State Plans to Ante Up $30 Million to Rebuild NJ Water Infrastructure

Office of Clean Energy scheme would take advantage of federal matching dollars to make funds go as far as they can

The state is planning to kick in $30 million in clean energy funds to help make New Jersey’s wastewater and water treatment plants more resilient in case of extreme storms like Hurricane Sandy.

The Office of Clean Energy in a revised budget proposes allocating the money to an energy infrastructure trust it is developing with the New Jersey Department of Environmental Protection, according to Scott Hunter, renewable energy administrator for the agency.

The idea is to finance the needed upgrades using an existing environmental infrastructure trust, in but not of the DEP, to leverage federal money expected to come into New Jersey to rebuild from Sandy. The trust has financed traditional improvements to water facilities for more than three decades

By any reckoning, the costs are enormous.

According to the DEP, Hurricane Sandy damaged more than 100 wastewater and water treatment facilities, leaving the state with an unexpected $2.6 billion bill to repair, rebuild, and make the systems more resilient.

Some of the state’s biggest sewage treatment plants were completely flooded during Sandy, an event that caused hundreds of millions of gallons of raw sewage to spill into waterways.

Under the plan being developed by the clean energy office, the $30 million would provide a required state match to anticipated federal funding. The money would be used to finance energy efficiency and combined heat and power (CHP) plants at the facilities.

In Sandy’s aftermath, the Christie administration is pushing plans to build CHP plants at critical facilities, such as sewage and water treatment plants and hospitals and nursing homes to prevent power outages caused by extreme weather.

New Jersey officials say they expect to receive about 40 percent of the $570 million Congress approved to deal with problems caused by Sandy. If so, state officials have said it could provide up to $3 billion in improvements to the water treatment facilities.

Beyond the $30 million allocation for the energy infrastructure trust, the clean energy budget proposal for fiscal year 2014 anticipates setting aside $65 million to help promote CHP, which is widely regarded as a more cost-effective and cleaner way of producing electricity than most conventional power plants.

The spending priorities have drawn criticism from some environmentalists, who question why clean energy funds are being used to promote CHP, a technology that generally relies on natural gas, a fossil fuel.

“Why not are we making these facilities more resilient by spending on micro-hydro projects, solar, and wind?” asked Jeff Tittel, director of the New Jersey chapter of the Sierra Club. That is what happened in Massachusetts, where 30 percent of a plant’s electricity is supplied by renewable energy, he said.

Legislators also are moving forward with a separate proposal to create a three-year program that could furnish up to $5 billion to help make repairs to water infrastructure. The bill, voted out by committees in both the Assembly and Senate earlier this spring, would funnel so-called bridge loans to local governments and institutions enabling them to get a jump on the needed work, Here again, the expectation is that the loans would be repaid with federal dollars.

The legislative initiative has been endorsed by executives of the Environmental Infrastructure Trust, which hopes to have the program operational by the end of July.

Even before Sandy struck the state, New Jersey faced staggering costs to upgrade its water and wastewater treatment facilities. According to a recent report by a blue-ribbon panel of experts, the state needs to invest at least $40 billion to upgrade its water infrastructure.