The New Jersey Public Utilities Board (NJBPU) approved a petition filed by Atlantic City Electric Co. (ACE) amending the Power Purchase Agreements (PPAs) and Power Sales Agreements (PSAs) between ACE and Chambers Cogeneration Ltd. and Logan Generating Co., New Jersey’s last two coal-fired power generation units. Under the agreements, coal-fired generation will cease on or about May 31, 2022, said Starwood Energy Group Global LLC, which owns the plants through investment affiliates.
The Logan Generating Station is a 225 MW unit in Swedesboro, New Jersey. It entered commercial operation in September 1994. Logan was among the first commercial-scale pulverized coal-fired power plants in the United States to use selective catalytic reduction (SCR) technology and the first to use a plate catalyst to reduce NO.X emissions.
ACE entered into a PPA with Logan Generating Co. in August 1988, pursuant to which Logan agreed to sell 200 MW of power and capacity to ACE. The existing PPA is due to end in December 2024. Additionally, ACE and Logan are parties to a separate PSA.
The Chambers cogeneration plant in Carney’s Point, New Jersey is a 245 MW facility that also began commercial operation in 1994. In addition to supplying electricity to ACE, the Chambers plant also sold electricity and steam at the adjacent Chemours-owned Chambers Works facility. Co.
ACE entered into a PPA with Chambers Cogeneration Ltd. in September 1988, under which Chambers agreed to sell 184 MW of capacity, and up to 173.2 MWh of energy during the winter, and 187.6 MWh of energy during the summer, to ACE. The existing PPA is due to end in March 2024. ACE and Chambers are also parties to a separate PSA which monetizes the value of energy and capacity above the maximum values set in the PPA and allows ACE to generate revenue additional for the benefit of customers. According to ACE, all of the energy and capacity it purchases under the PPAs and PSAs with Chambers and Logan are sold into PJM’s wholesale market in an effort to mitigate cost implications for customers. of ACE, and are not used by ACE to meet the needs of its retail customers.
In the agreement with Starwood Energy, ACE will make a series of negotiated fixed monthly payments for the remaining term of the existing PSAs and PPAs, which will be partially offset by payments to ACE customers from Logan and Chambers. Under this part of the agreement, ACE customers will see up to $30 million in savings on their energy bills through the end of 2024. “This achievement means more than savings on invoices for our customers; it means cleaner air for our communities and a safer environment for generations to come,” ACE Regional President Doug Mokoid said in a statement.
“The amended agreements are great news for the people of New Jersey as we finally end coal production in our state,” said NJBPU Chairman Joseph L. Fiordaliso. in a report.
“We are excited to continue to focus on the sustainable energy transition by creating win-win solutions with our counterparties such as ACE,” said Himanshu Saxena, CEO of Starwood Energy. in a report. “We appreciate the opportunity to support the environmental goals of New Jersey and ACE, as we permanently close New Jersey’s last two coal-fired plants and transition the site to 21st-century clean energy solutions. century, such as battery storage. We appreciate the support of Governor Phil Murphy, NJ BPU, ACE, Sierra Club, 350NJ-Rockland, Environment New Jersey and many other stakeholders and look forward to taking this monumental step for New Jersey.
Governor Phil Murphy and the New Jersey Legislature have taken significant steps to advance the state’s clean energy economy, passing and signing into law a landmark Clean Energy Act. The legislation calls for the significant advancement of solar power, energy storage, offshore wind and energy efficiency. New Jersey has also established an Energy Master Plan, which sets the goal of achieving 100% clean energy by 2050 and promotes higher levels of electrification across the economy, including transport.
“A key objective of the Energy Master Plan is to significantly reduce greenhouse gas emissions and today’s action by the Council is a huge step in that direction,” Fiordaliso added.
“Over the past few years, New Jersey has seen a steady decline in greenhouse gas emissions due to my administration’s aggressive approach to mitigating climate pollution, fueling coal, and expanding our resource mix from renewable energy,” Governor Murphy said in a released statement. by NJBPU. “These agreements allow us today to further shift New Jersey’s energy portfolio away from harmful coal production and focus on clean energy technologies.”
ACE, an Exelon utility, said it continues to take significant steps to advance environmental and clean energy initiatives. Last September, the company announced a major climate change pledge, launching “a multifaceted, action-oriented effort to help the State of New Jersey achieve its clean energy and climate goals.” . As part of this commitment, ACE said it is focusing on concrete actions “to reduce its greenhouse gas footprint, provide innovative solutions to enable customers to meet their climate change goals and lead collaborative efforts with stakeholders and community partners to achieve greater greenhouse gas reductions.” in South Jersey, while continuing efforts to address the impacts of climate change.
“We applaud the efforts of Governor Murphy and the State Legislature to advance a clean and sustainable energy future for all New Jerseyans and are proud to do our part to help establish the State as a clean energy and climate leader,” said Mokoid.
In one statement issued by the New Jersey Chapter of the Sierra Club, Greg Gorman, Group Conservation President, said, “This is a historic decision by the BPU, as it marks the end of coal burning in New Jersey, and an important step in bringing implementation of Governor Murphy’s Energy Master Plan. We commend Atlantic City Electric for taking this crucial step to reduce the carbon footprint of its electricity supply, while guaranteeing a refund to its subscribers. We’re also thrilled that Starwood Energy is looking to transition directly to cleaner, cheaper renewable energy at these sites, ending nearly three decades of pollution in Carneys Point and Penns Grove, historically overburdened communities on the Delaware River. This is an important step in the state’s transition to a clean energy economy. As Gorman alluded to, Starwood Energy plans to decommission the plants and work with a clean energy developer to bring renewable energy projects to the sites.
—Aaron Larson is the editor of POWER (@AaronL_Power, @POWERmagazine).