State Strategic Plan Looks To Boost Energy Efficiency, Cut Customer Costs

Greatest savings most likely will be seen in commercial and industrial sectors, typically the biggest users of energy.

A draft four-year strategic plan for New Jersey’s Clean Energy Program suggests enhancements in how it operates will significantly increase the amount of energy savings the program achieves while lowering customers’ costs.

The plan, completed late last month and now circulating among stakeholders, also calls for boosting by $10 million a year funds raised from utility customers to bolster efforts to promote energy efficiency and distributed energy resources, or more localized power systems.

“The programs will improve the environment, reduce utility costs, and provide ratepayers with net lifetime energy bill savings over the proposed four years,’’ according to the report, prepared by TRC, a consultant retained by the Board of Public Utilities to oversee its clean-energy program.

The 82-page draft plan is likely to draw much scrutiny from clean-energy advocates who long criticized the prior administration for not being more aggressive in promoting energy efficiency projects, which serve to lower customers’ energy bills and improve the environment by making large new power plants less necessary.

Its release also occurs as Gov. Phil Murphy has two far-reaching energy bills on his desk to consider. One involves a proposed subsidy from ratepayers to keep nuclear plants afloat. The other ramps up state mandates to rely on renewable energy to produce power as well as increasing requirement to have utilities prod customers to use less gas and electricity.

Part of governor’s clean-energy efforts

To an extent, the draft plan embraces those goals and then some. The draft provides a plan for increasing energy efficiency savings by over 56 percent from the level reached in fiscal year 2018, according to the draft. The lion’s share of the savings would be achieved in the commercial and industrial sectors, typically the largest users of energy.

Those savings would be achieved by increasing benefits for each dollar invested in projects to a much more aggressive marketing and outreach program to convince customers of the advantages of energy efficiency.

For instance, the program is considering starting up an initiative to offer new incentives to distributors of energy-efficient lighting to increase access to equipment that can achieve huge energy savings at a nominal cost. Such an approach would deliver a higher sales-penetration rate and reach a greater number of customers, according to the report.

The strategic plan also envisions increasing spending on energy efficiency and distributed energy resources from the societal benefit charge, a surcharge imposed on virtually all electric and gas customers’ bills. It suggests increasing the amount raised from the SBC for clean-energy programs from $186 million in fiscal year 2018 to $216 million in fiscal 2022.

Raids on Clean Energy Program

That increase assumes raids on the Clean Energy Program, will eventually end. More than $1.5 billion has been diverted out of the program in the past decade, raids that are projected to continue in the new fiscal-year budget offered by the Murphy administration.

The TRC consulting team calculated net customer savings for the proposed portfolio of NJCEP offerings at more than $700 million over the four-year implementation period. It also suggested the plan would result in a 35 percent increase in the level of natural-gas savings in fiscal 2022 compared with fiscal 2018.

The board also released its proposed four-year funding plan for clean energy programs and other state energy initiatives. The numbers will remain static from fiscal 2018 – fiscal 2022: $344.7 million. The staff said the proposed overall funding levels are aimed at minimizing impacts on ratepayers while gradually increasing money to the Clean Energy Program, which should reduce overall energy costs in the state.

The state plans to hold a hearing on both the strategic plan and the proposed budget plan on May 15 at the state Department of Environmental Protection in Trenton, beginning at 1 p.m.

Original Article