BPU study suggests customers must change energy habits or face higher rates
BY RY RIVARD | 05/23/2022 06:04 PM EDT
Gov. Phil Murphy’s goal is to eventually have 100 percent clean energy by 2050 and to cut greenhouse gas emmissions in half by 2030. |
As New Jersey pursues its clean energy goals, residents could end up paying less for energy — if they buy an electric car, become more energy efficient and replace natural gas heating systems with electric ones.
That’s one of the key takeaways from a new, state-backed look at how customers will be affected by Gov. Phil Murphy’s clean energy plans. On Monday, the state Board of Public Utilities’ consultant, the Brattle Group, released preliminary findings from a long-awaited study on how the fight against climate change will affect home energy costs.
Right now, according to Brattle, the average New Jersey utility customer pays about $4,800 a year for all the kinds of energy they use — electricity for lighting and appliances, natural gas for space and water heating and gasoline for their cars. By 2030, the cost for that same mix of energy would rise to nearly $6,000 if the state hits goals in the Murphy’s administration’s clean energy master plan.
But if customers begin to ditch natural gas, purchase an electric vehicle and change how they heat their home, their costs would fall to about $4,000. That's because electrifying everything is expected to lower costs and make them more predictable, and because electricity can be generated without releasing greenhouse gases if it's made using wind, solar, hydro or nuclear power.
As people change how they use energy, “we start to see some substantial savings in their total energy bills,” Sanem Sergici, one of the consultants at Brattle who worked on the study, said during a public forum on the report.
Murphy’s goal is to eventually have 100 percent clean energy by 2050 and to cut greenhouse gas emmissions in half by 2030.
Background: The findings were an early glimpse at an ongoing process by the BPU that has spanned several years. A previous report on ratepayer impacts from Murphy's clean energy policies was not made public and deemed incomplete or inadequate by the BPU’s leadership.
Environmentalists seized on the potential for lower costs.
"The preliminary BPU study results make it crystal clear that achieving the state's ambitious climate goals will significantly decrease energy costs for New Jersey residents," said Eric Miller, the Natural Resources Defense Council's New Jersey policy director. "The goal now is to make sure that New Jersey designs and implements nation-leading energy efficiency and building electrification programs so every resident can share in our clean energy future."
Brattle also found that Murphy’s policies will avoid between $1.22 billion and $1.63 billion in damage done by the release of greenhouse gases, a calculation that uses a metric known as the “social cost of carbon” to assess the climate change harm done by the release of each ton of greenhouse gases. The reduction is roughly as much greenhouse gases as 3 million homes or 5 million cars would release.
What’s next: Firmer cost estimates are expected to be released in coming months and are likely to fuel a debate over the governor’s climate change policies. Environmentalists worry the estimates aren’t taking into account the benefits of avoiding not just greenhouse gas emissions but local air quality harms that come from ditching traditional combustion engines and ridding communities of byproducts that are released when fossil fuels are burned. Foes of the climate change goals are sure to focus on rising costs or the adjustments people must make to their lifestyle.
The estimates involve a lot of assumptions — including that the state will have 330,000 electric vehicles on the road by 2025 — and doesn't deal with some things like capital costs of energy projects or fully explore how rate impacts may be cushioned for low-income residents by subsidies.
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