Public Service Enterprise Group is a Newark-based holding company operating through two principal subsidiaries: PSE&G, the regulated electric and gas utility serving New Jersey, and PSEG Power, which owns and operates the three nuclear generating units at the Salem and Hope Creek stations in Salem County, New Jersey. CEO Ralph LaRossa has led the company since May 2022. PSEG is one of the largest investor-owned utilities in the northeastern United States by customer count and, after selling its entire fossil generation fleet in early 2022, is now a straightforwardly utility-plus-nuclear business with no meaningful commodity-exposed generation.
The fossil divestiture was deliberate and took years to execute. PSEG Power had operated a 6,750-megawatt portfolio of coal, gas, and oil generation units across New Jersey, Maryland, Connecticut, and New York. In 2021, the company agreed to sell the entire portfolio to subsidiaries of ArcLight Capital Partners for approximately $1.92 billion, completing the transaction in February 2022. The strategic logic was to remove earnings volatility, eliminate the capital expenditure obligations of aging fossil plants, and position the company as a regulated utility pure-play — a profile that commands a premium multiple from institutional investors compared to more complex merchant power businesses.
The nuclear fleet was kept. PSEG Power's three reactors now represent the company's only non-regulated generation and have become more valuable, not less, in the years since the fossil exit. The IRA's nuclear Production Tax Credit, effective beginning in 2024, provides federal support of up to 1.5 cents per kilowatt-hour for zero-emission nuclear generation through 2032, partially displacing New Jersey's own Zero Emission Certificate program as the primary financial backstop for the fleet. The combination of PTC support, rising wholesale power prices in PJM, and the state's growing demand from data centers has made the Salem and Hope Creek plants an asset that management is now investing in rather than managing toward closure.
PSE&G's electric system serves 2.3 million customers across a 2,600-square-mile corridor running from Bergen County in the northeast down through Essex, Union, Middlesex, and Mercer counties to Gloucester County in the south — a dense, largely urban and suburban footprint that includes Newark, Jersey City, Trenton, and the communities ringing the Raritan Bay and Delaware River corridors. The distribution system carries high load density by U.S. utility standards given the population density and industrial base of northern and central New Jersey. PSE&G does not own generation; it purchases all of its electricity supply through the PJM wholesale market and bilateral contracts.
The October 2024 NJBPU settlement resolved PSE&G's first electric and gas distribution base rate case since 2018, producing a combined 7% bill increase effective January 2025 and funding recovery of more than $3 billion in distribution system investments made since the prior case. The utility's 2026-2030 capital plan of $15 to $17 billion is projected to grow rate base from approximately $36 billion at year-end 2025 at a 6% to 7.5% compound annual rate, reflecting continued transmission and distribution investment, EV charging infrastructure, energy efficiency programs, and grid hardening.
The gas distribution system serves 1.9 million customers across much of the same northern and central New Jersey corridor as the electric system. PSE&G's gas infrastructure is aging in places — the Gas System Modernization Program (GSMP) has been running in successive phases since 2014, replacing cast-iron and unprotected steel mains with modern plastic piping. GSMP III, approved by the NJBPU and representing $1.4 billion in capital investment, began in January 2026 and runs three years. The long-term question for PSE&G's gas system is the same as for any northeastern gas utility: New Jersey's climate targets call for building electrification and a reduction in natural gas use in homes and commercial buildings, which would gradually erode the throughput base over which the gas distribution system's fixed costs are spread.
PSEG Nuclear LLC operates three reactors at two co-located sites on the Delaware Bay in Salem County, New Jersey. Salem Generating Station has two pressurized water reactors: Salem 1 at 1,169 megawatts (licensed to 2036) and Salem 2 at 1,181 megawatts (licensed to 2040). Hope Creek Generating Station is a 1,237-megawatt boiling water reactor licensed to 2046. Together, the three units generate approximately 30 to 31 terawatt-hours per year, producing roughly 40% of all electricity consumed in New Jersey and approximately 85% of the state's carbon-free generation.
In 2025, PSEG notified the NRC of its intent to seek subsequent 20-year license renewals for all three units: Salem 1 to 2056, Salem 2 to 2060, and Hope Creek to 2066. Applications are expected in Q2 2027, initiating a roughly two-year NRC review process. Alongside the license renewals, PSEG is developing uprate plans for the Salem units, with Salem carrying a potential of nearly 200 MW of additional capacity, and has completed a fuel cycle extension at Hope Creek from 18 months to 24 months between refueling outages, reducing downtime and increasing annual output.
The Salem and Hope Creek plants came close to early retirement. In 2018, PSEG warned that the plants were losing money in the PJM wholesale market — where an abundance of cheap natural gas and federally subsidized wind and solar had suppressed power prices below the plants' all-in operating costs — and that it would shut down Salem 2 and Hope Creek without state financial support. The threat was credible: Illinois had already lost the Quad Cities and Clinton plants to merchant power economics before enacting its own rescue program, and New Jersey's grid operator and environmental community faced the prospect of losing the source of nearly half the state's electricity.
New Jersey's legislature responded with the Nuclear Energy Transition and Economic Development Act, passed in May 2018, which created the Zero Emission Certificate program. Under ZECs, electric distribution companies are required to purchase certificates from qualifying nuclear plants, with the revenue flowing to the plant operators. PSEG received ZEC payments of approximately $10 per megawatt-hour, providing roughly $300 million per year in revenue support across the three units. The NJBPU awarded the initial three-year ZEC tranche in April 2019 and voted to extend the program for another three-year period thereafter.
The ZEC program drew criticism from competing generators and ratepayer advocates who argued the payments were above what was needed to keep the plants economical, particularly as wholesale power prices recovered. PSEG countered that without revenue certainty, it could not plan long-term capital investments in the fleet. The policy debate became largely moot when the IRA created the federal nuclear Production Tax Credit in 2022, which began applying in 2024. The PTC provides up to 1.5 cents per kilowatt-hour for zero-emission nuclear generation through 2032, effectively establishing a federal earnings floor similar in function to the ZECs but funded through the tax code rather than utility ratepayer charges.
With PTC support through 2032, PJM wholesale prices elevated by data center load growth in the mid-Atlantic region, and license renewal applications being filed for operations extending to the 2050s and 2060s, the plants have gone from assets management was considering closing to assets management is investing capital in. The 200 MW potential Salem uprate, the Hope Creek fuel cycle extension, and the turbine generator train upgrades collectively represent a bet that the nuclear plants will operate for decades and that incremental investment now is worth the long-term capacity and output increases.
PSE&G's large-load interconnection pipeline reached 9.4 gigawatts by mid-2025, up 47% in a single quarter, with more than 90% of that pipeline attributable to data centers. New Jersey's advantages for data center siting are real: fiber density, proximity to New York City financial markets, available industrial land in central and northern New Jersey, and access to PSE&G's high-density urban transmission system. AI data centers accounted for approximately 70% of new state power demand growth in New Jersey in 2025, contributing to residential electric bills rising roughly 20% over the year.
PSEG expects 10% to 20% of the pipeline to actually reach commercial operation, which would still represent 940 megawatts to 1.9 gigawatts of incremental large-load demand — material against a current PSE&G system sized to serve 2.3 million primarily residential and commercial customers. Specific projects already contracted or filed include a 1.4-gigawatt Oracle data center under construction and a 1-gigawatt Google project in regulatory review. New Jersey's legislature has also begun considering legislation requiring data centers to use clean power, which, if enacted, would directly favor PSEG Power's nuclear fleet as one of the few large sources of firm zero-carbon electricity in the mid-Atlantic region. Governor Sherrill and PSEG's CEO held public discussions in 2025 about the potential for nuclear expansion in New Jersey to serve data center demand, though no specific new-build decisions have been made.
PSEG reported FY2025 revenue of $12.16 billion, up from $10.29 billion in FY2024. Full-year 2025 GAAP net income was $2.111 billion ($4.22 per share). Non-GAAP operating earnings — the primary metric management uses, which excludes certain mark-to-market adjustments and other items — were $2.029 billion ($4.05 per share), up approximately 9% at the midpoint from 2024 guidance. PSEG Power contributed higher nuclear output of 30.9 terawatt-hours for the full year, with realized prices in excess of the nuclear production tax credit floor. PSE&G results reflected new electric and gas base distribution rates in effect for the full year following the October 2024 settlement.
For 2026, PSEG guided to non-GAAP operating EPS of $4.28 to $4.40, implying approximately 7% growth at the midpoint. The annual dividend was raised to $2.68 per share. Long-term guidance targets 6% to 8% compound annual growth in non-GAAP operating earnings through 2030, rebased higher for the second year in a row as of the 2025 results. PSE&G's rate base of approximately $36 billion at year-end 2025 is projected to grow at 6% to 7.5% per year through 2030, driven by the $15 to $17 billion five-year capital program.
PSEG's investment case is built on two compounding assets: PSE&G's regulated utility rate base growing at 6% to 7.5% per year and a nuclear fleet whose economics have materially improved since 2018. The utility capital program spans transmission hardening, distribution modernization, the GSMP III gas infrastructure replacement, EV charging buildout, and the grid upgrades needed to interconnect incoming data center load. The relatively predictable regulatory environment in New Jersey — the October 2024 rate case was the first since 2018 and was resolved by settlement — provides a stable backdrop for that capital program.
The nuclear uprate and license renewal program is the other major capital commitment. If the Salem uprate of nearly 200 MW proceeds and all three license renewals are approved, PSEG Power would operate roughly 3.8 gigawatts of nuclear capacity through the mid-2060s. That outcome would make PSEG one of the largest nuclear operators in the United States on a per-company basis and would position the fleet to benefit from what could be decades of tight zero-carbon firm capacity in the mid-Atlantic region. The management dialogue with the New Jersey governor's office about nuclear expansion reflects a policy environment more willing to discuss new nuclear capacity than at any point in the past three decades, though the economics of new nuclear builds remain challenging and no formal commitment to new construction has been made.
The nuclear PTC cliff is the sharpest near-term risk in the PSEG Power investment case. The IRA's Section 45U credit runs through 2032. After that date, unless Congress extends it or New Jersey renews ZEC support at adequate levels, PSEG Power's nuclear revenues would depend entirely on PJM wholesale power prices. Those prices have risen substantially on data center load growth, and forward curves reflect expectations that the current tightness persists, but wholesale power markets are volatile and the capacity price signals in PJM have historically been inconsistent. A prolonged period of low wholesale prices after 2032, without federal or state revenue support, could again call the economics of the fleet into question — particularly for the older Salem 1 unit, which has the earliest existing license expiration and the smallest capacity.
On the utility side, the data center load growth is real but lumpy. PSEG expects only 10% to 20% of the 9.4-gigawatt pipeline to actually interconnect, and the timing of even the committed projects is subject to permitting, equipment delivery, and customer construction schedules. The capital expenditures required to serve data center load — new substations, transmission upgrades, distribution capacity additions — are recoverable through rates, but they raise customer bills in the interim. New Jersey residential electricity rates have already risen roughly 20% in 2025, generating political pressure that could complicate future rate recovery filings. The GSMP III gas infrastructure investment also faces a structural headwind: if New Jersey accelerates building electrification policy, the rationale for continued capital investment in gas distribution comes under increasing challenge at each successive rate case.
This profile was compiled from publicly available information including:
PSEG Investor Relations — Earnings releases, SEC filings (10-K, 10-Q), capital plan presentations, and guidance disclosures.
PSE&G / PSEG Nuclear — Service territory data, nuclear fleet specifications, and operational updates.
FY2025 Year-End Earnings Report (February 2026), FY2024 Annual Report (Form 10-K), October 2024 NJBPU base rate case settlement, PSEG Nuclear NRC license renewal notification (April 2024), Nuclear Energy Transition and Economic Development Act (New Jersey, May 2018), NJBPU ZEC award decisions, ArcLight Capital fossil fleet sale completion announcement (February 2022).
This profile is for informational purposes only and does not constitute investment advice, a recommendation, or a solicitation to buy or sell any security.