Business Groups Say Energy Master Plan Could Cause Job Losses, Rate Hikes

Tom Johnson | September 12, 2019 | Energy & Environment
Major organizations urge Murphy administration to proceed with caution in implementing plan to make New Jersey a clean-energy economy

Credit: Hans Hillewaert/flickr
Offshore wind turbines
Most of New Jersey’s major business organizations are urging the Murphy administration to slow down adopting a draft energy master plan, fearing it could spike utility bills and drive jobs out of the state.

In an unusual sign of solidarity, 17 different business organizations told the state Board of Public Utilities (BPU) in a joint letter yesterday the draft plan, if adopted without changes, may have negative implications for New Jersey’s future.

The letter reflects rising fears about a long-range plan that aims to transition New Jersey into a 100 percent clean-energy economy by 2050, a future relying largely on offshore wind, solar energy, and energy efficiency to replace the fossil fuels vital to the economy today.

“There’s a real concern out there among the business community,’’ said Ray Cantor, a vice president of the New Jersey Business & Industry Association (NJBIA), one of the organizations that signed the letter. “If the EMP goes in the wrong direction, it could drive up energy costs and jeopardize reliability of our energy systems.’’

The blowback from the business community suggests the administration may have a difficult time winning approval of its draft plan, especially since a broad swath of environmental groups also are unhappy over its hesitance to enact a moratorium on new fossil fuel projects.

Besides NJBIA, the New Jersey Chamber of Commerce, New Jersey Builders Association, NAIOP (commercial real estate development association), Commerce & Industry Association, New Jersey Chemistry Council, New Jersey Realtors, New Jersey Food Council, Consumer Energy Alliance, and New Jersey Petroleum Council were among those urging a delay in adoption of the plan.

Not Like Christie’s plan

The Murphy administration’s draft EMP reverses course from the blueprint adopted by his predecessor, Gov. Chris Christie, that largely relied on natural gas to power the economy. The draft plan, scheduled to be finalized by the end of the year, focuses on renewable energy and reducing greenhouse-gas emissions, although it stops short of imposing a moratorium on new fossil fuel projects as many environmentalists have demanded.

In the letter, the business groups said both substantive and procedural issues need to be addressed before the plan becomes final.

“Substantively, we are concerned about the EMP’s implementation cost and the long-term impact to the state’s economy, particularly as it effects families and businesses, neither of which are adequately addressed in the draft EMP,’’ the letter said.

Credit: NJBIA
Ray Cantor of the New Jersey Business & Industry Association
The groups called for an independent economic analysis by an outside organization to be undertaken to understand what the costs and impacts will be. “Given the importance of energy costs to our economy, we are extremely concerned that the draft EMP does not address costs or economic impacts beyond minor references to least cost’ solutions.’’

That raises the procedural issues. As part of the overall EMP process, the BPU is simultaneously doing an Integrated Energy Plan (IEP), a modeling exercise to look at alternative strategies to accomplish the plan’s goals in a least-cost scenario. That modeling, however, may not be finished until the close of the public comment period for the EMP.

What can people and businesses afford?

“The EMP and IEP process keeps talking about least cost,’’ Cantor said. “The least cost scenario is not necessarily the most affordable. We can’t have an energy system that people and businesses cannot afford.’’

In the letter, the groups also said that even the draft plan acknowledge certain policies cannot be implemented given the current state of technology. “Technological breakthroughs will be needed in areas such as battery storage, electrification of buildings, zero-emission heavy duty vehicles and transmission and distribution systems,’’ the letter said.

To address those issues, the groups argued the plan should include both longer-term aspirational goals and shorter-term implementable strategies. “No policies should be implemented in the short-term unless they meet the objectives of safe, reliable service at just and reasonable rates,’’ the letter noted.

The BPU is holding more hearings on the draft plan today beginning at 1 p.m. at the Kroc Center, 1865 Harrison Ave., Camden. Business groups are expected to turn out in force as well as environmental groups.