Legislators, Unions Say Power Bill Is Key

The controversial bill that subsidizes power plant development in New Jersey isn’t just necessary to building West Deptford Energy, LLC’s natural gas-fired plant, as well as other power plants throughout the state, legislators say.

It’s part of an overall effort, which includes the Back to Work NJ package of bills, to revamp the state’s business climate and turn around the state’s reputation for being bad for business.

Both the power bill and the Back to Work NJ bills have passed both the Senate and Assembly, and now await the signature of Gov. Chris Christie.

“They’re all part of the same goal: to attract businesses to New Jersey,” said Derek Roseman, a spokesman for state Senate President Stephen Sweeney.

And with some major businesses–like Sunoco’s shuttering of the Eagle Point refinery last year, and Sony’s announcement of the closure of their Pitman manufacturing plant–pulling out of the state, Roseman said the benefits of the bills are huge.

“It’s absolutely vital to bring in new development” to replace companies that have left, he said.

While the Back to Work NJ bills deal with larger issues, including reforming the corporate tax code and expanding tax credits, the power plant bill aims to help get 2,000 megawatts of new power generation under construction in the state.

West Deptford Energy, LLC’s natural gas-fired plant would represent 620 megawatts of that total.

Passage of the legislation was one of the key points Tom Hoatson, director of development and regulatory affairs for LS Power, West Deptford Energy's parent company, referenced in talking about the plant potentially breaking ground in the fourth quarter of 2011.

Roseman said the obvious, immediate benefit of the power bill would be for the local economy, both in terms of job creation and local spending from construction.

Hoatson previously said the project could create up to 500 temporary construction jobs, and about 25 permanent jobs at the power plant after completion.

Jim Chew, president of Boilermakers Local 28, said of the power plant’s potential to put many people back to work at once, “This is it. This is the one.”

Both Roseman and Chew emphasized the ripple effect from jobs major development like the proposed natural gas plant would create.

"You've got to keep your backbone working, and the backbone is skilled labor," Chew said. "You keep your backbone working, they're spending money in your stores, they're putting money back into the economy."

Those economic effects extend even to the local tax burden, Roseman said.

“The hope is it works in multiple ways,” he said. “Growing ratables takes a huge weight off he shoulders of local taxpayers, and by cutting taxes to attract business, it increases revenue down the line.”

Besides the immediate effects of job creation and tax growth, the bill aims to create more power capacity, which in turn could spur lower electricity rates across the state, Roseman said.

Increasing that capacity is an immediate need, with at least one major plant–the Oyster Creek nuclear generation station in Ocean County, which represents 619 megawatts of generation–set to shut down by the end of the decade.

Roseman said it’s important to replace that supply here.

“Unless we build it in New Jersey, we’ll be taking it from coal-fired plants in Pennsylvania,” he said.