NJ gas customers can save thousands with electric appliances, new study finds

Report: New Jersey gas customers can save up to thousands of dollars annually by weatherizing, converting to electric appliances like heat pumps

Acadia Center Report finds that some residents who upgrade to electric appliances can save up to 69% on energy bills when paired with weatherization, find relief from volatile fossil fuel prices

TRENTON, NJ, June 22, 2023 — New Jerseyans in an average insulated gas-heated home can save anywhere from 4% to 41% on their annual energy bills by adopting highly efficient electric appliances such as heat pumps depending on utility service territory, and up to 69% in a typical drafty home if paired with weatherization, according to a new report out today by Acadia Center.

Based on winter 2022-2023 utility rates, Acadia Center analysts found that New Jerseyans who live in poorly insulated gas homes can save $1,550 to $3,240 each year, a range of 47% to 69% savings on annual energy bills depending on service territory, by investing in electrification and weatherization.

“This report makes clear that switching from fossil fuels can save New Jerseyans money,” said Ben Butterworth, Director of Climate, Energy & Equity Analysis at Acadia Center. “With volatile natural gas prices driving energy bill spikes, it’s vital New Jerseyans understand they can save money by upgrading their homes to utilize clean electric appliances like heat pumps. For many customers, this can free up thousands of dollars each year to spend on groceries, prescriptions, childcare, and other daily necessities.”

This report, “The Future is Electric: How the Average New Jersey Household Can Save by Electrifying,” updates a 2022 analysis that calculated savings using low gas rates from winter 2021-2022, which demonstrated that the average household in New Jersey would see annual bill savings of about 20% by pairing electrification with weatherization. The 2022 report demonstrated that those savings jump to more than 50% for a typical drafty home electrifying and improving weatherization. Because utility gas rates for New Jersey households increased 51% on average in the past two years, even more dramatic savings are now available for gas customers who adopt weatherization and highly efficient all-electric alternatives like heat pumps.

Swapping fossil fuel burning appliances with electric alternatives would also eliminate a significant source of indoor and outdoor air pollution, the impacts of which are disproportionately borne by low-income households and communities of color. Gas appliances emit harmful pollutants such nitrogen dioxide (NO2) that can exacerbate respiratory illnesses when burned indoors. Children are particularly at risk, as children who live in homes with gas stoves have a 42% higher risk of developing asthma symptoms and a peer-reviewed study found that nationwide, gas stove use can be attributed to 12.7% of childhood asthma cases.

“Electrifying and weatherizing low-income homes can deliver equitable economic benefits and close health disparities for millions of Black and brown New Jerseyans who are more likely to be exposed to air pollution from our buildings, heavy industry and transportation emissions,” said Nicole Miller, Vice Chair of the New Jersey Progressive Equitable Energy Coalition. “These families should not be overlooked or left behind. New Jersey leaders must create pathways to increase affordability and ensure those vulnerable households who can benefit most from all-electric, comfortable homes are the first in line.”

Thanks to the passage of the Inflation Reduction Act, New Jersey residents will soon be able to take advantage of rebates and incentives to lower the upfront cost of weatherization and highly efficient electric appliances such as heat pumps, including up to $1,600 for weatherization and up to $8,000for air-source heat pumps. While New Jersey offers anywhere from $390 to $1,000 for cold climate heat pumps depending on utility service territory, more needs to be done to increase access to programs to help low- and moderate-income households weatherize their homes and adopt highly efficient electric alternatives.

“New Jersey has ambitious goals to deliver the economic, health, and climate benefits of all-electric homes but no programs to achieve those goals,” said Barbara Blumenthal, Research Director at the New Jersey Conservation Foundation. “This report shows that the longer state regulators at the Board of Public Utilities and legislative leaders delay in creating programs to accelerate the adoption of highly efficient electric appliances like heat pumps, the more it will cost New Jersey gas customers stuck with higher bills and less comfortable homes,” she concluded.

In New Jersey, 73% of homes rely on natural gas for heating. Governor Phil Murphy has set ambitious goals to deploy heat pumps in 400,000 New Jersey homes and 20,000 commercial properties by 2030. Rapidly transitioning New Jersey’s homes and buildings, which make up 26% of the state’s total emissions, is essential to meeting the state’s goal to reduce emissions 80% by 2050.

To see the original article in Insider NJ, click here.

MassDOT removing six unreliable Turnpike EV chargers

After years of unreliable electric charging service on the Massachusetts Turnpike, the Department of Transportation is looking for a total reboot.

The six charging stations at rest stops on the Pike have been permanently taken out of service, the agency said. Now MassDOT is in the early stages of selecting a vendor to remove the non-functional terminals and install new ones.

The replacement process will take time, given state procurement rules, said Kyle Murray, Massachusetts program director at the nonprofit Acadia Center who is following the EV transition. The administration of Gov. Maura Healey should move more quickly than the prior Baker administration, he said.

“I’m confident that we will see the pace pick up a bit with the new administration in place,” Murray said. “Obviously they’re still getting their legs under them, and any new policies they put in place are going to have some lag time until implementation.”

Read the full article from the Boston Globe here.

Winter grid concerns bringing federal energy agency to Portland

The independent agency that regulates America’s interstate electricity and natural gas transmission systems is holding a special forum in Portland on June 20 to discuss potential solutions to the winter supply bottlenecks that have sent New England’s power prices soaring and threatened reliability.

Roughly half of the region’s generating capacity is fueled by natural gas. But New England doesn’t have enough pipeline capacity now to serve both power plants and heating needs on the coldest winter days, a direct result of opposition by environmental activists who have fought building new lines in southern New England.

Groups such as Acadia Center favor strategies such as greater efficiency, and encouraging people and businesses to shift energy use to off-peak times, as ways to bolster winter reliability in the short term without expanding climate-changing fossil fuel use. More solar, wind and battery storage could displace gas over time, they’ve said.

To read the full article from the Portland Press Herald, click here.

The country’s first gas utility-run networked geothermal heating and cooling system breaks ground in Mass.

New England’s largest energy utility, Eversource, is on its way to becoming the first gas utility in the country to build and run a “networked geothermal system.” The pilot project, which broke ground this week in Framingham, will use a network of deep wells and pipes to provide climate-friendly heating and cooling for 37 buildings.

If successful, advocates say they hope the model can be scaled to help the state meet its clean energy goals and provide a new business opportunity for gas utilities as the country weans itself off of fossil fuels.

“We are really excited about this pilot project and want to see the results that come from it, [but] I think we really do need to think about all options here. We can’t just think, ‘oh, this is our solution,’ ” said Kyle Murray, the Massachusetts program director of Acadia Center, a clean energy advocacy group.

“We need to be thinking creatively about all potential solutions and that, that does include the potential decommissioning of gas utilities in the future as well.”

To read the full article from wbur, click here.

Wildfire smoke ‘significantly’ reduced solar power production in New England this week

The smoke from Canadian wildfires didn’t just block the sun and make the air unhealthy to breathe in much of New England this week. It also blunted solar power production and made it harder to forecast electricity demand in the region, according to the regional grid operator.

“Climate change is going to cause more and more of these kinds of issues,” said Kyle Murray, the Massachusetts program director of Acadia Center, a clean energy advocacy group.

At this point, it’s hard to say that human-induced climate change is directly causing the wildfires in Eastern Canada, but it certainly makes the sort of drought and hotter-than-average temperatures that lead to wildfires more likely.

As the smoke from the Canadian wildfires continues to dissipate over New England, Murray said he sees two big takeaways: First, New England needs to stop making the climate problem worse by burning fossil fuels. And second, it needs to build a more modern and flexible grid that relies on multiple sources of renewable energy.

“We need to learn strategies for how to mitigate [impacts] and how to think creatively going forward because the problem isn’t going away,” Murray said.

To read the full article from wbur, click here.

Also featured on NHPR.

PURA Advancing a Framework for Performance-Based Utility Regulation

Utilities recover the costs of the investments that are needed to provide customers with energy through the bills that customers pay each month. This “cost-of-service” framework is the foundation of traditional utility regulation. In contrast, Performance-Based Regulation (PBR) is an alternative method for regulating utilities that ties utility revenues more directly to their performance, such as efforts to reduce emissions or to support the deployment of distributed energy resources, rather than tying earnings primarily to the costs required to provide service.  

By allowing regulators to better align utility revenues with improved performance, PBR— which includes a broad set of regulatory tools, such as performance metrics and financial penalties or rewards—can help overcome outdated incentives under traditional utility regulation. High allowed returns create incentives for utilities to build expensive infrastructure projects, but PBR can help reorient utilities towards more cost-effective solutions that can save customers money and deliver additional benefits, such as reducing emissions and improving environmental justice outcomes.   

States across the US have experimented with PBR to varying degrees and with varying degrees of success. Recently, Connecticut’s Public Utilities Regulatory Authority (PURA) announced a decision that formally adopts regulatory goals and outcomes for PBR in the state. Over the past year, Acadia Center worked with a range of stakeholders to help develop PBR goals and assess how well existing utility regulatory policies do or do not align with those goals. (Some of Acadia Center’s filings in support of PBR in Connecticut can be found here and here.) 

PURA’s decision formally adopts four overarching goals for PBR in Connecticut and nine priority outcomes within those goals, including greenhouse gas emission reductions, advancing social equity, ensuring affordable service, and advancing reliability and resiliency. PURA’s decision sets the stage for the next phase of the PBR proceeding, which is expected to last through 2024. Phase 2 will consist of three “reopener” proceedings, each covering a specific set of issues in more detail, including the rules that govern how utilities recover their costs; performance metrics and incentives; and a process to develop an Integrated Distribution System Planning proceeding. 

Acadia Center commends PURA for taking this important step. However, although Phase 1 of Connecticut’s PBR proceeding has clarified the goals and outcomes that will inform future analyses and proposals, stakeholders will only know the real outcome of this decision in the spring and fall of 2024, when the three reopener proceedings end—and after PURA decides to what extent policy reforms will be implemented. PURA’s recent decision is a commitment to consider potential changes to many types of regulatory tools, which itself is a major step forward, and Acadia Center looks forward to exploring in more detail how utility regulatory tools should change.  

PURA’s leadership in moving this proceeding forward is noteworthy, and Acadia Center is hopeful that the PBR proceeding results in a robust framework that accelerates the achievement of Connecticut’s climate and clean energy goals and helps to deliver a clean and affordable energy system for all ratepayers.  

Daniel L. Sosland: Arctic Refuge affects people in Connecticut

Acadia Center recently joined more than 240 other organizations in requesting that major insurance companies, including The Hartford and Travelers here in Connecticut, show their solidarity with the Gwich’in Nation, who speak with one voice from Canada to Alaska against oil and gas development in the Arctic National Wildlife Refuge in northeastern Alaska. The coastal plain of the refuge is the birthing and nursing grounds of the Porcupine Caribou Herd and known to the Gwich’in people as Iizhik Gwats’an Gwandaii Goodlit — the Sacred Place Where Life Begins.

The letter asks 10 of the largest insurance companies to commit to the protection of the Arctic Refuge from the harms of fossil fuel development by announcing policies against insuring drilling projects there.

As a Northeast-based organization with deep Connecticut roots, this may seem like a far step from local concerns, but the issues arising around the protection and sanctity of the Arctic Refuge are ones that should register here. Acadia Center works to advance bold, effective, and equitable clean energy solutions for a livable climate and a stronger, more equitable economy in Connecticut and around the region. Connecticut, often a clean energy leader in the region, is working to build a clean energy system that puts people front and center, shifting conversations to promote equitable and economically beneficial solutions.

What happens in the Arctic impacts us all — even in the Northeast. The Arctic is warming four times faster than the rest of the world. If we allow drilling to happen in the refuge, entire coastal villages will continue to erode into the sea, the melting of permafrost will increasingly make infrastructure insecure or impossible, and food sources will disappear. Already, federal dollars are being spent to relocate villages sliding into the sea.

The sea around our coastline is also rising faster than the global average. Hurricanes are increasing in number and intensity – 2020 saw 30 tropical storms, forcing forecasters to dig deep into the Greek alphabet for names, and we are experiencing more heatwaves. With each passing year, the urgency grows to accelerate progress toward clean energy for people across the Northeast. Yet there is hope and progress. Connecticut is joined by most states in the region with aggressive plans to decrease greenhouse gas emissions and increase energy efficiency. Jobs in renewable energy industries such as wind and solar now outnumber jobs in the fossil fuel industry. This is our economic and environmental future. Producing and burning oil from the Arctic Refuge would accelerate climate change not just for Arctic communities, but for the world. And have little to no impact on energy prices.

Recently, Chubb became the first American insurance company to issue a policy stating that they will not underwrite oil and gas projects in the Arctic Refuge. They join 17 insurers and 29 major financial institutions that have restricted support for oil and gas drilling in the Arctic Refuge. This list includes five of Canada’s largest banks along with America’s six largest: Goldman Sachs, JPMorgan Chase, Citigroup, Morgan Stanley, Bank of America, and Wells Fargo. These financial institutions recognize the risks and the reputational consequences they would face should they support the violation of Indigenous Peoples’ human rights and such an important ecosystem.

Acadia Center is proud to have a presence in Connecticut’s vibrant community, and we all want to be proud of our large companies and employers. In solidarity with the Gwich’in Nation, we respectfully urge two of the most important businesses in the state, The Hartford and Travelers, to join colleagues and competitors, and other financial institutions that have taken a stand against financing or insuring oil and gas development in the Arctic National Wildlife Refuge. The human rights of Alaska Indigenous communities, the ecological value of the refuge, and the need to do all we can to avoid the devastating climate impacts are compelling reasons to phase out our addiction to oil and gas. Current and future generations depend on all of us making forward-thinking commitments to human rights and the health of our planet.

Op-ed originally featured in the Hartford Courant. Click here to read it there.

Mass. Stakeholders Debate the Scope of Clean Heat Standard

Massachusetts energy providers, consumers and climate advocates presented contrasting visions of what solutions should be included in a clean heat standard (CHS) that is currently being developed by the state’s Department of Environmental Protection (DEP), as shown by public comments published last week.

“Our top priorities for a CHS for Massachusetts are ensuring adequate equity protections and an electrification-only compliance program, particularly for gas utilities,” wrote a coalition of 37 environmental groups, led by the Conservation Law Foundation, Acadia Center, Green Energy Consumers Alliance and Pipe Line Awareness Network for the Northeast. “Alternative gases are not a long-term solution for the buildings sector, so incentives should not encourage buildout of these wasteful processes in the near term.”

The coalition said that the greenhouse gas emission reductions associated with replacing natural gas with hydrogen and RNG would be marginal, and that a dependence on these fuels would increase the overall costs associated with reaching net-zero emissions.

To read the full article from RTO Insider, click here.

Op-Ed: Listen to NJ businesses on heat pump benefits

Gov. Phil Murphy’s recent executive orders set modest 2030 goals for building electrification, goals that will be easier to meet if more homes and businesses install heat pumps for heating and cooling. Some opponents of these goals are now positioning themselves in the public eye as protectors of consumers and the business community. 

Will heat pumps drive up consumers’ monthly energy bills? For many New Jersey households, the answer is a resounding no! A 2021 study from the Acadia Center found that the typical NJ household switching from a gas furnace to an air-source heat pump could save anywhere from $325 to $1,812 per year. Adopters who weatherize their homes and switch from an expensive fuel such as heating oil or propane achieve the most dramatic savings. 

To read the full article, click here.

NE Stakeholders Support Developing Time-varying Rates

STOWE, Vt. — As New England plans how to cope with peak winter electricity demand with a growing reliance on renewables, energy leaders in the region are calling on the states to look at developing time-varying rates to reduce costs and environmental burdens.

Speakers at the 75th New England Conference of Public Utilities Commissioners Symposium generally agreed on the need to develop rate structures that would better allow customers to respond to market signals, incentivizing them to reduce energy consumption during periods of limited energy supply. The vast majority of customers in the region currently pay flat rates, regardless of the amount of stress on the grid.

In order to accommodate customers with special needs or limited energy-use flexibility, the speakers agreed that if time-varying rates do become the default, customers need to have other options.

“We absolutely have to have an opt-out program where people can opt out if the rates are not working for them,” said Amy Boyd, vice president of climate and clean energy policy at Acadia Center.

To read the full article, click here.