PEGPublic Service Enterprise Group

We note your disclosures in note 3 to the financial statements regarding the challenges faced by your nuclear generating stations and the resulting potential for early retirement or shutdown of the Salem and Hope Creek nuclear units, as well as your disclosure that Power recorded an increase to its ARO liabilities primarily due to a higher assumed probability of early retirement of its nuclear units.

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Please tell us your consideration of providing additional critical accounting policy disclosure that allows for an assessment of the probability, magnitude and timing of future material charges associated with early retirement or shutdown of these units, along with a description of the specific events and/or changes in circumstances that could reasonably be expected to result in early retirement or shutdown. Refer to Section V of SEC Release 34-48960 and Item 303(a)(3)(ii), which requires a description of a known uncertainty.

to the Staff’s comment, beginning with our annual report on Form

10-K for the year ended December 31, 2018, we propose revising our discussion of Critical Accounting Estimates relating to Long-Lived Assets included in our MD&A as follows (underline indicates additions, strike-through indicates deletions):

Long-Lived Assets

Management evaluates long-lived assets for impairment and reassesses the reasonableness of their related estimated useful lives whenever events or changes in circumstances, such as significant adverse changes in regulation, business climate or market conditions, could

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potentially indicate an asset’s or asset group’s carrying amount may not be recoverable or an asset’s probability of operating through its estimated remaining useful life changes.

Assumptions and Approach

Used: In the event certain triggers exist indicating an asset/asset group may not be recoverable, an undiscounted cash flow test is performed to determine if an impairment exists. When the carrying value of a long-lived asset/asset group exceeds the undiscounted estimate of future cash flows associated with the asset/asset group, an impairment may exist to the extent that the fair value of the asset/asset group is less than its carrying amount. These tests require significant estimates and judgment when developing expected future cash flows. Significant inputs include forward power prices, fuel costs, dispatch rates, other operating and capital expenditures and the cost of borrowing.

In addition, long-lived assets are depreciated under the straight-line method based on estimated useful lives. An asset’s operating useful life is generally based upon operational experience with similar asset types and other non-operational factors. In the ordinary course, management, together with an asset’s co-owners in the case of certain of our jointly-owned assets, makes a number of decisions that impact the operation of our generation assets beyond the current year. These decisions may have a direct impact on the estimated remaining useful lives of our assets and will be influenced by the financial outlook of the assets, including future market conditions such as forward energy and capacity prices, operating and capital investment costs and any state or federal legislation and regulations, among other items.

The assumptions used by management incorporate inherent uncertainties that are at times difficult to predict and could result in impairment charges or accelerated depreciation in future periods if actual results materially differ from the estimated assumptions utilized in our forecasts.

Effect if Different Assumptions Used: The above cash flow tests, and fair value estimates and estimated remaining useful lives may be impacted by a change in the assumptions noted above and could significantly impact the outcome, triggering additional impairment tests, or write-offs or accelerated depreciation. For additional information on the potential impacts on our future financial statements that may be caused by a change in useful lives of certain of our generating assets, see Note 3. Early Plant Retirements and Note 5. Property,

Plant and Equipment and Jointly-Owned Facilities.

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Similar to the preceding comment, please tell us your consideration of providing investors with additional information that allows for an assessment of the probability, magnitude and timing of future material charges due to a significant shortening of the expected economic useful lives of the Keystone and Conemaugh generating stations, along with a description of the specific events and/or changes in circumstances

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that could reasonably be expected to negatively affect the economic viability of these assets through their currently designated useful lives. Refer to Section V of SEC Release 34-48960 and Item 303(a)(3)(ii), which requires a description of a known uncertainty.

Similar to our response in Comment 1 above, we discuss factors that may impact the useful lives of our generating assets in Note 3. We further disclose the then-current book value of each of our Keystone and Conemaugh interests, including accumulated depreciation, in Note 5. Property, Plant and Equipment and Jointly-Owned Facilities to our consolidated financial statements, which serve as quantitative estimates of the magnitude of the potential for future income statement charges should these plants be retired or shut down earlier then their current estimated useful lives.

The proposed

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revisions to our discussion of Critical Accounting Estimates relating to Long-Lived Assets, discussed in response to Comment 1 above, are also in response to this Comment 2.

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Once you have had time to review our responses to the Staff’s comments, we would appreciate the opportunity to discuss any additional questions or concerns that you may have. Please feel free to call me at (973) 430-6424.

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We note that restricted stock units and performance share units entitle the recipients to dividends. Please tell us if these awards qualify as participating securities as defined in ASC 260-10-20. If so, please tell us what consideration you gave to computing earnings per share under the two-class method. Please refer to ASC 260-10-45-60B.

The dividend equivalent units related to our restricted stock units and performance share units are forfeitable with the base awards. As a result, these awards would not be considered participating securities and therefore, the two-class method for computing earnings per share would not apply to our restricted stock unit awards and performance share unit awards.

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Once you have had time to review our response to the Staff’s comment, we would appreciate the opportunity to discuss any additional questions or concerns that you may have. Please feel free to call me at (973) 430-6424. Read in the reply ↗

In your next earnings release, please provide a more substantive, and concise, discussion of how Adjusted EBITDA is useful to investors. Please provide us with your proposed changes in your response letter.

The Company proposes revising its discussion of how Adjusted EBITDA is useful to investors in its next earnings release as follows (underline indicates additions):

Management believes Adjusted EBITDA is useful to investors and other users of our financial statements in evaluating operating performance because it provides them with an additional tool to compare business performance across companies and across periods.

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Management also believes that Adjusted EBITDA is widely used by investors to measure operating performance without regard to items such as income tax expense, interest expense, depreciation and amortization and major maintenance expense at Power’s fossil generation facilities, which can vary substantially from company to company depending upon, among other things, the book value of assets, capital structure, whether assets were constructed or acquired and accounting methods. Adjusted EBITDA also allows investors and other users to assess the underlying financial performance of our fleet before management’s decision to deploy capital. Adjusted EBITDA excludes the same items as our Operating Earnings measure as well as income tax expense, interest expense, depreciation and amortization and major maintenance expense. See Attachment 12 for a complete list of items excluded from Net Income in the determination of Adjusted

EBITDA. The presentation of Adjusted EBITDA is intended to complement, and should not be considered an alternative to, the presentation of Net Income, which is an indicator of financial performance determined in accordance with GAAP.

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Please revise your next earnings release to begin your reconciliations with GAAP net income rather than “operating earnings.” See Question 102.10 of the updated Non- GAAP Compliance and Disclosure Interpretations issued on May 17, 2016. Also, clearly identify operating earnings as a non-GAAP measure.

Company will revise its reconciliations and clearly identify operating earnings as a non-GAAP measure in its next earnings release. Read in the reply ↗

We note that you exclude major maintenance expense at Power’s fossil generation facilities from Adjusted EBITDA. Please explain to us why this is not a normal, recurring, cash operating expense necessary to operate your business. See Question 100.01 of the updated Non-GAAP Compliance and Disclosure Interpretations issued on May 17, 2016.

While major maintenance for our fossil generation facilities could be considered a recurring operating expense at the company level, we exclude it from Adjusted EBITDA due to the potential diversity of practice for accounting for such costs allowed under GAAP, as discussed below. In addition, at the individual plant level, major maintenance differs from routine maintenance in both scope and frequency.

Major maintenance is dependent upon many factors including, but not limited to, current and expected operating conditions, the age and type of generation, passage of time, and management’s

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discretion to defer or forego the expense. As a result, at the individual plant level, many of the components included in major maintenance expense are infrequent in nature and are highly variable in scope and cost.

ASC 908-360-25-2 Airlines states that there are three acceptable methods of accounting for major maintenance. This guidance has been accepted and applied by analogy to all major maintenance activities. We have adopted the direct expense method to account for major maintenance, which requires expense recognition as it is incurred and is included in Operation and Maintenance Expense in our financial statements. The other two acceptable methods allow for capitalization with depreciation expense incurred over the life of the asset or next major maintenance event. This creates diversity in practice based on methods elected by each company, and for companies that capitalize major maintenance, such spending is excluded from EBITDA by definition.

As a result, we have elected to exclude major maintenance expense from our Adjusted EBITDA. Due to the inherent diversity of the industry’s accounting for major maintenance, investors are able to add these costs as a proxy to depreciation expense to allow for better market comparison of operating performance. We believe our disclosures about costs in each period regarding major maintenance expense increase transparency about our accounting policy elections and allow investors to more accurately compare us to other generation companies in regards to both ongoing maintenance and major maintenance activities.

Given the variability and discretionary nature of these expenses, coupled with the diversity in accounting methods, management believes that excluding major maintenance expense from Adjusted EBITDA is widely used by investors and the analyst community to consistently measure operating performance.

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To the extent applicable, the Company agrees to make the modifications discussed above for PSEG Power LLC and Public Service Electric and Gas

Company.

The Company hereby acknowledges that (i) it is responsible for the adequacy and accuracy of the disclosure in the filings,

(ii) the Staff’s comments or changes to disclosure in response to Staff comments do not foreclose the Commission from taking any action with respect to the filings, and (iii) the Company may not assert Staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.

Once you have had time to review our responses to the Staff’s comments, we would appreciate the opportunity to discuss any additional questions or concerns that you may have. Please feel free to call me at (973) 430-6424.

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We have read your response to comment 3. Explain to us what peer analysis, if any, you have performed to assess whether there is widespread diversity of practice related to the accounting for major maintenance expenses. Further, tell us whether you believe there is any one method that is more prevalent in practice.

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Lastly, tell us whether there are other utility companies that you are aware of that adjust for major maintenance expense.

We have performed an analysis of the most recent 10-K filings of 12 peer utility and merchant generator companies

(similar to PSEG Power) to understand their disclosed accounting policies with respect to major maintenance. While it is not always possible to discern a company’s actual capitalization policy and capitalization criteria from its audited financial statements, our analysis identified at least two companies (as discussed in our recent teleconference) that appear to utilize the “deferred method” of accounting for major maintenance (i.e., capitalize the major maintenance expense and

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depreciate over the period until the next major maintenance event). In addition, while reviewing the disclosed capitalization policies, it appears that a number of companies that follow the “direct expense method” may capitalize costs associated with maintenance if such expenditures meet certain betterment criteria, including extending the useful life or enhancing the productive capacity or efficiency of the generating asset. While it does appear that the direct expense method is the most commonly disclosed method in our analysis, it also appears that the application of the direct expense method can vary company by company.

With respect to peer utility and merchant generator companies that utilize the performance measure “Adjusted EBITDA”, we are aware of at least one other company (as discussed in our recent teleconference) that adjusts for major maintenance in a manner similar to our presentation of Adjusted EBITDA.

As discussed in our recent teleconference, we believe that providing major maintenance as supplemental information, and not as an adjustment to net income in our reconciliation to Adjusted EBITDA, would provide investors and other users of our financial statements with the information necessary to assess our operating performance. As such, we will revise our disclosure relating to, and reconciliation of, Adjusted EBITDA in subsequent filings to omit major maintenance as a non-GAAP adjustment and will provide it separately as supplemental information.

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Once you have had time to review our responses to the Staff’s comments, we would appreciate the opportunity to discuss any additional questions or concerns that you may have. Please feel free to call me at (973) 430-6424.

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