Public Service Enterprise Group (PSEG) on Tuesday reported that third-quarter earnings were up to $139 million, compared to $114 million for the same period last year, and executives laid out their plans for infrastructure investing on a call with analysts.
PSEG’s main subsidiary, Public Service Electric and Gas, “invested approximately $1 billion in capital spending during the third quarter, bringing the year-to-date spend to $2.7 billion,” said PSEG CEO Ralph LaRossa. “For the full year 2023, capital spend is expected to total $3.7 billion, slightly higher than our original plan of $3.5 billion, ahead of scheduled execution on our Clean Energy Future-Energy Efficiency and Infrastructure Advancement Programs. This work is helping our customers to save energy and lower their bills, upgrading the ‘last mile’ of our system, as well as adding new electric infrastructure due in part to increasing EV penetration.”
PSEG has been working to improve the predictability of its business by selling off its fossil generating assets to ArcLight Capital Partners early last year and exiting the offshore wind development business early this year.
“We have helped to secure the financial viability of critical, important New Jersey energy assets with the decision to retain our carbon-free baseload nuclear fleet, enhanced by the revenue stability of a production tax credit (PTC) that begins January of 2024,” LaRossa said.
The federal PTC for nuclear is in place for a decade, giving PSEG enough security that it can execute its five-year capital investment program without issuing new equity or selling any assets, he added.
PSEG is putting some of the extra money back into those nuclear plants, as well, with plans to transition its boiling water reactor at Hope Creek from an 18- to a 24-month refueling cycle, LaRossa said.
The firm is waiting for final approval on a $447 million transmission project that it bid into a PJM solicitation last year, with the RTO’s board expected to vote on it in December, LaRossa said.
“We intend to leverage our considerable transmission skills in similar opportunities that arise,” he added.
The utility also reported success in expanding efficiency efforts under the conservation incentive program that has been in place since 2021. The program limits the impact of weather and other sales’ variances on the firm’s earnings while letting it earn money by promoting efficiency to both its electric and gas customers, said CFO Daniel Cregg.
“To give you some perspective on how strong the demand for energy efficiency is: Consider that PSE&G now sells more energy-efficiency solutions in a single month than we did in an entire year just a few years ago,” LaRossa said.
The utility is also just over halfway done rolling out new smart meters, with 1.3 million deployed out of a plan for 2.3 million, LaRossa said.
