The fire was reported around 2:15 p.m. at the inactive plant, located in the 900 block of West Broad Street, not far from the Burlington-Bristol Bridge.
PSE&G officials say there was a small oil fire that started at a building that's being demolished.
The fire was upgraded to two alarms and the Philadelphia Fire Department sent a boat to pump water out of the Delaware River to help fight the fire.
PSE&G says the fire was extinguished, however smoke continues to pour from the building.
No one was injured in the incident.
PSE&G says they have identified no public safety issues related to the fire.
The plant was built in 1914 and has not been in operation in more than a decade.