Dan Cregg: Yes. Carly, we may see it to move a little bit higher. It’s funny. We talked a little bit about the weather in the earlier remarks, and it was a fairly mild winter, but it was a really wet winter, and we had some storms that were not exactly temperature-driven as much as they were precipitation-driven. And so, some of that drove costs a little bit higher as did. Any time we have a Hope Creek outage, it’s 100% owned. So, there’s a little bit of a bigger impact there. And so, some years, we’ll have that, some years we won’t. So, you’ll see that come through on the power side. But really, the storms were one of the contributors to the first quarter’s impact on O&M.
Operator: Our next question is from the line of Andrew Weisel with Scotiabank. Please proceed with your question.
Andrew Weisel: Appreciate the details on the nukes. Maybe just one — can kind of pin you down a little bit to size up the opportunity, how much nuclear capacity do you have that’s not committed to state programs like the ZECs or other obligations? In other words, how many megawatts could actually be committed to a new dedicated customer?
Ralph LaRossa: Yes, Andrew, I think, look, you can look at what happened at Talend as a placeholder for size of units at hyperscalers are thinking about. Just a reminder, our state plan kind of ends in May of ’25, right? So, we’re — I don’t see a data center being built before May of ’25 down at that site. We may be in discussions with folks and have something to say sooner than that. But I don’t expect any power to be flowing into a data center before May of 25 when that program ends. And then we’ll see what the rules say on the IRA and how the PTCs interact with any of this kind of agreements that are reached.
Andrew Weisel: But your expectation is the entire portfolio is available?
Ralph LaRossa: I think, the entire portfolio could be available for long-term contracts. And again, I think that that falls into a bunch of different scenarios. I don’t think there’s anything that’s a restriction and we’ll continue to work forward and keep you posted.
Andrew Weisel: Just wanted to clarify that then second pivoting to the energy efficiency side of the utility, the — two program you filed in December calls for $3.1 billion of spending, much bigger than the first program at about $1 billion. Can you just talk to some of those dynamics of why each incremental kilowatt hour of savings is so much more expensive, and maybe more importantly, are you seeing any pushback from the BPU or key stakeholders, or is this all well understood and supported?
Ralph LaRossa: Andrew, it’s kind of simple as to why the dollar per megawatt saved goes up. I mean, you’re going from changing light bulbs, which was the first effort that we started way back when and thermostat changes to now you’re upgrading HVAC units and moving into commercial and industrial operations. That’s very different just from a dollar per megawatt hour save standpoint. As far as the pushback, this was all part of the BPU’s triennial, so a lot of what was submitted was based upon the needs identified by the Board of Public Utilities and really are not a surprise. The question will be just from a total spend standpoint, how far they would like to go. I don’t think there’ll be a lot of arguments about the cost per based upon one historic performance, which has been really good.
And then second the types of work that we’ll, the type of work that we’ll be doing going forward. Andrew, also, within what the BPU — I think to their credit, they tried to take a philosophy in approaching this, that they wanted to target things through this program that they viewed would not happen otherwise. And so, these light bulbs is an example of that given that incandescent are off the shelf, but in other examples too things that were going to happen anyway are not a great target for this kind of a program is to try to expand what would otherwise happen. And so that I think expands the reach a little bit moves them to a better place, but may cost a little bit more to get it done.
Operator: Our next questions from the line of Steve Fleishman with Wolfe Research. Please proceed with your question.
Steve Fleishman: Sorry, another nuclear question. We’ve talked about this hypothetically the last — let’s say six, nine months hydrogen, I think there’s supposed to potentially be like offshore wind port next to the plants around there, and then obviously data centers. Now just should we think about these as things, all things you can do there or you have to kind of focus to one and data centers is now kind of top of the list?
Ralph LaRossa: No, Steve, it’s a great question. So, the port is built. I mean they’ve done a ton of work down there, and that was the New Jersey Economic Development Authority has done a lot of work there. I don’t know if we can pull a ship up there yet, but we’re pretty darn close. So, there’s been a ton of activities completed. And they started to lease some space to some of the offshore wind developers. And so, I think from a state standpoint, that’s going pretty well. Then there’s additional land that’s available, and you could put a data center there, you could put how big it is, is a question right? You’ve got to figure all of that out based upon each individual developer design criteria and what they might be considering and the size that they’re looking for.
You could put a hydrogen unit there, you might have an electrolyzer or something that makes some sense to go there? Or maybe it goes a little bit off property, right? And again, it all depends upon the rules that come out and what we finally see from the IRA implementation. So, we’re thinking about it as all of the above and an optimization strategy. Just to figure out what is the best way for us to use those — that electricity that’s coming off the units and doing in a way that’s completely aligned with the state’s policy. So, you could do it all. It’s just a matter of what the policy is at the state and how big any one of those individual opportunities become.
Dan Cregg : An on the hydrogen front, Steve, as just a reminder, an upgrade there would meet both additionality and hourly matching to the extent that those limitations continue on hydrogen. So, I do think we feel pretty good about what we have the ability to do down there and don’t see limitations on having to pick one or the other.
Steve Fleishman: Okay. And then just the other — I guess the other part of this is just reliability in New Jersey overall and just a lot of focus on offshore wind that’s been delayed and the like. And just — so I guess from that last standpoint can kind of how are you in this alignment with the state thinking about that aspect to be able to do something behind the meter at nuclear?
Ralph LaRossa: Yes. So, Steve, that power flows a whole bunch of different ways, right, not just in New Jersey, but other states, right? So, it’s more of a PJM question as to that specific unit in those specific megawatts. But I will say this, and what we’ve set it in multiple settings, I apologize if it’s a repeat, but that 2003 blackout gave us the opportunity to rebuild the transmission infrastructure and we did that. And as Sandy comes along when we rebuilt the switching stations and substations. So, we’re well prepared for this. I think New Jersey is uniquely prepared and I’ve got my economic development hat on here for a second, but I think we’re in a really good place. and the margins aren’t quite as tight as some others might have. So, I think we’re looking at this and trying to figure out what’s the best solution for the state and we’re doing it in a partnership that one-off of the states plans. So, we feel pretty good.
Operator: Our next question is from the line of Ryan Levine with Citi. Please proceed with your question.
Ryan Levine : Had a, I guess, one or two more on nuclear. In terms of the duration of contracts that your counterparties may be willing to sign. I think in your comments, you mentioned long term, any color you could share around how long term is as you look at it? And then to the extent that there’s transmission constraints in PJM, how does the timeline of any investment there play into ability to serve that longer term?
Dan Cregg: Ryan, I think, the simple answer on the first question is somebody’s going to come in and build a data center that’s going to be a very, very significant investment and it’s going to be around for a long time. I don’t have a specific number of years to give you, but I think long term is pretty comfortably thought about as being long-term. And I think on the transmission side of things Ralph just really, I think gave the right response as much as we have built out the transmission system, given what we went through about 20 years ago and 10 years ago I do think we’re prepared for whatever flows need to happen within the region. Both of those I think are in pretty good shape.
Ryan Levine: And then to follow-on the last line of questionings, to the extent that there is policy opportunities to maybe attract this customer base to the state, are there any legislation initiatives that you’re keeping an eye on that may make it more palatable for other stakeholders to attract this load to the service territory?
Ralph LaRossa: No, so I believe, again, I’m putting my other hat on. I believe the state has plenty of solutions for new businesses to move to New Jersey or to start up here. There was a number of different initiatives down at the EDA that could attract businesses, and I don’t think anything that I’ve seen would require additional legislative changes. There may be some to speed things up or expand opportunities for folks, but I’m pretty confident that the state has the tools and its tool just to reach out to the opportunities that it has.
Operator: Our next questions are from the line of Travis Miller with Morningstar. Please proceed with your question.
Travis Miller : Since I don’t have to apologize for a nuclear question, I suppose I’ll jump in with another one here. Just thinking about what a contract at a very high level might look like for a co-located facility. And mainly, I’m thinking about who would take the risk on their — of perhaps a non-performance or something like that. Is that something you’d be comfortable with or is that something you’re going to essentially make the offtaker take that risk?
Ralph LaRossa: Travis, I would simply tell you way too soon for us to be talking about anything like that. We’re not in a position to talk about any details of any discussions. I would say this to you though, we’ve answered the question a bunch of times. And I’ll tie it back to the hydrogen opportunities. We don’t want to get into the commodity risk commodity risk situation. What we basically look at this is, we put a meter at point A and folks can pick it up from there and figure out what they’re going to do with the electricity. And I don’t see data centers or electrolyzers or anything else that might happen in that space as different.
Dan Cregg: And Dan, I don’t what you want to add. No, I mean, the only thing I would say is, is just from a practical perspective, if you think about a 3 unit site, you’ve got a lot of redundancy in the ability to deal with things like that. And so obviously contractual T’s and C’s are going to be worked through as across the entire breadth of, of whatever agreement you come to. But I think we start from a position of strength there.
Travis Miller : And then one other question on the transmission in your bids and proposals there. How much does what you proposed or put in those bids depend on a second round of offshore wind projects coming in, is any of it or some of it.
Ralph LaRossa: Yes. So, Travis, I think there’s two answers there. First, the PBI, the interest prebuild opportunity does not require that. It’s basically very similar to what happened in the first solicitation where use an analogy. It’s a [Indiscernible] for pipes coming — or wires coming in from the offshore wind farms. So that piece really is not dependent. I think the size and scope of the next solicitation is clearly dependent upon what — how big that offshore wind opportunity gets for the state as a whole. And that — we have not seen a scope of what that might look like yet.
Travis Miller : Okay. And would that be through the PJM process or through New Jersey process?
Ralph LaRossa : It would be a PJM process initiated by the state agreement approach from New Jersey. So, New Jersey would pick up the phone call PJM and ask them to run the process for — on behalf of the state.
Operator: Our last question is from line of Paul Patterson with Glenrock Associates. Please proceed with your question.
Paul Patterson : So just to sort of follow-up on the transmission stuff. I was wondering if you could — what your thoughts might be with respect to the upcoming transmission policy agenda that’s coming up here with FERC in the next few weeks. Any thoughts about how — what you think might be coming out there and how it might affect you guys?
Ralph LaRossa: No. I think — look, there’s 5 or 6 items that are there. We have some folks that are heavily involved in transmission in our wire’s organization, so many other ones. So, we’re staying abreast of it. I think FERC has remained balanced under the current share. And I don’t expect some wild swings in the outcomes there, but we’re monitoring it closely right now, Paul, and I wouldn’t have much more to add than that.
Paul Patterson : Okay. And then just on another big policy push that we’re seeing from different officials is grid enhancing technologies. And just wondering if your — if you see — how you see that might– how that might impact you guys or your operations in the next few years?
Ralph LaRossa: Yes. So, some of that grid enhancing has really been focused. I think there was a New York Times article on it about the upgrades of some of the conductors that people have installed. And we’ve looked at some of that and piloted some of that. As we’ve talked about, we’ve done a lot of transmission upgrades. We’ve also built into our system, the ability to do some additional upgrades. But I think that just becomes a cost benefit for the consumer based upon what additional capacity we would get out of it and whether or not we wouldn’t want to front run the need. So, it’s something we’ll monitor and it’s something that PJM again, will have in their tool chest to make some determinations upon how they want to solve some of the gaps that might get created as we move forward here with electrification.
Operator: There are no further questions at this time. And I’d like to turn the floor back to Mr. LaRossa for closing comments.
Ralph LaRossa: I just simply want to thank you all for your continued confidence and support, we welcome all these questions and we really look forward to getting together with most of you at AGA later in May. Again, thank you to our employees, to our customers, and to and to our investors, and we’ll see you all in California. Take care.
Operator: Ladies and gentlemen, this concludes today’s teleconference. You may disconnect your lines at this time. Thank you for your participation.
