The Energy Equation

[IMGCAP(1)]EDISON, NJ-With natural gas prices rising anywhere from 150% to 200% above 2002 figures and coal prices also on the upswing, New Jersey is looking to simultaneously combat higher energy costs and global warming. The solution: an energy plan that is both economically and environmentally responsible. But not everyone agrees on its finer points. That was the debate yesterday at NAIOP New Jersey’s “Energy Master Plan: Impact & Opportunity” program held here at the New Jersey Carpenter Contractor Trust Conference Center.

On hand were Ken Esser, Gov. Corzine’s chief energy advisor, and Steve Goldenberg, a partner at Fox Rothschild LLP, each of whom shared their views on the proposed plan. A panel discussion moderated by Jeffrey Grant, director of corporate energy at Mack-Cali Realty Corp., followed. Panelists included Lance Miller, chief of policy and planning, NJ Board of Public Utilities; Dr. Clint Andrews, department chair, Rutgers Center for Green Building; Patrick Connelly, president of BOMA NJ and vice president of Matrix Development Group; and Stephen Finkelman, director of sustainable services at CMX Engineering.

Esser kicked off the program by addressing the “800 pound gorilla in the room,” otherwise known as the Garden State’s government-granted $260 million allotment for energy efforts. “While I know it sounds like a large sum of money, it’s very spread out, with $118 million going to weatherization actions, $73 million for the state’s energy program and $75 million set aside for energy efficiency and conservation grants, among many others,” he said.

The focus then moved to New Jersey’s energy master plan, which was first devised in October 2008, after 13 years of relative inaction on the part of the state. According to Esser, the plan offers solutions to energy challenges through investment in energy savings, job creation, building a 21st century energy infrastructure and committing to innovation and further research into new technology.

“The old assumptions about energy are not responsive to the challenges we face today,” Esser said. “This plan aligns New Jersey’s energy policies with our changing challenges and captures the momentum of the gathering green revolution.”

First and foremost, the plan calls for New Jersey to reduce energy consumption 20% by 2020. While this may sound like a tall order, the state plans to offer incentives, rebates and other initiatives that will encourage investment in renewable energy sources such as wind and solar power, with the goal of providing New Jersey with 30% of its energy consumption from renewable sources by 2020.

While Esser said that the state will support offshore drilling, he emphasized that these projects must meet the highest environmental safety standards. Nuclear power is also on the table, but there’s still a great deal of research that needs to be done, not to mention sorting out the high cost. “The big push right now,” Esser said. “is co-generation, which he hopes will ultimately account for 50% of the state’s energy capacity.”

The Governor has also proposed the creation of a State Energy Institute to provide additional resources and collaborations for energy research efforts at the state’s colleges and universities. Smart grid technology will also serve to improve the efficiency and reliability of the state’s current energy infrastructure.

If fully implemented the plan is projected to reduce greenhouse gas emissions in the electricity and heating fuel sectors to 23% below 1990 levels and 33% below projected 2020 levels, as well as stimulate $33 billion in private investment, which will effectively create 20,000 green jobs. According to Esser, consumers will also save big in the form of $30 billion on energy costs between 2010 and 2020.

Still, Esser noted, this plan is not the answer to New Jersey’s long-term energy goal. “This plan buys us more time while we wait for the science community to develop new technologies that are both energy efficient and cost-effective.”

[IMGCAP(2)]Goldenberg followed Esser’s presentation with a critical look at the state’s energy master plan. “Reducing energy consumption 20% by 2020 is a very aggressive goal,” he said, adding that one of the EMP’s proposals–which calls for a 30% increase in efficiency, from the current state code, for new buildings–could incite businesses to build out of state. “If New Jersey buildings are held to higher standards, we may start to lose construction jobs to states like Pennsylvania,” he said.

Yet another part of the energy plan proposes assessing 300,000 buildings per year, which Goldenberg noted works out to 1,000 buildings per day “I don’t think the state is prepared for this,” he said, adding that currently only one building in the state satisfies the proposed net zero requirement, which essentially means that buildings should be autonomous from the energy grid supply; this is achieved typically by producing energy on-site.

According to Goldenberg, a recent Northeast Energy Efficiency Partnership study found that in order to meet a 30% reduction in energy use by 2020, the following would be required: