TRENTON -The Department of Environmental Protection (DEP), Board of Public Utilities (BPU) and Economic Development Authority (EDA) today released a strategic funding plan for investing the state's auction proceeds from the Regional Greenhouse Gas Initiative (RGGI), the cap-and-trade pact among northeastern states dedicated to reducing greenhouse gas emissions from the electricity generating sector. New Jersey plans to invest an estimated $80 million each year in programs that reduce greenhouse gas emissions, drive forward projects that boost clean energy and create jobs, protect the health of residents in environmental justice communities and increase the resiliency of coastal communities.
New Jersey's renewed participation in RGGI and the investment of proceeds into the clean energy economy and climate change mitigation are key components of the Murphy Administration's interconnected environmental and economic development goals. In addition, funds from the RGGI auctions will be heavily dedicated to projects that will benefit the state's environmental justice communities.
To help achieve Governor Murphy's goal of achieving 100 percent clean energy by 2050, as outlined in the Energy Master Plan, the RGGI Strategic Funding Plan emphasizes the goal of electrifying New Jersey's transportation sector, with a focus on projects that will benefit communities that historically have borne disproportionate burdens of air pollution. Projects developed under the plan will help the state reduce greenhouse gas emissions, leverage funding and stimulate financial opportunities and job creation, improve air quality, and enhance natural resources such as coastal wetlands and forests that sequester carbon emissions.
'The RGGI Strategic Funding Plan demonstrates how our state agencies collaborate to help create a brighter future for all New Jerseyans, especially our environmental justice communities,' said Governor Murphy. 'As our State responds to COVID-19, we see up close the vital link between public health and economic development, the same relationship that drives our Administration's efforts to reduce health risks from pollution and climate change through initiatives that also grow our clean energy economy. As we work to ensure that our economy recovers from this pandemic, the investments made under this Plan will promote health, equity, and environmental protection, helping us build a stronger and fairer New Jersey.'
Under Governor Murphy's leadership, New Jersey formally rejoined RGGI this year, after two years of reentry negotiations and rulemaking led by Department of Environmental Protection Commissioner Catherine R. McCabe. In March, the state participated in its first quarterly carbon dioxide (CO2) allowance auction since rejoining, realizing more than $20 million in proceeds. As required by the state's Global Warming Response Act, the EDA will be responsible for allocating 60 percent of the auction proceeds to qualified projects, and the DEP and BPU will each be responsible for allocating 20 percent.
'The RGGI Strategic Funding Plan will help spark transformational changes in New Jersey's clean energy and transportation systems that will make New Jersey fairer and stronger for generations to come,' DEP Commissioner McCabe said. 'This plan gives the state clear direction for investments in programs that reduce greenhouse gas emissions and better protect the health of residents in environmental justice communities. At the same time, the projects spurred by this plan will create opportunities and job growth in green technologies that will help New Jersey emerge stronger from the economic impacts of the current COVID-19 crisis.'
'In the same way focusing on fairness makes New Jersey's economy stronger, protecting our environment can be a path to increased economic growth. Clean energy and sustainability will be particularly important as engines powering New Jersey's recovery from the unprecedented challenges posed by COVID-19,' said NJEDA Chief Executive Officer Tim Sullivan. 'The RGGI Strategic Funding Plan incorporates a variety of strategies to not only preserve our environment for future generations but also spur innovation, job creation, and economic growth.'
'Carbon emissions are not confined by state borders, and that's why this regional collaboration is so critical. While climate change affects us universally, some communities feel those impacts harder than others. I'm especially proud that this strategic plan places special focus on environmental justice communities,' said NJBPU President Joseph L. Fiordaliso. 'This plan will put significant resources toward electrifying transportation, especially for low- to moderate-income residents, an area where we can make the broadest, fastest progress on cutting air pollutants and greenhouse gas emissions. With the RGGI Strategic Funding Plan, we will continue to take measurable steps to remediate past environmental inequities and ensure all New Jersey residents can participate in and benefit from New Jersey's transition to a clean energy future.'
Fossil fuel power plants are a significant contributor of carbon dioxide, the primary cause of climate change. RGGI is a cooperative, market-based cap-and-trade program consisting of states in the Northeast that provides incentives to generators of electricity to reduce emissions of carbon dioxide through investments in clean technologies. RGGI holds quarterly auctions of emission credits, proceeds of which states then use to fund projects that advance climate change mitigation goals.
Other RGGI states are Connecticut, Delaware, Maine, Maryland, Massachusetts, New Hampshire, New York, Rhode Island and Vermont.
The RGGI Strategic Funding Plan released today guides how the proceeds from this and future auctions over the next three years will be spent, under four broad initiative areas:
Catalyzing Clean, Equitable Transportation: All three agencies will work on projects that spur clean and equitable transportation by accelerating the transition to electric transportation throughout the state, with a heavy focus on projects that help environmental justice communities.
Promoting Blue Carbon in Coastal Areas: New Jersey's coastal ecosystems are particularly vulnerable to the impacts of climate change, including sea level rise. The DEP is responsible for funding initiatives that will protect and enhance ecosystems such as salt marshes, tidal wetlands and seagrass beds, which are particularly important in the fight against climate change. Blue carbon is the carbon stored by the soils and plants in these marine systems. These ecosystems also create resilience by creating buffers that help protect communities from storms and flooding.
Enhancing Forests and Urban Forests: The DEP also will focus on projects that restore and improve the health of forests, including urban and community forests. Forests play a critical role in the carbon cycle, serving as a stock of sequestered carbon and continually removing and storing additional carbon from the atmosphere. Additionally, urban and community forests provide shade and reduce the need for energy produced for air conditioning.
Establishing a New Jersey Green Bank: The EDA will establish a Green Bank to leverage funding and stimulate financial opportunities in New Jersey's clean energy innovation economy. Consistent with the Plan's overall environmental justice objectives, a substantial focus of a New Jersey Green Bank will be improving capital access for those who have traditionally had more difficulty in accessing the benefits of participation in the green economy. In addition to driving new investments and creating new jobs, Green Bank financing mechanisms will accelerate the deployment of clean energy and drive the evolution of the grid and energy infrastructure to be more flexible, resilient, and cost-effective. For example, a Green Bank could support projects such as rooftop solar in low-income areas or energy efficiency retrofits for smaller main street businesses. A Green Bank will also give priority to those projects that provide training and create high-quality jobs for New Jerseyans seeking to benefit from the state's clean energy transition.
These initiative areas reflect the mandates of the Global Warming Solutions Act, extensive public feedback collected during the 2018 RGGI rulemaking as well as feedback from a public scoping process.
The state received valuable input from diverse stakeholders including municipalities, unions, environmental groups, environmental justice advocates, transportation planners, the energy sector and resource conservation groups.
Addressing climate change and making New Jersey more resilient to its impacts is a core priority area for Governor Murphy.
As one of his first actions upon taking office, Governor Murphy signed Executive Order No. 7
, directing New Jersey to re-enter RGGI and take actions to address climate change, with an emphasis on projects benefiting environmental justice communities. The administration has since taken numerous strong actions to address carbon pollution and to make the state more resilient to climate change, including the development of a Statewide Climate Change Resilience Strategy
to be publicly released later this year.
Governor Murphy has taken other significant steps that inform and guide the funding allocation priorities established by the RGGI Strategic Funding Plan, including:
Forming the New Jersey Partnership to Plug-In, a first-of-its-kind, statewide partnership to build out the necessary infrastructure to support electric vehicle ownership to improve air quality and reduce greenhouse gas emissions. The partnership creates a strategic and streamlined framework to support New Jersey's electric vehicle ecosystem, with the goal of registering 330,000 Zero Emission Vehicles (ZEVs) by 2025.
Signing landmark legislation to boost electric vehicle use in New Jersey by setting aggressive goals for New Jersey electric vehicle sales and public charging stations, requiring the establishment of rebates for electric vehicle purchases, and directing the state to electrify its fleet.
Releasing a comprehensive Energy Master Plan that includes rigorous goals and spans multiple sectors and governmental agencies to achieve the Governor's goal of 100 percent clean energy by 2050. The Energy Master Plan defines clean energy as 100 percent carbon-neutral electricity generation and anticipates that the vast majority of electricity will come from carbon-free resources by 2050.
Issuing an order directing DEP to develop 'NJ Protecting Against Climate Threats,' or NJ PACT, a targeted regulatory reform effort that will modernize environmental laws and regulations to help government, businesses and residents effectively respond to current climate threats and reduce future climate damages.
To learn more about RGGI, visit www.rggi.org/
For information about RGGI in New Jersey, visit https://nj.gov/rggi/
For information on NJPACT, visit www.nj.gov/dep/njpact/
Follow the DEP on Twitter @NewJerseyDEP
Follow the BPU on Twitter @NJBPU
Follow the EDA on Twitter @NewJerseyEDA