Energy policy in New Jersey

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Energy policy in New Jersey
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Quick facts
Energy department:
New Jersey State Energy Savings Office
State population:
8.9 million
Per capita income:
Energy consumption
Total energy consumption:
2,438 trillion BTU[1][2]
Per capita energy consumption:
276 million BTU
Energy spending
Total state energy spending:
$43,214 million
Per capita energy spending:
Residential natural gas price:
$10.43 per thousand cubic foot
Residential electricity price:
15.33 cents per kWh
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Energy PolicyEnergy policy in the United StatesFracking in New JerseyEnergy and environmental news

Energy policy in New Jersey depends on geography, natural energy resources, how electricity is generated, how much energy consumers use, politics and the influence of groups such as environmental and industry organizations. Decisions by policymakers, such as state and local governments, utilities and regulatory agencies, affect all citizens economically and environmentally, and are generally geared toward providing reliable, affordable energy. The cost of energy affects not only home heating and electricity bills, and thus disposable income, but also economic growth, including jobs, investment and the cost of doing business in the state.

How energy is produced and consumed also has an impact on the environment and pollution. Energy policy in New Jersey focuses on both limiting energy use and producing more efficient energy. As the infrastructure for producing and delivering renewable energy sources is not as advanced as it is for energy generation from traditional sources, these policies often require subsidies to make the produced energy affordable, and their effects are difficult to measure.

Energy policy involves trade-offs between providing an affordable, consistent energy supply on the one hand, and limiting pollution and protecting the environment, on the other. How states attempt to balance these two differs between states, and often boils down to costs to consumers versus costs to the environment. This article provides general energy information about the state as the context within which energy policy is made, as well as information about major legislation and public and private groups that play a role in setting energy policy in the state.

See also: Energy policy in the United States for more information on energy policy.
See also: Fracking in New Jersey

Energy overview

State facts

Below are quick facts about New Jersey’s energy climate.

New Jersey

  • is a net electricity importer.
  • has no fossil fuels.
  • has renewable energy in the form of biomass, wind and solar energy.
  • requires use of reformulated motor gasoline blended with ethanol.
  • averaged the sixth highest electricity prices in the nation in 2011.
  • has planned an offshore wind renewable energy standard that will require at least 1,100 megawatts by 2021.[3]

In New Jersey

  • the transportation sector led energy consumption in 2011.
  • the Renewable Portfolio Standard requires that 22.5 percent of electricity sold in the state come from renewable energy sources by 2021, with 3.5 percent coming from solar energy.
  • natural gas is the main source of energy used in home heating.
  • coal and renewable energy resources made up less than 10 percent of net energy generation in 2013.
  • biomass is the leading renewable electricity source.[3]

Available energy resources

New Jersey has no traditional energy resources such as oil, coal or natural gas. As of 2013, New Jersey had three oil refineries despite having no crude oil production. New Jersey does have natural gas pipelines that run through New England and New York. New Jersey's coal-fired generating plants usually receive coal by rail from Virginia, Pennsylvania, West Virginia and Wyoming.[3]

New Jersey has renewable energy resources in the form of solar, wind and biomass. Renewable energy resources contributed less than one percent of the energy for electricity in 2011 according to the U.S. Energy Information Administration (EIA). Biomass is the leading renewable energy resource in New Jersey. New Jersey is also a leader in solar photovoltaic capacity. The Atlantic coast has the best wind energy potential in the state. Within the next few years, New Jersey plans on establishing offshore wind energy production.[3]

Consumption and prices

As shown in the pie chart in 2011 40 percent of New Jersey’s energy use was used in transportation, and one quarter for commercial; the rest was used mostly for residential and industrial purposes. Most of the energy used in the state is in the form of petroleum (used primarily for transportation), followed by natural gas and nuclear power. Per capita petroleum consumption for transportation in the state is above average among the states. This is due to the fact that New Jersey has the longest average commute time in the United States.[3] Generally the price of gasoline in the state tracks closely behind the national average.[4][5]

Energy consumption in New Jersey
NJ energy sector usage chart.png

     Transportation       Residential     Industrial       Commercial
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According to the EIA's February 2014 report, the federal excise tax is 18.40 cents per gallon of gasoline and 24.40 cents per gallon of diesel fuel. In addition to that, New Jersey collects a total tax of 14.5 cents on every gallon of gasoline and gasohol diesel fuel, which ranks it at the 48th highest in the United States.[7][8]

Comparisons tables

The table below compares New Jersey’s consumption and spending for energy, as well as prices for gas and electricity and carbon emissions to those of Maryland, which has similar population, resources and consumption needs because of climate and geography. Also given are the U.S. averages and the state rankings. All rankings are from highest to lowest, so, for example:

  • New Jersey’s rank of 16th in carbon emissions means that carbon emissions are higher than in New Jersey than in Maryland, which has a ranking of 30th.
  • Per capita income in New Jersey is higher than the national average, and similar to Maryland, which at sixth ranks two places behind New Jersey’s ranking of fourth in per capita income.
  • These two states are both placed in the top 20 on population.
  • Overall consumption and overall spending rank are different in New Jersey and Maryland. Per capita energy consumption in New Jersey (at 37th) is somewhat similar to Maryland (at 40th), but per capita spending in New Jersey is different since it ranks 19th to Maryland’s ranking of 39th.
Consumption and Expenditures Comparisons Summary
Type New JerseyMarylandU.S. Figures
FigureU.S. Rank*FigureU.S. Rank*Totals
Population8.9 million115.9 million19313.9 million
Per Capita Income Average$53,6284$51,9716$42,693
Total Consumption2,438 trillion BTU131,426 trillion BTU2797,301 quadrillion BTU
Per Capita Energy Consumption276 million BTU37244 million BTU40312 million BTU
Total Spending on Energy$43,214 million9$23,204 million22$1,394,088 million
Per Capita Spending on Energy$4,89119$3,97439$4,474
Price of Residential Natural Gas, dollar per thousand cubic feet$10.4327$11.4917$12.48
Price of Electricity, cents per kWh15.331013.151512.31
Total Carbon Dioxide Emissions, million metric tons (2010)115.41670.5305,631
*Rank is from highest to lowest.

Homes in New Jersey are primarily heated with natural gas, which accounts for 74 percent of homes. Fuel oil is the next most common home heating source, followed by electricity, LPG, and other sources.

See also: State Energy Rankings to compare all 50 states
Consumption of energy for heating homes in New Jersey
Source New Jersey 2011 U.S. average 2011
Natural gas 74% 49.5%
Fuel oil 11.9% 6.5%
Electricity 11.4% 35.4%
Liquid Petroleum Gases (LPG) 1.8% 5%
Other/none 0.9% 3.6%

Production and transmission

New Jersey produced 386.8 BTU of energy in 2011. Of that 90 percent came from nuclear energy. The remaining 10 percent came from what the U.S. Energy Information Administration classifies as 'other,' which is "assumed to equal consumption of all renewable energies except biofuels."[9]

Energy production by type in New Jersey, 2011
Type Amount Generated
(trillion BTU)
% of State % of USA
Nuclear 351.7 90.93% 4.25%
Other 35.1 9.07% 0.49%

Electricity produced and consumed in New Jersey is primarily from local nuclear power plants, which produce about one half of the state's total production. New Jersey’s Oyster Creek nuclear reactor, which began operation in 1969, is the oldest operating nuclear power plant in the United States. Natural gas accounts for two-fifths of the energy produced in New Jersey. The state itself does not produce any natural gas but receives it primarily from pipelines that bring natural gas to New York and New England. New Jersey's natural gas has traditionally come from the Gulf region. The remaining electricity is produced from petroleum, coal and other sources. Both petroleum and coal are not produced in the state and are imported.[3]

Where electricity comes from in New Jersey[10]
Type Amount generated (MWh) % of state** % of U.S.**
Petroleum-fired 1,000 0.02% 0%
Natural gas-fired 1,995,000 40.57% 0.2%
Coal-fired 126,000 2.56% 0.01%
Nuclear 2,625,000 53.38% 0.33%
Other renewables 120,000 2.44% 0.06%
Total net electricity generation 4,918,000 100% 0.12%
**Note: Because the U.S. Energy Information Administration (EIA) does not include all of a state's energy production in these figures, the EIA totals do not equal 100 percent. Instead, we have generated our own percentages.

Energy policy

Policy Issues

New Jersey has made efforts to increase the amount of renewable energy used in the state through efforts such as increasing offshore wind energy production. The state set a goal of having 6.5 percent renewable electricity by 2009. However, the state did not reach that goal.[11][12]

See also: Fracking in New Jersey

Energy policy is made, executed and influenced by many organizations, both public and private, and is codified in the laws and regulations of the state. Each state’s energy policy involves trade-offs in which energy production and prices are weighed against environmental concerns and efficiency. New Jersey had a renewable mandate of 6.5 percent renewable electricity for 2009. They failed to reach this goal with only 1.53 percent of electricity actually being produced with renewable energy resources.[13][14][15] New Jersey also set energy savings goals of 20 percent savings by 2020 relative to predicted consumption in 2020 in its Energy Master Plan of 2008. However, these goals are advisory and lack consequences if they are missed.[16] As part of electricity regulatory restructuring, New Jersey initiated their Renewable Portfolio Standard (RPS) in 1999. The state legislature has since enacted several significant revisions, generally increasing overall requirements and modifying types of facilities that qualify under the RPS. According to the EIA, "Legislators have also added specific quotas, or 'carve-outs,' for solar energy and for offshore wind energy. New Jersey is the first state to establish a carve-out for offshore wind energy. Overall, the law will require more than one-fifth of the electricity sold in New Jersey after 2021 to come from qualified renewable sources."[17][18]

According to the "2013 State Energy Efficiency Scorecard" published by the American Council for an Energy Efficient Economy (ACEEE), New Jersey is tied for 12th with Arizona, Michigan and Iowa in energy efficiency with a score of 24.5 out of fifty.[19] There are differing estimates about the economic impact of these mandates in terms of costs that may affect prices and jobs, as well as the impact on the environment and pollution. Thus, for example, there are many new studies of what is called the "rebound effect" which refers to the fact that "some of the theoretically estimated gains in energy efficiency will be eroded as consumers consume additional goods and services."[20][21]

Major legislation

  • Senate No. 2036 (2010) was signed by then Governor Chris Christie. Its purpose is to encourage private companies to develop offshore wind farms in the Atlantic Ocean off the New Jersey coast. The goal of the legislation is to increase the amount of renewable energy within the state and bolster the economy.[22]
  • N.J. Stat. 48:3-99 (2005) enacted minimum energy efficiency standards for eight products. The efficiency standards for unit heaters was effective for a little over a year and then preempted by a federal standard in August of 2008.[23]
  • N.J. Stat. 48:3-87 (1999) requires electricity suppliers to disclose to customers details regarding the fuel mix and emissions of the supplier’s electric generation from coal, gas, nuclear, oil, solar, hydropower, wind and biomass. Emissions must also be reported in pounds per megawatt-hour. The disclosures must be made in a way that is easily discernible by the customer.[24]
  • S.B. 212 (2011) stated that wind-dependent energy devices located on a pier within 500 feet of the water line may not be prohibited. These devices must meet other applicable laws and regulations and be an accessory to other purposes of the pier. The current rules, which prohibit wind-dependent energy devices above 500 feet, expired in July of 2013.[25]
  • A.B. 2550 (2009) defines facilities engaged in electricity production using solar energy technologies, photovoltaics and wind energy systems as permitted uses in industrial-zoned areas of 20 acres or more. In order for the wind or solar facility to be permitted for use, the area must be owned by the same person or entity. This law applies to all municipalities in the state.[26]
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Ballot initiatives

Below is a list of energy related ballot measures across New Jersey. These ballot measures cover issues from fracking bans, to utilities and related tax questions.

Government agencies and committees

  • State Energy Savings Office (SEO) was established in 2011 by Governor Chris Christie within the New Jersey Public Utilities Board. It aims "to determine where the greatest opportunities exist for state facilities to save energy and money."[28]
  • New Jersey's Clean Energy Program (NJCEP) promotes the use of clean and renewable energy resources such as solar, wind, geothermal and sustainable biomass. According the their website, "the results [of the NJCEP] for New Jersey are a stronger economy, less pollution, lower costs and reduced demand for electricity." They also offer financial incentives, programs and services for residential, commercial and municipal customers."[29]
  • The New Jersey Public Utilities Board (BPU) oversees the regulated utilities throughout the state of New Jersey. These include services such as natural gas, electricity, water, telecommunications and cable television. The BPU is charged with ensuring safe, adequate and proper utility services at reasonable rates for customers in New Jersey.[30]

Major organizations

  • The New Jersey Energy Coalition seeks to generate support from the public in production and distribution of affordable, reliable and clean energy to meet the increasing energy needs of New Jersey. They aim to do this " through increasing the public’s awareness of the need to keep existing clean energy providers operational, to develop new affordable clean sources of in-state generation and to maintain a suitable transmission and distribution infrastructure for delivering electricity to our citizens."[32]
  • The Mid-Atlantic Solar Energy Industries Association (MSEIA) is an organization established in 1997 representing New Jersey, Pennsylvania and Delaware that advocates solar energy trade. The MSEIA is made of many figures from various fields of expertise. The MSEIA works with local, state and federal governments to encourage and help in the development and rapid adoption of solar installations.[33]
  • Environment New Jersey is a citizen-based organization that seeks to protect the environment in New Jersey and to educate the population about the importance of protecting the environment.[34]

In the news

This section displays the most recent stories in a Google news search for the term "New+Jersey+Energy+Policy"

All stories may not be relevant to this page due to the nature of the search engine.

New Jersey Energy News Feed

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See also

External links


  1. These figures come from the U.S. Environmental Information Administration State Profiles and Energy Estimates, New Jersey Overview. Statistics for population and per capita income are for the year 2012; consumption and spending estimates are for 2011; and prices are for October 2013. Updated pricing information is available on the state's EIA profile. Prices will be updated on this page biannually.
  2. U.S. Energy Information Administration, "New Jersey Overview," accessed February 28, 2014
  3. 3.0 3.1 3.2 3.3 3.4 3.5 U.S. Energy Information Administration, "New Jersey Overview," accessed February 28, 2014
  4. "Gas Buddy", "Historical Gas Charts," accessed March 2, 2014
  5. To compare current gasoline prices in Colorado to the U.S average, go to
  6. This chart depicts the state's energy consumption as reported by the EIA for 2011. Click the image to enlarge.
  7. U.S. Energy Information Administration, "Petroleum Marketing Monthly," February 2014," accessed February 14, 2014
  8. The Tax Foundation, "State Gasoline Tax Rates, 2009-2013," March 21, 2013
  9. U.S. Energy Information Administration, "State Energy Data System, Production," accessed March 1, 2014
  10. These figures come from the EIA State Profiles and Energy Estimates U.S. Energy Information Administration, "New Jersey Overview," accessed February 5, 2014
  11. American Council for an Energy-Efficient Economy, "2013 State Energy Efficiency Scorecard," accessed March 3, 2014
  12. U.S. Energy Information Administration, "New Jersey Overview," accessed March 1, 2014
  13. According to a report called "The Status of Renewable Electricity Mandates in the States," by the free-market Institute for Energy Research, the cost of electricity in states with RPS were on average 38 percent higher in 2010 than in states without a RPS.
  14. Institute for Energy Research, "The Status of Renewable Electricity Mandates in the States," accessed March 24, 2014
  15. Manhattan Institute, "The High Cost of Renewable-Energy Mandates," February 2012
  16. "American Council for and Energy-Efficient Economy", "New Jersey Utility Policies," accessed March 3, 2014
  17. American Council for an Energy-Efficient Economy,' "2013 State Energy Efficiency Scorecard," accessed March 3, 2014
  18. U.S. Energy Information Administration, "New Jersey Overview," accessed March 1, 2014
  19. ACEEE "2013 State Energy Efficiency Scorecard," accessed March 3, 2014
  20. International Risk Governance Council, "The Rebound Effect: Implications of Consumer Behavior for Robust Energy Policies," accessed March 3, 2014
  21. Scientific American, "How Bad Is the Rebound from Energy Efficiency Efforts?," May 21, 2013, accessed March 3, 2014
  22. New Jersey Legislature, "Senate, No. 2036," accessed March 3, 2014 (timed out)
  23. Database of State Incentives for Renewable Energy, "Energy Efficient Product Standard," March 3, 2014
  24. Database of State Incentives for Renewable Energy, "Energy Efficient Product Standard," March 3, 2014
  25. Database of State Incentives for Renewable Energy, "Solar and Wind Permitting Laws," accessed March 3, 2014
  26. Database of State Incentives for Renewable Energy, "Solar and Wind Permitting Laws," accessed March 3, 2014
  27. "New Jersey Legislature", "Senate Rules, 2012," accessed March 3, 2014
  28. State of New Jersey Board of Public Utilities, "Economics Development & Energy Policy," accessed March 17, 2014
  29. New Jersey's Clean Environment Program, "About NJCEP," accessed March 1, 2014
  30. State of New Jersey, "Board of Public Utilities," accessed March 3, 2014
  31. New Jersey Department of Environmental Protection, 2010 Vision Statement
  32. New Jersey Energy Coalition, "Home," accessed March 3, 2014
  33. Mid-Atlantic Solar Energy Industries Association, "About," accessed March 3, 2014
  34. Environment New Jersey, "About Environment New Jersey," accessed March 3, 2014