit (“PTC”), which constitutes a double payment for Zero Emission Certificates.
Staff’s Proposed Refund Mechanism
“Staff reviewed and analyzed the Selected Units’ certified data and documentation regarding their CY24 PTC filings. Staff found that the CY24 federal PTC does constitute a double-payment, related to the resilience, air quality, or other environmental attributes associated with electricity generated or sold by the Selected Units during CY24 within the Second Eligibility Period. Accordingly, Staff recommends the following steps to effectuate a refund from the owners of the Selected Units to retail customers through the EDCs and Butler.
- Staff will determine the Base Value of double payment based upon the smaller of a) the as filed PTC for each owner or partial owner of a Selected Unit for CY24, or b) the value of ZECs received by the Selected Units owners in CY24.
- Staff will determine the Refund Value for CY24 by adding interest at the annual interest rate determined by the Board for customer deposits during the same period. The Board approved interest rate for customer deposits for CY24 was simple interest of 5.06%. Therefore, the Refund Value for CY24 will be the Base Value plus 5.06% of the Base Value.
- The Refund Value will be refunded to the EDCs and Butler via electronic funds transfer (“EFT”) based upon a proration equal to the percent of total retail sales for each EDC and Butler for CY24. The EFT from Selected Unit owners to the EDCs and Butler shall be on or before May 31, 2026.
- Beginning June 1, 2026, the EDCs and Butler will refund retail customers through a ZEC Reconciliation Charge Rate as part of the existing ZEC Recovery Charge (“ZECRC”). The refund to retail customers shall be evenly distributed, on a kilowatt-hour basis, over the following twelve months.
- The EDCs and Butler shall track any over/under balances in their ZEC refund accounts and submit a reconciliation filing by July 1, 2027.
The deadline for comments on this matter is 5 p.m. on March 31, 2026.
