Skip to content
Link copied to clipboard

N.J. gas utility unveils ‘clean energy plan’ to counter anti-fossil fuel sentiment

SJI will eliminate greenhouse gas emissions from its operations by 2040, the latest fossil fuel firm to embrace clean energy in response to growing pressure from climate activists

A shale-gas drilling rig in Lycoming County, Pa., in 2013. The gas industry is facing growing pressure from regulators, investors, and the public to reduce greenhouse gas emissions.
A shale-gas drilling rig in Lycoming County, Pa., in 2013. The gas industry is facing growing pressure from regulators, investors, and the public to reduce greenhouse gas emissions.Read moreClem Murray / The Philadelphia I

One of New Jersey’s largest natural gas utilities committed itself on Monday to eliminating greenhouse gas emissions from its operations by 2040, the latest fossil fuel company to wrap itself in a green cloak in response to pressure to combat climate change.

South Jersey Industries Inc. (SJI), which owns the South Jersey Gas and Elizabethtown Gas utilities, announced a “comprehensive clean energy plan” that includes greater spending to eliminate carbon emissions from its operations and to promote energy efficiency among its customers. It also includes a commitment to spend a quarter of its future capital budget on “sustainability” projects.

“We are committed to investing in new technologies that will safely, reliably and affordably deliver low-carbon energy to the more than 700,000 families and businesses that we serve across our state,” Mike Renna, president and chief executive of the Folsom, N.J., company, said in a statement. The company serves parts of Burlington, Camden, and Gloucester Counties, and all of Atlantic, Cape May, Cumberland, and Salem Counties.

The utility said it will install solar panels on all facilities, replace aging transmission pipes to reduce “fugitive” emissions, upgrade leak detection technologies, and complete conversion of its service vehicles to compressed natural gas, which emits less greenhouse gas than vehicles fueled with gasoline or diesel.

SJI also recently announced investments to reduce the carbon footprint of the gas it delivers by investing in renewable natural gas technology, which produces biofuel from such sources as landfills and dairy farms, and “green” hydrogen made using power produced by solar and wind generators.

The company said its plans were a genuine effort to reduce its environmental impact, but climate activists dismissed the “greenwashing.”

“If South Jersey Industries is really serious about being carbon neutral, they would be getting out of the gas business,” said Jeff Tittel, director of the New Jersey Sierra Club. “That’s not gonna happen.”

Doug O’Malley, director of Environment New Jersey, said that policymakers need to reduce the nation’s reliance on fossil fuels. “No industry is going to plan their retirement and our reliance on gas isn’t going to end tomorrow, but climate science tells us very clearly that we need to drastically reduce global warming pollution over the course of this decade,” he said.

SJI’s commitment follows a raft of announcements by fossil fuel companies to engage in green initiatives in response to growing pressure from regulators, investors, and the public to reduce carbon emissions.

Environmentalists are pressing state and local governments to block the expansion of fossil fuel infrastructure and to force customers to switch to electricity. Berkeley, Calif., in 2019 banned the use of natural gas in new buildings. Seattle this year banned gas in many new commercial buildings and apartments. In Philadelphia, a study is expected this spring that explores a transition away from gas for the city-owned Philadelphia Gas Works utility.

Oil and gas producers are taking more measures to mitigate the climate impact of extraction and transportation of fossil fuels. BP PLC announced on Saturday that it plans to spend about $1.3 billion to capture natural gas produced as an unwanted byproduct from its oil wells in west Texas and New Mexico. That gas is now largely burned off in flares.

In Pennsylvania, EQT Corp. and Chesapeake Energy Corp., which are among the state’s largest shale-gas producers, announced recently they had signed up with third-party verification companies to certify they produced “responsibly sourced gas” (RSG) from wells equipped with leak-reduction technology.

Project Canary, a Denver company that will monitor the EQT and Chesapeake wells for methane leaks, said that some utilities and exporters of liquefied natural gas are willing to pay more for gas that is certified to be responsibly sourced. The company says its service was created in response to the trend toward limiting or even eliminating natural gas as a commercial and residential energy source.

“This trend presents the natural gas industry with an existential threat, and therein lies the opportunity,” Project Canary said in a report.

SJI is an investor in several large natural gas infrastructure projects, including a 20% interest in the contentious PennEast Pipeline, which would carry fracked natural gas from Pennsylvania into New Jersey. The U.S. Supreme Court has scheduled arguments on April 28 to hear the project’s appeal of New Jersey’s decision to block the pipeline.

SJI said its commitments to clean energy include the recent acquisition of a $39.8 million minority interest in REV LNG LLC, a renewable natural gas producer, and a partnership with Atlantic Shores Offshore Wind to create a green hydrogen pilot program conjoined to a proposed offshore wind farm in New Jersey. SJI is exploring whether it can blend the renewable gas and hydrogen into the gas it delivers to customers to reduce its carbon footprint.

The company has also pledged to spend 25% of all future capital investments on renewable or clean energy projects, Dominick DiRocco, an SJI vice president, said in an interview.

“Twenty-five percent is a big number, and basically means that in addition to doing all the things we need to do to keep our system running right and being reliable, we’re also going to make sure that a big chunk of those dollars go toward renewable natural gas production or green hydrogen production or, you know, fuel-cell build-out or things that we can utilize to continue to reduce the carbon content of the gas that we provide to our customers,” DiRocco said.

SJI also got approval recently from regulators to spend $216 million to expand energy efficiency programs for its South Jersey Gas and Elizabethtown Gas customers.

SJI’s plan is intended as a counterpoint to “an overly aggressive approach” to transition the retail energy markets to full electrification, which would require modification of the electric grid at higher cost to customers, DiRocco said.

“Let’s also explore ways to decarbonize natural gas,” DiRocco said.