BPU Urged to Delve into Cost Impacts of Energy Plan

Tom Johnson | September 13, 2019 | Energy & Environment
Consumer advocates and business interests are asking the agency to extend public comment until more is known about the costs of transitioning to clean energy

Credit: Wikimedia Commons
Clean energy
The final public hearing on a draft energy master plan for New Jersey closed yesterday with more questions than answers amid complaints it fails to detail how much it will cost in a state already saddled with high energy costs.

The energy master plan (EMP) aims to transition the state to a 100 percent clean-energy economy by 2050, but some business interests questioned how New Jersey will smoothly shift away from fossil fuels when 85 percent or more homes are now heated with gas, propane, or oil, and 40 percent of the state’s electricity is produced by gas-fired power plants.

As in past hearings, clean-energy advocates called for a moratorium on new fossil fuel infrastructure, a plea endorsed by former Board of Public Utilities (BPU) president Jeanne Fox. But both consumer advocates and business interests urged agency officials to hold off adopting the plan until more detailed cost impacts are ascertained.

“It is glaringly lacking in focus on how much this draft plan will cost New Jersey ratepayers who are already struggling to pay some of the highest rates in the country,’’ said Evelyn Liebman, director of advocacy for AARP New Jersey.

The plan to shift to newer technologies such as energy storage, offshore wind and solar comes at a time when ratepayers face the prospect of rate hikes in the billions of dollars, including a $300 million a year nuclear tax subsidizing PSEG’s nuclear plants, according to Liebman.

‘Cannot ignore’ impact of costs

Ray Cantor, a vice president of the New Jersey Business & Industry Association, agreed with Liebman that the state needs to identify the cost impacts of switching from conventional fuels to new sources like wind and solar. “We cannot ignore the impact on whether costs will still be affordable and reliant,’’ he said.

Credit: Edwin J. Torres/Governor's Office
Joseph Fiordaliso, Board of Public Utilities president
Seventeen of the state’s most prominent business organizations echoed those opinions in a letter to BPU president Joseph Fiordaliso yesterday, essentially urging a delay in adoption of a final plan, scheduled by the end of the year, until those costs are assessed.

Among other things, they want the board to extend public comment until the agency completes modeling on how to achieve the plan’s goals in a “least cost scenario.’’ The modeling is not expected to finish until after the public comment period ends, a flaw that needs to be rectified, according to numerous commenters.

Gary Stockbridge, president of Atlantic City Electric, one of four electric utilities in the state, urged the board to focus on several areas, including more aggressive adoption of AMI, or advanced metering infrastructure, which helps utilities improve communication with their customers.

He also urged the board to move more aggressively on building the charging infrastructure for plug-in electric vehicles. The transportation system contributes 46 percent of the state’s greenhouse-gas emissions. Atlantic City Electric is still awaiting approval of an early 2018 application to install charging stations.

DOT needs to step up

Fox, a longtime advocate of clean energy, said she generally supported the EMP, but argued the state Department of Transportation needs to be more engaged in achieving the governor’s clean-energy goals. “They have to be involved if the EMP is going to be successful,’’ she said.

Others found the plan more problematic. Eric DeGesero, executive vice president of the Fuel Merchants Association of New Jersey, questioned the plan’s assumption to transition homes to electric heating (through heating pumps) instead of natural gas, propane, or oil.

Instead of a capital cost of $4,000 to $7,000 for installing such a system, DeGesero said the costs could range from at least $18,500 for small homes and low-income row houses to at least $21,500, depending upon whether homes are heated with boilers or furnaces.

“Heat pumps will not keep you warm when it is really cold,” DeGesero said.