What’s New With New Jersey’s electrification push?
New Jersey Gov. Phil Murphy (D) is taking a second look at electrification as part of his new plans to accelerate the state’s climate ambitions and secure his title as “America’s greenest governor.” But his willingness to remove natural gas from homes and the state’s energy portfolio disregards affordable and reliable energy production at a huge cost to consumers.
Recall that the state voted in December 2022 to drop a controversial boiler electrification mandate in December 2022. Criticized as astronomical in price, the first phase of new building-electrification regulations would have cost nearly $2 million per unit with around 8,200 boilers in need of replacement.
Regulation and Legislation
Earlier this month, the New Jersey Board of Public Utilities (BPU) voted to establish a stakeholder process to develop plans to reduce emissions from the gas sector. The board’s focus will include evaluating business models that could keep the “gas system intact while accounting for a shrinking customer base” and the “elimination of subsidies that encourage unnecessary investment in natural gas infrastructure.”
While the effort will look at “electric grid readiness to handle electrification of building heating and cooling, as well as transportation,” a bill now in the Senate Environment and Energy Committee would now require the BPU to establish a beneficial building electrification program and electric public utilities to prepare and implement building electrification plans.
Sustained Attacks on Natural gas
The effort is nothing new, however, as activity in the Garden State over the past few years shows the push for electrification has been steadily growing up until Feb. 15th, when Gov. Murphy announced a “six pillar” sweep of broad climate goals ranging from business and home electrification to requiring all new cars and light-duty trucks sold to be zero-emission by 2035.
Three of these pillars come as Executive Orders which accelerate the target of 100 percent clean energy by 2035 (No. 315), aim to install zero-carbon-emission space heating and cooling systems in 400,000 homes and 20,000 commercial properties (No. 316), and initiate a process to plan for the Future of the Natural Gas Utility in New Jersey (No. 317).
Despite Gov. Murphy stating in his announcement that “no one is coming for anyone’s gas stove. No one is walking into anyone’s kitchen. No one is going to be forced to do anything, in any way,’’ this action speeds up the electrification timeline 15 years sooner than the state’s existing goal.
The State’s Electrification Progression
Jan. 2020: Gov. Murphy unveiled his 2019 Energy Master Plan (EMP) as part of Executive Order No. 100 in January 2020. The EMP outlines a roadmap with seven main strategies to reach the goals of 100 percent clean energy and 80 percent emissions reductions from 2006 levels by 2050.
- Notably, it calls for “a transition plan to a fully electrified building sector, including incentivizing appliances like electrified heat pumps and hot water heaters.”
- It further strategizes that “building electrification reduces final energy demand and allows buildings to efficiently utilize clean electricity for space heat and water heat”, as well as “accelerating the transition to electric vehicles allows the transportation sector, currently the largest source of carbon emissions in New Jersey, to run on clean electricity.”
Dec. 2022: The controversial boiler electrification mandate was dropped from the Department of Environmental Protection’s PACT rules.
- The department failed to seek input from lawmakers on the electrification of the building sector nor provide a holistic cost estimate before moving forward.
- Opponents argued its implementation alone would have cost $17 billion. When asked about the high costs of the mandate in September, Gov. Murphy had “no specific comment”.
Jan. 2023: Politico reported that Gov. Phil Murphy delayed revisions to the EMP, so the guiding climate change document won’t be updated until 2024.
- In a statement, Murphy said that the 2024 plan will consider federal clean energy policy funding from the IIJA and IRA, as well as look to “better capture economic costs and benefits” and “ratepayer impacts” of the state’s energy transition.
- While environmental groups and legislative proponents of the EMP raised concerns about stalling development of much-needed green energy goals, industry felt this move widened the goalposts for state lawmakers to take action by giving them an “opportunity for robust debate”.
Feb. 2023: A condensed version of the New Jersey Clean Energy Act of 2023 (S-2978) is put forth by Sen. Bob Smith (D-Middlesex) for discussion in the Senate Environment and Energy Committee on Feb. 16th.
- Shortened from an initial Aug. 2022 proposal, the bill would enact a 100 percent clean electricity standard to accelerate the state’s transition from fossil fuels to reduce greenhouse gas emissions.
- Specifically, the bill sets various clean electricity targets — 75 percent by 2026, 84 percent by 2030 and 100 percent by 2035.
- The legislation is controversial, with both industry and conservationists questioning its requirements:
“Right now, we don’t understand the goals of the bill,’’ said Fred DeSanti, executive director of the New Jersey Solar Energy Coalition. “We don’t know what it costs. We’re not opposing it, but we don’t understand it.’’
“Pushing these numbers upward without any serious means to meet these goals is counterproductive,’’ Raymond Cantor, an executive with the New Jersey Business & Industry Association, said.
While Gov. Murphy’s administration has yet to take any action against gas stoves, New Jerseyans have good reason to be worried about the Energy Master Plan’s call for reducing natural gas usage to a fifth of its current level. The march towards electrifying the state has been laid out, and the costs haven’t been considered – both from an affordability or reliability perspective. As a precaution, New Jersey Republicans introduced legislation to block any bans on the appliance and protect consumer right-to-choose. State Sens. Steven Oroho (R-24) and Joe Pennacchio (R-26), the bill’s primary sponsors, warned that a gas stove ban and appliances are still a long-term goal as the state aims to meet greenhouse gas benchmarks in the Energy Master Plan.