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The costs of going green: Murphy’s clean energy vision raises questions

When Phil Murphy was running for governor, clean energy ranked near the top of his agenda. After the election, Murphy followed up on that commitment and in October 2018 he issued a statement committing New Jersey to “a path of 100% clean energy by 2050,” using wind and other alternative energy sources.

His declaration wasn’t just rhetoric—earlier that year, Murphy signed the state’s Clean Energy Act into law, and issued Executive Order 28 directing the Board of Public Utilities to create a new Energy Master Plan aimed at achieving the green goals.

In addition to caring about the environment, many business owners have been stung by roller-coaster energy prices and welcome an alternative to fossil fuels. But at the same time, say some insiders, there’s concern about being saddled with extra costs during the journey to Murphy’s clean New Jersey.

‘Not by edict’

Egenton

“We always look to engage and participate with the administration,” said Michael Egenton, executive vice president, government relations at the New Jersey Chamber of Commerce. “Rather than mandates, we believe that the governor’s office, the state Board of Public Utilities and businesses should work together to see what’s actually achievable. Environmental concerns and economic ones often go hand in hand, but we need to be sure that all forms of energy are on the table.”

Egenton would like to see the state keep current power providers intact, while “investigating solar, wind and other alternatives. Encouraging more electric vehicles cars in New Jersey, for example, is very good, but it’s got to be done in consultation with businesses, not by edict. Many Chamber members want to participate in the green energy solution, but they also want continuing discussion on the methods.”

While supporting state consideration of “greener and cleaner energy,” Egenton sounded a cautionary note, saying that officials “have to be sure that wind, solar or other initiatives consider the economic, environmental, and ratepayer impact. Energy tends to be more expensive here to begin with, so companies with high manufacturing and production and other energy-intensive activities may be disproportionately impacted by higher fees” associated with green efforts.

Some Chamber members, like PSE&G, are already taking substantive steps to roll out cleaner energy programs. In September 2018, the utility proposed a Clean Energy Future program (CEF) to the state BPU, calling for more than $3 billion of investments in clean energy and advanced technology.

“PSE&G’s proposed investments support New Jersey’s clean energy goals, while putting our customers’ needs at the forefront,” Ralph Izzo, chairman, president and CEO of PSE&G’s parent company, Public Service Enterprise Group, announced at the time. “The investments aim to keep bills lower than they were 10 years ago. In addition to providing safe, highly reliable service, utilities need to help their customers use less energy. This may be the only industry in America making a business case to sell you less of its product.”

The proposed six-year plan includes $2.5 billion of investment and $283 million in other program costs. It would allow customers to use up-front rebates and other financial incentives to “purchase more efficient appliances, smart thermostats and other equipment” in addition to initiatives like seed funding for new energy-saving techniques.

Another CEF component, a $364 million electric vehicle program, is aimed at jump-starting broader use of EVs by supporting nearly 40,000 EV chargers, most of which would be positioned for residential use. It also includes mixed-use and public DC fast-charging; and “EV innovation, including custom projects for airports, ports and other transit facilities and grants for school districts to buy and operate electric school buses.”

How much?

Gov. Murphy’s clean energy plan got a thumbs up from Les Vail, president and CEO of the Gloucester County Chamber of Commerce, but he has some reservations. “Everybody would love to be clean, but I don’t know if it’s doable by 2050,” he said. “At this point, we’re still very reliant on fossil fuels. It’s a great initiative, but can it actually happen, at the state or national level by then?”

A number of Gloucester Chamber members, like South Jersey Federal Credit Union, are ahead of the curve. Some years back, when the financial institution had a new headquarters constructed in Deptford, the project was awarded the Silver LEED [Leadership in Energy and Environmental Design] Certification by the US Green Building Council. The LEED certification is USGBC’s rating system is based on an evaluation of a building’s environmental performance. It’s aimed at encouraging market transformation toward sustainable design and operations.

The credit union’s building scored LEED points for design features that included reducing pollution from construction activities by controlling soil erosion, selecting the location of the building to reduce the environmental impact on the site, special attention to preferred parking for hybrid and fuel efficient and car pool vehicles, providing bike rack facilities, controlling the quality and quantity of stormwater runoff and minimizing light pollution, according to the civil engineering firm Stout & Caldwell Engineers LLC, which was involved in the project.

Still, Vail noted some potential sticking points: “What if a home has a legacy underground oil tank,” he asked. “What will it cost to replace it and who will pick up the tab? Where will the money come from? There are about 300,000 residents in Gloucester County; how will you get them all to turn to new energy sources?”

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