en.Wedoany.com Reported - Executives at PSEG Power, the unregulated power generation subsidiary of Public Service Enterprise Group, revealed during an earnings call that the company is studying the feasibility of supplying electricity to data centers through the reliability backstop program of PJM Interconnection.
The PJM program addresses large load demand in two steps: one is a one-time capacity auction scheduled to launch on September 30, and the other is an already-started process to match power suppliers with planned large loads, which will lead to long-term bilateral contracts. The first bilateral deals could be announced in August, but the entire process may extend into next spring.
PSEG Chairman, President, and CEO Ralph LaRossa said PSEG Power has submitted multiple power supply proposals in New Jersey and other PJM regions under the bilateral contract portion of the PJM initiative. He noted that as PJM moves into the reliability backstop auction phase, opportunities for long-term power purchase agreement-type or utility-type agreements increase, and the company sees potential opportunities emerging. LaRossa declined to provide further details, stating that PJM's plan is still evolving, including its load forecasts. For example, PJM said Tuesday that it has lowered its 2031 load forecast by 1.3 gigawatts and its 2034 forecast by 3.3 gigawatts for the Commonwealth Edison region in northern Illinois, based on reduced utility data center pipelines, a change that could affect PJM's transmission development.
LaRossa said PSEG Power is also in ongoing discussions with potential customers who value its existing nuclear generation, future nuclear uprate projects, and other generation opportunities. At the start of this year, PSEG Power had approximately 3,760 megawatts of nuclear capacity in New Jersey and Pennsylvania.
By the numbers: PSEG's second quarter of 2026. PSEG earned $334 million in the quarter, down from $585 million in the same period last year, primarily due to changes in mark-to-market positions. Over the past 12 months, weather-adjusted electricity sales at PSEG's New Jersey subsidiary, Public Service Electric and Gas, grew by 1%. If the company loses the 0.5% return on equity adder it receives as a PJM member, it estimates a $40 million loss in continuing operations earnings.
LaRossa said PSEG executives view positively a report released last month by the New Jersey Bureau of Public Utilities that explores possible changes to the state's utility business model. The report highlights several promising regulatory frameworks, such as multi-year rate plans, performance-based rates, and earnings-sharing mechanisms. LaRossa said the options listed in the report could further promote alignment and transparency among the utility business model, state energy policy goals, and affordability in the state. The Bureau has entered the second phase of its review process, which is expected to focus on cost discipline, financing modernization, incentives and shared savings, and performance-based rate setting.
PSEG, headquartered in Newark, New Jersey, maintained its previous five-year capital expenditure guidance through 2030 of $24 billion to $28 billion in its earnings report, with more than 90% directed to regulated investments, primarily for replacing aging infrastructure. PSEG Executive Vice President and CFO Daniel Cregg said the company is also pursuing nuclear revenue opportunities, competitive transmission projects, and incremental utility infrastructure projects, including incremental system investments to connect solar and battery storage resources to the grid to meet new demand, which could provide upside to its current growth outlook through 2030. Excluding one-time items, PSEG expects its operating earnings to grow 6% to 8% annually through 2030.
