BPU Budget Slashes Clean Energy Program By $158 Million

Tom Johnson | April 15, 2010
Critics bemoan precedent and predict setbacks in green economy. BPU's scaled-back budget could endanger state's efforts to promote solar power and wind energy

The state today approved a scaled-down clean energy program that critics argued would jeopardize New Jersey’s efforts to promote solar and wind energy as well encouraging businesses and homeowners to reduce energy consumption.

The Board of Public Utilities supported a revamped clean energy budget, which reflects $158 million in reductions mandated by the Christie administration’s diverting of that amount from the program to help plug a hole in the current state budget.

With most of the five-member board expressing regrets that the state’s current fiscal crisis made the cuts unavoidable, the agency approved the revamped budget even though its former president, Jeanne Fox, warned the move established a worrisome precedent that could lead to further reductions in the program in the future.

“We have a fiscal emergency,” Fox conceded, but she warned the precedent established by this move could lead to cuts of $100 million to $200 million in the clean energy program in the future. “This is not taxpayer money. It is money raised from ratepayers,” she said.

That view was largely endorsed at a hearing last month by clean energy advocates, renewable energy proponents and others who feared the cuts would set back New Jersey’s efforts to become a leader in the emerging green economy.

“The biggest issue is the precedent it sets,” said Matt Elliot, clean energy advocate for Environment New Jersey. “The Governor has indicated this fund now is a cash cow,” he said, referring to the surcharge on utility bills that finances clean energy programs. The fund last year raised $740 million.

BPU President Lee Solomon conceded the cuts in the programs were difficult to make, but added “I know there are sure to be hard choices going forward” given the state’s current budget crisis.

Fellow BPU Commissioner Nicholas Asselta agreed. “We’re in a very bad situation. A $158 million contribution from is a small indication of what need to do. No one is happy giving back $158 million in incentive programs,” he said.

Others, however, disagreed. Jeff Tittel, executive director of the Sierra Club of New Jersey, predicted the cuts would “dismantle the most successful program in the country when it comes to handing out rebates for energy efficiency and solar power. This is going to be a job killer.”

Assembly John McKeon (D-Essex) agreed. The chairman of the Assembly Environment and Solid Waste Committee said the proposed cuts would threaten New Jersey’s economic recovery and thousands of green jobs.

“The cuts would set us back billions of dollars in private investment in our state’s green economy that has successfully put thousands of people to work,” he said.