PSE&G 2008 Annual Report Download - page 4

year with approximately $3.5 billion in
available liquidity and very modest
financing requirements.
Financial strength is about many things
at PSEG, from rigorous controls to sound
governance practices and an emphasis
on risk management. It is fundamental to
our efforts to provide acceptable returns
for our shareholders — in keeping with
our century-long reputation for rock-solid
integrity and focus on reliable, long-term
performance.
Of course, financial strength has taken
on greater importance in an extremely
challenging economy. We moved
aggressively to address economic pres-
sures. We reduced our capital spending
plans for 2009 by roughly $300 million
well before the year had begun. We took
steps to ensure our nuclear decommis-
sioning trust fund and pension fund
stay safe and sound. In the same vein,
we are managing the business to take
into account financial risk, including the
potential tax liability associated with our
lease portfolio.
We are working hard to ferret out cost
savings without compromising safety or
reliability. Employees across the com-
pany are engaged in this effort, resulting
in a stream of new ideas, including how
to produce this report.
While taking great care with every dollar
ourselves, we worked hard to provide
assistance to our customers at a time of
financial distress. In New Jersey, we
have long partnered in programs that
can help eligible customers pay their
utility bills. In 2008, we deepened our
involvement in such programs and
expanded educational efforts to help
our customers save energy.
It will take time to overcome the wide-
ranging impact of the economic
downturn. Nevertheless, I hope our
shareholders will take heart from our
strong fundamentals and the proactive
way we responded to the crisis. We are
determined to remain financially solid.
Disciplined Investment
As to the future, we are well positioned to
address three major energy challenges,
each providing significant opportunities:
The first is climate change; the second is
the need to replace aging energy infra-
structure; and the third is the need for
additional energy supply.
Investing to Help Society Combat
Climate Change
Climate change is the pre-eminent envi-
ronmental issue that will define our industry
in the future. We are pursuing solutions
along three main lines: conservation
through energy-efficiency improvements;
the development of renewables such as
solar, wind and biomass energy; and
clean central station power plants using
proven nuclear or other environmentally
sound technologies.
A major focus of ours is to help New
Jersey reach the aggressive goals of the
state’s energy master plan. The plan
delineates a leading role for utilities in
energy efficiency and expands opportu-
nities for both our regulated and
competitive businesses to grow in the
renewable energy area.
We are pursuing energy-efficiency invest-
ments that can help customers lower
their bills, reduce carbon emissions and
stimulate the economy. In December
2008, we received regulatory approval
for a $46 million pilot program of house-
hold energy audits, and energy-saving
measures for homes, businesses and
hospitals. This program has a strong
urban emphasis, reflecting the key role
that utilities can play in providing universal
access to green energy and green jobs.
In January 2009, as part of our efforts to
provide an additional economic stimulus,
we proposed a new $190 million invest-
ment to improve customer access to the
benefits of conservation.
In the renewables area, PSE&G became
in 2008 the first utility to offer a loan pro-
gram to spur the development of solar
energy in New Jersey. This $105 million
program provides financing to expedite
30 megawatts of solar energy over two
years. In February 2009, PSE&G pro-
posed a new $773 million program to
bring the benefits of solar power directly
to all of our utility customers. This initia-
tive for 120 megawatts of solar capacity
“
Employees across the company
are engaged in this effort, resulting
in a stream of new ideas, including
how to produce this report. We will
remain cost vigilant”