SENATE ECONOMIC GROWTH COMMITTEE

STATEMENT TO

SENATE, No. 4070

with committee amendments

STATE OF NEW JERSEY

DATED:  MAY 22, 2025

      The Senate Economic Growth Committee reports favorably and with committee amendments Senate Bill No. 4070.

      As amended and reported, this bill establishes the Fusion Energy and Technology Incentive Program (program) within the New Jersey Economic Development Authority (EDA) to encourage the use and development of power plants by fusion energy or fusion technology companies.

      Under the bill, the program consists of two distinct components, including the issuance of tax credits to: (1) eligible property owners that lease space on the site of a power plant for use by one or more fusion energy or fusion technology companies; and (2) fusion energy or fusion technology companies that operate, or seek to operate, one or more fusion energy or fusion technology facilities on the site of a power plant.

      The bill allows the EDA to issue up to $5 million in tax credits annually to eligible property owners that lease space on the site of a power plant to fusion energy or fusion technology companies.  Specifically, an eligible property owner may apply to the EDA to receive tax credits in an amount equal to the sum of: (1) 15 percent of the rent paid to the eligible property owner by any fusion energy or fusion technology companies leasing space on the site of the power plant; and (2) 35 percent of the capital investments incurred by the eligible property owner, prior to the date of application, provided that the capital investments were necessary to enable the site of the power plant to be leased and used by a fusion energy or fusion technology company.  The bill defines an “eligible property owner” to mean any individual or business entity that owns a power plant.

      Additionally, the bill authorizes the EDA to issue up to $10 million in tax credits annually to fusion energy or fusion technology companies that operate, or seek to operate, one or more fusion energy or fusion technology facilities at the site of a power plant.  Specifically, a fusion energy or fusion technology company may apply to the EDA to receive tax credits in an amount equal to 35 percent of the capital investments incurred by the company related to the preparation, construction, or improvement of any fusion energy or fusion technology facility that is actively operated by the company on the site of the power plant.  If a fusion energy or fusion technology company applies for the tax credits before it is actively engaged in the operation of a fusion energy or fusion technology facility, the EDA is not permitted to issue tax credits to the company until after the facility is actively operated by the company.  Thereafter, the EDA is required to review and verify the actual amount of capital investments incurred by the company, for which the tax credits are to be issued.

      The bill defines “fusion energy or fusion technology company” to include any business entity that: (1) has its headquarters or base of operations in this State; (2) owns, has filed for, or has a valid license to use protected, proprietary intellectual property; and (3) employs some combination of the following: highly educated or trained managers and workers, or both, employed in this State who use sophisticated scientific research service or production equipment, processes, or knowledge to discover, develop, test, transfer, or manufacture a product or service related to fusion energy or fusion technology.  The bill also defines the term “power plant” to include: (1) any facility that is used for the generation of electricity, including any decommissioned power plant and any operational power plant; and (2) any site that is capable of hosting a fusion energy facility or fusion technology facility.

      Under the bill, the EDA is permitted to prescribe the form and manner in which applications are submitted for both program components.  The bill also permits the EDA to approve applications on a rolling basis, subject to the annual limitations in tax credit issuances for each program component.

      Additionally, the bill authorizes the EDA to use moneys in the "Global Warming Solutions Fund" to provide grants or other financial assistance to commercial, institutional, and industrial entities to support fusion energy facilities or fusion technology facilities.  Notably, the fund serves as the repository for moneys received from electric power generation facilities pursuant to New Jersey's participation in the Regional Greenhouse Gas Initiative.

COMMITTEE AMENDMENTS:

      The committee amended the bill to make technical corrections.