NJ Infrastructure > Infrastructure by Category > Energy (Grade C+)
Infrastructure by Category:
Energy
In 2004 New Jersey consumed 2,519.9 trillion BTU of energy, ranking 13th out of 50 states. Energy consumption per capita was 293.9 million BTU, ranking 40th. New Jersey feeds its energy demand through the following fuel sources:
Fuel Source Type Percent
Petroleum 48.9%
Natural Gas 24.7%
Nuclear Energy 12.8%
Interstate Electric Flow 8.0%
Coal 4.2%
Biomass 1.5%
Hydroelectric Power 0.0004%
Other 0.04%
The New York Harbor area between New York and New Jersey has over 40 million barrels of refined product storage capacity (much of which is in New Jersey), making it the largest petroleum product hub in the United States. The largest of the four U.S. Northeast Heating Oil Reserve sites is located in Woodbridge, New Jersey. The Salem Nuclear Power Plant is one of the highest-capacity power plants in the nation. New Jersey's Oyster Creek Nuclear Power Plant, whose reactor first came online in 1969, is the oldest operating nuclear plant in United States.
Electricity
The three basic functions within the electric power industry are
generation, transmission, and distribution. Generation is the
production of electricity. Generation typically occurs at power
plants that are large-scale plants of oil, coal, or nuclear. It
should be noted recently new forms of electric generation such as
distributed generation and renewable resources such as wind, biomass
and solar are playing a more significant role in power generation in
New Jersey. Transmission is the transport of electricity to areas of
distribution. Transmission lines are mostly Alternating Current (AC),
transformers, and other components. Distribution refers to the local
lines and facilities that provide direct access of electricity to the
consumer. The total sales of electricity in New Jersey in MWH per
sector is:
Sector Total Sales Percentage of Sales
Commercial 38,073,559 MWH 50%
Residential 28, 020,125 MWH 36%
Industrial 11,209,578 MWH 14%
Transportation 289,905 MWH 0%
In 1999 New Jersey and other states restructured the electric power industry in conjunction with federal policies. This brought the deregulation of electric generation and the establishment of an electricity wholesale market. Power plant owners apply to the Federal Energy Regulatory Commission (FERC) which grants them the ability to sell their electricity at market based rates. The transmission and distribution of electricity in New Jersey is done through four companies: Public Service Electric and Gas (PSE&G), Jersey Central Power & Light Company (JCP&L), Atlantic City Electric Company, and Rockland Electric Company.
New Jersey is part of the larger power grid of the Mid-Atlantic Area Council (MAAC) which serves as a regional reliability organization. The Pennsylvania -New Jersey-Maryland Interconnect (PJM) is the regional transmission organization (RTO) which ensures the reliability of the largest centrally dispatched electric grid in the world. As part of this regional power grid, New Jersey's electricity supply factors, including costs, reliability, and environmental impacts, are linked and influenced by the happenings in other neighboring or nearby states.
The amount of capacity available in New Jersey depends on the required level of electricity reliability as determined by the PJM based on MAAC reliability requirements. Electricity reliability requirements have been enforced by voluntary agreement among electricity providers. However, in response to the 2003 blackout, the Federal Energy Policy Act (EPACT) of 2005 provides mandatory electricity reliability requirements which will be enforceable under federal law.
New Jersey's electricity generating capacity increased from 15,837 MW in 1990 to 18,384 MW in 2002. In the PJM region demand for electricity is increasing at approximately 1.4% per year. Currently there is a slight surplus of electricity, but according to MAAC estimates, the margin is expected to tighten over the next several years requiring either new generation facilities or greater energy efficiency. In New Jersey, electric energy usage is expected to increase at a rate of 1.52% annual growth rate from 78.342 million MWHs in 2004 to 99.728 MWHs in 2020. Under a campaign to reduce energy consumption by 20% in 2020, annual usage will drop by 19.946 million MWHs in 2020 for a total of 79.782 million MWHs of energy consumed. With the potential retirement of the Oyster Creek Nuclear Plant in 2009, the oldest nuclear power plant operating in the U.S., and other plants in New Jersey, we will need to construct additional energy generation and transmission and distribution infrastructure or import more electricity from other states within the PJM which in itself will necessitate the need for new transmission infrastructure in the State. The PJM has recently taken a more significant role in the long term planning that traditionally was conducted by utility companies and state regulators. The PJM is also increasing its investment in the transmission infrastructure as part of its Regional Transmission Expansion Plan (RTEP) within its 13-state region which includes New Jersey providing $464 million in 2005.
Gas
The U.S. Department of Transportation's Pipeline and Hazardous
Materials Safety Administration (PHMSA) Office of Pipeline Safety is
responsible for the safety, reliability, and environmental soundness
of New Jersey's interstate and the nation's pipeline infrastructure.
The State of New Jersey regulates and inspects all intrastate
pipelines through the Bureau of Pipeline Safety within the New Jersey
Board of Public Utilities. Statistics provided by the Office of
Pipeline Safety present a downward trend in the energy loss, costs,
injuries and deaths associated with hazardous liquid pipeline
accidents over the past three years. In New Jersey there are 56 miles
of Hazardous Liquid pipelines, 1,456 miles of Gas Transmission
pipelines, and 32,759 miles of Gas Transmission pipelines for a total
of 34,781 miles of pipelines in New Jersey.
There is consideration for the construction of a Liquid Natural Gas (LNG) Facility nineteen miles off the coast of Sandy Hook New Jersey which would allow the shipment of liquefied natural gas to the New York / New Jersey metropolitan area for the use of electric generation and heating. This $1.7 billion, 62.5 acre facility is very controversial and is the subject of much debate. If approved, the project will take five years to build. Another LNG Facility is being considered in Logan Township, NJ near Philadelphia.
New Jersey's Renewable Sources and Clean Energy Program
New Jersey is leading the nation in the implementation of renewable energy sources and clean energy programs. The New Jersey Board of Public Utilities (BPU) adopted a Renewable Portfolio Standard (RPS) in 1999 to encourage the use of renewable energy in the production of electricity. This electricity restructuring legislation called the Electric Discount and Energy Competition Act (EDECA) supports investments in energy efficiency and renewable energy over an eight-year period through the "Societal Benefits Charge" (SBC) collected from all electric public utility customers. A separate Universal Service Fund (USF) provides assistance for low-income programs. The SBC funds New Jersey's Clean Energy Program that was established on March 9, 2001 by the New Jersey BPU. The BPU directed program funding of $358 million for the years 2001 through 2003: $115 million for 2001; $119 million for 2002; and $124 million for 2003. Of this funding, 75% targeted energy efficiency programs. The remaining 25% of the SBC funding supports Class I renewables. Class I renewables include solar, wind, fuel cells, geothermal technologies, wave or tidal action, methane gas from landfills, and sustainable biomass facilities.
In 2006, the BPU raised the RPS requirements for Class I Renewable Energy resources from 4% by 2008 to 20% by 2020. Assuming the loss of significant generation capacity in the State, renewable sources of energy may play a significant role in meeting New Jersey future energy demand.
Conclusion
New Jersey's existing energy infrastructure meets the needs of its
population. Over time demand will increase requiring a need to
provide greater generation capacity, upgrade and improve transmission
and distribution infrastructure. Challenges New Jersey faces include
the possible closure of the Oyster Creek nuclear generating facility
and the need to find replacement energy sources, the construction of
new infrastructure to support urban load centers, the construction of
additional renewable energy generation, and the possible construction
of new LNG facilities.
To better plan for New Jersey's increasing energy demand, the NJ BPU is beginning a project to create an Energy Information Center (EIC) at the Center for Energy, Economic and Environmental Policy (CEEEP) at Rutgers University. The creation of this data base will greatly improve the ability to gather New Jersey energy data in order to update the State's Energy Master Plan. The PJM, of which New Jersey is a part of is taking a more active role in the long term planning to help meet future energy demands. The PJM is also making a significant investment to improve transmission infrastructure to meet future demand.
New Jersey is the largest and most important petroleum hub in the northeast United States having six oil refineries and the petroleum storage capacity of 40 million barrels. New Jersey is exploring the potential of constructing infrastructure for the importing of Liquefied Natural Gas (LNG) to help meet growing energy demand.
New Jersey is a leader in the implementation and use of renewable energy sources. In addition, New Jersey has initiated energy programs which are aimed to reduce energy consumption over time. In 2005 ASCE graded the U.S. Energy Infrastructure and the National Power Grid a "D". With its current diversified energy sources, exploration of potential new energy sources, PJM's increased investment in transmission infrastructure, and commitment to renewable energy and efficiency programs, New Jersey's energy infrastructure can be reasonably graded above the national average at a C+.