PSEG to retire two New Jersey coal plants in 2017
PSEG's Hudson Generation Station in Jersey City, N.J., and its Mercer Generation Station in Hamilton Township, N.J., will be retired on June 1, 2017. PSEG currently is investing more than $600M in a new combined-cycled gas plant in Sewaren, N.J., as well as new plants in Connecticut and Maryland. PSEG is evaluating all options for future use of the sites. In Q3, PSEG and PSEG Power expect to recognize one-time charges in Energy Costs and Operation and Maintenance expense ranging from $40M-$70M and $35M-$77M, respectively, related to the cost of shutting down these units, including coal and other materials and supplies, inventory reserve adjustments, employee-related continuance, and severance benefits costs. In addition to these one-time charges, there will be ongoing annual incremental non-cash charges to earnings of $560M-$580M in 2016 and $940M-$960M in 2017 due to the shortening of the expected economic useful lives of the Hudson and Mercer plants.