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While Policymakers Fret Over Alleged High Cost of Renewables & Electric Vehicles

Facts To Reframe The Whole Trenton Debate

“Scientists warn that drastic action is the only way to avoid catastrophic climate impacts” ~~~ WaPo, 11/27/19

[Update below]

The State of NJ pays polluters not to pollute, instead of making polluters pay.

This policy results in billions of dollars in subsidies to fossil polluters, while ignoring the costs of the climate emergency and the benefits of reduced energy consumption, energy efficiency, and renewable power.  

Paying polluters not to pollute is not only economically inefficient. It is deeply regressive and exacerbates economic inequality by transferring money from predominately low and middle income consumers to corporate profits and wealthy shareholders, where it perversely feeds profligate private consumption that increases  greenhouse gas emissions and expands corporate power, while frustrating democracy and reducing social investment.

In contrast, making polluters pay provides economic incentives to reduce greenhouse gas emissions, generates public revenues to invest in energy efficiency and renewables that reduce greenhouse gas emissions,  increases democratic control, and equitably redistributes resources via investments and dividends that benefit low and middle income consumers.

But we never read about any of that in NJ media reports, because the Trenton climate and energy debate is dominated by special interests, self interested consultants, narrow minded technocrats like “Ratepayer Advocate” Brandt, and incompetent hacks, who have focused almost exclusively – in a constant media drumbeat, especially in NJ Spotlight coverage – on the alleged “high cost” and  “subsidies” to renewable energy and electric vehicles.  Follow me:

As has been widely reported by the media, the NJ legislature recently passed – and Gov. Murphy signed – legislation that pays PSE&G over $300 million/year for so called “zero emission credits” (ZEC’s) at their nuclear power plants. The ZEC payment is allegedly justified by avoided carbon emissions that would result if the nuke plants shut down and their capacity was replaced by out of state fossil powered sources.

But what has not been reported by media is that ZEC’s are the exact opposite of pollution fees – and that regulatory mandates are even more effective than economic tools (more on that latter point in a future post).

This ZEC policy is based on a dubious assumption, i.e. that all the power that replaced PSE&G’s nuke capacity would be fossil generated imports, not from in-state efficiency and renewables.

The ZEC subsidy amount ($300 million/year) has no publicly stated factual basis. But in what may be the stupidest on the record public comment ever made by a legislator, bill sponsor and Senate Environment Committee Chairman Bob Smith told Star Ledger editor Tom Moran that he got the number from PSE&G CEO Ralph Izzo. NJ Spotlight:

Yesterday, Sen. Bob Smith (D-Middlesex), who helped draft the law, told the Star-Ledger’s Tom Moran he decided to set the incentive at $300 million because PSEG CEO Ralph Izzo told him it was the right number.

But we can roughly estimate the price of a ZEC as follows:

assuming PSE&G nukes produce about 40% of NJ’s electric power and the current NJ power sector emits 18.6 million tons, this amounts to about $40 per ton of avoided carbon emissions. ($300 million/(18.6 MT X 0.4) = $40/ton *** (see below)

Regardless of details, this is paying polluters not to pollute.

In contrast, making polluters pay would require that they pay to pollute.

The price per ton of carbon pollution would be at least the $40/ton that PSE&G receives for ZEC’s which amount is effectively a surrogate “price on carbon”.

But there are many other ways to “put a price” on carbon and make polluters pay. (for example, I’ve compared the RGGI allowance price to the $122 per ton emission fee that DEP charges for traditional “criteria pollutants”, showing over $2 billion per year in subsidies to the power sector alone).

Which brings us to the table above, which is from NY State.

ZEC’s are not the only huge subsidy to polluters.

Imposing the Social Cost of Carbon (SCC) is being discussed in New York: (but not in NJ):

Note the HUGE difference between the “Social Cost of Carbon” and the RGGI price.

In the first year (2020) its $40.74/ton. It only gets bigger over time.

NJ’s energy sector carbon polluters are only paying the small RGGI allowance fee for their carbon pollution.

That represents a $40.74/ton subsidy. On a statewide level, that amounts to $758 million/year subsidy.

So, just the PSE&G nuke subsidy and the RGGI power sector subsidy amount to over $1 billion/year in public subsidies to carbon polluters.

For statewide context, according to DEP,

New Jersey’s current annual [RGGI regulated power sector] emissions of CO2 are about 18.6 million tons

But according to NJ DEP’s most recent greenhouse gas emission inventory, the power sector is less than 20% of total GHG emissions.

If the transportation sector (40.6 million tons of GHG missions) were required to pay the SCC – via some form of fuels tax – that would amount to $1.65 BILLION.

So, the fuels industry is being subsidized by $1.65 BILLION/year (and that’s not counting $15 billion/year in federal subsidies nationally. Global subsides are even larger.).

Commercial and industrial buildings emit 16.6 million tons. That amounts to another $676 million subsidy.

These subsidies only grow over time.

So, think about these HUGE MULTI-BILLION DOLLAR SUBSIDIES to fossil polluters next time Rate Advocate, some legislator or NJ Spotlight complains about all the so called “high cost”, “burdens” and”subsidies”  to renewable power and electric vehicles.

And these “costs” are based only on traditional mainstream economics – not science –  which ignores the most significant “cost” implication of the climate emergency: the collapse of civilization, ecological collapse, and the suffering and death of billions of people.

Now how the hell does one put a price on that?

[*** I must have been doing inverse Izzzo math. I mistakenly adjusted the 40% nuke capacity by applying that to the RGGI powers sector. Actual data is available to provide a more accurate estimate, so I’m surprised that PSE&G didn’t make that part of the public debate. When my error is corrected, the ZEC price is closer to $25 per ton, not $40. But that doesn’t change the fundamentals flaws with ZEC’s.]

[Update 12/18/19 – The drumbeat goes on. Right on time, NJ Spotlight provides another example of false framing  to over-emphasize alleged costs & ratepayer burdens – 54 cents per month doesn’t even buy a cup of coffee!! See:

• South Jersey Utility Seeks OK on Plan for More EV Charging Stations

Remarkably, after 13 paragraphs that emphasize costs and subsidies to renewables  buried at the end of the 14th paragraph in a claim attributed  to the utility – – not even reported as as a fact –  we learn:

Atlantic City Electric said the cost of the program, if approved by the BPU, will be paid by a delivery charge on customers bills — roughly 54 cents a month for the typical customer.

NJ Spotlight Editor John Mooney, in his email distribution today, even wrote about costs being “foisted” on ratepayers:

For all the agreement on the need to promote electric vehicles, there is hardly consensus on how to pay for it. Even if the state’s utilities step up, will it just get foisted on the ratepayers in their electric bills?

Hey John – your bias is showing. See a dictionary for the pejorative definition of “foisted”:

transitive verb

Tentacles of Military Industrial Complex Extend Into Conservation Groups

Beware the REPI Man!

File this one under “K” for “Know Your Partners”. Curious, maybe I missed it, but I don’t recall ever reading about any of this in an NJ DEP or NJCF press release.

According to the US Department of Defense, in order to “protect the military’s mission“, the US military spent over $16 million in NJ, including the preservation of over 9,000 acres of land via the “REPI” program:

Climate Crisis Exacerbates Environmental Injustice

[UPDATE BELOW]

Over 18 years ago, US District Court Judge Orlofsky wrote in South Camden Citizens v. NJ Dept. of Environ., 145 F. Supp. 2d 446 (D.N.J. 2001) (emphases mine):

As described in greater detail in this Court’s Findings of Fact and Conclusions of Law set forth below, the NJDEP granted the necessary air permits to SLC to allow its proposed facility to begin operations. In doing so, the NJDEP considered only whether the facility’s emissions would exceed technical emissions standards for specific pollutants, especially dust. Indeed, much of what this case is about is what the NJDEP failed to consider. It did not consider the level of ozone generated by the truck traffic to and from the SLC facility, notwithstanding the fact that the Waterfront South community is not currently in compliance with the National Ambient Air Quality Standard (“NAAQS”) established by the EPA for ozone levels, nor did it consider the presence of many other pollutants in Waterfront South. It did not consider the pre-existing poor health of the residents of Waterfront South, nor did it consider the cumulative environmental burden already borne by this impoverished community. Finally, and perhaps most importantly, the NJDEP failed to consider the racial and ethnic composition of the population of Waterfront South.

BOOM! Hit the link above and Read the whole opinion. Orlofsky goes into great detail to document the specific failures of DEP review and show how the actual DEP regulatory review contradicts DEP rhetoric and spin. A must read.

Unfortunately, Orlofky’s legal decision was later reversed on legal grounds by the Third Circuit Court’s holding, in South Camden Citizens in Action v. New Jersey Department of Environmental Protection, 274 F.3d 771 (3d Cir. 2001)

But Orlofsky’s factual findings and accurate criticism of basic and egregious failures by the NJ DEP were never challenged and remain valid.

[Of course, the Murphy DEP’s History of the EJ Program says NOTHING about all this embarrassing reality, but it does throw former DEP Commissioner Campbell under the bus under an absurd claim of lack of “user-friendly” regulation

Sadly, as most recently illustrated by the NJ DEP’s air permit renewal for the Newark garbage incinerator, despite Gov. Murphy’s Executive Order #23 on “environmental justice”, NOTHING HAS CHANGED – Orlofsky’s criticisms remain valid.

DEP still fails to consider what DEP failed to consider back in 2001 in Camden, NJ.

How is this tolerated?

Why is it not reported by media?

Why aren’t the “green”, climate and environmental justice groups even making these arguments?

Stay tuned as we try to find answers and report back soon.

[UPDATE: Proposed legislation (S1700[1R]) to direct DEP to designate EJ communities and specifically authorize DEP to deny permits for NEW or expanding facilities based on EJ and cumulative impacts  – even though it was gutted by amendments and even though DEP already has adequate legislative authority to act and even though the bill grandfathers all the unjust existing pollution – is going nowhere, blocked in Senate by Senate President Sweeney and languishing in the Senate appropriations Committee. DOA

[For example, over 15 years ago, Gov. McGreevy issued Executive Order #96 that, among other things, established a petition process to designate EJ communities:

Any community may file a petition with the Task Force that asserts that residents and workers in the community are subject to disproportionate adverse exposure to environmental health risks, or disproportionate adverse effects resulting from the implementation of laws affecting public health or the environment. …

In consultation with the Environmental Justice Advisory Council, the Task Force shall identify a set of communities from the petitions filed, based on a selection criteria developed by the Task Force, including consideration of state agency resource constraints;

[Update 2 –  A Trenton source tells me that Sweeney supported the original version and that the amendments that gutted the bill came from Gov. Murphy’s Office (with a perceived CV threat).  Someone should ask Sweeney. If we had a functioning press corps, someone would. Don’t hold your breath on that one.]

DEP Science Board Must Be Restricted From Any Role In Regulation And Policy

4. The issues upon which the Board deliberates shall be those that the Commissioner requests the Board, through the Department’s Office of Science, to consider, which issues shall be limited to specific scientific and technical issues, not policy or regulatory matters.  ~~~ Administrative Order 2009-05, Acting DEP Commissioner Mauriello

On numerous occasions, Murphy DEP Commissioner McCabe has emphasized the key role of science in DEP decisions. These decisions include: DEP priorities, budget and staff resource allocations, policies, programs, plans, regulations and permits. (DEP press release)

“I am excited to join the DEP and its thousands of expert professionals to help continue the Garden State’s leadership on the issues of climate change and renewable energy, sustainability with economic growth, and environmental protection based on strong science and facts.”

However, McCabe – in addition to mis-stating DEP’s mission to include a role in  “economic growth” –   is continuing the abuse of science at DEP, as practiced by the Christie DEP Science Advisory Board (SAB).

The DEP SAB was created by Corzine administration DEP Commissioner Lisa Jackson.

I am a longtime critic of the DEP SAB, particularly with respect to the membership, which includes industry representative and consultants who have clear conflicts of interests and scientific bias. I’ve objected to the SAB’s role, lack of ethical standards, lack of scientific integrity, and lack of transparency and accountability. Some of those criticisms have led to reforms, others have not.

When Corzine Commissioner Jackson left DEP to assume a role as Gov. Corzine’s Chief of Staff, she was replaced by Mark Mauriello, who served on an Acting basis.

Mauriello issued Administrative Order #2009-5 on May 28, 2009 regarding the mission, role, ethics, and composition of the SAB.

Importantly, Mauriello’s Order specifically restricted the SAB from any role in DEP “policy and regulations” (see paragraph #4).

But Christie DEP Commissioner Martin ignored that restriction and directed the SAB to attack DEP regulations.

Most notoriously, the Christie DEP SAB attack on DEP’s Highlands Nitrate Model – the basis for the Septic Density regulations – led to extreme controversy and a legislative veto of DEP regulatory rollbacks that were based in part on that SAB “science”.

Curiously, Gov. Murphy’s DEP Commissioner McCabe – who touts the importance of science – is repeating that abuse of the SAB.

I lay out and document the argument in the below letter to Senate Environment Committee Chairman Smith, seeking legislative oversight and reforms. I urge support of readers on this important issue:

Dear Chairman Smith and Senators Bateman and Greenstein:

I just reviewed Gov. Murphy’s proposed FY’20 DEP budget in light of NJ Spotlight’s report on a decade of deep budget cuts. In case you missed the important Spotlight story, see:

Funding for State Pollution Control Dropped 12% in Decade to 2018, Study Says

https://www.njspotlight.com/2019/12/funding-for-state-pollution-control-dropped-12-in-decade-to-2018-study-says/

At any rate, aside from these critical funding issues, in reviewing the proposed DEP budget, I noted troubling language regarding the DEP Science Advisory Board (SAB).

As you may know, I have been a longtime critic of the SAB and some of my criticisms have been addressed by DEP reforms, particularly regarding conflicts of interest, ethical standards, and scientific bias. But others have not.

As you may recall, the SAB was created by former DEP Commissioner Lisa Jackson. Unfortunately, DEP’s SAB website does not include a link to the Jackson AO (see:

https://www.state.nj.us/dep/sab/

However, it does include a link to the subsequent Administrative Order 2009-05 of Acting DEP Commissioner Mauriello, who replaced Jackson when she went to Gov. Corzine’s Office See:

https://www.nj.gov/dep/sab/sab-ao.pdf

I specifically call your attention to paragraph #4 of that Order, which has not been repealed or superseded and remains in effect, which provides (emphasis mine):

“4. The issues upon which the Board deliberates shall be those that the Commissioner requests the Board, through the Department’s Office of Science, to consider, which issues shall be limited to specific scientific and technical issues, not policy or regulatory matters” 

I now call your attention to Gov. Murphy’s proposed FY’20 DEP budget, which on page D-123, directly contradicts paragraph #4 of Administrative Order 2009-05 regarding SAB involvement in regulatory and policy matters:

“The Science Advisory Board (SAB) … reviews the quality and relevance of the scientific and technical information being used or proposed as the basis for Department regulations.”

https://www.state.nj.us/treasury/omb/publications/20budget/pdf/FY20GBM.pdf

Clearly, the SAB was NOT an is NOT authorized to review “the basis of Department regulations” as stated in the proposed FY’20 DEP budget.

Commissioner Mauriello’s AO# 2009-05 clearly restricts the role of the SAB with respect to any role in “policy and regulatory matters”.

Instead, the SAB’s mission, as AO #2009-05 clearly states in paragraph #1, is to:

“is to provide independent peer review and advice to the Commissioner, as requested by the Commissioner, on scientific and technical issues relevant to the Department’s mission (emphasis mine).

In contrast to offices such as the State Geologist, State Forester, and the State Climatologist, the DEP SAB was not established by legislation and has no legislative basis or authorization. It was a creature of Administrative Order.

Because the issue of scientific integrity is central to the protection of public health and the environment and the role of DEP regulations is to implement and enforce responsibilities delegated by the Legislature, I strongly urge you to enforce the DEP AO #2009-05 to limit the role of the SAB to restrict their involvement in regulatory and policy matters.

To do so would require, at a minimum, that the DEP FY’20 budget language cited above be stricken.

Preferably, legislation – or budget language – should establish legislative authorization and define the mission, role, ethical standards, transparency, accountability, and composition of the DEP SAB. I would be glad to work with you on that.

Sincerely, Bill Wolfe

Program Is Capped At Just 75 MW/Year, Compared to 650 MW Proposed To BPU

Less Than 30 MW Is Allocated To Low & Moderate Income Homes

“Activists” “Demand” 400 MW, Which Is LESS THAN The Private Sector Proposed

[Update below]

NJ Spotlight ran another misleading story today on the Murphy Administration’s “Community Solar” program, with a sham headline, no less, see:

• Solar Power to the People: Coalition Hopes to Bring Clean Energy to Poor Families

“Power to the people”? Are you kidding me?

There are no requirements that the “community” solar system be publicly owned and subject to “community” standards and democratic controls.

The story repeats the false narrative about the so called high costs and subsidies to renewable energy, while completely ignoring the context in which to evaluate those alleged costs, including:

• the human & economic costs of climate catastrophe, which include collapse of civilization
• the metric of traditional mainstream economics, known as the Social Costs of Carbon
• billions of dollars of subsidies to the fossil industry
• corporate profits

How can it be that NOT ONE of these major points – all of which are robustly documented in the literature, as a simple Google search reveals – is part of the media coverage and policy debate?

This is totally irresponsible journalism.

So  called “Ratepayer Advocate” Brandt is professionally negligent in her one dimensional analysis and repeated criticism of so called “renewable subsidies”.

The climate and renewable energy activists are incompetent in failing to make the case and challenge the media narrative and the technical methodologies upon which this false narrative is based.

I hardly know where to begin in correcting the omissions and misinformation in that story and the lame efforts of the so called “activists”.

First, let’s present key facts about the community program, which were not included in the NJ Spotlight story, based on Murphy BPU’s own press release::

1. The community solar pilot program is legally capped at just 75 MW/year.

2. BPU estimates that over 3 years of 75 MW/year, could provide the power consumption equivalent of  (not actual service to) 45,000 homes.

3. Private sector solar developers submitted proposals to BPU for 650 MW of capacity.

In comparison, the so called “activists” “roadmap” in NJ Spotlight story are demanding a program of just 400 MW by 2030, which is far LESS than proposed by the private sector in year 2019!!!. How is that “roadmap” ambitious? It too is a joke.

4. BPU claims that 40% of the 75 MW capacity – just 30 MW – is “earmarked” for low and modest income homes (note that the “earmark” is not a legal “dedication” or guarantee).

But, upon close examination of the BPU program priority criteria – in light of almost 10 times more capacity proposed than the 75 MW cap – that 40% “earmark” is not even close to what capacity is actually likely to be allocated to low and moderate homes. Follow me.

Specifically, the BPU received 252 applications for 650 MW of power,  almost 10 TIMES the 75 MW cap.

So, the actual allocation of the 75 MW will be based on how projects earn “points” and are ranked based on the BPU priority criteria. The 75 MW capped capacity will be consumed by a very short list of the total projects, compared to those that applied to BPU.

According to BPU, 232 of the 252 applications “are for projects where at least 51 percent of capacity would benefit low- and moderate-income (LMI) residents.”

Did you get that? Just 51% of capacity to LMI qualifies the project. That means 49% of a so called LMI project power can go elsewhere, like a corporate office park or shopping center. Technically, that 51% minimum could cut the 30 MW “earmark” to just a little over 15 MW.

Technically, assuming that a typical community solar project provides just 51% to LMI, the 75MW capped capacity means that far less than 30 MW is actually guaranteed to LMI. It could be as little as just 15 MW.

But, it gets worse.

Next, we must consider how the BPU priority point system will operate and impact the allocation to LMI.

First, let me present how BPU  describes it and then I will interpret how this will allocate funding to LMI:

BPU will “score the applications based on evaluation criteria which include:”

• Low- and moderate-income and environmental justice inclusion (30 points max.);

• Siting – with priority given to landfills, brownfields, areas of historic fill, rooftops, parking lots, and parking decks (20 points max., with a potential five-point bonus for landscaping, land enhancement, pollination support, storm water management, soil conservation, and/or decommissioning plans);

• Product offering (15 points max., with priority given to those that guarantee savings of greater than 10 percent);

• Community and environmental justice engagement (10 points max.);

• Subscribers (10 points max., with priority given to projects with a majority of residential subscribers);

• Other benefits (10 points max., with priority given to projects providing local jobs, job training or demonstration of co-benefits such as paired with storage or a microgrid project); and

• Geographic limit within EDC service territory (5 points max., with priority given to projects with subscribers in the same municipality or an adjacent municipality to the project’s location).

  Projects must receive at least 30 points to be considered for participation in the Pilot Program. Projects that receive more than 30 points will be awarded capacity in the Pilot Program in order, starting with the highest-scoring project and proceeding to the lowest-scoring project.

Note that, based on the priority criteria, technically, zero capacity is actually guaranteed to LMI.

It is easy to imagine ways to game the point system. A project that gets at least 31 points that has no LMI (e.g. a landfill site, with stormwater controls and greater than 10% savings – with no LMI or EJ components).

LMI gets just 30 points of 90 total points – but note that a project could get more than 30 points based on earning some of the 60 points of other criteria.

Note also that environmental justice – and alleged priority of Governor Murphy – gets just 10 points, of 90 total.

Ironically, the actual “guarantee” to LMI is the result, not of the BPU priority point system, but of the fact that large majority of the applications allocate at least 51% to LMI.

There is no guarantee whatsoever for environmental justice considerations.

The so called activists need to understand facts and make more effective arguments.

And the media needs to stop the false narrative and report the facts.

[Update: For content, compare Gov. Murphy’s paltry program to Bernie Sanders‘ Green New Deal for Public Housing, which, among other things seeks to:

[(1) – (4)]

(5) to transition the entire public housing stock  of the United States, as swiftly and seamlessly as possible, into highly energy-efficient homes that produce on-site, or procure, enough carbon-free re-newable energy to meet total energy consumption annually.

Obviously, this retrofit policy and all the provisions of the Sanders’ bill could be applied to existing privately owned housing.

I post this as a benchmark for the exaggerated low and moderate income, social justice, renewable energy, and climate claims of Gov. Murphy. ~~~ end update]