in New Jersey

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Fracking in the U.S.
Energy policy in the U.S.
State fracking policy
State energy policy
Glossary of energy terms

Energy policy involves governmental actions affecting the production, distribution, and consumption of energy in a state. Energy policies are enacted and enforced at the local, state, and federal levels and may change over time. These policies include legislation, regulation, taxes, incentives for energy production or use, standards for energy efficiency, and more. Stakeholders include citizens, politicians, environmental groups, industry groups, and think tanks. A variety of factors can affect the feasibility of federal and state-level energy policies, such as available natural resources, geography, and consumer needs.

This article outlines state-level oil and gas regulations, renewable energy programs, oil and gas production, energy usage, energy and electricity prices, fuel taxes, and utilities in New Jersey.

See the tabs below for further information:

1. Policy: This tab provides information about state regulations on energy production and policies related to oil and gas production, fracking, renewable energy generation, energy efficiency, and net metering.
2. Production: This tab provides information about total energy production by energy source in New Jersey.
3. Usage: This tab presents information about electricity consumption by energy source.
4. Prices and taxes: This tab presents information about average energy and electricity prices, per capita spending on energy, and fuel taxes.
5. Utilities: This tab presents information about public and private utilities, electricity markets, the types of utilities in New Jersey, and the electric reliability organizations in New Jersey.
6. Background: This tab provides information about the types of nonrenewable and renewable energy sources produced and used in the United States, an energy profile of New Jersey, a state profile of New Jersey from the Almanac of American Politics (2016), and economic indicators in the state, such as median income.

Policy

State regulations

Because New Jersey had no crude oil or natural gas reserves as of 2015, there were no state rules or regulations governing oil or gas production in the state.^[1]

Fracking

See also: Fracking in New Jersey

Because there were no proven crude oil or natural gas reserves in New Jersey as of 2015; consequently, there were no fracking operations in the state.^[1]

Renewable energy policies

States have implemented funding and financial incentive programs to subsidize or otherwise increase investment in renewable energy resources such as wind, solar, and hydroelectric power. These programs include renewable portfolio standards, grants, rebate programs, tax incentives, loans, performance-based incentives, and more. The aim of the policies generally involves reducing the cost of renewable energy production for consumers, reducing regulatory compliance costs, reducing investment risks involving renewable energy, and/or increasing the adoption of renewable energy sources by individuals and businesses.^[2]

Renewable Portfolio Standard

See also: Renewable Portfolio Standard

A Renewable Portfolio Standard (RPS), also known as a renewable electricity standard, is a mandate intended to increase the amount of renewable energy production and use. Under these standards, a utility company can be required by a state to have a certain percentage of its electricity come from certain renewable energy resources. In addition, states may give tax credits to utility companies to fulfill these requirements.^[3][4]

As of February 2017, New Jersey was one of 30 states with a Renewable Portfolio Standard. The standard requires all electric suppliers serving retail customers to procure 20.38 percent of their electricity sales from eligible renewable energy sources by June 2020. In 2010, the New Jersey Legislature enacted legislation requiring that electric suppliers procure an additional 4.1 percent of their sales from eligible solar energy sources by June 2027. Eligible renewable sources include solar energy, wind energy, wave and tidal energy, geothermal energy, landfill methane gas, biomass, and hydroelectric facilities with a capacity of 3 megawatts (MW) or less.^[5][6]

Grant programs

States, nonprofit organizations, and/or private utilities may operate grant programs for renewable energy. These programs may include state or private funding for energy installation costs, research and development, infrastructure and business development, system testing, and renewable energy feasibility studies (studies that look into the potential for renewable energy use in specific areas). Grants can be provided with or without requiring a recipient to match the grant. Additional incentives, such as lower interest loans, may be included with a grant.^[2]

As of March 2015, New Jersey was one of 18 states with a state-run grant program for renewable energy. However, the New Jersey Economic Development Authority as of February 2017 ceased issuing grants for renewable energy sources. The Edison Innovation Clean Energy Manufacturing Fund previously provided grants and loans for photovoltaic solar energy, wind energy, tidal and wave power, biomass, and landfill methane gas. The program distributed grants and loans to qualified manufacturers for the above renewable energy projects.^[2][7] However, the New Jersey Clean Energy Program ceased accepting applications for grants and incentives for its combined heat and power and fuel cell program as of December 2015. Applicants received funding based on the size of the project, its efficiency, environmental performance, and other metrics determined by the state government. See the map below for grant programs by state.^[2][8]

States with grant programs for renewable energy as of March 2015 (Source: Environmental Protection Agency)

Loan programs

Loan programs may be used to offer lower interest loans or other financing options to individuals and businesses to reduce the upfront costs of purchasing and installing renewable energy technologies. Loan programs may include programs that use payments from earlier borrowers to provide loans for new borrowers, programs in which building owners reduce their energy consumption to pay their upfront costs for renewable energy technologies, and programs that allow individuals with a higher debt-to-income ratio to purchase homes that use less energy, among others.^[2]

As of March 2015, New Jersey was one of 36 states with a state-run loan program for renewable energy technologies. However, the New Jersey Economic Development Authority as of February 2017 ceased issuing loans for renewable energy sources. The Edison Innovation Clean Energy Manufacturing Fund previously provided grants and loans for photovoltaic solar energy, wind energy, tidal and wave power, biomass, and landfill methane gas. The program distributed these grants and loans to qualified manufacturers for the above renewable energy projects. In addition, the Edison Innovation Green Growth Fund previously provided loans for up to $2 million to technology companies with photovoltaic solar energy, wind energy, tidal and wave power, biomass, and landfill methane gas technologies.^[2]Cite error: Closing </ref> missing for <ref> tag

Net metering

Net metering is a billing system in which customers who generate their own electricity, usually using renewable sources (such as solar panels) are able to sell their excess electricity back to the electric grid, which is an interconnected network that is used to deliver electricity. This requires electricity to be able to flow both to and from a consumer.^[9][10][11]

As of October 2016, New Jersey was one of 41 states with a statewide net metering policy. The state requires all investor-owned utilities to offer net metering to residential, commercial, and industrial consumers. Eligible renewable energy sources include wind energy, solar energy, geothermal energy, wave and tidal energy, landfill methane gas, and biomass resources. Renewable energy systems must be limited to the amount of electricity needed to meet annual on-site electricity demand. For a complete list of net metering programs by state, click here.^[5][12][13]

Recent legislation

The following is a list of recent energy policy bills that have been introduced in or passed by the New Jersey State Legislature. To learn more about each of these bills, click the bill title. This information is provided by BillTrack50 and LegiScan.

Note: Due to the nature of the sorting process used to generate this list, some results may not be relevant to the topic. If no bills are displayed below, no legislation pertaining to this topic has been introduced in the legislature recently.

Ballot measures

Energy policy ballot measures

See also: Energy on the ballot and List of New Jersey ballot measures

Ballotpedia has not covered any ballot measures relating to state and local energy policy in New Jersey.

Utility policy ballot measures

See also: Local utility tax and fees on the ballot

Ballotpedia has not covered any ballot measures relating to local utility tax and fees in New Jersey.

Production

The sections below include statistics on total energy production in New Jersey, oil and natural gas production in New Jersey, oil and gas production in New Jersey over time (2004-2014), and oil and gas production on federal land, including the amount of federal land leased in New Jersey for production.

Total energy production

The table below provides information regarding energy production in New Jersey in British thermal units (Btu). A British thermal unit is used to measure the heat contained in different fuels. The U.S. Department of Energy defines a Btu as "the quantity of heat required to raise the temperature of 1 pound of liquid water by 1 degree Fahrenheit." Fuels are discussed in terms of Btu to compare fuels with different energy content and prices. For example, one gallon of gasoline equals 120,524 Btu.^[14]

Nonrenewable energy production

The table below provides information regarding nonrenewable energy production in New Jersey. For coal data, the phrase productive capacity refers to the maximum amount of coal that could be expected to be produced in 2014. The natural gas and crude oil production data refer to the amounts of natural gas and crude oil produced in December 2014 and April 2016, respectively.^[1][15]

Oil and gas production (2004-2014)

Note: This section provides information about oil and gas production on private and state-owned lands. Information on oil and gas production on federal lands is accessible here.

Because New Jersey had no proven oil or natural gas reserves as of 2015, the state had no oil or gas production.^[1]

Energy usage

The section below includes statistics on electricity consumption in the state by energy type (in 2014).

Consumption

The table below provides information about energy consumption by source in New Jersey in 2014. Information from select surrounding states is provided for comparison.^[1]

Prices and taxes

The sections below include information on energy prices and spending in New Jersey, fuel taxes and state taxes in New Jersey and in neighboring states, and an overview of the federal tax on gasoline.

Energy prices

The price of electricity is affected by supply and demand. The supply of electricity is affected by fuel prices, environmental and energy regulations, power plant capacity, weather, and other factors. Demand for electricity also affects the price. Because electricity cannot be stored for long periods of time, it must be produced and used when it is needed. As demand for electricity increases, the price also generally increases.^[16][17]

The table below provides information about energy prices in New Jersey as of April 2016. Information from select surrounding states is provided for comparison.^[1]

Electricity prices can vary depending on the type of consumer; consumer categories include residential, commercial, industrial, and in some cases, transportation. The rate-making process is both political and economic. The table below presents information about electricity prices by consumer type in New Jersey in April 2016. Information from select surrounding states is provided for comparison.

Energy spending

The table below provides information about energy spending in New Jersey as of 2014. Information from select surrounding states is provided for comparison.

Fuel taxes

Click to enlarge.

Revenue collected by federal, state, and local governments from fuel taxes is usually used to fund transportation infrastructure such as roads and bridges. Some states may charge an excise tax based on how much gas or diesel is purchased. Some states may charge retail tax based on the average price of gas over a certain period. Additionally, some states may charge an environmental tax to be used for environmental projects. The Tax Foundation, which created the map to the right, used data from the American Petroleum Institute, which converted each state's different tax structure into cents per gallon to compare each state's gas taxes. In 2016, gas taxes accounted for 23 percent of the price of gasoline. Crude oil accounted for 40 percent of the price of gasoline, refining accounted for 24 percent of the price, and distribution and marketing accounted for 13 percent of the remainder.^[18][19]

The table below provides information about state fuel taxes by type (excluding the federal gas taxes) in New Jersey as of January 2016. As of January 2016, New Jersey levied a 14.5 cent state gasoline tax and a 17.5 cent state diesel tax. New Jersey ranked 49th highest in total gasoline taxes (federal and state) and 46th highest in total diesel fuel taxes as of January 2016.^[20][21]

Federal tax

The first federal tax on gasoline was proposed by Secretary of the Treasury Ogden L. Mills under President Herbert Hoover (R) as a revenue generating measure to balance the budget during the Great Depression. A 1-cent tax per gallon of imported gasoline and fuel oil was passed as part of the Revenue Act of 1932 and signed by President Franklin D. Roosevelt (D). The 1-cent tax continued until 1951 when the tax was increased to 2 cents in part to raise revenue during the Korean War. In 1956, the tax was raised to 3 cents to fund the Interstate Highway System. During this time, the Highway Trust Fund was created as a means to fund highway construction. Since 1956, there have been increases to the tax. As of April 2016, the gas tax was last raised by President Bill Clinton (D) in 1993 to 18.4 cents per gallon.^[22]

Utilities

The sections below include general information on utilities, an overview of utilities and electricity markets, information on the types of utilities in New Jersey, an overview of electricity reliability organizations (EROs), and the EROs that oversee electricity in New Jersey.

Background

Utilities are firms that own and/or operate facilities to generate, transmit, and/or distribute electricity, gas, and/or water to the public. Electric utilities are commercial entities that own and operate facilities to generate, transmit, and distribute electricity to the public and/or the industrial sector. State and local regulators oversee transmission and distribution charges. Local utilities read electric meters and bill individuals or businesses, generally on a monthly basis.^[23][24]

Utilities are defined differently in each state and in federal legislation. Two general types of utilities are private and public utilities. Private utilities, commonly known as investor-owned utilities, provide stocks to investors and sell bonds. These utilities are regulated by state regulatory agencies. State agencies are also responsible for setting retail rates charged by investor-owned utilities, overseeing utility infrastructure, and ensuring that investor-owned utilities respond to customer service demands. Public utilities include government or municipally owned utilities. Another type of utility is an electric cooperative. Cooperatives are nonprofit businesses voluntarily owned and managed by the individuals and businesses that use their services. They are commonly used in rural areas that do not have access to a larger state or region-wide electric grid.^[24]

Electricity markets

Electricity markets in each state are defined as regulated or deregulated. A regulated market includes utilities that own and manage the power plants that generate the electricity, the electricity transmission lines, and the distribution equipment (such as wires and electric poles). In addition, the utilities rates are approved and regulated by local and state agencies. A deregulated market requires utilities to divest ownership in the generation and transmission of electricity. In this market, utilities oversee the interconnection from a meter at a household or business to the power grid and is responsible for billing ratepayers.^[25][26]

Depending on the state and/or area, public utilities may provide most or all energy services to homes and businesses, or a state may allow other private electricity providers to transmit and distribute electricity in addition to other utilities. For example, one type of private provider is a retail energy provider, which sells electricity in areas with retail competition. The provider purchases wholesale electricity and the delivery services (such as transmission lines) and can price electricity to particular consumers.^[25][26]

As of February 2017, New Jersey was one of 10 states with a deregulated electricity market. The New Jersey Board of Public Utilities has regulatory authority of the state's four investor-owned utilities—Public Service Electricity & Gas, Jersey Central Power and Light, Atlantic City Electric, and Rockland Electric Company. These utilities oversee the transmission and delivery of electricity while electric suppliers generate the electricity purchased by consumers. Electric suppliers must be licensed by the Board of Public Utilities^[27][28]

Electric reliability organizations

The Energy Policy Act of 2005 required the Federal Energy Regulatory Commission (FERC) to designate an electric reliability organization (ERO) for the United States. An ERO oversees the reliability of a nation's electric grid. In 2006, FERC granted authority to the North American Electric Reliability Corporation (NERC) to develop and enforce grid reliability standards for the United States. NERC, a self-regulated nonprofit corporation, is authorized to enforce grid reliability standards for all users, owners, and operators of the U.S. electrical system.^[29]

NERC works with eight regional reliability organizations to oversee the U.S. electrical system. These organizations, known as regional entities, are composed of officials from investor-owned utilities, federal power agencies, electric cooperatives, and state and municipal utilities. Regional entities enforce NERC and regional reliability standards. Further, they forecast electricity demand and coordinate operations with other regional entities.^[30]

New Jersey EROs

As of February 2017, ReliabilityFirst was the NERC-affiliated nonprofit corporation that oversees electric service reliability in New Jersey. NERC authorized ReliabilityFirst as an ERO in July 2006. The corporation is responsible for developing electricity reliability standards, monitoring compliance by owners and users of the bulk electric system, and issuing seasonal and long-term assessments of bulk electric system reliability in the region.^[31]

Background

The sections below include an overview of the types of renewable and nonrenewable energy produced and consumed in the United States, an energy profile of New Jersey (from the U.S. Energy Information Administration), a general profile of New Jersey (from the 2016 edition of the Almanac of American Politics), and various economic indicators in New Jersey.

Background on energy resources

Nonrenewable energy sources, such as coal, oil, and natural gas (sometimes known as fossil fuels), and renewable sources, such as hydropower, wind, biofuels, and solar energy, are produced in each state, though at different levels depending on a state's geography, energy consumption, and the raw materials available in a particular state. For example, several states do not have coal, oil, and/or natural gas resources. States that lack these resources import these fuels.^[32]

According to the U.S. Department of Energy, oil, coal, and natural gas comprise the majority of the resources used to generate power in the United States. In 2014, the top five energy-producing states were the top five fossil fuel-producing states—Texas, Wyoming, Pennsylvania, Louisiana, and West Virginia. These states' fossil fuel production accounted for approximately 42 percent of U.S. energy production in 2014. States with fewer coal, oil, and natural gas resources generally consume less energy. In 2014, the bottom five energy-producing states—Rhode Island, Delaware, Hawaii, Nevada, and New Hampshire—produced 0.2 percent of U.S. energy and consumed approximately 2 percent of total U.S. energy.^[32]

The production of biofuels (liquid fuels created from plant or plant-derived materials) is generally concentrated in the Midwest—states such as Illinois, Iowa, Nebraska, and South Dakota) given the region's agricultural production of crops such as corn, which is used to make ethanol, a biofuel that can be blended with gasoline and used as a transportation fuel.^[32]

Other renewable sources are used to generate power in the states include hydroelectric power, which accounted for about half of all renewable energy production in the United States in 2014.^[32]

New Jersey energy profile

According to the U.S. Energy Information Administration, New Jersey has no proven crude oil, coal, or natural gas reserves and thus no production.^[1]

As of 2014, the state had three operating oil refineries, two of which produce motor vehicle gasoline, diesel fuel, and heating oil (the third produces asphalt). Pipelines deliver petroleum from New Jersey to the rest of the northeastern United States, such as Pennsylvania and New York. New Jersey also receives petroleum by ocean tanker from Europe, Canada, Latin America, and India. About 10 percent of New Jersey residents used fuel oil as their primary heating source as of 2014.^[1]

From 2010 to 2015, the majority of natural gas consumed in New Jersey went to electricity generation and home heating. As of 2015, five interstate pipelines delivered natural gas to New Jersey from the Gulf of Mexico. In 2014, New Jersey received less than 5 percent of its net electricity generation from coal, a decline of approximately 20 percent since the 1990s. As of 2014, renewable energy accounted for less than 5 percent of New Jersey's net electricity generation; approximately 66 percent of the electricity generated by renewable energy in the state came from solar energy.^[1]

State profile

Presidential voting pattern

See also: Presidential voting trends in New Jersey

New Jersey voted for the Democratic candidate in all six presidential elections between 2000 and 2020.

Pivot Counties (2016)

Ballotpedia identified 206 counties that voted for Donald Trump (R) in 2016 after voting for Barack Obama (D) in 2008 and 2012. Collectively, Trump won these Pivot Counties by more than 580,000 votes. Of these 206 counties, two are located in New Jersey, accounting for 0.97 percent of the total pivot counties.^[33]

Pivot Counties (2020)

In 2020, Ballotpedia re-examined the 206 Pivot Counties to view their voting patterns following that year's presidential election. Ballotpedia defined those won by Trump won as Retained Pivot Counties and those won by Joe Biden (D) as Boomerang Pivot Counties. Nationwide, there were 181 Retained Pivot Counties and 25 Boomerang Pivot Counties. New Jersey had one Retained Pivot County and one Boomerang Pivot County, accounting for 0.55 and 4.00 percent of all Retained and Boomerang Pivot Counties, respectively.

More New Jersey coverage on Ballotpedia

• Elections in New Jersey
• United States congressional delegations from New Jersey
• Public policy in New Jersey
• Influencers in New Jersey
• New Jersey fact checks
• More...

Economic indicators

See also: Economic indicators by state

New Jersey's GDP increased by 0.4 percent in 2014. Click the image to view a larger version.

Broadly defined, a healthy economy is typically one that has a "stable and strong rate of economic growth" (gross state product, in this case) and low unemployment, among many other factors. The economic health of a state can significantly affect its healthcare costs, insurance coverage, access to care, and citizens' physical and mental health. For instance, during economic downturns, employers may reduce insurance coverage for employees, while those who are laid off may lose coverage altogether. Individuals also tend to spend less on non-urgent care or postpone visits to the doctor when times are hard. These changes in turn may affect the decisions made by policymakers as they react to shifts in the industry. Additionally, a person's socioeconomic status has profound effects on their access to care and the quality of care received.^[34][35][36]

Compared to neighboring states, New Jersey had the smallest portion of residents that earned incomes below 100 percent of the federal poverty level, 11 percent, and the highest median annual household income, $65,321. In September 2014, the state's unemployment rate was about 0.6 percentage points above the national rate.^{[37][38][39][40]}

Note: Gross state product (GSP) on its own is not necessarily an indicator of economic health; GSP may also be influenced by state population size. Many factors must be looked at together to assess state economic health.

See also

• Energy policy in the U.S.
• Fracking in New Jersey
• Net metering
• Renewable Portfolio Standard
• Environmental policy in New Jersey

Recent news

The link below is to the most recent stories in a Google news search for the terms New Jersey energy policy. These results are automatically generated from Google. Ballotpedia does not curate or endorse these articles.

Footnotes

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