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Crafting a Multifaceted Energy Policy Targeted Beyond Governor’s Term

A change in administration could offer an opportunity to reshape New Jersey’s clean-energy profile, from electric cars to distributed generation

bob smith roundtable
Sen. Bob Smith (D-Middlesex)

In a bid to reshape energy policy in the state, a multibill package is being pushed to promote electric cars, enhance energy conservation, and study the possibility of giving financial incentives to nuclear power as a carbon-free source of electricity.

The legislative package introduced yesterday by Sen. Bob Smith (D-Middlesex), the chairman of the Senate Energy and Environment Committee, would overhaul the state’s energy priorities, pushing policy toward ramping up efforts to improve energy efficiency and away from a reliance on fossil fuels.

Smith’s package incorporates many issues long advocated by clean-energy advocates, including adoption of an energy-efficiency portfolio, which would require utilities to curb energy usage by customers. The policy, adopted by many other states, is of concern to utilities because it ends up trimming their revenue. Smith has yet to introduce that bill, saying it is “under construction.’’

He also is working on a proposed constitutional amendment that would phase out over a five-year period the diversion of clean energy funds to other purposes. The practice, increasingly relied on by the Christie administration, has siphoned off more than $1 billion from a clean-energy fund financed by a surcharge on customers’ electric and gas bills.

For instance, Gov. Chris Christie’s proposed budget for the next fiscal year would allocate $152 million out of the clean-energy fund, primarily to pay the state’s and New Jersey Transit’s energy costs. In the past, the Legislature has griped about the diversions, but approved them.

The package also would propose a couple of measures aimed at installing smart thermostats — one would require the devices be put in new homes; the other would offer financial credits to install them in existing homes. Smart thermostats can lower energy use and bills for customers. A separate resolution in the package urges the state to take steps to have at least a half-million homes in New Jersey outfitted with smart thermostats by 2023.

The legislation also would direct the New Jersey Board of Public Utilities, the agency responsible for implementing energy policy, to undertake a study of several emerging issues.

One measure would direct the BPU to examine the value of zero-emission credits, a type of financial incentive pushed by owners of nuclear power plants to keep their fleet economically viable. With electricity prices depressed, owners of nuclear units are pressing regulators to bolster their viability with subsidies from ratepayers, citing the benefits of zero greenhouse-gas emissions.

Another resolution would have the BPU undertake a study on the prospects for energy storage and distributed generation, which involves localized power sources serving a smaller customer base. Energy storage is deemed critical if intermittent forms of producing electricity like solar or wind power are to take off in the future.

To Smith, clean energy must play a bigger role in New Jersey’s energy mix.

“We have 135 miles of coastline. Superstorms are our future,’’ he said. “We have to set the model to incorporate more renewable energy into our grid. The great thing about solar and wind is it is free. You have to integrate it into our system.’’

The package also includes various incentives — either tax credits or a reduction in energy bills — to promote installation of electric car-charging stations around the state. Motor vehicles are the biggest source of greenhouse-gas emissions in New Jersey and electric vehicles are considered crucial to meeting state targets to reduce carbon pollution.

In another bill yet to be introduced, Smith is working on a measure that would direct any money the state receives as a result of a billion dollar settlement with Volkswagen involving a diesel-emissions scandal. Money from the settlement would fund installation of electric charging stations and be used for environmental justice.

Most of the bills are unlikely to be enacted into law under Gov. Chris Christie, but environmentalists say it is important to get the bills moving through the process so they can be signed into law early in the term of the next governor.

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