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Ruiz/Gordon Bill Would Support Energy Efficiency Through Development Of Combined Heat And Power Grant Program

Senator Teresa Ruiz, D-Essex and Union, listens to testimony at the Senate Budget Committee meeting on Governor Corzine's toll road plan.

TRENTON – A measure sponsored by Senators Teresa Ruiz and Robert M. Gordon which would create a grant program to encourage the use of Cogeneration/Combined Heat and Power (CHP) was unanimously approved today by the Senate Budget and Appropriations Committee.

Under the bill, CHP is defined as the use of a combined heat engine or a power station to simultaneously generate both electricity and heat. CHP plants utilize the heat that comes from electricity generation and use it for industrial or domestic heating needs.

“As energy costs continue to increase, it is imperative that we find new, more affordable energy sources,” said Senator Ruiz, D-Essex and Union. “The grants would be funded through this legislation, and would allow businesses to develop combined heat and power energy, which would help to cut down on costs and spur healthy competition within the State’s energy market.”

“The goal of this legislation is to encourage businesses to generate their own energy, thereby reducing the State’s overall energy demands,” said Senator Gordon, D-Bergen. “In addition to compelling companies to try new energy sources, this legislation would help to develop New Jersey’s Cogeneration market, and help keep our State at the forefront of energy innovation.”

The Senators’ measure, S-1932, would amend the Electric Discount and Energy Competition Act to permit the Board of Public Utilities (BPU) to use monies from the retail margin fund on grants for combined heat and power and other demand response measures. “Utility companies would collect the retail margin charge, and deposit all monies into the Retail Margin Fund for development of Cogeneration and other demand response measures. This bill would not create any new charges or taxes,” the Senators said.

The bill would also authorize the State Treasurer to have access to the Retail Margin Fund.

Currently, there is already over $100 million in the Retail Margin Fund, and the fund will continue to grow over time. Of the funding in the Retail Margin Fund, $60 million would be appropriated to provide grants to companies seeking to install or expand combined heat and power production. All grants would be awarded on a first-come, first-served basis. Grant amounts would vary based on the amount of energy used per company.

This measure now heads to the full Senate for approval.

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