Lecture 2: NJ Energy Master Plan (EMP) Prof. Park UTI-111 Essex County College

New Jersey’s Energy Master Plan The 2008 Energy Master Plan is part of the Corzine Administration’s response to the imperatives of a new era. The old economic order is passing and a new one is emerging. At the same time, it is clear that the old assumptions about energy no longer serve us. Gov. Corzine recognizes that new approaches to energy provide the new pathways to economic prosperity. By offering solutions to our energy challenges through investment in energy savings, job creation, building a 21st century energy structure and committing to innovation and further research into new technologies, the EMP aligns with that new economic order and captures the momentum of the gathering green revolution.

Energy Challenges New Jerseyans use electricity in more ways than ever, and the cost of it --- as with all energy --- is increasing because of economic and jurisdictional factors beyond our State’s borders. In addition, our ability to shoulder our share of the responsibility to combat global warming is thwarted by the State’s aging generation and distribution infrastructure. Unfortunately, because of deregulation, the State has limited authority to procure clean, 21st century power generation.

Solutions in the EMP Through the EMP, New Jersey rejects policies of the past that promise no relief from these energy challenges. Instead, New Jersey is choosing a better future, in which we use energy more efficiently, cut costly peak energy demand, and produce more clean energy right here in New Jersey. This better future means jobs, lower energy costs and a healthier environment. The policies of the EMP will enable New Jersey to assert greater control over its energy destiny and become less subject to uncertainties we face now. The 2008 EMP proposals shift and reorder the way NJ manages energy and which energy sources we rely on to ensure a safe, reliable supply of energy for electricity and heating that is produced in an environmentally responsible manner and is priced competitively.

Maximizing Energy Savings The Plan will close the gap between supply and demand, reduce energy costs, increase reliability and reduce the harmful greenhouse gas emissions produced by NJ through a sustained and multi-faceted effort to make New Jersey more energy efficient. These goals and action items will effectively result in approximately $30 billion in total energy savings between 2010 and 2020 for its consumers, while stimulating $33 billion worth of investment into the State’s energy infrastructure and creating 20,000 jobs.

Energy Efficiency Goals Save electricity equivalent to the amount of power to run 2.2 million homes for a year (20,000 GWh). Save heating energy equivalent to the amount of energy needed to warm 1.1 million homes in one year (110 trillion BTUs). Working with the utilities and by retooling our current energy efficiency programs, building by building, we plan to enhance energy performance both structurally, in the equipment, and by educating the people who interact within the building.

Energy Efficiency Goals We aim to undertake a systematic effort to give our 3.7 million buildings--homes, commercial and government structures -- an energy check-up that will uncover the best ways to improve the building’s performance. We have already improved the energy performance of 500,000 homes, businesses and other structures in New Jersey. Now, we undertake the task of accomplishing more – to improve the energy performance of 300,000 buildings each year between now and In addition, we will promote new laws, regulations and incentive/rebate programs that will make new buildings 30 percent more efficient and require more energy efficient appliances.

Energy Efficiency Goals We will educate the public to understand the value they get from energy conservation and energy efficiency and the value it provides our society as well. As part of that education effort, we will work with the utilities and commercial and industrial users of electricity to curtail their use of electricity use at peak demand times.

Fostering Green Job Creation The efforts we put toward achieving the EMP goals will result in the creation of New Jersey-based jobs. Through an investment of approximately $33 billion by 2020 into our energy infrastructure, we will create more than 20,000 jobs by 2015, including energy auditors, energy service contractors, appliance manufacturers and installers, electricians, insulation installers, window installers, EnergyStar home developers and builders, and engineers.

Fostering Green Job Creation To ensure that New Jersey residents are ready to enter this career field, the state will develop timely and industry recognized job training programs to ensure that sufficient numbers of New Jersey workers have the skills demanded by industry to fill the jobs that are created from the action items in this Energy Master Plan.

Establishing a 21st Century Energy Infrastructure New Jersey’s new economy and approach to energy require an energy delivery system less dependent on “older generation” fuels such as fossil fuels and more dependent on “new generation” fuel sources and which is more local and thus more reliable. New Jersey actually began to make that shift to “new generation” energy sources in Incentives from the New Jersey Clean Energy Program helped make the State home to the first on-shore wind farm on the East Coast as well as to a highly successful solar program that is second only to California in the number of installations. The 2008 EMP will accelerate that shift by increasing the portion of the electric supply that come from renewable sources including offshore wind, solar, onshore wind, biomass and new and emerging technologies.

Renewable Energy Goal Strive to surpass the current Renewable Portfolio Standard goals with a goal of achieving 30% of the State’s electricity needs from renewable sources by By 2020, New Jersey aims to generate 121 percent of its electricity from in-state generation sources. Of that, offshore wind would account for 13 percent, biomass 7 percent, and solar 2 percent.

Renewable Energy Goal Fossil fuel-based generation would decrease from 50 percent in 2004 to 43 percent of the State’s total electricity generation under the EMP. Combined heat and power, a more efficient form of generation that uses natural gas would account for 30 percent of the fossil fuel based generation. There is unlimited potential for jobs, for clean sources of generation and for economic prosperity waiting to be exploited when it comes to new and emerging clean energy technologies. For this reason we have projected a 50 MW carve-out for as-yet unperfected RE technologies. And for this reason the State plans to invest substantially in emerging technologies to nurture this potential.

Committing to furthering research and innovation in NJ New Jersey will rely on its backbone of more than 500 environmental, energy and engineering companies, a long history of innovation and a world-class workforce, to position itself to become a major participant in the clean energy technology sector. We will fortify our efforts to encourage development of clean energy technologies by expanding the Edison Innovation Fund to nurture clean energy technologies and business incubators. We will train a new generation of New Jersey workers to satisfy the demand that the developing cleantech industry will generate. And New Jersey will establish the Energy Institute of New Jersey to support the basic and applied energy research efforts at its colleges and universities.

Changing New Jersey’s Energy Future If we do not get our energy house in order we will lose in two ways. We will miss out on the enormous potential of the green economy with thousands of new jobs and we will spend billions more than we have to on energy instead of on other worthy needs. The proposals of the EMP will save consumers $6.4 billion in 2020 and $30 billion between 2010 and In addition, this plan will result in reducing carbon dioxide emissions to 56.1 million metric tons in 2020, compared to the 84 million metric tons that we would emit if we did nothing. This reduction goes beyond the requirements in the Global Warming Response Act to reduce greenhouse gas emissions to 1990 levels by 2020.

Changing New Jersey’s Energy Future The Plan offers aggressive policies that create an energy system that is responsible and will establish the clean energy industry as a major part of New Jersey’s economy. It will strengthen New Jersey’s economy by reducing consumers overall energy expenditures, while creating jobs, improving the current energy infrastructure and meeting our environmental goals.

Electricity Fact Sheet Where does our electricity come from today? –Based on 2004 data, New Jersey generated 72% of the electricity consumed from in-state generation sources and imported 28%. –Nuclear power provided 47% of the in-state generation, followed by natural gas at 28%, coal at 18%, petroleum at 2%, on-site (including combined heat and power) at 2% and refuse at 2%. –Fossil fuel based generation accounted for 50% of the total in-state electricity generation.

Electricity Fact Sheet Where will our electricity come from in 2020 under the Energy Master Plan? –In 2020, New Jersey would generate 121% of the electricity it needed from in-state generation sources. –This would allow New Jersey to export 21% of its electricity generation to other states. –Nuclear power would provide 36% of the in-state generation, followed by natural gas at 15%, coal at 15%, on-site (including combined heat and power) at 13%, wind at 13%, biomass at 6%, solar at 2% and refuse at 1%. –Fossil fuel based generation would decrease to 43% of the State’s total electricity generation under the EMP. Combined heat and power, a more efficient form of generation would account for 30% of the fossil fuel based generation.

Electricity Fact Sheet How would residential and business electrical bills shift as a result of the EMP? –If the current policies were to continue, the average residential bill in 2020 would be $1,721; the average Commercial bill would be $15,734; and the average industrial bill would be $95,975. –Under the EMP, average residential bill in 2020 would be $1,339; the average Commercial bill would be $9,922; and the average industrial bill would be $68,370. –Under the new energy future for New Jersey, the projected costs for residents would be reduced by 22 percent; commercial businesses by 37 % and Industrial businesses by 29 percent.

Green Jobs Fact Sheet What is a Green Job? –Green jobs involve environmentally friendly products and services or businesses and organizations that concern themselves with improving the environment. How Will the Energy Master Plan Generate Green Jobs? –Meeting the 2008 New Jersey Energy Master Plan’s aggressive targets for energy efficiency, renewable energy, demand response, and new generation will require green jobs in sectors such as solar manufacturing, energy auditing, HVAC installation, and smart grid technology installations as well as design, manufacture, installation, operation, and/or maintenance of new renewable energy and energy efficiency technologies.

Green Jobs Fact Sheet How Does the EMP Prepare New Jersey for ‘Green Collar’ job growth? –Expand efforts that encourage the development of clean energy technologies by expanding the Edison Innovation Fund to invest in innovative clean energy technologies and provide support to business incubators that support clean energy business development. –Develop timely and industry recognized job training programs to ensure that sufficient numbers of New Jersey workers have the skills demanded by industry to fill the jobs that are created from the action items in this Energy Master Plan.

Green Jobs Fact Sheet How Does the EMP Prepare New Jersey for ‘Green Collar’ job growth? –Establish the Energy Institute of New Jersey to support the basic and applied energy research efforts at the colleges and universities in the State. –The Department of Labor has formed an Industry Workforce Advisory Council (IWAC) to convene senior human resources representatives from the energy sector with the State’s agencies working on workforce development, higher education, and training programs.

Green Jobs Fact Sheet How Many Green Jobs Can We Expect in NJ? –The $33 billion of investment into the NJ energy infrastructure stemming from the 2008 EMP is estimated to result in the creation of over 20,000 jobs between now and At peak creation, approximately 8,300 will come from installation and construction jobs; another 7,400 in operations and maintenance jobs and over 4,000 in ancillary jobs.

Green Jobs Fact Sheet What types of green jobs will be created to achieve the EMP goals? –There are two main types of jobs included in the assumptions: One-Time, 12-month installation jobs, including construction; and Annual (permanent) operation and maintenance jobs, including plant maintenance, energy efficiency audits, and energy efficiency installations. These jobs include: Solar manufacturing; Energy audit contractors; HVAC installers; Smart grid technology installations, and many more.