Affordable housing advances energy efficiency programs in New Jersey

Affordable housing advances energy efficiency programs in New Jersey

Writer: Esteban Pages

3 min read March 2023  — Crucial to the Garden State’s energy transition goals, energy efficiency recently found its way in a whirl of bills aimed at addressing New Jersey’s affordable housing challenge.

Bill S3602, introduced in the current legislative session, would establish a $30 million “weatherization and energy efficiency pilot program to address open cockloft space between certain buildings.” The pilot program would be carried out in Union City, Trenton and Camden and directed at low- and moderate-income families. For families outside of this revenue bracket, the option of paying for the weatherization via a property tax special assessment over 10 years would be provided. Adding insulation, vapor barriers, fire protection barriers and ventilation are some of the notable offerings in the program. It is estimated that weatherization could lower energy bills by as much as 30% per household.

The bill dovetails Gov. Murphy’s Energy Master Plan unveiled back in January 2020 and outlines key strategies for the 100% clean energy by 2050 goal. These strategies include reducing the energy consumption and emissions of the transportation and building sector. For the latter, measures such as the expansion of statewide net zero carbon homes incentive programs, the development of EV-ready and Demand Response-ready building codes and the establishment of a long-term building decarbonization roadmap.

Another honorific mention is the 2023 New Jersey Home Performance with ENERGY STAR® program: as much as $5,000 worth in cash-back incentives and up to $15,000 in zero-interest financing toward installing energy efficiency upgrades for the Garden State’s multifamily and single-family homes. Between insulation upgrades and mechanical equipment offerings, the program can generate at minimum 5% in energy savings.

Adding to these efforts, New Jersey’s Board of Public Utilities, in conjunction with New Jersey’s Clean Energy Program, offer a series of residential programs aimed at offsetting the cost of making homes more comfortable and energy efficient. Two programs stand out to that end: Comfort Partners and Residential New Construction. The first one assists income-eligible customers by installing free energy efficiency measures, while the second offers rebates for energy efficient new home constructions under either ENERGY STAR® or ZERO Energy Ready Home standards.

New Jersey’s Council on the Green Economy’s 2022 One Year Planopens PDF file was also adamant on including an energy efficiency component, albeit on the talent side of the equation. Its strategic roadmap includes initiating a $2.5 million Green Buildings Workforce Pilot to support skills training related to the green economy, with a specific focus on residential building energy efficiency, building health and safety and building decarbonization, as well as flexible support to defray the costs of other job training-related green economy workforce needs. With this pilot program, New Jersey is sure to consolidate a sustainable pipeline of talent able to cater to the state’s growing energy efficiency needs.

One of the most ambitious energy transition regulations of the past decades, the Inflation Reduction Act (IRA), also enables generous tax incentives for Garden State residents. For the 2022 tax year, taxpayers can claim a lifetime credit of up to $500 for eligible home improvement expenses related to energy efficiency. In 2023, the credit is slated to increase to $1,200 per year for qualified home improvement expenses made through 2032. In addition, the IRA enacted a credit of up to $2,000 per year for several new water heaters and heat pumps, adding upwards of $3,200 for each year through 2032.

A strong complement to the IRA and New Jersey’s energy efficiency efforts is the federal Infrastructure Investment Jobs and Act, which the state is sure to capitalize on. “That money is directed to and is dedicated to infrastructure improvement, including water and sewer, roads and bridges, and energy and storm resiliency, which is part of our natural hazard practice.  And our environmental practice is involved in all aspects. Also, there’s been an emphasis on environmental and social governance (ESG). We have a lot of clients in the public and private sectors that are required to have an ESG policy in place. That is a business model that speaks to environmental concerns, social concerns and good governance,” said Gary Dahms, President & CEO of T&M Associates, in an interview for Invest:.

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