New Jersey Natural Gas Looks to Roll Out Energy-Efficiency Portfolio

Tom Johnson | March 29, 2018 | Energy & Environment
Utility goes to BPU with $341M filing to fund rebates and incentives for commercial, industrial, and residential customers — including those with limited incomes

energy efficiency
New Jersey Natural Gas yesterday filed an expansive six-year proposal to help its customers reduce their energy usage, seeking to invest more than $341 million in a wide array of programs to help lower bills.

The filing with the state Board of Public Utilities seems to align itself with the aggressive clean-energy agenda of the Murphy administration and its goal of ratcheting down greenhouse-gas emissions, as evidenced by bills now moving through the Legislature.

Essentially, the proposal builds on the Wall Township utility’s successful SAVEGREEN project, a comprehensive energy-efficiency program on which the company spent $150 million since 2009 trying to curb energy use. That program expires in December.

The initiative targets rebates, incentives, and special financing for residential customers, including low-income households, as well as public entities and commercial and industrial outfits.

Innovative programs

It includes a number of innovative programs, such as providing certain low-income customers annual credits on their bills. These would be funded by the value of solar renewable energy certificates generated by new solar installations to be built at utility facilities. The program also includes a pilot at an all-electric development in Ocean County, which would encourage customers to convert some equipment to natural gas, saving up to 50 percent on their energy bills.

The NJNG petition seeks to invest more than $341 million over the six-year program, consisting of approximately $158 million in direct investment and $183 million in financing options, if approved by the BPU. The investment will be funded at a cost of $302 million by customers over the next 30 years.

The average annual impact for the typical residential customers is estimated at $14.74 or 1.4 percent. Expected savings for participating customers will range from 1 percent to 30 percent, depending on the program utilized, totaling $605 million over the 30-year program.

“Energy efficiency is one of the most effective ways to help customers save energy and money, protect our environment, and create a stronger and fairer clean-energy economy,’’ said Laurence Downes, chairman and CEO of New Jersey Natural Gas.

Looping in low-income customers

New Jersey Natural Gas employee conducting home energy audit and inspecting the furnace
The state Office of Clean Energy funds a wide range of energy-efficiency programs, but while all utility customers help fund those efforts through a surcharge on their monthly bills, the benefits often do not flow back to low-income customers because they lack the financial means to replace capital-intensive equipment.

“We are looking to get low-income customers involved in the program,’’ said Tom Massaro, senior vice president of marketing, customer service, and energy efficiency for NJNG. For instance, the utility plans to provide those customers with smart thermostats and no-cost weatherization kits to help them obtain energy savings at a very low cost, he said.

The offerings will provide customers with repayment and financing options and new lower-cost energy-saving measures, as well as special terms for low- to moderate-income households for energy-saving solutions, according to the company.

Saving on gas at the dentist

NJNG also is targeting small businesses, particularly those that have failed to take advantage of energy-saving measures in the past, Massaro said, such as dentists, small retail operations, and tourist businesses.

The proposal will look into the energy-efficiency potential of those smaller commercial customers (using 5,000 therms or less) by providing an energy assessment with coaching and training, along with upfront incentives to cover the costs of energy improvement measures.

The programs also will target public entities with high energy demand —municipalities, schools, universities, nonprofits, healthcare, and multifamily housing. NJNG will offer a range of incentives to cover the cost of energy-saving projects.

“The recurring theme here is not to stop what the BPU is doing today,’’ Massaro said.

The filing by the company comes at a time when a bill pending in the Legislature would ramp up requirements by the state’s seven gas and electric utilities to reduce energy use by their customers by at least 1.5 percent a year.