October 5, 2026 · 27,800 words · 33 speakers · 270 segments
Here.
Is present. Assemblyman Sauickie.
Here.
Is present. Assemblyman Barlas.
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Is present. Assemblyman Walker.
Here.
Is present. Assemblywoman Katz.
Here.
Is present. Assemblyman Spearman.
Here.
Is present. Assemblyman Karabinchak.
Here.
Is present. Assemblyman Bailey.
Here.
Is present. Vice Chair Egan. ASSEMBLYMAN KEVIN P. EGAN (Vice Chair): Here.
Is present. Chairman DeAngelo. ASSEMBLYMAN DeANGELO: Here.
Is present. Chairman DeAngelo, you have a quorum, Sir. ASSEMBLYMAN DeANGELO: Thank you. Good morning, everyone. We have a unique agenda; we have three bills that will be voted on today. We’ll go with them in order; and, then, we have -- for discussion only -- a hearing on the bills that are on the back two pages discussing Department of Energy, which, we’ll have some discussion on, and they’ll vote on that. It’ll give us an idea on how we’re going to -- if we decide to put the legislation together for the Department of Energy. So, first bill on the docket, Assembly Bill 3612.
Assembly Bill Number 3612 supplements the FY 2027 Appropriations Act, and makes a $10 million off- budget appropriation to the NJ SHARES SMART program. The Committee amended the bill to supplement the FY2027 Appropriations Act, rather than the FY 2026 Appropriations Act, and to make technical changes related to how the funds are to be appropriated. ASSEMBLYMAN DeANGELO: Thank you, Assemblyman Karabinchak is the second prime. Would you like to have a statement on that or anything?
Yes, thank you, Mr. Chairman. This is a pretty straightforward bill. We’re looking to absolutely help homeowners and tenants in an expeditious manner to be able to help them be eligible under this grant program to be able to do to get private insurance and have available funding opportunity to consider duplication of benefits. Thank you. ASSEMBLYMAN DeANGELO: Thank you. We have Erick Ford, New Jersey Energy Policy Coalition is in favor no need to testify; thank you, Erick. Cheryl Stowell at SHARES, come on up in favor. Make sure your red light (indiscernible).
I had to read first; it’s been a while. Good morning, Chairman, Vice Chairman, distinguished Committee members. My name is Cheryl Stowell; I am the CEO of New Jersey SHARES. I can’t thank you enough for posting this bill today; this means a lot to not only New Jersey SHARES, but to all your constituents. We’ve been seeing an outrageous onslaught of applications for assistance, as you can well be aware of with the utility rates, what they are with electric and gas. So, I do thank you very much for the time for your consideration today. ASSEMBLYMAN DeANGELO: Thank you, Cheryl. Do any members have any questions for Cheryl? (no response) Seeing none, do any Committee members wish to be heard on the bill? (no response) Seeing none, I’ll entertain a motion to release.
Motion for release.
Second. ASSEMBLYMAN DeANGELO: Roll call.
On the motion to amend and release Assembly Bill number 3612, Assemblyman Kanitra.
Yes.
Is a yes vote. Assemblyman Sauickie.
Yes.
Is a yes vote. Assemblyman Barlas.
Yes.
Is a yes vote. Assemblyman Walker.
Yes.
Is a yes vote. Assemblywoman Katz.
Yes.
Is a yes vote. Assemblyman Spearman.
Yes.
Is a yes vote. Assemblyman Karabinchak.
Yes.
Is a yes vote. Assemblyman Bailey.
Yes.
Is a yes vote. Vice Chair Egan.
Yes.
Is a yes vote. Chairman DeAngelo. ASSEMBLYMAN DeANGELO: Yes.
Is a yes vote. ASSEMBLYMAN DeANGELO: Bill is released.
Thank you. ASSEMBLYMAN DeANGELO: Assembly Bill 4688.
Assembly Bill Number 4688 excludes biomass solar and wind energy systems located on rooftops or exception areas from certain size restrictions and approval requirements applicable to preserve farmland. The committee amended the bill to, Number 1, authorize the construction of biomass solar or wind energy generation facility structures and equipment, provided that, in part, the facilities’ structures and equipment are owned, leased, or will be owned by the landowner, pursuant to an agreement rather than just facilities, structures, and equipment that are owned or will be owned by the landowner pursuant to an agreement under specific conditions outlined under current law. Number 2, exempt a landowner from having to obtain approval from the state Agriculture Development Committee prior to constructing, installing, or operating biomass, solar, or wind energy generation facility, structure, or equipment located in exception areas of the farm. Number 3 revised the bill’s synopsis, and Number 4 make technical changes. ASSEMBLYMAN DeANGELO: Thank you. Assemblyman Bailey, you’d like to (indiscernible)
Thank you, Mr. Chairman; I appreciate you posting this bill today. It is-- This is the day for straightforward legislation. Pretty straightforward-- What this bill is looking to do is to grow our state solar capacity as well as helping farmers save money on their electric bill, or also sell additional power back into the grid. Also, and just as importantly -- and, I think this is where the SADC would be happy about it -- it also cuts unnecessary red tape, which has delayed the installation of solar on unpreserved farmland. I do want to thank the Department of Agriculture, SADC, Farm Bureau for bringing this to my attention, and helping me get the language right on this bill. Farms are currently permitted to install solar on preserved farmland, but that solar can only generate 110% of the energy that they need on the farm, and it can only cover 1% of the entire acreage of the total area of the farm. This is a mostly reasonable restriction, but, in practice, it has resulted in farmers being unable to utilize empty rooftop. As I drove up here today, I drove through the farmlands of Salem County, drove right between two dairy farms. And, you look to where the cows are coming in to be fed, or they’re coming in to be milked, and you see all the different rooftop availability there that could be accessible to them when this bill eventually becomes law. This bill would remove that cap for a rooftop solar usage, allowing them to fill the rooves’ existing structures. It will also remove the cap for non-rooftop solar, other types of generation currently allowed on preserved farmland. And, then, we get to the red tape piece that the SADC appreciates. It removes their oversight over the installation of power generation on exception areas of preserved farms. The original law allowing generation on preserved farms are not preserved and not usually subject to SADC regulation. Removing that oversight makes the law consistent with how exceptionaries are normally treated; it eliminates a time-consuming process that farmers who wish to install solar previously had to go through. So, this is a much-needed update to the statute that will help farmers and do a small part to help farming remain sustainable here in New Jersey, so I encourage my fellow legislators to move forward, positively, pass this legislation today. Thank you. ASSEMBLYMAN DeANGELO: Thank you, Assemblyman; and, I just got a disturbing vision in my head when you would picture yourself going through the fields with cows. I just somehow can’t see you walking through the pasture and the fields. (laughter) But, I will take your word for it, and I won’t challenge it. So, thank you.
Come on down, Mr. Chairman. ASSEMBLYMAN DeANGELO: Al Murray, New Jersey Farm Bureau, is in favor, no need to testify; thank you, Al. And, Doug O’Malley, Environment New Jersey, is in favor no need to testify. Thank you, Doug. Is there any Committee members wishing to be heard on the bill? Yes, Assemblyman Sauckie.
Yes, thank you, Mr. Chairman. But, I just want to say, I heard this bill originally in one of my other committees, the Agriculture Committee, and initially had concerns around it, because, preserved farmland is there to be preserved and farmed. So, I just wanted to make sure that we weren’t moving in a direction that went away from doing exactly that. Like Assemblyman Bailey, as I’ve learned more about it, it became apparent that this really is a good thing. So, I voted yes for it there, I plan on voting yes here today. Thank you. ASSEMBLYMAN DeANGELO: Thank you. Any other Committee members to be heard? Assemblywoman.
I want to thank Assemblyman Bailey for his leadership on this as he highlighted our agricultural community is dealing on various small margins, and, so, anything that we can help them do to reduce cost, be able to generate a little bit of additional revenue is greatly appreciated; and, so, thank you so much for all your leadership and working with us on this bill. Thank you; that’s it. ASSEMBLYMAN DeANGELO: Thank you, anyone else? (no response) Seeing none, I’ll entertain a motion to release as amended.
So moved.
Second. ASSEMBLYMAN DeANGELO: Roll call.
On the motion to amend and release Assembly Bill Number 4688, Assemblyman Kanitra.
Yes.
Is a yes vote. Assemblyman Sauickie.
Yes.
Is a yes vote. Assemblyman Barlas.
Yes.
Is a yes vote. Assemblyman Walker.
Yes.
Is a yes vote. Assemblywoman Katz.
Yes.
Is a yes vote. Assemblyman Spearman.
Yes.
Is a yes vote. Assemblyman Karabinchak.
Yes.
Is a yes vote. Assemblyman Bailey.
Yes.
Is a yes vote. Vice Chair Egan.
Yes.
Is a yes vote. Chairman DeAngelo. ASSEMBLYMAN DeANGELO: Yes.
Is a yes vote. ASSEMBLYMAN DeANGELO: Bill is released as amended. And, then, last bill to be voted on, Assembly Bill 5136.
Assembly Bill Number 5136 requires certain new residential construction to have preinstalled sufficient raceways to allow post-construction broadband cable deployment. The Committee amended the bill to, Number 1, define communications distributions point; Number 2, revise the definition of raceway; Number 3, shift responsibility for installing the raceway from the majority incumbent local exchange carrier within the area to the developer of the new residential construction requiring raceway installation. Number 4, clarify that the bill applies to new residential construction that falls under occupancy group R2 within the building subcode, under the state uniform construction code. Number 5, require the developer of the new residential construction to install a dragline and endcaps when installing raceways under the bill from the building’s designated communications utility room or telecommunications entrance facility, to the nearest existing communications distribution point capable of providing broadband service to the property. Number 6, clarify that raceways are to be solely dedicated for the use of broadband service providers on a nondiscriminatory basis. Number 7, revise the bill’s title and synopsis, and Number 8, make technical changes. ASSEMBLYMAN DeANGELO: All right, thank you. Ladies and gentleman, this bill came out of fruition from discussions with members of the IBEW Local 827 who represent the Verizon employees for the State of New Jersey. So, the first two I’m going to call up, and they come up collectively together, is a Lucas Frank and Tony Isaac, representatives with Local 827 from the International Brotherhood of Electrical Workers. Tony, Lucas. Just make sure, guys, the red light is on the microphone there.
Thank you, Mr. Chairman.
Thank you, Mr. Chairman. ASSEMBLYMAN DeANGELO: Go ahead.
Basically, Mr. Chairman, it’s a straightforward competition bill that allows for wired fiber optic broadband deployment and a pathway for residential new construction. It’s a common-sense bill. As we know through the COVID epidemic, we saw the limitations of the current broadband infrastructure; this will allow that to be rectified if there ever is another pandemic. ASSEMBLYMAN DeANGELO: Anything else you want to add, Lucas?
Having a conduit installed when a new building comes up allows for a future expansion of broadband. Obviously we live in a time where broadband is very, very needed for data centers, for cellphones, for Wi-Fi, for a lot of different stuff that we rely on on a daily basis. And, if that conduit isn’t put in when the new buildings go up, we’ll be very hindered, or it’ll be a very expensive process to bring in a conduit afterwards. So, I think that this is very good for the residents, and for everybody. So, thanks so much. ASSEMBLYMAN DeANGELO: And, just in closing before the gentlemen leave, some of the things during early construction having the raceway being put in before a potential parking lot, or a curbing system, or a driveway, or sidewalks, or landscaping is in place, it’s the opportune time to put it in; a lot of times this infrastructure is not done because of that purpose. And, then, the homeowners or dwelling renters at that time are unable to get a diversity of competition; and, I’ll pick on my own residential home right now, I don’t have -- I have underground utilities -- and, I don’t have a raceway in, and there is no fiber coming to my house, and nor do they want to come through my neighborhood and do that. In my community -- and I’m hearing this from senior communities throughout the State of New Jersey -- the lack of competition; the lack of, “I’m dealt with just the copper lines that are at my house,” and the speed of that infrastructure as everything is changing. This doesn’t say that it comes at the point where it’ll be an empty, vacated raceway and the opportunity to be able to put fiber or the next level of technology in that raceway would be able to surmise itself. Does anyone have any questions for Lucas or Anthony? Seeing none, thank you, guys. If I could have Jeff from New Jersey Builders Association, just has concerns. Jeff.
Mr. Chairman, Mr. Vice Chairman, members of the Committee, Jeff Kolakowski with the New Jersey Builders Association. For those of you who are not familiar with who I represent, it’s a nonprofit trade association for the residential construction industry, and I represent both builders of single-family, multi-family, as well as residential home improvement contractors, remodelers. And, the reason why I mention that is it will be relevant to my testimony. As always, I appreciate the opportunity to come here. I don’t hesitate-- I come here with significant hesitancy to oppose kind of one of your bills, Mr. Chairman, or, as I kind of cross out oppose and put concerned. I do have some more technical concerns with the bill, but, I also want to kind of take the moment to possibly dovetail into the second half of your hearing; on the Division-- Department of Energy, and those bills up there; because, I think there’s a connection between my testimony and this particular bill and the larger picture that we face here in New Jersey. So, your bill individually, Mr. Chairman, my industry usually bristles when they see legislation that amends Uniform Construction Code. We think we have a really solid process there; we adopt a model code every-- We rely on a model code that’s developed every three years, comes to New Jersey -- as I affectionately call them the “code nerds” at DCA -- sort through that, come up with a New Jersey version of that, we move on. We make advancements in fire safety; in energy efficiency; the whole 9 yards. So, I, again, I hesitate when the Legislature wants to maybe get involved in those things and create New Jerseyisms, and little things that -- and some of members operate across state lines, and then, some of these New Jerseyisms go to Assemblyman Bailey’s comments, they turn into little regulatory burdens and costs. And, so, to get, kind of bring it back to your bill here, like, this technology changes. I don’t know what’s going to be the future; how we’re going to deliver the information; what devices we’re going to need in the future. And, we’ve dealt with this issue from an infrastructure standpoint when we did electric vehicle charging stations, and we heard the same arguments that you made about how it’s easier to do it on the front end. Why rip up a parking lot and have to run a larger conduit to eventually take on additional capacity or, in this case, run the additional cable provider. But, at the end of the day, digging a bigger trench and putting in a larger conduit does cost money, and it’s this kind of nickel-and-dime stuff that’s kind of come together and led to our kind of housing affordability crisis that we have right now. And, so, my concern about that-- The more technical way- - I don’t care about the competition; I support your goals -- I think we should have competition; I think we should have competition across all our utility infrastructure. It helps lower prices; it makes New Jersey more affordable from a consumer standpoint; wholeheartedly support the goals of your agenda. It’s just codifying exactly like I’d say a 4-inch pipe. Say the code geeks come along and say, “Hey, we should do a 5-inch pipe.” We now have to come back and amend New Jersey’s law and say now 5-inch pipe. So, I kind of, again, (indiscernible) my hesitancy on codifying these things through statute; I don’t want to go there. To kind of segue in again -- if I’m going too far off field here, please use the Chair’s prerogative and yank my leash here - - to go to the kind of Department of Energy. I think we need to have a larger conversation about these kind of things, the coordination on what type of infrastructure we’re going to need for the future, because we kind of change directions a lot. We were wind, all wind, and before that it was solar, and now we’re kind of, appropriately, taking an all-of-the-above approach. We’re looking at new nuclear options. And, so, I see your bill about the -- I don’t know if it’s your bill or the bills on the agenda -- about the Department of Energy, and it makes me think more broadly about what we need to support where the Governor just announced late last week with we need 350,000 housing units built over the next decade in order to create a healthy housing ecosystem here in New Jersey. And, it makes me think where are we putting 350,000 units? More importantly, what’s needed for those 350,000 units to be created is a whole host of utility infrastructure. It’s not just we have to build out the electrical grid, which, needs its love in and of itself, but I need water and sewer, and I need that planned in the appropriate places to be able to accommodate where this growth should go. We all know we need more housing units; it is a supply problem here. I think we’ve all kind of now agreed to that. I’m very grateful that the Governor is showing leadership on this and realizing this is a whole government approach, and that brings me back to kind of the second half of your hearing, this Division of Energy is looking at more of a, kind of a wholesale perspective. And, I say there needs to be a larger conversation about where the infrastructure goes, because the electrical grid does at times -- when it comes to the residential sites -- it ties into the water and sewer. I want to be able to dig a trench once and put all the utility infrastructure in there. And, there’s also coordination issues when it comes to utilities on poles and stuff like that. I want to be able to have each of the utilities that are tapping into those poles have a coordinated fashion. I think there’s a larger coordination conversation that has to have about the future and how we line up, again, the infrastructure we need here; and, I think there’s a ton of jobs that can come from this, and I think there’s a lot of good. So, sorry for a lot of words on that particular topic, and I appreciate the latitude; I’d be happy to answer any questions the Committee may have. ASSEMBLYMAN DeANGELO: Anyone have any questions for Jeff? (no response) Seeing none, thank you, Jeff.
Thank you. ASSEMBLYMAN DeANGELO: Do any Committee members have any questions on the legislation?
Chairman, I just want to point out one thing about this, because I’ve thought about it and which way I was going to go on it. When I was Mayor of Point Pleasant Beach, one of the things that I’m sure everybody in my town complained about and every other town, “Oh, well, you know my cable prices are too high.” They want the thousand channels, but they don’t necessarily want to pay for the cost of it, and the solution is always, well, why don’t you bring in another cable company? But, they don’t realize the cost that it takes a cable company to kind of build out that infrastructure, and, as we dug into it, in our town the reason that there wasn’t another cable company was simply it was too cost prohibitive to dig up underground and to run all the cable and to do all that. So, if consumers want more competition and want a little bit lower prices, this certainly seems like a competitive and fair way to the cable companies to be able to come into a market and service more people and give them more options. And, that’s why I’m going to be a yes on this. ASSEMBLYMAN DeANGELO: Thank you. Seeing-- Yes, Assemblyman.
Quickly, Chairman, thank you. Just to the last gentleman’s comments about the cost up front, you mentioned in your own residential development, they aren’t doing the digging. They actually did that in mine. And, I got to tell you, that’s got to cost more than doing it correctly up front. I mean, the equipment, and the boring through the right of way, hitting sprinkler heads and things like that that they had to deal with; all that’s got to outweigh what it would cost to do it up front. So, I think doing it up front and preparing in advance is the way to go. Good bill, thank you. ASSEMBLYMAN DeANGELO: Thank you; any other Committee members wish to be heard? (no response) Seeing none, I’ll entertain a motion to release.
Motion to release.
Second. ASSEMBLYMAN DeANGELO: Roll call, please.
On the motion to amend and release Assembly Bill number 5136, Assemblyman Kanitra.
Yes.
Is a yes vote. Assemblyman Sauickie.
Yes.
Is a yes vote. Assemblyman Barlas.
Yes.
Is a yes vote. Assemblyman Walker.
Yes.
Is a yes vote. Assemblywoman Katz.
Yes.
Is a yes vote. Assemblyman Spearman.
Yes.
Is a yes vote. Assemblyman Karabinchak.
Yes.
Is a yes vote. Assemblyman Bailey.
Yes.
Is a yes vote. Vice Chair Egan.
Yes.
Is a yes vote. Chairman DeAngelo. ASSEMBLYMAN DeANGELO: Yes.
Is a yes vote. ASSEMBLYMAN DeANGELO: Bill is released. Thank you, everyone. Now we are for-discussion-only hearing. Kind of-- We have-- There was potentially two pieces of the legislation that were written. One is by Assemblyman Greenwald to establish a Department of Energy. And, second bill was by Assemblyman Karabinchak was to establish a Division of Energy Resources and Development, transfers certain responsibilities from the BPU to this Department of Energy Resources and Development. All relying around energy and what we, this Committee, has been dealing with over the past couple years. We see the challenges; this Committee has taken an enormous amount of time outside of the State House, going to nuclear reactors; going to natural gas generation; going to PJM seeing what the grid is. There’s new members who have gone for the first time, and next week we’re going back to PJM to see the operation of that. Seeing switchyard substations; seeing all the different complexities of this Committee, and I appreciate your time on venturing out and giving yourself education on that. So, we have a Board of Public Utilities. And, that’s an entity, like an authority, appointed by the Governor, confirmed by the Senators, and they’re sitting there and they’re indirectly working for us here. They’re working for the ratepayer; they’re working for everybody collectively. I know Federally we have a Department of Energy. And, if I was the Governor, I’d want to have a Department that is working so that I’m not solely relying on the work that comes out of the Senate or the Assembly to give me advice. And, a lot of times, sometimes things get diluted or changed, and -- not that I am an energy expert to the umpth degree -- but I’m somewhat knowledgeable in the industry to give some guidance and direction and answer questions fairly to everyone to the best of my ability. But, there is politics that sometimes play roles in what we do here and so having this discussion on, should we be moving more in that direction? That’s why we’re here today before we drop a piece of legislation, because everybody here is seeing a lot of bills written that are close to each other, and there’s 80 of us in the Assembly, and another 40 in the Senate. We don’t all talk all the time, every day with each other, to see what the heck we’re all doing, so, I sure thought that would be a good idea to have this kind of discussion before we move forward. Does any member have any opening statement so you can hold that ’til the end, you can speak twice, I don’t care. But, if you just want to listen to what everybody else does first, and then maybe we’ll do a round discussion on that first, that’d be great. Ms. Fox, the Commissioner from the Board of Public Utilities, if I could please have you come up. And, if you could, just make sure the little -- I don’t have a red dot -- yes, there you go, you got a red dot. Perfect. Thank you. JEA N N E F O X, J.D.: Well, thank you for inviting me; this is an important committee. I think, some of you-- I’ve known, some of you for quite a while, while others I don’t. And, I’m going to say up-front that if I could ever be helpful to you and your staff regarding any of this-- I just retired from teaching as an adjunct professor at Columbia this past spring, because my husband decided to retire. So, I did 12 years there; it was great; a lot of interesting topics; I can provide you with that or your staff has it. So, these two things-- I looked-- I was asked about this, I think, on Friday morning, and I glanced at the Majority Leader’s bill; we want a little bit closer than 404, and I’ve known Lou Greenwald since way back. I’m originally a South Jersey girl. And, there’s a lot to it that’s positive, but it’s also obviously, as been told by staff, there are some obviously some problems and difficulties with that. I want to note that we had a Department of Energy back in the late ’70s and early ’80s, a Joel Jacobson, for you old guys, like me, would remember that name. They actually -- Legislature -- merged it into the Board of Public Utilities when I was a young attorney there. In 1991, when Governor Florio made DEP, DEPE, the last “E” for energy; I’ve had made reference of my career dealing as an active fighter on the climate change and the climate crisis front. That’s what my career has been about, and that’s going to help do my small part until I die. I should also mention that, upfront, my bias, my concern, when developing a sustainable future and all the programs that we need, I was with the BPU first as a civil servant, an attorney, Deputy Director of Solid Waste -- two years of hell -- Director of Water and Sewer, and then when Florio came in and, in 1990, became Chief of Staff there, it was my first political appointment. And, I have a strong bias concern, when who pays for what, based on my time as a staffer at the BPU. I’ve always been concerned that ratepayers should not pick up the cost for most of the programs and projects needed to reduce emissions -- greenhouse gas emissions. And, that was due to my first 10 years at the Board, and I became very sensitive, and still am to this day as to who will pay for capital improvements, but also for special programs. On the other hand, in my 10 years of environmental at DEP and EPA in between those BPU years, I found that the environmentalists, including those excellent staff people at DEP and EPA, really don’t worry about who’s going to pick up the cost. And, clearly, when I was in those two positions for those 10 years, I hit hard on that, because it was important to me, being a working-class person myself, and having family that way. I know that the Sherrill administration, and you, the Legislature, have a top concern of affordability, that’s always been my major concern. So, in 2002, I wanted to go back to the BPU and not to DEP, because, at that time, after transportation, electricity generation was a major source of greenhouse gas emissions in New Jersey. So, within the existing laws, we did what we thought needed to be done at the BPU. We created the now robust clean energy program, from scratch by the way; we invented the solar car at IE; the first SREC in the country or in the world; we designed a statewide energy efficiency program that was quite effective; we conducted the first offshore wind study in our hemisphere in 2003. And, I was very active in creating RGGI, and actually, but for me, the State wouldn’t be getting any of the RGGI money. I fought that with my fellow environmental and utility (indiscernible). At the BPU we were inventive; I hired some great staff; there’s a guy named Mike Winka who retired maybe three years ago, stole him from DEP; he was the founding clean energy program director, and he was awesome. We worked very closely together. But, we also hire-- We always have good staff in that area. We always had in my entire career, significant, significant -- not legislative requiring -- significant public and stakeholder input. We had public hearings around the state the first year I was there as to what people wanted. I created a Clean Energy Council; which has three committees: One on renewables; one on energy efficiency; one on community outreach. And, that council included several agencies: the Federal DOE; EPA; EDA; DEP; Environmentalists and Utilities; some renewable energy and energy efficiency experts. All those meetings, committee and otherwise, were open and we got public comments in. Back then, Mike Winka and I discussed the possible creation of a standalone state energy office, because other states had done it; it is still a trend. Probably, we thought, located within Governor’s office, like some other states do, but I was told it might not be constitutional because the constitution basically says Governor’s office says policy, it doesn’t do programs, the office itself. I think the current BPU can work well like we did 2002- 2010. Obviously, it was stakeholder and public input. There are some things that would need to be changed. I think the current president, Ben, is fantastic; he’s totally capable of doing this. He has some good staff -- they’re hiring some good staff -- the Governor’s policy office has some three excellent people who are working on this, and they work very closely together. There’s other things that would need to be rectified, though. For instance, NYSERDA, and I know quite well, because the chair and the board NYSERDA, they have 13 members who are the board, is a friend of mine, (indiscernible), and I actually know the Public Service Commission Head is there, as well. NYSERDA is a completely different animal, and, throughout the country, most of these energy offices were completely unique animals per state. NYSERDA has the authority for a separate procurement process; the BPU doesn’t. So, the BPU has to follow a Treasury procurement; it takes -- I think with the nuclear program -- I was told it took six months to be able to get a consultant on board; not good. However, when the Power Act went through, your Power Act, they moved that more quickly, so it is possible. There’s a group called NASEO, National Association of State Energy Officials; the BPU President is officially a member of that. I went to some of those meetings; but, Mike Winka, who is (indiscernible) director, handled most of that, something that’s not good we probably need more involvement. So, the BPU could function better. It needs to focus on things that -- I’m not sure if it’s collecting now -- in addition to procurement; energy data and energy planning, which would actually be useful. An independent state energy office would give the Governor more direct control; but, as you well know, it is a separate state energy office if established is a lot of issues, and I wrote down a bunch of them that you’ll need to consider, and I can work with your staff on that. Where the energy office is actually located, though, is very misleading. I have numbers I can give to your staff; because, I talked to Jeff Genzer, who’s a good friend of mine, who’s been the lawyer for NASEO for -- Jesus -- 30 or 40 years, and, the President of NASEO, recently. And, it depends-- The question is, who, what entity in the government does the Governor and the Legislature listen to as the energy expert? That’s different and maybe it’s for good state, even though I may have had numbers that I can give you, but, like California Energy Commission, California’s all over the place. They have a Utility Commission; they have an Energy Office; they have a -- all over the place. And, yet, they’re not cabinet level, even though California does a lot of great stuff, and New Jersey frequently follows their lead. So, there are states-- There are a lot states who do good work; best practices is the way to go for clean energy. That’s what we started with, energy efficiency; I went to that national group, ACEEE on that. When it came to the solar and wind sector, we created that; we were inventive here. We did it within our current legislative authorities. Other states, Virginia-- I mean, I could talk about Maryland, Virginia or other states and what they do. Some are located in their environmental agency, like Florio had DEPE. Some don’t even have appointed directors by the Governor; there are literally civil servants who do this as part of another department. And, there are some small energy offices as well. As you’ve been told, there are only three states where the state energy office is within the Public Utility Commission: Kansas, South Carolina, and New Jersey. But, then, it depends on who those people are and what the relationship is, what their authority is to the Governor’s office and to you all. So, there’s a lot of numbers I can give you guys if you’re interested in it, but, it’s tough. It would be a good thing to do; but, it would take a lot of time and effort to do that. I know EDA gets a lot of the RGGI money; I was instrumental, as I said before, getting the RGGI money to the states and not to the generators. EDA gets 60% of the RGGI money. They used that for great projects. So, when I was at Columbia, I was working with the EDA on some projects, and what they were working, like community solar and other things. So, we already had that system set up here, so that when we go to break stuff out of EDA and what they do to this office, BPU had some good staff (indiscernible) energy; they’re hiring more. So, my concern is really that if you put this into a group - - and I can talk to you or your staff people about it -- into a group if their concern is doing this program, who’s going to be concerned with the cost? Who’s going to pay for it? Personal opinion: It really is a societal cost; it isn’t just for ratepayers. Sometimes the Legislature decides to do something and they give it to the BPU because the BPU gets in trouble for raising the rates. I would suggest that’s not the good way to do it. I’m open for questions now, and I could give your staff more information later. ASSEMBLYMAN DeANGELO: Thank you. Does any Committee members have any questions? Assemblyman Sauickie.
Thank you, Chairman. Ma’am, I think I heard you say, “between the years of 2002 and 2010” you thought the BPU was doing a good job. Not a loaded question in any way-- Since then, what do you think has changed that they’re not as good as they were during that time period?
I stand as a Commissioner not President for four years under Governor Christie. I got along very well with the presidents, and I did-- I was Chair of the National Association of Regulatory Utility Commissioners Environmental Committee; so, I spent a lot of time on that. This is like-- This is 2010 to 2014; energy storage; geothermal; distributed energy resources; that kind of thing. So, I worked closely, I got along with the presidents; New Jersey didn’t do much. But, I think that’s because the Governor was thinking about running for office. And, therefore, those eight years, not much got done. I actually left, in large part, because Jon Corzine had lost the election. I believe that we would have had offshore wind in the state waters, which is in 3 miles of Atlantic City, four, five, maybe six wind turbines, which would have been the first, obviously, in the country. Didn’t happen because Corzine lost the election.
Just a couple more questions, Chair. I think I heard, too, that you believe the separation could be good for reduction of red tape. Is that a fair statement? You mentioned a procurement process, and--
Well, you guys have handled that without breaking them apart. BPU needs specific authority to procure; it’s not in the typical Treasury procurement department. I’ve dealt with the Treasury procurement department for a long time in my career at DEP and at the BPU. Good rules for typical procurements. But, the clean energy, you really need to-- You don’t want to give a contract out that’s a no-good contract; you always want a good contract. But, now I guess (indiscernible) that there are a lot of companies who can bid on these contracts. But, BPU really needs a quicker procurement process than what they currently now have.
Last question. What I’m struggling with, going forward, if we went in either one of these directions is, who would be responsible for the energy master plan and really driving policy? From what you’ve read and what you understand, where do you think that falls?
Well, the energy master plan, the ’08 one, and, again, a lot of staff might blanket a lot of staff involvement that worked with the Governor’s office on it. It was delayed for about a year because of the Governor’s office, but I won’t go there. As in the BPU is, you have a committee, and all of the relevant agencies and other departments are a part of that; some are active, some are not active. So, EDA was active; DEP to a degree active; some others not so much. If there is a state energy office, they would be in charge of the energy master plan. But, they should have the BPU President on it, the DEP Commissioner or their delegate on it, that kind of thing where they would meet and discuss, because there’s a lot of overlap. EDA works very closely -- has been working very closely -- with the BPU quite a while on this stuff, and I think they have a decent relationship with DEP as well.
OK, thanks, Chair. ASSEMBLYMAN DeANGELO: Any other Committee members? Assemblyman Walker.
Thank you, Chair. Thank you, Ma’am, for coming here and sharing this discussion with us this morning. I’m just curious to know, because I think you said it in the early ’70s, we had a Department of Energy? Why did the State discontinue it?
Ask Governor Kean.
Oh, OK, that’s why.
But, they were good people. I mean, because I was there; I just started as a young attorney. By the way, I was the only woman attorney out of 15 attorneys at the BPU. But, be that as it may, the really good people that came over from the energy office, and Joel Jacobsen became a Commissioner. So, there were only three commissioners back then. So, I don’t know the political reason, but my guess is it was a political reason.
Thank you. ASSEMBLYMAN DeANGELO: Anybody else? Any other Committee members who wish to be heard-- Assemblyman Kanitra.
Thank you, Chairman. So, you from your background, how many years have you been in the BPU?
I was a law clerk there in 1976.
OK.
I started as an attorney in ’81. In ’85 I became two years-- I was a Director of the brand new Division of Solid Waste, which the wisdom of the Legislature decided we should regulate as a utility. Organized crime ran the business in New Jersey, Philadelphia, New York; that was the scariest two years of my life. Then Barbara Curran, who was President of BPU, had been -- became a judge after this. A quite major record in the Water and Sewer Division, which was also civil service. And, I was in that position for three years. When Florio got elected, a guy named Scott Weiner, who I did not know, who is now one of my friends, but, was treasurer, I think, for the campaign, became President of the Public Utility Commission. I wrote him a 10-page memo about how to reorganize. He made me his Chief of Staff, which was my first political appointment.
OK, so, 20 years?
Yes-- Ten years, and then 14 years as the Commissioner.
How have our utility costs risen over that period of time?
(laughs) Well, I was involved in the breakup of AT&T, Ma Bell--
OK.
A lot of good stuff; a lot cheaper and all that kind of stuff--
How about our energy costs; I’ll make it simple.
OK, energy cost, it’s gone up a lot.
I’ve got-- I looked into it, it looks like in about 22-23 years, it’s gone up $1,000.
Yes. PJM -- as I think all of you know -- PJM and the capacity market is (indiscernible). I was against -- as a Commissioner, and a very active Commissioner, President -- against the capacity market when it was created by PJM, for just the reason that we’re dealing with it now.
Were we making decisions based on climate change 20, 25 years ago?
I was. ASSEBMLYMAN KANITRA: OK.
Because, we knew-- I went to the BPU because- - Other than transportation, electricity generation, we stay out of coal plants, was a major source of carbon emissions.
And, now, we don’t have any coal plants in New Jersey--
Yes.
--and we’re buying 25% of our energy from other states where they’re using coal energy, so that’s an interesting dichotomy. But, you said a couple things, and I pointed out, you led with kind of your first comments were about climate change, and then later on you said, “One of your priorities was affordability.” How do you think that climate change and affordability can-- Your climate change goals can actually work with affordability given the cost comparison to say, natural gas and wind and everything else.
Natural gas is really a fuel that gets us over the hump.
Do you like natural gas?
It’s not the administration’s position. My personal position -- I really need to study this; the BPU staff have to study this -- it’s very complicated and go to national experts and all that, which they can do. Natural gas is a fuel that gets us to where we need to be. Obviously we’ll have better batteries, batteries (indiscernible). I just put in, even though I don’t like the owner, a battery on my house. So, we have solar in New Brunswick, we have a battery on it. We can now -- if another Sandy comes along -- go offline (indiscernible).
I hear what you’re saying about batteries--
So, so-- But, homeowners can, in fact-- Energy efficiency is the most important thing. We started stuff back then when we went into homes in Newark, who were low-income people. They were old houses, and we did whole building energy efficiency audits. That cut the bill a lot.
Do you like natural gas?
Bottom line, no, but-- ASSEMBLYMAN DeANGELO: Assemblyman, let me ask you if I can--
--I think that’s a very fair question, Chairman.
-- it’s still needed. But, it’s better than coal, obviously, it’s a transition fuel to where we can, in fact--
OK, fair enough. Do you like nuclear?
My personal feeling is, no.
OK.
Just because of the nuclear waste that will be there for a long time, and it’s distributed in 103 different places all over the country.
And, you-- One of the quotes that I had here was, you “were very active in creating RGGI.” What are your thoughts on the extra hundred bucks a year that RGGI has cost of an average house?
Well, it-- There’s things to be studied. And, it’s really that the cliff between New Jersey, RGGI, and Pennsylvania that’s a big problem because of PJM. When RGGI was started, PJM wasn’t as big as it is now. And, so, the issue was to get the emissions down. We have that border with Pennsylvania, which is a problem. And, it’s something that needs to be looked at. I think RGGI’s intent -- and mind you, we started negotiation from 2002, 2003 -- I think it was signed by the MO’s by the Governors in 2005, that was Codey. So, I think RGGI at the time was a good thing. You now have to-- And, things have changed. We got with PJM and capacity markets; you’re really going to have to balance--
I at least like hearing that things have changed, and that’s important, but, I think what’s important to look at is that, the fact that this Committee is even considering separating these things out. If we’re being blunt, it seems to signal that the Majority is almost on a wavelength where they don’t think that BPU can effectively get us out of the cost crisis that we’re in right now. And, you said that you don’t like nuclear, and you didn’t say that you like natural gas--
I wouldn’t close down the nuclear plants in South Jersey, that’s for sure.
So, I think, my personal opinion is, all this ideology and climate change is why we’re in this cost crisis, and I think the fact that the Committee and the Democratic leadership is even looking at separating this out is because they can’t trust the BPU is going to move us in the direction that we need to go to get us out of this. So, I would ask you, what would you say to that? Because, the whole point of this Committee is to really kind of--
I agree.
--feel that whole thing out in a much more diplomatic way than I could ever put it.
And, it was raised last year before we got a new Governor, right; this issue was raised? I personally think that the current President of the BPU is capable of doing this. The Governor’s office people were very good; they work closely together. Ben has immense knowledge from his time at Wood Mackenzie and Grid Edge about these things. He’s hiring staff; he’s still hiring more staff. He needs some Federal staff in some areas; he has some great staff, there’s that Ph.D. program you probably know about, through Rutgers-- Anyway, great Ph.D. people, and other agencies are also there. My personal recommendation would be to give them some time because I think it’s doable, and you really-- One thing about the BPU handling: Control of the utilities and having utilities do what we want them to do. And, they’re also the place that decides any mergers, any rate cases, anything that happens with the utilities, that’s the BPU; kind of is helpful when you want them to do things on the clean energy side.
I hear you, so-- ASSEMBLYMAN DeANGELO: Jeanne, let me just ask you, just to confirm. So, not to cut you off, Assemblyman. Right, so, we don’t want this discussion that’s going to go on like on your personal views; we’re just talking about the creation of this, because we could be here all day. What I’m trying to kind of get at here is the ideas of this and your dialogue back and forth, I appreciate that. When you say utilities, majority of the room doesn’t understand that our four utilities in the state don’t generate energy.
Yes, you totally left with the gas-- ASSEMBLYMAN DeANGELO: Right, there are transmission distribution, but we say our utilities, everyone’s expecting them to be the generators, and that’s not the case. And, as I kind of -- good dialogue going back and forth, whether your personally preference on nuclear or not, or natural gas, listen, it’s the decision of--
Not my job. ASSEMBLYMAN DeANGELO: --the legislation that we pour out of this, because I don’t know what your opinion was back when we did the subsidies for nuclear reactors, that we held, because the Committee here thought -- the Joint Committee -- thought it was in the best interest to move that forward. So, if I can give you a little latitude, just so it’s not-- I don’t want to turn this into Republican/Democrat; this has been (indiscernible); I just want to calm it down.
It’s actually supporting Majority, I was just saying the stuff that I don’t think you guys can say--
I think there was seven--
--but the one thing--
Seven electric and gas companies who are absolutely necessary to help us do the clean energy program; some of them had done good work.
Well, I appreciate all that; I think I made plenty of my points. The one thing that I would end with, which, I think compliments what the Chairman says, but, ties to my question about if the BPU could even move us, be responsible for moving us in a direction that would actually lower energy costs. Your own quote said that when you were talking about climate change that, you “had developed a strong bias based on your time at the BPU,” and I think that we have seen that that is rife throughout the entire BPU with a lot of things, and that’s one of my biggest concerns, so, thank you.
Well, that was the (indiscernible) had lower cost for ratepayers, electric, and gas.
That was right after you--
That’s my bias, and water act.
That was right after you talked about climate change being the top priority, though.
Yes. ASSEMBLYMAN DeANGELO: Do any other Committee members have any questions--
Mr. Chairman-- ASSEMBLYMAN DeANGELO: Seeing none-- Yes, sorry.
If I could-- As you know, I have to step out for a minute, respectfully. I just wanted to say one thing. What I’m wrestling with, and what I’m hoping to understand -- and I will come back, hopefully, in a little bit to hear the rest - - is, the separation from BPU, I mentioned it just now, is, where ultimately does the energy master plan live, and who is driving those policies? Again, this isn’t, again, to drive any kind of wedge, but, if we agree there’s a need for something like nuclear or natural gas to help get us out of this long term-- We’re nine months in to the new administration with new leadership under the BPU, which, I’ve probably been as critical as anybody on the BPU. I have not been so far because I have read the gentleman’s background, and it does seem like he has a lot of experience, which I think we were lacking. But, we’re nine months in, and we still don’t have shovels to the ground on anything new from natural gas or any new nuclear. So, I do-- I do have concerns about where is that policy and the drive of those policies going to live going forward. Whether we go one of these two routes or we stick with the BPU, maybe try to help improve it. ASSEMBLYMAN DeANGELO: Yes, and I believe that through the discussion from this Committee and the other individuals that are testifying will let us know whether we need a Department of Energy solely under the executive branch, or some sort of hybrid partnering in with the Board of Public Utilities, or just leave it the way it is now. I can tell you that this Committee has held up a lot of things, and especially the Assembly side. Even when the Senate has passed it. Because, if it wasn’t for the work here, we’d be 100% renewable by 2035. And, I’ve expressed and showed everybody the problems that would have been implicated with that. It’s not my expertise, it’s just putting everything together, and it’s disagreements with individuals that may be with the Board of Public Utilities, or the importance of nuclear, or the expansion of natural gas. As I tell people -- or the continued growth in renewable energies, and what type of renewable energies we need to do. And, even the discussion of should we be when Christine Todd Whitman deregulated us. Was that a -- maybe a good decision back then -- is it still a good decision now? And, is that decision necessary that-- Are we getting the benefits of that $70, $75 a megawatt to be in RGGI. These are the information that we got we get; what are we getting back from them? And, we continue our growth, but this kind of stuff helps us working out today--
I appreciate the-- ASSEMBLYMAN DeANGELO: --and thank you very much for your testimony.
It’s whatever you and your staff would like, let me know. ASSEMBLYMAN DeANGELO: If I can have-- I’m going to call up three people, so I’m not doing three separate ones at a time, but we’ll do them individually. If I can have Eric Miller, Vice President of the State’s Program for Evergreen Action; Zoe Baldwin, Vice President, State Program for Regional Plan Association, come on up. And, last one, Ray Cantor, NJBIA. I could fit one more up there, right? We got four seats-- Yes, one more. Katie Mettle, Advanced Energy United, come on up. Let’s see if I got everybody; Eric and Katie. Thank you. And--
I’m happy to take it away-- ASSEMBLYMAN DeANGELO: We’ve just got to go left to right. Please go ahead. State your name and association for the record.
So, Chair DeAngelo, Vice Chair Egan, members of the Committee, my name’s Eric Miller. I’m the Vice President of the State’s Program for Evergreen Action. We are a national environmental nonprofit dedicated to advancing actionable climate policies across the country. I feel like I might be opening myself up here, but, in the interest of having open and transparent conversation, I would also add that prior to joining Evergreen Action, I served as the Executive Director for Governor Murphy’s Office of Climate Action from 2024 through the end of his administration earlier this year. And, on behalf of Governor Murphy, I was responsible, and my office was responsible, for coordinating the disparate energy functions of the Economic Development Authority; the DEP; and the Board of Public Utilities; was also a co-founder of the PJM Governor’s Collaborative. That said, I think a key question in front of this Committee is not where State authority for energy planning lives, but, rather, whether the State has sufficient authority under current statutes to give us the level of control necessary to plan our energy supply; procure the energy we need, and basically control our energy future, especially in the face of unprecedented challenges in the wholesale market. My point of view on that is no, the State does not currently have the authority it requires to have full control over its energy future. And, I think a lot of that goes back to our current energy framework, which, prior speaker, Ms. Fox, spoke about this, but, the Electric Discount and Competition Act of 1999, or EDCA, that deregulated our electric market by cleaving off utility ownership of generation, is basically what set the framework for how we’ve been operating the last 25, 26 years. And, we basically made a grand bargain in EDCA in 1999. In exchange for ceding control of the wholesale energy market and the bulk power systems to market actors into PJM, we would receive back low- cost, reliable power. And, what this means today is that New Jersey does not directly control our energy supply; the state does not unilaterally make decisions on whether a power plant is built in state or out of state; what kind of power plant is built; whether the plant is needed or unneeded. That is ultimately left to the private market and market actors that are participants in PJM. And, now we can bend the curve a little bit, and we have, through incentive programs by the Board of Public Utilities related to solar, related to nuclear, related to wind, related to storage; and, those programs are nation leading; I want to be clear about that. Relative to our peers, the Board has done a good job procuring resources that it is allowed to procure under this current model. So, it is limited in scope. So, to be very clear with this Committee, I do think we’re all asking the question: Was it worth it to deregulate 25 years ago? The answer is pretty clearly, “yes.” The State benefited greatly from a bifurcated model where it was not responsible for supplying all the power all the time. For around, let’s call it, 23 years of this model, the most expensive and the dirtiest generation units, not in New Jersey, but also elsewhere in the region, went offline. And, they didn’t go offline because singular states were deciding to shut them down; it’s because they were operating in a competitive market. They were not competitive; they went offline. And, it provided another really important benefit that I think remains today that we are clearly hitting the breaking point, which is, it takes risk off ratepayers. Private market actors had to go to their boards; go to their investors; get the capital to do these projects; as opposed to captive ratepayers; as opposed to your constituents. Unfortunately, though, and I’ll be really clear about this, this grand bargain of ceding power to the competitive market and PJM falls apart if the market’s broken, and I think we have all seen over the last several years that the competitive market and PJM’s running of that market is broken. The energy crisis in PJM is real; it is affecting every state in PJM. We went from historic low capacity prices to historic high capacity prices in one auction in 2024. We have serious reliability concerns across the entire grid from here over to Illinois; and, we have market rules that disadvantage New Jersey energy projects. And, this is something I really want to make clear with this Committee, I think it is a really animating point in why this conversation is so timely. Not only are we seeing dysfunction at PJM, we are seeing disdain from PJM member companies. Just recently, there was a bipartisan proposal by every single PJM state, didn’t matter Republican, Democrat; all came together and put forward a proposal for the PJM member companies to vote on that would give more control to the states, and give states a bigger say and a bigger seat at the table. This was initiated by FERC; this is something I think we all -- varying opinions of the current Federal Government of the White House -- where the FERC under this White House was in New Jersey’s corner on this for pushing for more state control of the wholesale electric market. And, what happened last week is that this proposal was not voted favorably by the PJM members. So, member companies, which include the states’ utilities, decided that they would rather keep New Jersey out of the competitive space and provide the state with less control. So, I think with that in mind, it is very clear to me that the State and the Board of Public Utilities doesn’t not have the tools it needs to adequately control its energy future. And, so, I do think the establishment of an agency singularly focused on energy would be extremely valuable to the State. I think there’s a couple other things that should be considered and were mentioned previously. The State should overhaul the energy master plan process. I’ll be really clear, I was the staff member for Governor Murphy who was primarily in charge of the 2024 energy master plan and working in concert with other agencies across the states. One of the hardest things about the energy master plan is not all of it is actionable. We are setting a broad blueprint for what we think the energy system could look like and how to get there; but, it is not a deep integrated resource plan. It is not something like the energy infrastructure development plan that happens in New York. There are things in the energy master plan, recommendations in the energy master plan, that the State does not control. It is part of a competitive market. Again, we can bend the curve a little, but we do not fully control what the outputs are of the energy master plan. We cannot, under the current statutory framework, which leads me to my second recommendation. So, the State does this new IRP process; we know what type of energy we need; where we need it; how much; when we need it; all of those questions are answered. There needs to be broad authority for an agency to take that plan and then go and do it. And, I would say this requires broader procurement authority -- as was previously mentioned by the prior speaker - - than currently exists at the Board. And, the Legislature should consider the types of advantages that an authority like the Economic Development Authority has, which is more market facing; closer to finance; provides more flexibility. It is worth looking at NYSERDA in New York as well as the New York Power Authority. And, this can provide us -- I’m not going to say there is a perfect silver bullet model -- but having the flexibility to go and procure in innovative ways is really important. I think as we’ve all done the post mortem on what has presented as the biggest challenges to this state when it comes to big energy solicitations, I think wind is one of those solicitations. I’ll point out the recent battery storage procurements as an example that went better. Lack of flexibility was a hinderance to being able to modify these projects midstream. And, had there been more flexibility, whether at the board, or at a different agency, it would’ve made it easier for the state to move forward on these energy projects. The last piece I’ll say very briefly is siting and permitting should obviously be included in this conversation as an important component of this. And, I do just want to make sure as I close here that our current distribution utilities need to be a part of this; they need to get on board. We think they will be willing partners; they should also maybe be told to be willing partners. But, please do not misunderstand my testimony; I’m not waxing poetically for the days of vertical integration and reregulation. Virginia’s a vertically integrated market; they import just as much power as we do; they’ve had the same exact energy spikes that we’ve had. So, let’s not take it as a given that we have to go back to more utility control, but I do think this state needs more control overall. I’m happy to answer any questions or pass it along, thank you. ASSEMBLYMAN DeANGELO: Thank you. What I’m going to do is I’m going to go across the board and then I’ll open it up to the dais for questions. Just state your name for the record, and association.
Hi, my name is Katie Mettle, and I am from Advanced Energy United. Thank you for the opportunity to speak to you today. We are an industry association of member companies whose products and services lower our greenhouse gas emissions while making our energy system more affordable, more resilient, and more reliable. These bills each offer a framework for creating an additional department of a division in the State government, and assigning to some of the responsibilities that currently lie with the Board of Public Utilities, such as energy generation planning; determining the level of financial assistance toward programs; the evaluation criteria application process; and the mechanism to quantify benefits for programs; managing programs for energy efficiency; creating cost savings for low- and moderate-income residents; light-duty, plug-in electric vehicle incentives; adopting standards for technical sufficiency of solar energy systems; managing the State’s involvement in the regional greenhouse gas initiative; promoting local government efforts to reduce greenhouse gas emissions; and to create a new home for the Business Ombudsman which is currently housed under the BPU. That’s a lot of stuff-- And, United is not taking a position on either bill, and we’re not advising the State on whether to create an additional department or division for energy, and whether to reassign some of those responsibilities that I just listed, which isn’t even the full list of things that are currently housed under the BPU. But, we do commend the Legislature for having this conversation, and our gentle advice -- but, I would not characterize it as an official position of our member companies -- is that the State of New Jersey should consider hiring a consulting firm to conduct a study on whether to make this change, and, if so, the best way to proceed. Because, after all, what really matters is how it all happens. If there’s going to be a new agency; the size of the agency -- doesn’t necessarily tell you if it will be run efficiently -- what the culture will be like; what the leadership will be like; and those kinds of details really make the difference. More folks who are trying get more energy built, and more affordably in the state. We suggest that if New Jersey commissions a study, the study should identify a set of states for evaluation and comparison; and, some could be peer states that look a lot like New Jersey in some ways, and others could contrast in a way that could be very useful. So, this is just the starting point. But, we do suggest studying Colorado, Illinois, Maryland, Massachusetts, Michigan, New York, and Rhode Island. And, again, that’s just a starting point. Colorado is a study in contrast; they have a very different market; they have ambitious clean energy goals that they are running two years behind on, but they do have an office that would be very close to laid out in these bills. Illinois is very interesting because it has Illinois Power Agency and they, not the utilities, procure energy for customers who have standard (indiscernible) service. Massachusetts is different with the Massachusetts Clean Energy Center; it’s a state economic development agency dedicated to accelerating the growth of the clean energy sector. They partner with business accelerators, technology incubators, and the finance industry to help companies to access capital. And, Mass Save is the state’s Unified Energy Efficiency Electrification and Demand Flex program, which is unusual that the utilities have formed a collaborative to create more unified offerings for customers. Michigan has partially -- has a partially deregulated market. They have reorganized their energy and environmental functions multiple times, creating a standalone energy agency in 2015, then again under a new agency in 2019. Of course, Eric just mentioned New York, so I won’t dwell on that but that also has a lot to look at, as well. And, Rhode Island could create another additional point of comparison just because it’s nearby and it’s part of ISO New England which it’s in contrast to. A study should compare how many agencies are involved in energy related functions in each state; which agencies are quasi-public; what organizational models are followed; and which functions are housed by each agency. And, a study should also develop metrics to determine effectiveness, and for identifying successes and pain points. And, if a state or a particular agency within a state is determined to be particularly effective or ineffective, then a study would attempt to tease out why that is, and if the facts contributing to that relative effectiveness or ineffectiveness are inherent to the way that energy related programs and roles are divided amongst state agencies or if there are other reasons such as organizational culture; level of funding; accountability measures in place; or effective leadership, for example. We’re hopeful this can just provide a little bit of food for thought as the state continues to explore these questions, and we very much applaud the Legislature for creating a space to have this conversation. Thank you. ASSEMBLYMAN DeANGELO: Thank you.
All right, good morning, everybody. Chairman DeAngelo, thanks for -- and, the Committee -- thanks so much for taking on this tiny little issue here, of how we govern our inter-energy infrastructure. So, my name is Zoe Baldwin; I’m the Vice President for State Programs at Regional Plan Association, and we’re a 105- year-old civic organization in New York, New Jersey, and Connecticut, essentially making sure that the built environment works for the people and communities and businesses that need it every day. And, so, similar to some other folks up here-- I’m not going to come up here and tell you what to do. RPA-- We’re more interested in kind of presenting the framework that we think you should kind of think about this issue with, because you can slice this up a bunch of different ways, or not slice it up and leave it whole. But, we do think there is absolutely room for New Jersey to be doing a better job of its energy research, planning, and procurement. And, given that we work in New Jersey a lot, we, of course, looked to NYSERDA over in New York, a lot, to kind of see what’s there; but, I think the most important thing-- There’s a ton of budget considerations; there’s all sorts of ideologies in here; but, I think we just need to start with a really fundamental thing. Like, what do we want out of either a new structure or adding to the existing structure? Like, what capabilities functionally do we need, and then think about where we want to put those. Because, really when you kind of boil the thing down, I think where a lot of the recent tension comes from is that BPU is increasingly, like, it was kind of stood up just as the regulatory agency, overseeing rates and those structures. But, it’s increasingly now because it’s the only energy structure we really have that’s being asked also to kind of oversee the physical energy transition as we diversify our energy sources; move to renewables; and, broadly, we have to upgrade our grid. Even like the non-- Be it the source agnostic things, we need to upgrade our infrastructure. And, so, those two functions aren’t really necessarily incompatible, but, they definitely require different kind of organizational structures, and that really should be thought about. So, we’re not saying that NYSERDA is something that should be necessarily replicated wholesale, but it is our closest example in terms of like, models, to look at. But, I think, first, what should stay the same: BPU is really good at doing rate design and regulation; fundamental expertise on anything like ratepayer oversight and protection; and they do a great job with the grants, and the finance, and the incentives in that space. And, so, those are, again, these are the fundamentally kind of regulatory functions. And, we think that should largely -- no matter what you do -- kind of stay untouched. The two opportunities, though, that we do see for actual additional capacity in terms of meeting those needs are, 1., very specifically research and planning that is directly tied to implementation, and, then, separate procurement. And, this is, as some of you might know, I represented infrastructure construction industry for five years, so procurement is a bee in my bonnet, and was an absolute issue when we were trying to do some of the really complex procurements that things like wind energy and solar energy to a lesser extent; absolutely require. So, really quick, NYSERDA has dedicated-- Procurement is a base function, and that is not the situation at BPU in the current structure. So, it is dedicated in-house staff that has the research and connects it to delivery. For example, we have this really important thing in an energy master plan: We should be planning how we’re going to build any of this out and meet the needs of the State, but that never really identified the capacity. And, so, that’s where this conversation is kind of backing up to it. So, something-- One of the functions that would be really interesting to see that something like a NYSERDA would fill in New Jersey is answering the kind of basic questions, like, that we kind of continually need to answer, like, how much will this cost? What are the actual emergent -- emerging constraints, and that can be local permitting; that can finance; that can be any number of things. But, really it’s-- NYSERDA has the ability to kind of continually analyze and iterate, which is really important to any flexible process. And, so, then they take that analysis, and then that directly informs the program design and the procurements that they’re doing in that space. So, they’re kind of able to just solve problems, and have that nimble kind of structure that would be very difficult to just tack on to BPU, although it would be very possible. And, so, separately-- Sorry, I lost my place. Along the same lines, the iteration helps provide transparency, which is really helpful. NYSERDA publicly measures its program performance all the time, and that is really important, because BPU just doesn’t have that capacity right now. But, doing that iterative thing and reporting out to the Legislature, for example, also builds that institutional muscle memory and, like, helps it actually get better at things, which is much better than when you’re just constantly farming things out to consultants. On procurement, separating the rate-making agency -- like, out from that process -- kind of allows more flexibility in the procurement design, because you have to think about-- When we’re talking about transportation, and people think of bidding as construction, and that’s like, low bid, the lowest bid wins no matter what. And, that’s not actually how energy procurement works; you really -- it’s more of like an energy -- excuse me -- like an engineering contract where you’re factoring in kind of the nature of what is in the actual program. And, so, there’s things, like, beyond just the dollar amount, it’s like, what is the interaction for this plan from generation and transmission. Can this help check two boxes: The stability of a finance stack and the market conditions? And, so, it allows you to more subjectively for your needs evaluate and do that. And, then, also, NYSERDA has the bandwidth to -- stakeholder how to do a lot of these complex procurements before they go forward, which is really important and was missing from our process. We saw with Empire Wind that allowed them to kind of resolicit when the market condition changed, and that’s really important because we have to be really honest about how long these things change. We saw the cost of materials escalating across the board. And, so, finally, NYSERDA also is able to help with like technical assistance, and implementation support for local governments, which is where we know a lot of our energy projects kind of get gummed up. And, they also do, like, a lot of very direct workforce development. And, so, those two are really just important because those are two of the biggest constraints on actually upgrading any of this and doing this work, because the local plot processes add a lot of risk to processes. And, then, obviously workforce, we need the workforce to deliver the thing. And, so-- The structural question, there’s advantages to both; happy to talk about, but, advantages and disadvantages to both, but, again, we really think that you need to think through, “What do we need out of this? Why are we having this conversation?” And, it’s because we saw a need. And, so, what do we need, secondary, where we put it out, and I have to -- Regional Plan Association, and on a Regional message -- energy is very, very regional. So, also, think about this in terms of, like, research institutions. If New Jersey’s looking at nuclear energy, know who just did a lot of research on that? NYSERDA. And, so, sharing research capabilities across very similar markets can absolutely save money. And, so, where NYSERDA or a different regional -- or a different state’s organization can lead on one thing, we can lead on another, and have a little bit more creativity. And, then, also as we’re dealing with some of the grid operator stuff; it gives us a little bit of solidarity, working with other states in concert instead of just competition. Sorry to speedrun, but thank you. ASSEMBLYMAN DeANGELO: Thank you. Ray. RAY C A N T O R, J.D.: Thank you, Mr. Chairman and members of the Committee. My name is Ray Cantor; I am with the New Jersey Business and Industry Association. I appreciate the opportunity to be here today. To just first, as an overview, our membership does include all the public utilities, but they also include solar developers; they did include wind developers when wind was being very actively discussed here. And, we obviously include manufacturers and large consumers of energy. So, we have a very real interest in making sure that energy policy in New Jersey results in affordable and reliable energy, and that our economy can grow. So, we have a strong interest in making sure that energy policy is produced in the best and efficient manner as possible. We are not here today to talk about what the energy policy should be; but, we’re here today to talk about what these bills do, is to create a structure so the best decisions can be made. Ultimately, what we want is a structure that results in the best possible policy that it can result, and an organization that has the ability to implement that policy as appropriate. There are good ways of structuring how energy policy should be done and who should be doing it, and there are bad ways of doing it. Unfortunately, we think the current system right now is not the best way to marry energy, and, with the Board, there are conflict issues, which I’ll talk about in a minute, and there are legal issues as well. Again, ultimately, we want a structure that allows for the best decision-making; the best input from everybody; and an organization that is able to carry those policies out. As was mentioned previously, there are many ways of going about that and I’m also not here to tell you exactly which way you should be going, but I want to give you considerations of what you should be considering. Obviously, when the Department of Energy was first built coming off the Arab oil embargos; had a different set of interests. It was looking at a different set of policies; it was not as widespread as it is today in trying to manage what sources of energy and carbon emissions, et cetera. So, but, having a Department of Energy is probably the most expensive way of doing it, but it may also be the way of giving it the most highlight and importance within the administration. Having a separate division -- one of the bills does that -- is the very efficient way of doing it as well. And, as you heard before, the-- Department of Environmental Protection, at one point in time, contained both the BPU and the Division of Energy. Again, there are good synergies in that type of setup. The problem with that is that the Department of Environmental Protection is already a very large and unwieldy agency, and, as you all may or may not agree, sometimes it can be intransient in its thinking, and not receptive to different ways of approaching issues. The problem with the current structure-- Again, there are conflicts and certain legal issues that, while may not be dominant, are certainly worth taking into consideration. The Board of Public Utilities is a regulatory entity; it regulates the rates that our public utilities can charge. There is inherent conflict when you’re setting energy policy with a lot of the same utilities have to live with and being the regulator on one hand of what they can charge, and then the policymaker of what they must do. Often or -- I don’t want to speak for any particular entity -- but, there is the real potential that entities may not be very forthcoming, or be entirely truthful in their positions because they’re afraid of making the regulating entity upset because, there again, coming up with a policy and doing the regulations as well. There needs to be a split between who is setting the rates and who is setting the policy. That conflict really cannot be justified, and I think it results in less information being shared, and possibly worse decisions being made. There are some small practical issues; you can’t have three board members together in a room to talk about energy policy, because they’re a quasi-judicial entity. Three people in a room, three commissioners in a room, creates a quorum. So, there are just some practical limitations of how they can address energy policy, even if it’s unrelated to rates, because you never know when that line is being crossed. Similarly, I am not even allowed to send information to a BPU Commissioner directly because of the potential of a conflict with a rate case. So, those types of small things -- they may be small -- but it interferes with how the process actually works. More relevant is the board sets its policies through issuing an order. While the Board has done a good job largely with opening those decision-making processes to public comment, it is not the same as other entities do by creating rules to go in to the Administrative Procedure Act. The Administrative Procedure Act is meant to further public participation and creates a back and forth between the entity and the public. It requires the entity to set forth certain types of impact statements so we know what it does. There’s a set public hearing process; there’s timeframes; there’s a response to common document. None of this is applicable when the Board issues an order. Again, the order process can be done very well, but it’s not the same as the Administrative Procedure Act as it sets forth regulations. So, we believe that a split between the Division of Energy and the Board of Public Utilities should be done because it will result in better policy; it will result in less conflicts; and, again, as you’re doing this, you need to make sure that whatever entity ends up with an energy master plan and the programs is sufficiently staffed and has sufficient expertise to carry that out. And, I’ll just make one comment, which is, slightly off this, but it was mentioned by a prior speaker, we would not be in favor of giving the State of New Jersey more power to dictate energy policies and facilities are built on the ground. We think largely the problem with today’s system -- cost increases, a lack of generation -- is a result of too much government power interfering with the market. So, we think, again, there are lots of ways of going about this. It could be a separate department; it could be a separate division; it could be within DEP; all great. So, we thank you, Mr. Chairman, for, again, inviting us here today. We’re happy to work with this Committee and the sponsors to figure out exactly which way to go. But, we believe you’re moving in the right direction. Thank you. ASSEMBLYMAN DeANGELO: Thank you. Committee members wishing to be heard? Assemblyman Walker.
Excuse me. Yes, thank you guys for coming in today, and sharing this discussion. We could always add; change; amend. But, I’m just curious to know from you all, how many of you are in favor, by show of hands, are in favor of adding this department?
Devil’s in the details. I can’t raise, or, I will keep my arm level. (laughter)
Compared to where we are today, I think it’s a step forward.
So, that’s a yes?
That would be a yes.
Certainly think it’s worthy of consideration.
I agree with Zoe, it depends on how it’s done.
Thank you, Chair. ASSEMBLYMAN DeANGELO: Assemblyman Bailey.
Thank you, all; great discussion, and I appreciate all your thoughts and comments and your expertise, back to (indiscernible), thank you. Eric, specifically, when we take a look at PJM, the PJM region -- we could talk nationwide, but I’m specifically thinking about just our additional 13 states and D.C., the region that we’re a part of -- obviously, I won’t go through all of them. But, as an example, what are they doing? Do they have-- Have they broken this out from the regulatory standpoint on their side? Do they have separate energy departments, or-- How are they handling this issue?
Yes, so, looking at PJM is actually really helpful, and I appreciate the question, Assemblyman. Across PJM, how they are structured varies significantly. There are vertically integrated states in PJM in the Midwest and the South. There are states that are deregulated and deregulated around the same time as New Jersey, like Pennsylvania, like Delaware, like Maryland, to some extent. There are states that have independent energy authorities. Maryland has MDE, which sits outside of its commission. And, then, there’s states that look a little more similar, or there’s even states that look even more wild like Illinois; worth a shot to look at, but aren’t going to hold them up given lack of media -- media equivalency. But, what I will make clear and I think makes clearer by looking around at PJM is, every single state in PJM was affected. States with heavy coal fleets were affected. States like Pennsylvania, with more natural gas than basically everywhere but Texas, were heavily affected. States that are vertically integrated like Virginia, heavily affected. So, the problem in the PJM market is not a unique New Jersey problem. Every state is looking at solutions. Governor Shapiro in Pennsylvania recently called their utility model “broken,” in a letter he penned. Governor Moore in Maryland is taking a lot of action in passing significant legislation requiring their commission to look at how their current framework works. So, this is what I want to say: I wish I give you like the perfect state by state as every state is looking at this; every state is trying to figure out the best pathway forward, and it is certainly worthy of going deep and considering the options that are in front of New Jersey and nothing should really be off the table at this point in time. ASSEMBLYMAN DeANGELO: Assemblyman Kanitra.
Thank you, Chairman. Eric, you -- in your earlier testimony -- pretty confidently threw PJM under the bus and blamed them for quite a bit, and then come here as the expert in all of this. But, for me, when people are testifying on a decision like this that is so incredibly important to the State-- I mean, we’re essentially going to be creating a new agency or a department, the biases and backgrounds I think are also important, too. I mean, you were one of Governor Murphy’s big energy advisors, right? Let me first ask, what did the Murphy administration do that helped get us in this situation anyway where we need to look at breaking up the BPU to eventually wind up lowering costs and trying to fix the situation that we’re in? Do you have anything that you could objectively say?
Yes, I’m very proud of my time in the Murphy administration, and in particular, proud of the Governor’s quick action to move forward (indiscernible) on the PJM capacity auction that helped freeze rates at the current level. An uncapped capacity auction would have rates increase probably double again, and that is something the Governor led and I’m really happy I was a part of it.
Now, I had asked what you guys could have done differently, or what you could have led to; but, it’s interesting that you say that, because you say how quickly the Governor acted, right? When you were an advisor in the Murphy administration, didn’t NERC and PJM -- who you threw under the bus -- didn’t they warn you guys in 2022 and 2023 that we were losing generation more quickly than new generation of equivalent standards were coming onto the grid?
I think on that question, I do believe NERC did make that recommendation PJM wanted. Whether there was any conversations between NERC and New Jersey predate my time with the Governor, I couldn’t give you an answer.
I looked into it; the warnings were clear, clear and loud from NERC in 2022 and 2023, and PJM, basically, was screaming from the rooftops that we were going to be in trouble. So, then, what happened after that? You guys had those reports; you did nothing. You didn’t act on them at all; and then you issue the 2024 energy master plan. And, with that plan in 2024 as we were already starting to see the problems with offshore wind, how much offshore wind did you account for in that master plan?
I’d have to go back and look, but I believe the timeline was updated to reflect the current slate of projects that were still award holders. So, I don’t believe that number was based on any make- believe projection; it was based on what we had in front of us at the time.
It seemed like there was a lot of assumptions that we were going to have all this generation on, and, as we all know, we don’t have any offshore wind generation on right now. In fact, when I looked at that energy master plan report-- Which, do you know how much money we spent on consultants for that?
I’m aware.
About $7-10 million, at a minimum, from what I could tell.
I would need to go check my recollection if it was even close to that amount--
OK.
--I’ll take your word for it.
It seemed like it was so ideological to me that the initial report’s assumption was that President Trump wasn’t even going to win, and then you guys had to, like, rush around and fix that, too, right? MR .MILLER: I cannot speak to the mind of certain individuals of around who is going to win electoral politics--
But it got changed-- It got changed as a result when he did win.
I will tell you very openly that we based the energy master plan in 2024 on the best information we had available to us. At the time, it did not contemplate a hostile -- such a hostile approach towards large energy infrastructure projects built with American steel, using American workers. We-- I own--
Destroying our oceans; industrializing the ocean; ruining tourism--
--it was unforeseen.
--ruining fisheries; all that kind of stuff. But, that’s fine; they were more expensive sources, regardless, and I go back to my original point, you guys knew in 2022 and 2023 that we were going to be in this situation. The Murphy administration chose not to act; PJM did warn everybody well in advance of all this, and here we are today. So, thank you. ASSEMBLYMAN DeANGELO: And, Assemblyman, you’ve made your point--
Yes. ASSEMBLYMAN DeANGELO: --but, we lost the country’s both oldest nuclear reactor because of what Governor? Chris Christie.
Chairman, the only thing that I would say respectfully-- ASSEMBLYMAN DeANGELO: What I’m saying is I gave you latitude with this; you’re challenging his expertise, sitting here on the dais; I’m giving you -- not challenging his expertise, you’re challenging him as a person presenting to the Legislature. And, I--
If we had four years to get a natural gas plan back on track, we would be in a much better spot. ASSEMBLYMAN DeANGELO: Listen, let me finish; let me finish. Don’t interrupt me; don’t interrupt me. I always give you a chance to speak, right?
Fair. ASSEMBLYMAN DeANGELO: Let me finish. So, as you’re asking questions, let’s not be so attacking. We’re just here to listen to them as potential presenters on the legislation going forward; not getting into Trump; not getting into Murphy; not getting into Christie. Let’s focus on the future; you can use that on your judgement on whether or not you decide to vote on any piece of legislation here going forward.
Fair, Chairman. ASSEMBLYMAN DeANGELO: Thank you. I got Doug O’Malley from Environment New Jersey--
Can I ask a question? ASSEMBLYMAN DeANGELO: --in reference to-- Oh, sorry. Assemblywoman Katz.
Just a question, sorry. So, a few things have come up in the conversation that we were having. Jeanne referenced that when the BPU was created and the decision at the state level to go from a Department of Energy to BPU was done intentionally and there were reasons for it at the time, but a lot has changed in that time. And, so, I thought just maybe to refocus the conversation, can somebody highlight what those changes were that are causing us to want to have this conversation right now? Where did we go when the BPU was first founded? What are some of those changes that we’ve seen that we’re asking the BPU to do differently, now that we need the Department to possibly be able to overtake a little bit? Undertake, not overtake. Go ahead, someone.
I’m going to sneak in real quick, and I want to say that I can’t lead with the history, because that’s not my expertise. But, I do want to say that a huge part of this is actually not coming from institutional failure, as Eric mentioned. States across the country are looking at their energy regulatory structures. I think a really good lens to look at this through is actually complexity. It is far more complex. For a very long time, our energy system was very clear and straightforward; we were maintaining a -- the same type of infrastructure for a very long time using the same types of sources. Now we’re diversifying; we are dealing with the extreme age of that infrastructure. And, as that complexity increases, we need to realize that, again, structurally there’s a very different make-up for an agency that is largely overseeing ratepayer dollars, rate cases, and that type of funding, and an agency that’s able to be very nimble to changing economic conditions, that is able to do highly complex procurements, and is able to do that in a timeframe that doesn’t mess up the output that we need from those assets.
And, if I can-- ASSEMBLYMAN DeANGELO: Assemblyman Karabinchak.
Thank you, Mr. Chairman, I just want to make a statement; I don’t have a question for any of (indiscernible). Obviously, these two bills that are being discussed, we’re hearing your opinions, which I thank you for. The reason for these two bills is because we are in an energy crisis. Regardless of the history, we’re in it today. So, both of these bills are looking at a vast amount of changes that we both -- both the Majority Leader and myself, and everyone’s that’s doing these discussions -- believe we have to make today. Here’s just a few energy sources that were briefly talked about: Nuclear; we have solar; we have geothermal; we have fusion coming that’s being studied in Massachusetts right now; we have hydrogen; we have storage; we have wind; we have wave and ocean energy; and we have gas. And, I’m sure there’s going to be more. So, 20 years ago, did we think we’d be talking about these energy sources? Maybe. I don’t think so. Twenty years ago I wasn’t talking about them. Today, we’re talking about virtual power plants; it’s a whole new term that came up this year, from a residence being able to have enough solar, and energy storage, and possibly a geothermal, so they would be able to have their own energy source in their own home. That’s what we’re talking about today. These bills are looking at, again, a broad scope. We’d have to look at short-term, medium-term, and long-range energy. The whole purpose of this is to create a better timeline to address our energy issues today. I believe in technology; more than ever, we’re seeing what 15 years was compared to today how fast it is. And, I could tell you in five years what the 15 years did, we’re going to be able to do in one year, or less, when you start to deal with AI. ASSEMBLYMAN DeANGELO: Assemblyman--
So-- Almost done, Mr. Chairman. So, a few things. These bills are looking to create -- whether it’s a division, whether it’s an independent department -- to cut the red tape, and to make sure that our permit process is expeditious, not the way it is today in this great state, because it’s horrible. Procurement, on the same side, we have to be able to do this today. We can’t talk it, and kick the can down the road for two more years, because that’s not what our people need in this great state. And, we need to increase electric capacity. Period. And, the last thing is -- it was talked about briefly by one person -- but, flexibility, yes, we need flexibility without being strong armed from everybody else to be like, “You can’t do it; you can’t do it; you can’t do it.” We have to do it; we have to do it now; that’s what the purpose is, and I thank all of you for coming, but I have a lot of notes here that I think are very, very good. I apologize, Mr. Chairman, but I think I had to say this now so the next speakers could at least understand what I’m going to say. At the end, I’m going to say even more. Maybe, hopefully, less. Thank you, Mr. Chairman. ASSEMBLYMAN DeANGELO: We’ll give you a couple minutes at the end. (laughter) Assemblyman Spearman.
Yes, I just want to take this back to the original question. What I seem to hear is that all of you feel that we need to have an entity that does regulation, and we need an entity that has more flexibility in setting policy. Is that, in general, what we’re saying?
In the matter of regulation, I would use the term “rate setting.” One entity with expertise in rate setting versus one which is policy and implementation oriented.
Right. Is that how, in general, you guys feel it?
I wouldn’t say that United’s position isn’t necessarily that we need to have separate entities, but that those functions need to happen in an effective way.
OK, thank you. ASSEMBLYMAN DeANGELO: Assemblyman Barlas.
Thank you, Chairman; just a couple of questions for the panel. Eric, you talked about your role in Governor Murphy’s administration with energy policy. I’m not asking for names; I’m not looking to put you on the spot. If someone-- If the Governor wanted-- Governor Murphy wanted offshore wind-- If there was somebody that worked anywhere in the administration, BPU, DEP, wherever, Governor’s office, doesn’t matter. If they said, “Wind production is bad,” what would have happened? Not, would they have been fired, that’s not what I’m asking. I’m saying, they would have been heard, right? Presumably?
I don’t think there’s any conceivable way I can answer that question that would give you a level of clarity or satisfaction. Everyone who--
--If someone had a differing opinion than what the Governor wanted to ultimately do, would that individual have been afforded an opportunity to make their point and their case?
One of the great benefits, when we are talking about rooms -- room for improvement for New Jersey Government -- one of the great benefits of New Jersey Government across the EDA; across the DEP; across the BPU; and across my office, was that there absolutely were differing opinions, and there absolutely were different points of view, largely informed by the high level of expertise, in particular in the civil service in New Jersey. So, no. Was it ever uniform all the time? No, absolutely not; New Jersey is significantly better for it. But, I think that’s as far as I can go.
No, no, no, no-- It’s not a trap; I’m just asking a question. If somebody had a differing opinion, they would have been afforded the opportunity to make their case, correct? Yes or no.
Yes, we regularly have--
OK, great.
--open discussion.
But, ultimately, the decision was the Governor’s, presumably. He took all the information, whatever it was that he got, and then he made a decision. Correct? Whatever that decision was, whether everybody agreed with it or not, he was the ultimate decider, if you will.
Governor Murphy was the Governor of New Jersey, and our job was to provide him with the best information available so that he could make decisions. That’s typically how things went.
OK. So, these two bills A3610 and A4004; both say that, “the Governor will nominate an energy Commissioner with the advice and consent of the Senate. The Governor will nominate or appoint the new Division of Energy Resource and Development, with the advice and consent of the Senate.” BPU gets appointed by the Governor with the advice and consent of the Senate. So, everything that everybody’s talking about, whether it’s nuclear or hydrogen, or if you want to go back and do coal mining; or the turbines in Louisiana from the 1920s that powered steamboats; whatever. Ultimately, the decision on which way we go with energy, whether you have it all under BPU, or 15 other departments, is set by the Governor, correct? We can all agree on that?
(indiscernible) based on the individual--
Whoever that Governor is--
--under the consent and advice of the Senate.
--whatever their decisions are, they decide, right? And, this body can pass as many bills as we want, but if the Governor -- whomever they are -- doesn’t like it, they can veto it, correct?
Yes.
So, ultimately whether it’s PJM’s fault, or anybody’s fault; it rests solely with the Governor in terms of whether or not we have more energy production, or less, and what sources we use to produce that energy, correct?
I would caveat that statement with the observation that the large majority of programs that run within the State of New Jersey are based on statutes.
Unless the Governor says, “Change the statute,” right? If the Governor decides to ask the Legislature to pass a different bill; or, as this Governor has done a couple times already, decide not to enforce existing statutes.
Not going to opine on that dynamic currently; I’m here just here to provide information.
All right, my point is, though, that we could talk about all this other stuff, and it’s great, but at the end of the day, whoever fills any of these seats, whether it’s the new Commissioner of Energy; President of BPU; or whatever; they’re following the direction of whatever it is the Governor wants to see happen, right? So, I would say to everybody, these things are great, and we talk a lot about energy production here in this Committee; and, yes, energy bills are high and we could talk about who’s at fault. But, ultimately, if we’re going to move the ball forward to reduce the cost of energy to residents, it has to start at the top. Right?
The one thing I would like to add to that, though, is just I think there’s something to be said. Look at other sectors that have long-term capital planning, which is something that we don’t have in energy that way, right?
Well, well--
So, I want to say that the thought here -- and, I can’t help but wear my old construction hat, like, to the extent -- and, I’m thinking about this a lot in resilience, as well -- is that when it comes to things like transportation and water -- water utility infrastructure, we have a literal pipeline that just -- it’s the machinery of government that advances projects from idea to construction. And, the thing there is that what that does is, is it means that when you have money arise, you have a myriad of projects in varying states of completion that allow you to go after it and, like, actually leverage that funding, whether it’s local, private utility, or Federal money. And, so, to the extent, every department is technically run by a political appointment; that’s how cabinets work.
And, our long-term planning is done on two- and four-year cycles, right?
So, to that end--
In odd years only?
But, just to address your thought, like, I think it would be fair that, like -- for me at least -- thinking through the procurement functions that would, theoretically, arise from a new entity. There is-- I-- Regional Plan Association wants to see longer-term planning; we want to see that the State is mapping out a long- term process so that we can get to where our grid needs to be. And, so, I would just put that one caveat to answer your question, structurally, that the new structure would allow for a different machinery that just doesn’t exist right now, in that way.
OK, thank you, Chairman. ASSEMBLYMAN DeANGELO: Thank you, any other questions? (no response) Thank you, panel. I’ve got Doug O’Malley from Environment New Jersey, who’s in favor, no need to testify; thank you, Doug. If I can ask Allison McLeod from New Jersey LCV to come on up. Alex Ambrose, New Jersey Policy Perspective, come on up; Brian Lipman, the Rate Council, come on up. And, I got two more; five seats. Aden Savett at Climate Jobs -- Excuse me, Climate Jobs New Jersey. And, then, lastly, Erick Ford, New Jersey Energy Policy Perspective. We got five seats, so that’s it on our testimony. Allison. ALLISON M c L E O D: Good afternoon, Mr. Chairman, Mr. Vice Chair, members of the Committee, thank you for the invitation to testify. My name is Allison McLeod, and I’m the Interim Executive Director for the New Jersey League of Conservation Voters. One of the benefits of being able to go after many esteemed colleagues is I get to say a lot of what they said, so I will keep it brief. I did send an analysis to the Committee previously, and we’re happy to talk about that at any time. But, in the interest of time for today, obviously there’s a discussion of whether to split the functions of the Board of Public Utilities into a new agency. It comes at a crossroads; we’re all very aware, your constituents are certainly aware, large increases in load are driving up demand. The Federal Government has ordered PJM reform. We heard that from one of the previous testifiers, about what happened last week at PJM and their vote. Partially one of the reasons that they’ve been ordered to reform is for failure to bring new generation online rapidly. And, more demand with less supply, as we all know, means electric bills are skyrocketing for New Jersey’s working families. That’s the end result. So, creating a dedicated energy delivery institutions, such as a New Jersey Department of Energy, can execute a lot of clean energy policy; procure projects; build markets; and coordinate investment. And, then, you can retain the Board’s function as an independent regulator of utility rates; consumer protections; and utility conduct. And, we have nothing -- to be clear -- but respect for the hardworking staff at the Board of Public Utilities. And, the goal here would not be merely to create a new department, but to address fragmentation in New Jersey’s existing clean energy system, and to give the State a durable institution capable of moving those projects from policy through to deployment, to the result. So, the current system, that fragmentation, creates several gaps including, just briefly, limited procurement authority for new and emerging technologies -- as someone else shared before -- they have to go through the Board (indiscernible) process, which can take many months. So, that’s an inability to move quickly and nimbly with emerging technologies as they come, and as the landscape changes. So, a new department could consolidate those functions that are now dispersed across Board programming, helping the State to reduce barriers, but slow project development. An important note that I just want to make that was touched on briefly before, but to just underscore, is that a new department as proposed could not bond on its own in the way that an authority -- folks talked about NYSERDA -- that model can bond. So, an option, while acknowledging volatility in the current bond markets is to create an embedded green bank function, or to somehow create the capacity for dedicated funding. And, again, I don’t necessarily want to advise how to do that; but, I think it’s just an important note that whatever system is chosen or wherever it chooses to be housed, should you separate the functions, you would want to think about the capacity for dedicated funding for those programs. And, as others have shared, the department would not -- should not -- if created -- function simply as the same designated functions as the Board; but, it would need additional delegated authority, as we’ve talked about, to be able to execute on those functions, where we have challenges right now. I will just note there is some concern about what other drawbacks of such a system, and to separate them in addition to the sort of administrative costs that could be incurred. And, some of the concern that we’ve heard is that it could -- weaken utility cooperation, particularly on distributed energy interconnection; circuit capacity upgrades; and related grid capacity work. And, so, we would suggest that the solution is not to say that you can’t separate them, but rather to build into the enabling statute some mechanisms of enforceable utility cooperation. Including things like load data; grid hosting capacity maps; and, et cetera. And, we would just say, wherever it chooses to be housed -- the new department, should you choose that path -- it should be paired with public accountability, as we believe for all agencies. So, transparent procurement processes; public process input, et cetera; and clear performance measures. And, so, one of the main benefits, we think, is instead of asking individual investor-owned utilities to manage these very complex procurement processes and contracts, a new department could run a centralized process, which would allow for planning and procurement at scale. And, one of the reasons that that’s very beneficial is, again, in addition to the ability to move a little bit more nimbly, and to rapidly bring online cheaper technologies. It also is the ability to secure project labor agreements and the ability to create jobs out of these projects for New Jerseyans, and the ability, as shared before, to give the State greater input and control over siting and long-term planning. And, again, we shared more full comments, and I don’t want to take too much time, but I’m happy to answer any questions. Thank you, Mr. Chairman. ASSEMBLYMAN DeANGELO: Thank you.
Thank you, Mr. Chairman, and members of the Committee, for the opportunity to testify today. It is officially afternoon, so, good afternoon. My name is Alex Ambrose; I’m a Senior Policy Analyst with New Jersey Policy Perspective. And, I’m so grateful that this very important topic has come up. We do need to have some kind of different authority for energy in New Jersey. The Board of Public Utilities is a utility regulatory commission, and it should not be saddled with extra responsibilities outside of that. It simply can’t move as quickly as another kind of independent authority or agency, and we need that kind of nimble action in order to respond to a lot of our energy issues. Once again, we cannot just copy and paste what the Board of Public Utilities does and move it over to another agency. It’s very important to think about what can we add to this new division, new agency, in order to make a better energy future for everyone. Where the agency, division, whatever department, is placed is important. I understand that in Assemblyman Karabinchak’s bill, there is the option of putting it underneath the Department of Treasury. One benefit to that is that there will be support staff available instead of creating a new department, which will take a little bit of time to get off the ground. So, keep that in mind as well while you are deciding where this goes. I also wanted to talk about something that was not in this bill, but should be an important part of any new division, which is permitting. There’re two things that mainly slow down new energy projects: They are permitting, and local opposition. And, we all know when a project slows down, it gets more expensive. As we look to diversify our grid with new energy sources, we really need to look at permitting reform, and there are two states where we can look at to learn lessons from them: New York and California. So, New York has ORES, the Office of Renewable Energy Siting; and California has it within one of their existing energy authorities. We can create a new office that’s a one-stop shop for all permits and reviews for projects that are graded on a certain threshold; 25 megawatts is usually around that threshold, but smaller projects can usually opt in. This office -- how it is created in New York -- they must act upon applications within one year for standard projects, or within six months for projects that have already been preapproved. They-- There’s a really cool program in New York called the Build Ready Program that allows private sector developers to proactively identify and nominate brownfield sites, and we all know we have a lot of those in New Jersey, that have received project approvals in the past. The-- In New York, NYSERDA works with those municipalities to advance the permitting process, and then that property is auctioned off to private developers. So, it really helps take the onus off of private developers, which makes it less expensive to build, and helps to streamline that process at the State level. The law gave the State stronger override of a lot of local laws; as we all know in New Jersey, 564 different municipalities means there are a lot of different processes that these projects need to go through. So, it still requires project overview at the State level, and consultations with local communities, but the State can override if they are unreasonably burdensome. Now, these projects also must provide benefits to host communities including pilots for lost tax revenue, and whatever the Public Service Commission determines how to provide compensation for these areas for hosting the projects, including utility bill credits, and there’s lots of successful examples of that. We can also maintain CVAs and PLAs to reduce local opposition and expedite the process. The three most common concerns with local-- The three most common local opposition concerns with energy projects are: Decreasing land values; better land-use ideas; and not feeling heard or not having ideas integrated. All of these can be addressed at a State office that helps streamline that process, and ensures that these local communities get those benefits. And, this has been a great success in New York. It is less than eight months on average to obtain a permit in New York, and only one project took a full year to get the permits. Before that, it used to take 5-10 years to get a permit. Now, entire projects are approved in about two years. Now, the one caveat is, of course, New York is not part of PJM. So, we are still dealing with PJM’s, shall we say, not expedited interconnection process. But, this is one way that the State can take action on ensuring that we can build newer, more reliable energy faster and cheaper. This will not only actually drive down costs, but it will help us build more capacity quickly. So, while we are looking at building a new Department of Energy, we absolutely have to look at permitting reform, and we cannot bring down costs or build more capacity without it. Thank you. ASSEMBLYMAN DeANGELO: Thank you. Brian. B R I A N O. L I P M A N, Esq.: Good afternoon, Brian Lipman, I’m the Director of the New Jersey Division of Rate Counsel. When I first looked at this bill, I was a little confused, and not getting the benefit -- quite frankly, of listening to everybody else -- and, to the extent that there’s a requirement or a need for someone to give advice and explain, and be an expert in the energy development field, I think a new division might make sense. Where I am concerned, and where ratepayers are concerned, is where they’re going to start funding things. You are creating a division that is going to be spending ratepayer money, but won’t be actually assigning that ratepayer money to utility bills. It’s unclear where the prudence review of these projects will be done. It is unclear who’s going to be looking to make sure that these projects are within the realm of affordability. I will tell you now, the problem that I see is that the BPU -- in the BPU -- that’s not being done. And, I can give you a really good example without naming any names or getting anyone in trouble, but, I was in negotiations for a base rate case, which is where rates are reset for utility, the bread and butter of what the utility does. The clean energy person came on and proposed a new program. During negotiations, I asked, “What is the rate impact of what you’re proposing?” The response was, “How would I know? That’s nothing to do with me; I don’t do rates.” This is the problem, and with all due respect to Jeanne behind me, this has been a problem -- I’ve been doing this now for almost 25 years. For almost 25 years, clean energy and rates have not really spoken to each other; 25 years ago, it wasn’t such a big deal because we didn’t have so many clean energy programs. Now, we have a lot more clean energy programs. The real issue here is we’ve got to find a way to make sure everybody’s talking, and what I am concerned about is, we are codifying the divorce between policy and ratemaking, and now affordability. And, that’s something that if we’re going to go forward with some type of new division, new department, that’s going to have the ability to do something that impacts rates, we need to look at that. I want to talk a little about something -- take advantage of going after everybody else -- and talk about a couple other things. One of the things I heard a lot about is procurement, procurement, procurement. Procurements cost money. Again, this is going to be ratepayer money unless the Legislature is willing to fund it with taxpayer money, which, we support entirely. But, more likely than not, this is going to fall onto the ratepayers. It is unclear what we’re going to be procuring, as well. I agree with everything the Assemblyman said about all the different technologies, and all the things that we need to do. It is not the State’s ability in our market to do it the way we would like to do it. And, I feel really important to give a little bit of a history lesson here about what was called LCAP, which was -- and, I think, Assemblyman DeAngelo, you may be the only one who was here when LCAP was passed -- but, LCAP was a great idea because PJM came to New Jersey and said, “Hey, guess what, guys, in about two years you’re going to have rolling blackouts because you don’t got enough capacity in New Jersey.” And, the Legislature wisely said, “Holy crap, we’ve got to do something,” and, they procured three gas-fired electric generation facilities. And, we had them bid into the market, and ratepayers are going to pay for them, and we’re going to hold them indifferent to the market because we don’t care about the market. PJM, our utilities, and all the other generators sued us, and had that law declared unconstitutional because we interfered with PJM’s market, because we were putting generation into the market without a care of how much it cost. So, we were doing buyer side -- for some reason, that’s what they’re most concerned about -- is buyer side manipulation, not seller side. So, PJM is pushed back, and I find it ironic indeed that PJM came to us in 2022 and 2023 and said, “You’ve got a generation problem,” when they’re the reason we have a generation problem. We were willing to build and pay for generation in New Jersey. So, again, I’m not sure, when we talk about procurement of new generation, we have to be careful of the limitations. I think it was Eric Miller, who had spoken earlier, about the limitations on what we can do when we want to build new generation. We can do what we need to do to facilitate new generation; but, it’s much more difficult for us to actually build it. And, also, I want to talk a little bit about permitting. This is not a new issue. All these issues-- Old issues become new issues. The BPU currently has the authority to override local zoning permitting. If a utility goes to a town and says, “I want to build this transmission line because I need it, because the State needs it,” and the town says, “No,” they can go to the BPU under 455D-19 and file for preemption of that local finding. And, the Board has done it over and over again. In my 25 years, there’s only been one time that a Board has not upheld a utility’s desire to build something, and it’s because it was -- for lack of a better word -- a crap project. And, they were right to deny it. Other than that, they have allowed every one of these projects, and they have preempted, and we’ve got two, maybe three of those cases currently pending at the BPU where our utilities are building something. It would be a simple fix to allow others to go to the BPU and do the same thing. So, we do have some of this process in place. But, my biggest concern is that you’re going to create a department -- a division, whatever it is -- that’s going to be spending ratepayer money, but doesn’t care how much it’s going to cost because they don’t have to care, that’s the BPU’s problem. And, the BPU is going to be handed a bill from this agency, and where is the review being done? Who’s making sure that the people who are doing EVs; the people who are doing solar; the people who are doing nuclear; are talking to each other and making sure that combined they’re not creating a problem? It’s very easy for me to say, “Oh, I’m only adding a dollar or two a month to your bill.” But, if four or five people are doing that separately, and no one is overseeing that; no one’s looking at those costs, suddenly you’re looking at $10 a month, $12 a month because everyone’s working independent of each other. We need, quite frankly, more coordination, not less coordination, and whether that’s done through a separate division; working closely with the BPU; or within the BPU, we need to keep an eye on affordability. We need to keep an eye on the rate impact of what we’re doing, and I’m concerned that right now that’s not looked at in this bill. And, I understand what we’re trying to do; but, I think someone else said, “The devil is in the details.” There’s a lot of details here that are missing that I think still need to be addressed and looked at before we can go forward with this. And, as always, I’m always open to questions here, or if someone wants to reach out to me later, I’m also open to questions. ASSEMBLYMAN DeANGELO: Thank you. Aden. ADEN S A V E T T: Good afternoon, Chairman DeAngelo, Vice Chair Egan, and members of the Committee; my name is Aden Savett, and I have the distinct honor of serving as Executive Director of Climate Jobs New Jersey, a labor coalition representing tens of thousands of New Jersey workers across the building and construction trades, service, and education sectors. CJNJ’s core mission is to ensure that our state builds and interconnects zero-emissions power quickly, affordably, and with a qualified, skilled, union workforce. Organized labor, in our view, will play a decisive role in helping to meet our state’s rapidly increasing clean energy needs. We thank Chairman DeAngelo and Majority Leader Greenwald for allowing us the opportunity to speak on this important piece of legislation, and CJNJ appreciates the sponsor’s desire to clarify and streamline the BPU’s responsibilities while simultaneously entrusting a dedicated entity with the responsibility to oversee policy. In that vein, CJNJ’s optimistic that A3610 could allow the State of New Jersey to take back control of its energy system by putting the State in charge of planning and purchasing energy, including in-state generation to meet New Jersey’s current and future energy needs. CJNJ also believes that state-led planning and procurement through a dedicated entity, such as a department of energy, can continue to ensure future energy infrastructure is built and maintained using a highly qualified and trained labor workforce, and this workforce can ensure efficient, cost- effective, high-quality construction and operation when it comes to that critical infrastructure. We sincerely look forward to working with the Committee and the sponsor to strengthen this legislation, so that it can best serve our ratepayers, our environment, and the hard-working men and women in our unions. Thank you very much for your time, and I’m more than happy to answer any of your questions. ASSEMBLYMAN DeANGELO: Thank you. Erick.
Good morning, Chairman, members of the Committee; Erick Ford, President of the New Jersey Energy Policy Coalition. We represent the energy sector in and around New Jersey. Our members include companies like PSEG; Holtec; Westinghouse; South Jersey Industries; New Jersey Natural Gas; we also have members from the IBEW; Ironworkers; and operating engineers, carpenters, what have you. We also have companies that are also small, minority-owned, women-owned businesses. It’s a good snapshot of the entire ecosystem of the energy sector. And, we also have other companies like FuelCell Energy. I’ve been doing this -- I’ve been in the energy sector -- for about, actually, over a decade now. I started at the Board of Public Utilities, been running the Coalition ever since. So, the real question is, why are we here today? We’re here to talk about these bills, but drove us to what we’re here today. The real answer is we have to build generation. Whether it’s here, or other parts of the country. The entire country is seeing the same issue. More importantly that we’re seeing it here. But, the reality is we’re going to have to build. Earlier this year, yourselves and the Governor took a bold step for power to be built in New Jersey with nuclear. We’re going to have to take a look at other aspects as what do we need to bring online? Will this idea of new divisions or new authorities help make -- help build generation in our state faster? And, or, if we don’t build the generation here, are we going to have to build transmission lines from Pennsylvania? The reality is we’re going to need power. You see it everyday; it influences prices; and the one thing you’ve got to think about is: Good economic policy and good energy policy coincide with each other. And, you have to think about what it is we’re doing here. So, we’ve talked a lot about permitting; a lot about workforce, which is great; but, I think you’ve got to think about also what the energy sources that we’re supporting provide. Energy capacity, the capacity market that Jeanne spoke about quickly, which is a fundamental part of where we’re at today-- Nuclear has a capacity factor between 95-99%, depending on the moment. Natural gas combined cycles tend to have between 75-79% capacity factor. So, that means for 1,000 megawatts, you get 770 or 950 for nuclear. Fuel cells, in the latest report from PJM, showed 91%, so you can think about 910 megawatts; solar, anywhere between 10- 18% and so on and so on. So, each source has a different reliability of capacity, and we have to think about that as to what we’re doing for procurement. Now, the State has really taken initiatives with its funding through the SBC funding; that’s a lot of money sitting there. Would these two divisions or new divisions take that funding and oversee how it’s procured or used, or to change it? I’ll give you an example, fuel cells, which, I will tell you I like. And, I also like other sources. But, the reason is, you take a look at the incentive that was developed for fuel cells. Last time it was adjusted, it was 2016. So, you have some sources that can be helping to bring power back on the grid. And, to think about what we got to be doing to be able to bring that onto the grid. So, if you look at the incentives that are out there, are they right? Are they what they need to be? Do they need to be adjusted? What other technologies are coming? Just reading this morning from one of the websites I follow that there’s technology utilizing rain now to make energy. Could that happen? Probably. One of the biggest advocates I remember, being at the Board, was Mike Winka; he would walk through all this type of technology that was there. And, the question is, again, though, will whatever is developed from these two bills -- if something is developed -- be able to solve the overall issue? Which, is the question is why we’re here. Price of electricity has gone up exponentially, not just here, though, but in other states. Looking at other states like Maryland, where their policies have gone so far backwards that they actually did see a blackout last year in August of 2025. They just lost power; they didn’t have enough. They didn’t have enough infrastructure, and they also didn’t have enough generation in the state. So, you have to think about what is it we’re trying to really accomplish here? Are we trying to bring down the rates? Are we trying to figure out who should be making sure we have the NERC reported properly and on time and understanding for you guys to make decisions as quickly as possible, or, or not? So, happy to answer questions; happy to talk to all of you; I know I’ve spoken to a lot of you over the years. But, here to help; here to be -- answer any questions. So, thanks. ASSEMBLYMAN DeANGELO: Thank you, Erick, and are there any Committee members wishing to be heard? (no response) With that being said, thank you, panel.
Chairman.
Chair, please, thank you. Thank you, guys, for coming in today and discussing this critical issue in the State of New Jersey in terms of our energy crisis. I just want to take a tally, if you’re for this or not. MS. McLEOD: I’ll echo my colleague before and say it depends how you do it, but, there’s certainly a lot of benefits to it, pursued with the right guardrails.
Agreed.
I’m currently not for it, but I’m certainly open to discussion; but, right now, the way it’s proposed, I am not for it. But, again, always open for discussion.
Thank you, Assemblyman. It depends on how it’s structured, but we believe that this is a good start, and there’s reason to be optimistic here.
I think it’s obvious we have to have the conversation, but will this ultimately solve the issues that we’re facing right now, and will our children or our children’s children be able to look at this moment and say that our state and our leaders stepped up or not? Do we want our children to have to do what we’re doing now? We’re reevaluating everything again, to say did we do it right or not, 25 years ago. Maybe we did; maybe we didn’t. How much has the market changed? COVID-19, honestly, changed a lot. How many of us worked from home or still do? And, it’s going to continue to change. I think we want to think about how is the current system flexible enough, as we’ve heard this idea of flexibility. Or, do we need to make sure that whatever does exist in the future, if it’s an authority; it’s a department; if it’s what it is today, does it have what it needs to be able to react, or by -- to be quite honest -- be proactive? Be proactive in a sense that’s saying we need to bring on new technology. Is there new technology? Are there emerging technologies? Or, have the technologies we thought were emerging, emerged? Are they here? Some are. It’s a fundamental question, though, is what will future generations say of us? Will we step up to a plate that needs to happen; and, right now, honestly, the most important thing is that we get shovels in the ground and start building, whether it’s transmission lines; power plants; distribution; what have you. Yes, it’s going to cost money. Everything costs money. I tell my daughter every time I have to give her money to go to Wawa, it costs money. It’s just a reality. But, we have to accept the fact of that, because, if we don’t do it, if we do nothing, we’re going to be in the same predicament in 10 years; it’s going to be worse. So, we have to step up to the plate; do what needs to be done; build what we need to build in this state; and, be willing to do what it takes. Not everything is easy. So, sorry. Didn’t really answer your question, but I think I did.
I think you said yes; I’m not sure. (laughter) ASSEMBLYMAN DeANGELO: Any other -- again, second time around -- anybody wishing to be heard? (no response) All right, thank you, panel, appreciate your testimony. Any closing statements from Legislators? We’ll start with Kanitra-- We’ll go around. Kanitra.
Thank you, Chairman. This was certainly helpful today, and there’s a lot of people on all sides of this that think that this needs to be a consideration. But, I still want to focus on the fact that the underlying issue, in my opinion, seems to be a lack of confidence in the current BPU and BPU structure and setup, to get us where we need to be affordably as a state with our utility and energy cost specifically. And, that’s a problem that isn’t necessarily going to get fixed by this. We might throw all of the crazy ideological stuff and smug bureaucrats into a different entity, and that may free us up the ability to be able to make more objective decisions on one side of the equation. But, on the other equation, on the other side, what are we creating? We’re going to send all of the extremists to one group. There’s going to be whatever it may be, a $3 million, a $7 million, a $10 million cost of setting up a new agency based on what I kind of looked at, and then some couple million dollars additional a year to have that moving, depending on how heavily we staff it. But, are we creating an entity that then will, as was suggested by some of the testimony, create ideas with little to no accountability? I mean, one of the problems that was suggested, a staffer proposing a new program with no understanding of the cost of it, doesn’t seem like those kinds of things would be addressed here. So, there’s-- I’m not purporting to have the idea of how to build a better mousetrap here, and I applaud you for looking at some creative solutions here. I don’t know what the answer is. My opinion, the answer is to take all the ideology out of the current BPU, and then we wouldn’t be here in the first place. You yourself always say, “We need an all- of-the-above approach.” Well, I don’t agree with that as much as you do, based on, I believe Erick’s testimony was saying solar was like 10% compared to nuclear at 90% in terms of generation, or anything like that. There’s certainly people that testified today that don’t agree with you in any capacity, and they’re still going to be there, and we’re still going to need to deal with them, and they’re still going to be gumming up the works, and that needs to be rooted out, in my opinion, before any of this can work. But, thank you. ASSEMBLYMAN DeANGELO: Thank you. Assemblyman Sauickie.
Thank you, Mr. Chairman, and thanks for running this today. I am truly open to figuring out a better way of doing it, because doing nothing is not an option. I think this Committee is on the same page, whether some people can say it or not, that the BPU of the past at least had serious issues. So much so that this Committee, and the Assembly, passed a bill requiring the BPU to have certain experience and certain training. To me, that underscores the problem. We did that in the last legislative session in May of ’25. A bill that, when you think about it, is almost ridiculous that we had to do that. But, I really think, collectively, we underscored a major problem; it was experience in the BPU. As I said earlier, I haven’t been critical of the new President, because I did see his background, and it does seem pretty good. I would like to see more come out of there, of course. But, I’m not sure creating a new division is necessarily the solution yet, and I’m open to that, I really am, I just haven’t seen what are we getting for that? How’s that changing the problem we have today? And, to Assemblyman Barlas’ comments earlier and some that we heard from the panel, we can put guardrails in around the BPU; so, it doesn’t necessarily mean that the Governor says and does everything, assuming the laws are followed. I agree with that comment. But, we have legislation in front of us that, for example, prohibits the BPU from authorizing rate increases for utilities that charge inclining block rates. That’s guardrail; we can direct the BPU to do that; we can put that law in place, and that’s got to be followed. So, I do think fixing the problem can happen with the current BPU; I just think we need to put guardrails in that underscore what needs to be done. And, I think, to your credit, this Committee has been educated to know that. We-- I think we preach a lot of the same things: Long-term strategy, as well as potential short-term impacts to save on utility bills. We can do that; we have good legislation on both sides of the aisle that could do that. So, my thought right now is focus on that; get the BPU doing what the BPU should do; eliminating some of the things that got us into this situation in the past. Again, though, I am open to understanding if there’s a better way to do it. Because, like I said, I think doing nothing is not an option. We all know that, all of us up here. So, that’s my thought on it. I appreciate the sponsors of the bill and what they’re trying to do. Again, I think we’re aligned in what we want to do long term. We’ve got to fix this thing. Thank you. ASSEMBLYMAN DeANGELO: Thank you. David. Just wanted to see if I could catch you off guard. (laughter) Assemblyman Barlas.
You caught me off guard; I was going to give him a mic, say, “Go ahead.” Thank you, Chair, for this meeting today. Just sort of echoing what everybody said. I think before we create another bureaucratic agency and another layer to an already complex government, I think, ultimately it comes down to who’s in the Governor’s office, and what do they want. They pick these nominees. We can talk about whether or not the Seante advises and consents the right people sometimes, but that’s usually upper house, lower house divide. But, ultimately, their job is to carry out what it is that the Governor wants. And, we pass legislation here all the time. Chairman, you’ve been around a long time; I was a staffer for a long time. When it gets before the regulators, it’s a whole different ballgame, right? And, so, all of that starts, to me, with the message that is sent from the top. And, if the message from the top is, “We want everything on the table; we want a rapid deployment and increase of availability of energy, however we do it, with the appropriate guardrails,” then, I think that’s going to happen. If we have a Governor that doesn’t want that, who wants to slow roll it, or wants to go in a different direction, that’s the way it’s going to go. So, I think these two bills are great, and they’re worthy of a discussion and a conversation, but it doesn’t matter who you put there unless the person that’s putting them there shares that same viewpoint. Thank you, Chair. ASSEMBLYMAN DeANGELO: Thank you. Assemblyman Walker. If you have any comment?
I’m a maybe on the two bills, if you wanted my position. (laughter)
I had to fire a lawn company calling me, too, but anyway, I digress. Look, I think this is a bipartisan situation. I think, not dissing the State of New Jersey, but, it’s a problem throughout our county. And, I think, given my background, I’m very competitive, and I would want to with this body, and we got a lot of smart people here today, and try to come up with something that we could all agree upon and to move it forward, and quite naturally help the residents of the State of New Jersey. So, whatever we can do and get to that point, on a collective basis, and I’m willing to support. So, that’s my closing statement on that. Thank you. ASSEMBLYMAN DeANGELO: Assemblywoman Katz.
So, my day job when I’m not here Assemblywoman-ing is being a mom to my three teenagers, and they often come to me and say something that they have to do is unfair or the situation isn’t right or whatever it is. And, I tell them all the time that we can’t change what was done before we got to the point that we’re at in life. We can’t change it; we don’t have a time machine and there’s nothing we can do. But, what we can do is change what we do moving forward. So, it sounds to me from this discussion that we’ve had that the BPU was set up and designed to do something that we needed here in New Jersey at the time. But, things have changed. And, we can’t control what’s happened in that time that we change; we can’t go back in a time machine and set BPU up to have done the things that were going to evolve and change. It’s why we’re here to be the government, to be able to look at the changing environments and be able to adapt. And, I’m really grateful, Chairman, for giving us the opportunity to have this discussion; to learn; to hear; to think; go home, do some more thinking; do some more talking. And, I applaud you for that, thank you. I also thank the Majority Leader for putting up this important bill and giving us the opportunity to have that conversation as well. I think we’re moving in a good direction, and that’s all that we can keep doing right now, is keep moving in a good direction, as timely as we possibly can. And, that’s our job. So, thank you for that today. Thank you to all the speakers, and I look forward to further discussions. ASSEMBLYMAN DeANGELO: Thank you. Assemblyman Karabinchak.
Could I be last? ASSEMBLYMAN DeANGELO: Oh, you’ll be last, sure? Assemblyman Bailey.
Well, I’m last-- (laughter) ASSEMBLYMAN DeANGELO: Don’t get carried away with yourself.
He can have mine-- He could speak-- ASSEMBLYMAN DeANGELO: Assemblyman Bailey.
Mr. Chairman, thank you. Many of you know that my entire career has been in the mental health world and working with kids and families from throughout the State of New Jersey. And, so, if you go back 20 years ago, we all would be familiar with a department, a division within the State of New Jersey called the Division of Youth and Family Services. We would cut it down and call it DYFS. And, that was really child protective services in New Jersey; that was the main focus, child protective services; abuse and neglect; and things along those lines, and they’re the folks that I worked with in my early career along those lines. And, then we had a very horrible situation happen in New Jersey, where some kids -- there was an abuse situation -- and the Feds jumped in to get involved with taking a look at it. A Federal monitor was created, that came in and set the guardrails and guidelines around the State of New Jersey. So, to get back to Assemblyman Barlas’ question and comment earlier about, “Well, the Governor is in control; the Governor’s control;” not always. Not always is the Governor the final say in certain situations along those lines. And, so, 20 years ago to this year, you can fact check on me this -- Brian I know you probably know -- but, fact check me on this, but the last new department was created in the State of New Jersey; the Department of Children and Families. Twenty years ago, 2006, under the Corzine administration. Ken Harvey (sic) was the first Commissioner, cabinet-level commissioner that was created to answer to the Governor; to work with kids and families throughout the State of New Jersey. DYFS was changed into the -- the Department was changed into -- the Department of Permanency and Protection, a brand new Division was created that mainly focused on mental health for kids throughout the State of New Jersey, which we had never done before, with a national model along those lines. And, I have spent the majority of my career now leading an agency that works with them. Is it perfect? No. Do the bureaucrats get involved and we have to go through different administrations to have their focus that I don’t always agree with? Yes. But, it changed the lives of kids in New Jersey, and families in New Jersey for the better, because a brand new department was created. Now, $1.5 billion -- more than that, frankly, $1.55 billion, I believe, in this new budget -- is spent on kids and families directly in the State of New Jersey, specifically in this department. We could argue, should the ratepayers be paying for that? Should we be paying that investment in kids and families with high-end trauma; with education issues; with housing issues; with all the things that come into play with kids and families throughout the State of New Jersey? Is that a good investment? Should that be happening today? I would argue with you -- I would argue, yes, that Department should have been created. Yes, it has made a difference in the State of New Jersey. Yes, it has cost money. So, my vote if you were to ask me 20 years -- go back 20 years ago, Jerry -- how would I have voted? Although it hasn’t been perfect, although I’ve come before this body and testified at that desk in front of other commissioners that I vehemently disagree with the direction you’re going at times, and under different administrations, overall, my vote would be yes, I think we’re headed in the right direction with these conversations. Thank you, Mr. Chairman. ASSEMBLYMAN DeANGELO: Thank you. Vice Chair.
Well, I’m going to be brief, which is not the topic of today, that’s for sure, because we had certainly a lot of discussion here. Listen, the problem in New Jersey is we have an energy crisis, and everybody wants to blame everybody else. That’s the problem. Obviously, it’s the data centers that are causing all the energy problems; that’s today’s topic, or, last month’s topic. We need to do something. And, we got to do something to make it better for the taxpayers of New Jersey. So, while I do agree with Assemblyman Barlas, that we do need some direction from the Governor, on this particular situation -- not all situations, like my colleague just spoke about -- but, we do need some direction from the Governor’s office on what they want to do, because ultimately she is the person -- the Governor and their administration -- have to deal with this problem because it’s not going to go way. Everybody has their phone out; everybody’s using their phone; everybody when you go to the doctor’s office, you get your data; it’s all there; this is all data center related. And, the biggest thing we need to do, which we should be adopting or trying to create a law is, how do we get away from PJM? That’s what we should be doing, is trying to figure out, how do we break our ties with PJM, and get away from that circus? Thank you, Mr. Chairman. ASSEMBLYMAN DeANGELO: Thank you. Assemblyman Karabinchak.
Next to last. Thank you, Mr. Chairman. I just want to say thank you to all the people who spoke, and obviously the people who spoke to me prior to the meeting too, because obviously, I get my cell phone out so people can give me a call and let me know what’s on their mind. These are some of the notes that I took today from all of the different speakers; and, I print very small, so that’s a lot of information. In-- Quite honestly, I want to thank the Chairman for having this hearing, because both of the bills, in my opinion, do something just a little slightly different, but all have the same goal, is to help all of our people who pay these energy bills today. In my humble opinion, I think that however which one gets developed here, I’d like to see people think out of the box. We can’t do it the way we normally do it. No disrespect toward BPU because I like BPU. I think they do an excellent job of protecting the ratepayers; however, I think there has to be some level of separation. Because, if your boss is saying, “I want you to protect the ratepayers,” at the same time you’re saying, “I want you to think out of the box and tell me anything that you could do to increase our energy capacity.” That may not be cheap today, but in 10 years will be. I want that independence. I want somebody to think we’re not -- they have to be uninhibited to come up with an idea, and to move forward with it. We have so many experts here, and plus more outside of here that we’re looking for your help; we need all your help. Some of the things that I’ll bring back to the Majority Leader, some of the things that was actually stated here that we should be looking at adding into these bills. Which, I think is an excellent piece that came out of this. Some of the stuff that we talked about with the funding through the EDA, and we’re doing more in New Jersey now with PPP. So, there is so many opportunities we have here, and we have to think not the normal way, because everything takes time. It has to be OK’d, and OK’d; we need to expedite that level, because we do a great job here. As the Assemblyman said, PJM. We have 12 partners who we don’t talk to, who directly affect our bottom line, which is our energy bills. The bill that I believe that was signed into law under Governor Murphy, allowed us to finally speak to other states, and the most drastic piece is to remove ourself from PJM, period. So, that’s there. What we do with it is something that’s so important, too. Our Governor has to start talking to Delaware and Pennsylvania, and even New York heads who’s independent, and Texas who’s completely independent. We may in -- who knows in 10 years -- be independent, because our capacity is way beyond what we need, and we could sell it. Because, that’s what it was 15 years ago. So, I just want to thank you all for all your input, and this is just the first step on moving this forward. Thank you; thank you, Mr. Chairman. ASSEMBLYMAN DeANGELO: Thank you, Assemblyman. Committee members, thank you again, as always for patience and doing these kinds of hearings besides just kind of voting on a piece of the legislation. What I ask from every Committee member is, before you guys kind of drop an important piece of legislation, please, give me a shout; give me a buzz. There’s few of us that are involved in these industries that kind of give you guys direction and advice, and the good, bad, and ugly of it. Listen, I think the discussion and topic of a Department of Energy, whether it’s solely by itself; whether it’s a hybrid; whether it’s revamping of the Board of Public Utility, something needs to be done, because our communication and investment into energy generation was not there. We were very sporadic. We’ve been sporadic for the past 25 years going back to when we started with solar, and moving that into play when it initially was a grant program, you put it in, you get money back on your house based on the amount of power that you used to our public/private partnerships; to our involvement with doing public sector; to every and anything that we grow into tiers of the solar renewable energy credits; the transitional TREC credits; everything has changed, and it was sporadic. And, our long-term discussion is this: New Jersey, we can’t pull off the grid. We’re stuck because we only generate two-thirds of what we use; you guys are going to see that in a week as we go to and talk to them; and, the air traffic controllers that I call at PJM, and they’re going to see the thousand-plus generators that are there. We sat there and we’re in 16 hours worth of hearings to hear the reason why. It wasn’t one person saying why energy prices are going up, it was the 16 hours telling us that it’s simple, supply and demand. Are we better off being deregulated or regulated? Are we better off with RGGI or without RGGI? Are we getting money back? How are we making our profits? What’s the difference? Are we paying the same amount of money per megawatt as the other 13 states on generation cost? Yes, we are. Are we importing, exporting? All big questions. So, as we move forward with this before we don’t -- I hear what you’re saying -- don’t want to give one person too much power to make a direction; we should be equally involved with that direction. But, we don’t want to be held up from the permitting process on whether we’re putting transmission-scale projects and PJM is holding us up, or, we’re waiting a year for the Board of Public Utilities to put a solar rate online. These are the problems that I hear, that I get. And, as we continue to develop ourselves, guys, in the last 30 seconds ’til we’re out of here at quarter of one. As we’re talking nuclear, it has to be part of our generation; natural gas expansion; renewable; we have to do a lot more with each of them. We have to make sure that we’re doing this and recognize if we had more reactors down South Jersey, we’ve got to parallel the transmission lines coming out, because it’s too much power in one location. All big stuff for us to continue to fight with and debate on, but I think moving this in the right direction is just we’ve got to be mindful not to give too much in one House. We’ve got three branches, and let’s keep them all equally powerful. So, thank you, and adjourned.