Study Underscores Oyster Creek’s Critical Importance to Maintaining Affordable, Clean, Reliable Energy for New Jersey

TRENTON, N.J.--(BUSINESS WIRE)--Closing the Oyster Creek Generating Station, according to a new study by a national economic consulting firm, would result in severe economic and environmental consequences for New Jersey, including sharply higher electricity costs, increased air pollution and a heightened risk of power blackouts.

“realistic nor cost-effective replacements for Oyster Creek.”

The 38-page report was sponsored by the plant’s owner, the Exelon Corporation, to assess both the economic benefits of Oyster Creek as well as the adverse impacts on New Jersey should the Nuclear Regulatory Commission (NRC) decline to grant a 20-year extension of the plant’s operating license now set to expire in 2009.

The study was praised by Dr. Edward Salmon, Chairman of the New Jersey Affordable, Clean, Reliable Energy Coalition. A diverse cross section of New Jersey leaders drawn from business, education, labor and civic groups, the Coalition received initial seed money from Exelon and was recently formed to raise public awareness of the energy challenges facing New Jersey and build support for the bid to extend the license of the Oyster Creek station.

“Our Coalition applauds these findings that reinforce what we already knew: the continued operation of Oyster Creek is essential for a cleaner environment, a stronger economy and a reliable source of clean, affordable electricity for New Jersey,” Dr. Salmon said.

The study’s authors, Collin Cain, Dr. Jonathan A. Lesser and Dr. Spencer Yang from the Washington D.C. based firm of Bates White, LLC, did not express an opinion on the merits of the license application before the NRC. However, the study found that the loss of Oyster Creek and the need to replace its electricity in the face of steadily rising demand would cause significant economic hardship for residents and businesses statewide.

“We conclude that Oyster Creek’s retirement would result in a direct loss to New Jersey of $190 million, because of increased electricity prices, and an additional loss of at least $126 million in economic activity,” the report said, adding that “costly improvements will be required to maintain the reliability of New Jersey’s coastal transmission network.”

Experts from Bates White, including Dr. Lesser, had previously been hired by the New Jersey Department of Public Utilities to testify against the proposed merger between Exelon and Public Service Enterprise Group. Although Exelon sponsored the report, the study’s authors had total independence while conducting their analysis and writing their report.

The environmental damage associated with closing Oyster Creek would be considerable, according to the study.

“We estimate that, if Oyster Creek’s output were replaced with increased generation from coal, the annual increase in CO2 emissions would be the equivalent to the output of 920,000 cars. Replacement with natural gas generation would cause annual CO2 emissions equivalent to that of 460,000 cars,” the report stated.

Like all nuclear plants, Oyster Creek has extremely low running costs compared to other types of generation, allowing it to run economically on an around-the-clock basis providing what is known as “baseload” power.

Oyster Creek’s baseload power accounts for roughly 20% of the electricity distributed by Jersey Central Power and Light and each year supplies roughly 5 million megawatt hours of electricity; enough to power 600,000 homes and meet 6% of New Jersey’s total electricity demand. If Oyster Creek is closed, the study found that more expensive sources would be needed, “inevitably” leading to higher wholesale and retail electric prices.

The study concluded that renewable energy may play an important role in the New Jersey’s future energy plans but it could not be considered a “realistic nor cost-effective replacements for Oyster Creek.”

To schedule an interview with Dr. Salmon or Dr. Lesser, please contact Maury Donahue at [phone] or at [e-mail].

To learn more, please visit www.NJACRE.org

The mission of the NJ Affordable, Clean, Reliable Energy Coalition is to generate public support for the production of clean, reliable, affordable, American energy to meet New Jersey's growing energy needs. The Coalition seeks to achieve this goal through increasing the public's awareness of the need to keep existing clean energy providers operational and to promote and support the development of new affordable clean sources.

The Coalition's immediate focus is to generate public support for renewal of the operating license of Oyster Creek Generating Station. The Coalition will increase public awareness about the benefits of Oyster Creek and the important role nuclear power plays in meeting New Jersey's electricity needs.