Understanding green energy's role in NJ



NJBIZ panel examines how state can navigate policy chasm between Trump administration and incoming governor

The green energy industry in New Jersey, especially solar, has been thriving, and brings a whole host of benefits to the table, including reducing the carbon footprint, creating energy efficiency and offering reliable sources of power generation and cost incentives to state businesses. While the federal government has signaled its support of fossil fuels over renewables, the incoming Murphy administration has promised that within its first 100 days, the governorelect "will start the process of creating a new State Energy Master Plan that will set New Jersey on a path to 100 percent clean energy by 2050," according to its campaign website.

At a recent energy panel hosted by NJBIZ on Dec. 12 at The Imperia in Somerset, panelists discussed a number of issues, including how to rectify the federal government's divergent wishes with the state; offered insights into the opportunities and challenges the green energy industry faces; and made recommendations for the Murphy administration's green energy master plan.

Panel participants included: Barbara Blumenthal, Ph.D., research coordinator, New Jersey Conservation Foundation; Lyle Rawlings, president and CEO, Advanced Solar Products; Adam Zellner, founder and president, Greener by Design; and David Weinstein, partner in the law firm Archer. William Amann, president, M&E Engineers, was the event's moderator. Amann is a LEED Fellow by the U.S. Green Building Council; a board member and advocacy committee chair for the U.S. Green Building Council New Jersey Chapter; and serves as chairman of the Somerset County Energy Council and Climate Reality Central New Jersey Chapter. After a brief introduction from the panelists, Amann began the discussion with the panel in talking about the federal government moving away from encouraging and incentivizing the reduction of greenhouse emissions.

Amann: With D.C. moving away from carbon policy, do you foresee the Murphy administration taking steps towards carbon reduction target mandates?

Weinstein: With Washington moving away from it and Murphy's announcements during the campaign, it is going to be a goal of the administration to do that. I think there is going to be a lot of head wind from Washington. Murphy has announced about possibly suing the federal government. It is going to be very interesting to see where this goes with your federal policy diverging with your state policy and you have a lot of tension.

Zellner: It is going to be a lot of positioning against the [Trump] administration and what New Jersey thinks is right. Having worked for the state and being the policy director for the governor, I don't think people realize the size of this pyramid. People think we are a $34 billion state. The size and impact of the state is much larger than what people think.

Rawlings: This state is likely going to go in diametrically opposite direction [from the federal government] with a gov.-elect who is very strong on developing solar and other renewables. New Jersey, along with New York and Massachusetts, are really going to be the tip of the spear in this conflict that will contest the movement in the other direction of the federal government.

Blumenthal: Behind the scenes, there are those who are clearly in favor of green energy expansion and there are battles being waged. And those battles primarily have to do with policy mechanisms. Every state is doing experiments now to figure this out. In some ways, we are fortunate in that we can learn from other states.

Amann: How do you think the new tax code would affect the development of energy projects here?

Weinstein: If you look at the senate bill it leaves everything status quo; the house bill will be different. They are going to move alternatives into the input tax credit (ITC), which is currently at 30%. This is bad for solar because this will lead to additional competition. The overall reduction in tax credits is what is most interesting. The value of the credits will drop heavily. When you reduce the corporate tax rate, there is going to be less of a need for credits on the whole. This is not just within the energy sector, this is across the board.

Zellner: There are some clear incentives for the coal and gas world. One of the things you have to watch — and this is often a conversation I have with folks in the environmental world — that in terms of the gas world, we are following behind it. With a lot of those incentives, especially the gas folks here in New Jersey there will be a balance now between the extensions for federal approvals and NJ's ability to deal with those approvals. When there are energy vacuums where large nuclear plants are going away—at least in today's economic world—it looks to a gas replacement. And it might fly counter to some of the things the gov. elect is trying to do.

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Previously published in NJBIZ, January 15th 2017

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