Archive for March, 2015

PSEG Explains How Markets and Pollution Trading Schemes Fail and Regulation Works

March 31st, 2015 No comments

Deregulated markets and economic incentives sacrifice public health

PSEG explains “market failure”

PSEG: “EPA imposed the least stringent standards the statute allows”  

PSEG Mercer Generating Station on the Delaware River, Hamilton NJ - old coal plant converted to natural gas

PSEG Mercer Generating Station on the Delaware River, Hamilton NJ – old coal plant converted to natural gas

It’s always fun when your opponent makes your argument for you and you can throw their words back in their face.

So, today, we use PSEG’s own arguments to confirm our long-standing  criticism that markets and pollution trading schemes are not only fatally flawed, but don’t actually work, while traditional regulation works.

PSEG made some remarkable admissions about the failure of market based pollutant trading schemes and the success of regulation that absolutely destroy a lot of political and policy myths about the economics of pollution control regulations.

So, it is vitally important that these arguments see the light of day instead of lying dormant in a legal brief.

There is some danger in relying on this lazy man’s tactic instead of laying out one’s own critique, because PSEG’s arguments are narrow and do not include our far broader and more radical critique. But, in this case, I can mitigate that by putting  PSEG arguments in context, briefly noting their flaws – and I don’t think there is any danger of readers confusing my arguments with those of PSEG.

PSEG recently submitted a legal motion to the US Supreme Court, seeking to convince the Court not to take the case of industry’s challenge to EPA’s mercury emission standards for power plants.

In that highly unusual and blunt motion, PSEG took the same side of and confirmed longstanding criticisms by environmental groups.

PSEG told some very basic and hard truths about what’s really going on behind the smoke and mirrors of corporate PR and the controversial politicized debate about environmental regulations.

PSEG wasn’t doing that because they had some epiphany and suddenly realized that public health was important and pollution was bad. They were interested only in protecting their own economic bottom line and shareholder profits.

You see, NJ DEP regulations forced PSEG to spend over $1.5 billion to stop mercury pollution from their old coal fired power plants. Those pollution costs hurt PSEG’s competitive position in energy markets, particularly with respect to “cheap” power from old coal plants that have no pollution controls.

PSEG was foolish in spending that enormous sum of our money on pollution controls, instead of retiring those dinosaur coal plants and investing in efficiency and renewables, but that’s another story not for today.

Anyway, here are key points that PSEG made (verbatim, in their own words) in their motion, almost all of which none of their energy industry colleagues would publicly admit to. The arguments are presented and excerpted in the order they were made in the PSEG motion, not in terms of priority. In fact, the best  arguments are the last few. The headline to each excerpt from the PSEG brief and boldface are mine:

1. The real issue is all about coal industry profits and the real problems were caused by greed and a lack of foresight and planning by major polluters:

The [EPA] Toxics Rule establishes consistent national limits on emissions of these pernicious pollutants by power plants. While many power plants are already capable of achieving these standards, others will require additional capital investment in order to meet the standards, and it is expected that some older, less efficient plants will retire, reducing the demand for coal. Coal producers, a segment of their power plant customers and a block of states aligned with those interests comprise the coalition seeking this Court’s review. Unlike many of their peers among the petitioners, Industry Respondents made significant investments in their generation fleets to prepare for the Toxics Rule. 

2. Industry crafts “narratives” that blatantly lie about the costs of compliance with EPA regulations and ignore public health impacts

Petitioners dress up their contention by grossly distorting EPA’s benefit- cost analysis, and ask this Court to ignore the enormous health benefits that the Rule will produce because those benefits undermine petitioners’ narrative.  

3. Industry evades and delays compliance with regulation to maximize profits – not to avoid “red tape” or produce “jobs”:

The Toxics Rule ends the free ride for power plant owners that have avoided the expenditures necessary to reduce hazardous air pollutants and have profited at the expense of owners of cleaner generation units, such as the Industry Respondents.

This free ride has been a long one. The electric generation industry has anticipated the Toxics Rule since EPA first determined that it was “appropriate and necessary” to regulate power plants under Section 112 in 2000. 

4. Delays in regulation translate to higher industry profits and negative impacts on public health

The ten-year delay in the Rule’s development has harmed the industry, especially those members who, like Industry Respondents, participate in competitive wholesale power markets, where the massive capital investments necessary to maintain the integrity of the nation’s power grid are protected only by foresight dependent on regulatory certainty. Those markets are disrupted when some generators are permitted to externalize the costs of their pollution, reaping higher profits at the expense of other, cleaner generators. Even as it improves public health, the Toxics Rule finally levels the playing field for power plant owners.  

 5. The Regional Electric Grid has huge excess capacity, is very costly, and inefficient – by design.

PSEG makes the case here for energy efficiency, demand management and local, distributed, renewable power which is far more efficient, cheaper, more reliable, and cleaner:

Because demand and supply must be balanced at all times, it is essential that the system include enough generation capacity to satisfy the largest expected electricity demand, plus a margin of safety, to assure an uninterrupted electric supply. The generation fleet, therefore, is sized according to peak demand. 

6. The price of power is set based on the HIGHEST COST GENERATION SOURCE

When I first read about the PJM power auction, it was so absurd that I was sure that I was misunderstanding how the auction set the price of power. Since then, every time I read this my head explodes.

I don’t think the public has a clue about how the so called deregulated “free market” in energy actually works or how the so called competitive power auction works. Just think if when you went shopping, if you were forced to pay the price of the highest priced item – the filet mignon and Cadillac for everything!

In a must read story, David Kay Johnston exposes how the auction markets are rigged by industry fraud.

PSEG explains this clearly – how the auctions lead to high prices and consumer ripoff even when they work as designed and are not rigged:

The price that each generator receives for the power it produces is not ordinarily established by its own bid. Wholesale markets operate on the principle of the “single market clearing price.” All generators are paid the same price based on the bid of the last unit that “cleared the market,” that is, the most expensive unit needed to meet demand. 

7. There is a direct conflict and tradeoff between pollution and profits. Competition and prices and profits harm the environment and public health. The market produces a cost cutting race to the bottom.

This pricing scheme creates a powerful dual incentive to reduce operating costs: units with low operating costs and low bids are both dispatched more frequently than units with higher costs and higher bids, and produce a higher profit margin when they do operate. This incentive serves to reduce wholesale electricity prices to their minimum, but has negative implications for air pollution control. 

The operation of pollution control systems can entail significant operating costs for higher-priced fuels, treatment chemicals, waste disposal and power and water consumption, in addition to any capital costs that may be involved. Hence, power plants operating pollution controls tend to have higher operating costs, resulting in higher bids and less frequent dispatch compared to uncontrolled units. Every power plant that incurs additional costs to reduce its emissions is at risk of being undercut by cheaper, dirtier plants that do not incur these pollution control costs. Industry Respondents’ cleaner, environmentally- controlled generation units can be more expensive to own and operate than uncontrolled units, and so are placed at a disadvantage in electricity markets where they compete against higher-emitting units with lower operating costs, such as uncontrolled coal-fired plants. 

8. Loopholes in the Clean Air Act are what have allowed polluters to exploit the regulatory regime at the direct sacrifice of clean air and public health.

If all competing power plants faced identical regulatory requirements, operating costs for pollution controls might make little difference, but these requirements vary from plant to plant. For each generation unit, the applicable standards for conventional pollutants are determined by the year of the unit’s construction. See, e.g., 40 C.F.R. pt. 60 subpt. Da (new source performance standards for fossil fuel-fired units).7 New units are required to be equipped with state-of-the-art controls, and must operate those controls to meet more stringent mandatory permit limits. Older plants are required to meet only the far less stringent limits in place at the time they were built. More than half of the coal-fired units in operation in 2010, representing more than one-third of coal-fired generation capacity, were in existence when the Clean Air Act was enacted in 1970, and the vast majority of those units had no pollution controls. 

9. State regulatory leadership is essential for clean air and to protect public health

Pollution control requirements also vary from state to state. Many states impose more stringent pollution control requirements than their neighbors because these controls are needed to attain air quality standards or to serve some other public health goal. In their brief, the State and Local Respondents identify fourteen states that have adopted limits on emissions of mercury, one of the hazardous pollutants limited by the Toxics Rule. State Resp. Br. at III. Indeed, petitioner Michigan had such a requirement in place, but suspended it after EPA adopted the Toxics Rule.

10. The fundamental economics of the grid and deregulated markets undermine clean air and public health protections

This is a perfect example of what Noam Chomsky referred to as an “institutional logic that is deeply pathological”:

Most grid operators cover multiple states, and power from one region can be sold into another. Therefore, when it comes to dispatch decisions, power plants do not compete only against plants in the same state, of the same age and subject to the same regulations. They compete against units in other states, including states where pollution control requirements are less stringent. They compete against older units with few if any pollution control requirements. In this price competition, cleaner power plants are dispatched less frequently and make less money when they do run, while dirtier power plants run more often and make more money. The economic calculus of the wholesale electricity market institutionalizes a disincentive to incur costs to reduce air pollution. 

11. The 1990 Clean Air Act’s Acid Rain market based pollutant  trading program was a failure

It is important to consider PSEG’s admissions here, because the acid rain trading program is held out as the example of success the demonstrates why cap & trade market based trading program should be established for greenhouse gas emissions.

However, there is no doubt that instead of the market based trading scheme, had EPA imposed regulatory requirements to install scrubbers, the benefits in clean air would have been far greater, much faster, and at lower cost.

B. The Role Of Section 112

Section 112 was adopted in its current form in 1990 concurrently with the Title IV Acid Rain Program, which introduced the first large-scale market-based system for reducing emissions of sulfur dioxide (“SO2”) from coal- fired power plants. See Clean Air Act Amendments of 1990, Pub. L. No. 101-549, 104 Stat. 2399 (1990). Title IV did not impose mandatory emission limits on individual power plants, but rather established an allowance trading program to create economic incentives for generators to install and to operate emission controls, especially flue gas desulfurization systems, or “scrubbers,” to control SO2. See 42 U.S.C. §§ 7651-7651o. In allowance programs, once the total amount of permissible emissions is determined (in tons per year), an equal number of tradable “allowances” is auctioned or distributed, and each power plant must turn in one allowance for every ton of pollution it emits. The owner of any power plant is free to decide whether to buy the allowances necessary to cover its emissions, or to reduce its emissions, enabling it to sell surplus allowances to other plants. Congress adopted Section 112(n)(1)(A) to give EPA an opportunity to assess the impact of, among other things, Title IV on hazardous emissions from power plants before deciding whether they should be regulated under Section 112. See 76 Fed. Reg. 24,976, 24,978 (May 3, 2011). Scrubbers installed to reduce SO2 also reduce hazardous acid gas pollutants, including hydrochloric acid and hydrofluoric acid, and in certain configurations scrubbers will also reduce mercury and non-mercury metals, also hazardous pollutants.9 Although Title IV prompted the installation of some scrubbers, most plants either switched to low sulfur coal without adding controls, or took no action at all, using allowances to meet their obligations. Only 27 of 261 power plants surveyed by EPA in 1997 installed scrubbers.10 More than fifteen years later, less than two-thirds of plants had scrubbers, and fewer still had configured their scrubbers to remove hazardous pollutants.11 

12. In contrast with the failed market based trading scheme, strict regulation works to protect public health

The logic here shows why market incentives fail and why regulator mandates work:

Furthermore, much of the control equipment that was installed in response to Title IV and other programs fails to reduce hazardous pollutant emissions because it is not operated consistently. Allowance programs such as Title IV rely on economic incentives to reduce emissions, rather than mandatory limits. When those economic incentives are insufficient to cover the cost of operating pollution controls, even generators who already installed controls operate those controls only to the minimum extent necessary to comply with their permits.12 For the past several years, allowance prices have been so low that it has been cheaper for many generators to buy allowances rather than to reduce pollution by operating already- installed controls. Neither Title IV nor any other provision of the Act requires or even encourages generators who have thus far avoided installing hazardous pollutant controls to install them now, absent the Toxics Rule. As a result, uncontrolled power plants remain the leading source of many hazardous pollutants in the air we breathe. 

13. The benefits of regulation exceed the costs of compliance, but Cost Benefit Analysis is inherently prone to industry manipulation and abuse.

Petitioners’ arguments are premised on a mischaracterization of the economic consequences of the Rule and EPA’s approach to benefit-cost analysis. The three petitioners’ briefs are intended to create the misapprehension that EPA found that the Rule would create only a few million dollars of benefits. The real story is quite different: EPA determined that the benefits of the Toxics Rule will be $37 to $90 billion, at least triple the costs of the Rule. 77 Fed. Reg. at 9,305-9,306, and Table 2. Petitioners’ rhetoric is not based on a comparison of all benefits to all costs, as proper economic analysis requires. Instead, petitioners exclude all unquantified benefits, and all quantified benefits other than the benefits of  avoided IQ loss for children exposed to mercury through recreationally-caught fish. See NMA Pet. at 2 (citing 77 Fed. Reg. at 9,306 Table 2); UARG Pet. at 15-16; Michigan Pet. at 9; 77 Fed. Reg. at 9,428. Nowhere do petitioners offer a legal or scientific rationale for ignoring over 99% of the benefits of the Toxics Rule.

EPA analyzed the costs and benefits of the Toxics Rule under Executive Orders 12866 and 13563, as it must with all major rules. See 77 Fed. Reg. at 9,432. The purpose of these orders is to provide a detached, unblinking look at the benefits and costs of rulemaking, direct and indirect, quantified and unquantified. EPA applied best scientific practices and approved, peer-reviewed guidelines, and correctly showed that the benefits of the Rule vastly exceed the costs. See id. An independent peer review of EPA’s methodology submitted with Exelon’s comments on the proposed Toxics Rule confirmed EPA’s methodology and found that, if anything, EPA underestimated benefits and overestimated costs.13 

Petitioners’ criticism of EPA’s benefit-cost analysis appears to be that it is too inclusive, taking into account all costs and all benefits, but this is exactly the point of the exercise. It is true that the Toxics Rule will yield reductions in conventional pollutants (e.g., fine particulates) in addition to reductions in hazardous pollutants. Congress would not be surprised at that result.

14. Strict regulation is economically more efficient and more equitable than market based approaches

3. The Toxics Rule does nothing more than level the playing field, counteracting the economic disincentive to pollution control, and does not threaten reliability.

Petitioners’ unwavering focus on total cost of the Toxics Rule is intended to imply that the emission standards established in the Rule are onerous and unreasonable, but that is not the case. The cost of compliance is a function of the large number of power plants that have escaped regulation and remain uncontrolled; if anything it is an indication of how urgently the Rule is needed. The emission standards in the Toxics Rule are achievable by all types of facilities through the application of widely available and well-understood control technologies already in place at many plants. In nearly every case, EPA imposed only Floor Standards, meaning that the Rule requires power plants to do nothing more than match the performance of their best performing peers.

In fact, EPA found that 69 coal-fired units already met all of the Rule’s standards, without any further investment. 77 Fed. Reg. at 9,387.16 Contrary to petitioners’ doomsday predictions, these cleaner plants have continued in business, even while suffering a competitive disadvantage to dirty, uncontrolled plants. The Toxics Rule will go a long way to eliminating this disadvantage by requiring those uncontrolled plants to install and operate emission controls.

15. EPA set a far LESS STRINGENT standard than scientifically justified and legally allowed under the Clean Air Act and already adopted by 15 States

This argument completely destroys the myth that EPA is engaged in a “War on Coal” or is under the influence of environmental zealots.

I think it is stunning that PSEG admitted that EPA has the legal authority under the Clean Air Act to PROHIBIT mercury emissions!

In fact, EPA found that 69 coal-fired units already met all of the Rule’s standards, without any further investment. 77 Fed. Reg. at 9,387.16 Contrary to petitioners’ doomsday predictions, these cleaner plants have continued in business, even while suffering a competitive disadvantage to dirty, uncontrolled plants. The Toxics Rule will go a long way to eliminating this disadvantage by requiring those uncontrolled plants to install and operate emission controls.

EPA’s nearly exclusive use of Floor Standards is significant for another reason: it contradicts petitioners’ portrait of an agency determined to regulate as aggressively as possible. Had that been EPA’s motivation, EPA would certainly have adopted more aggressive emission standards under the authority of Section 112(d)(2). 42 U.S.C. § 7412(d)(2). That provision consigns the stringency of emission standards to a series of EPA administrative judgments about achievability, cost, non-air-quality health and environmental impacts and energy requirements, and even expressly authorizes a prohibition on hazardous emissions. Id. All of these judgments would fall squarely within the protection of Chevron deference. Instead of exploiting this potent statutory authority to adopt more stringent standards, EPA imposed the least stringent standards the statute allows.  

The basic process of   setting Floor Standards is largely ministerial: collect emissions data; determine best performing 12%; average results. See 42 U.S.C. § 7412(d)(3). The Toxics Rule’s Floor Standards are based on real world performance by real operating power plants. They are not based on the sort of result-oriented exercise of administrative discretion of which petitioners accuse EPA. In perfect harmony with the Congressional mandate animating Section 112, it is petitioners’ cleaner industry peers that have set the bar for performance under the Toxics Rule, not EPA.

16. The Lights Won’t Go Out – Energy Industry “reliability” arguments are a Big Lie

This is one of my favorites, because it exposes the sham argument that PSEG itself often deploys.

The energy industry often tries to scare the public and regulators with claims that if they don’t get what they wont, that the lights will go out. PSEG puts the lie to that claim:

EPA gave especially close attention to the issue of electric reliability. In the final rulemaking, EPA summarized the many comments it received on this issue, some suggesting the Rule would compromise reliability, some suggesting the opposite.18 77 Fed. Reg. at 9,406-9,407, UARG App. 379a-383a. EPA painstakingly addressed each of these concerns, adjusting its own analysis of plant retirements based on revisions to the final rule and concluding in the end that the Toxics Rule would not adversely affect reliability. 77 Fed. Reg. at 9,407-9,411, UARG App. 383a-402a. EPA found more than adequate evidence in the administrative record to support its conclusion.

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Another Pipeline – More Insane Lies About Fracked Gas

March 30th, 2015 No comments

“leading us exuberantly to the precipice”

“an institutional logic that is deeply pathological”

The Real Mad Men Are Not On TeeVee

Last week, I listened to a brilliant talk by Noam Chomsky, in which he employed the metaphor of the Doomsday Clock for the climate crisis.

His analysis highlighted the contrast between public opinion and elite beliefs, and explained how the the policy decisions of governments reflect elite interests while ignoring democratic sentiments.

Pointing to energy industry propaganda in the Wall Street Journal, he ridiculed examples of how the press is helping to “lead us to the precipice”.

That being the case, the attitudes at the top of the [income/wealth] ladder are of very great significance.

These are revealed dramatically in a poll of CEO’s that was released last January at the Davos conference in Switzerland – a conference of “Masters of the Universe” as the business press describes them. By rather ominous coincidence, this was just at the moment when the Doomsday Clock was advanced to 3 minutes to midnight.

The poll revealed that climate change did not merit inclusion among the top 19 risks that concern CEO’s.

Worse still, at the top of their ranking of perceived risks was regulation – that is, the prime method for addressing environmental catastrophe.

Their overriding concern was with growth prospects for their companies. That’s not surprising. Whatever their individual beliefs, in their institutional role the CEO’s are constrained to adopt policies that are designed to pose extraordinary and undeniable threats to the continued existence of humanity, in the words of the Doomsday clock declaration. ….

The effects are before our eyes every day, so take last Sunday’s Wall Street Journal as a typical example.

There’s a Week In Review section. It features an article titled: “Fossil Fuels Will Save the World, Really“.

The lead story in the news section is headlined “US Producers Ready New Oil Wave”. The article glories in the thought of what they call an ocean of oil from US shale as American energy companies are poised to unleash a further flood, while they lead us exuberantly to the precipice.

Scientists are well aware that most of the oil must be left in the ground if there’s to be some hope for a decent life for our grandchildren, but who cares as long as there are spectacular profits for tomorrow.   ~~~ Noam Chomsky ~~~ Lannan (Santa Fe, NM, March 18, 2015)

I was reminded of Chomsky’s analysis today, particularly the greed and exuberance of the fossil industry and cheerleading by the media.

NJ Spotlight reports today on another gas pipeline expansion:

But the expansion of the natural gas pipeline system has been strongly endorsed by the Christie administration and most business interests. Not only has it delivered big savings for consumers and companies depending on the fuel to heat homes and businesses, it also has helped drive down the price of electricity in a state with some of the highest energy costs in the nation.

The steep drop in natural gas prices — some consumers have seen their heating bills drop by one-third or more — is pushing gas utilities to get access to the cheaper supplies. With tougher environmental rules proposed by the Obama administration, many older coal-fired plants will be retired, replaced by new or expanded natural-gas generation. …

But Droege [Williams] said increased capacity of the compressor station in Mercer County, will not create problems. “You will not even notice it,’’ he said.

Yup, there it is, just like Chomsky said, – American energy companies leading us exuberantly to the precipice.

I submitted the below comment, in what appears to be another futile attempt to inject sanity in the discussion and reframe the perspectives presented in the story:

First of all, the current market price of gas is artificially low – economists agree that it fails to consider “external” environmental, public health, social, and climate change costs.

Those costs are described and quantified in the EPA”s social cost of carbon” – when will we ever see a report on that?

Gas consumers and ratepayers are paying for these costs now, just not in the price of so called “cheap” natural gas – that is a huge lie.

Second, scientists warn that at least 80% of known reserve of fossil fuels must remain in the ground to prevent catastrophic climate change – so it is literally insane to be investing in fossil infrastructure instead of efficiency and renewables.

Third, the so called “cheap gas” is undermining the economics of efficiency and renewables and discouraging critically needed investments.

This is perverse – literally.

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Christie Administration’s Coastal Management Plan Fails to Address Huge Regulatory Gaps In Off Shore Energy Development

March 29th, 2015 No comments

Why Is Gov. Christie Invisible On Obama Off Shore Drilling Plan?

No wonder DEP conducts ocean and coastal planning behind closed doors and by invitation only 

Today we briefly follow up on two recent posts, one about the fact that DEP was conducting important coastal planning behind closed doors and by invitation only – the other about Gov. Christie’s failure to clarify his now 5 year old stance with respect to the Obama administration’s off shore drilling plans.

With all the controversy and public opposition regarding various off shore energy development proposals – from the Obama Administration’s proposal to allow oil & gas drilling in the Atlantic to the off shore “Port Ambrose” LNG export facility – I thought I’d take a look at how the current NJ Coastal Management Plan (CMP) strategy addresses off shore energy issues.

Is the CMP meeting it’s objectives?:

Energy & Government Facility Siting

Section 309 Enhancement Objectives

Adoption of procedures and enforceable policies to help facilitate the siting of energy facilities and Government facilities and energy-related activities and Government activities which may be of greater than local significance

The NJ CMP is required under the federal Coastal Zone Management Act.

The current 2011 – 2015 NJ CMP Coastal Assessment and Strategy is a critical component of that federal CMP requirement.

The current CMP and assessment are now undergoing update, but that process is being conducted behind closed doors and by invitation only.

First of all, the current CMP is outdated and mis-states the facts on off shore wind (see page 33). This masks Gov. Christie’s failure to develop off shore wind capacity under the Offshore Wind Economic Development Act (see p. 35).

Second, The CMP flat out misstates the facts on the Energy Master Plan (EMP) (see page 33) regarding renewable energy goals, thereby masking Gov. Christie’s rollback of the prior 30% goal to the statutory minimum of 22.5%.

Third, and most importantly, the CMP finds major gaps in NJ efforts to address the threats from off shore energy development, specifically the lack of enforceable requirements under the Energy Use rule, N.J.A.C. 7:7E-7;  the “Technical Manual for Evaluating Wildlife Impacts of Wind Turbines Requiring Coastal Permits”, and the DEP’s “Ecological Baseline Study” of a 1,300 square mile off shore area.

Huge gaps, classified by DEP as “high priority”,  include a lack of regulation and policy to “inform decision making with respect to the siting of energy facilities” and “Planning for offshore energy development, including consideration of cumulative impacts” (see page 39, DEP table reproduced below)

Source: NJDEP Section 309 Coastal Assessment and Strategy - 2011 - 2015

Source: NJDEP Section 309 Coastal Assessment and Strategy – 2011 – 2015

That’s right: DEP has no regulatory or policy basis to inform decision making regarding the planning or siting of off shore energy facilities or the evaluation of cumulative impacts.

But despite these huge regulatory and policy gaps in high priority issues directly related to off shore energy threats, DEP proposes to do nothing to close these gaps:

Although this enhancement area is important to the Coastal Management Program, it will be addressed under other enhancement areas, as discussed below. 

While no strategy is being developed for this enhancement area, planning for offshore energy development will be addressed under the Ocean Resources strategy. The Coastal Management Office has determined that comprehensive Coastal and Marine Spatial Planning will be the most effective way to address and manage the growing interest in energy development in coastal and offshore waters. The SAMP strategy contemplates the development of a SAMP for the Barnegat Bay watershed, which is affected by one of New Jersey’s four nuclear power plants.

That’s right: no strategy is being developed to close these critical gaps.

So what is DEP doing with MSP and Barnegat Bay SAMP?

When one queries the CMP for progress and action items on how “Marine Spatial Planning” (MSP) is filling these critical regulatory and policy gaps, one comes up completely empty, other than to conclude that MSP has become a very small fig leaf providing very little cover for the do nothing Christie DEP, who has outsourced core DEP regulatory functions (see page 55):

Ocean resource mapping or information system

a) Marine spatial planning is recognized by MARCO member states as a means to advance most, if not all, of the four goals identified by the Mid-Atlantic Governors: Climate Change Adaptation, Ocean Habitat Protection, Offshore Renewable Energy and Water Quality Improvement. MARCO member states are each taking steps to develop offshore spatial plans for ocean waters off their coast and will coordinate through MARCO to ensure plans are integrated across the Mid- Atlantic region. In anticipation of initiating a marine spatial planning process, the five MARCO states have agreed to develop a regional, web-based GIS portal through which Mid-Atlantic Ocean data layers can be publicly viewed. In response to this need, the Virginia Coastal Zone Management Program has provided funding to The Nature Conservancy to create a prototype data portal for the Mid-Atlantic region. The vision for this project is to provide easy access to regional scale ocean data from beaches out to the submarine canyons at the edge of continental shelf, supplemented with additional state specific data (VA, MD, DE, NJ, NY) and tailored to serve the needs of MARCO. New Jersey Coastal Management Office staff is working closely with the other states and The Nature Conservancy to develop the portal.

Got that? “Anticipation of initiation”? DEP is working with TNC to develop a data portal. That would not close the gaps identified.

But DEP appears to be doing better on MSP than the Barnegat Bay SAMP, which seems to be on a slow train to abandonment – and god forbid that DEP should spend a thin dime on Gov. Christie’s alleged #1 environmental priority, as DEP admits:

The SAMP will take a total of five years and will be funded through the Coastal Zone Management Program’s NOAA Section 309 of the Clean Water Act funds, ensuring that the SAMP will be developed without additional cost to the State.

Meanwhile, huge high priority regulatory and policy gaps that DEP themselves identified remain unaddressed.

  • Why is Gov. Christie invisible on Obama off shore drilling plan?

Eight months ago, I wrote:

Back on March 31, 2010, before he was running for President, Gov. Christie issued a statement opposing the Obama plan:

“I oppose the idea of drilling off the coast of New Jersey,” Governor Christie said, noting that the President’s proposal thus far includes areas off Virginia and the northern tip of Delaware near Cape May in the Delaware Bay. “New Jersey’s coastline is one of our economic engines and I would have to be really convinced of both the economic viability and environmental safety of oil and gas exploration off our coast. At this point, I’m not convinced of either.’

Has he been convinced since then?

Energy industry money to fuel a run for President can be very convincing.

With the Gov.’s political ambitions and a DEP performance like that, no wonder the DEP conducts ocean and coastal planning behind closed doors and by invitation only.

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Gov. Christie’s Office Controls Pinelands Commission Press Statements

March 29th, 2015 No comments

Christie’s Trenton Attack & Spin Machine Reaches Into the Pinelands

The Executive Director of the Pinelands Commission made a stunning – and I presume inadvertent – disclosure during Friday’s P&I Committee meeting that should be highlighted.

During the public comment opportunity, I began my remarks by asking the Committee if the Commission had a policy and procedure for releasing press statements.

Chairman Lohbauer just shrugged his shoulders, which I took for a NO.

So, I then commented that I assumed that left press statements up to the judgement of Executive Director Wittenberg.

I then took strong objection to Wittenberg’s statement of January 30, 2015 regarding the SJG MOA emails, which was reported by NJ Spotlight:

“What the emails show is the governor’s office was involved, almost in real time” as Lloyd was to be confronted with the conflict allegation, said activist Bill Wolfe, a former state environmental analyst now with the Public Employees for Environmental Responsibility.

In a terse prepared statement, commission director Wittenberg has said there was no evidence of wrongdoing in the email records, despite the criticism of Wolfe and others.

“Their comments are pure hyperbole and show a lack of understanding of the commission’s rules and procedures. The commission prides itself on being transparent and provides for and encourages public comment at all of our meetings. It is unfortunate that a few individuals take these opportunities to mislead, disrupt and promote their own agendas.”

Citing my training and 30 years of professional experience in environmental planning and regulation, I noted that Wittenberg’s statement was ad hominem, unprofessional, and false.

At this point, Wittenberg interrupted my testimony to state that press statements were approved by the Governor’s Office.

So, it sure seemed like Wittenberg was pointing the finger of blame to the Gov.’s Office for the press statement I criticized.

So now the plot thickens and Wittenberg’s revelation raises even more troubling questions:

1. Why would the Gov.’s Office have review and approval power over the press statements of the independent Pinelands Commission?

2. Why would the Pinelands Commission do the Governor’s bidding?

3. Who was the attack dog in that Jan 30 press statement? Was it written by the Gov.’s Office or the Pinelands staff?

Under the NJ Pinelands Protection Act, the Gov. has a negative power to veto the minutes of the Commission and block them from taking action.

But the Gov. has no power over press statements of the Commission or its staff.

The Executive Director reports to the Commission, not the Governor.

So, I can only assume that the attack dogs in the Gov.’s press Office wrote that Jan 30 statement as an attack on the messenger in a transparent attempt to undermine the credibility of their critics and deflect attention.

I can understand that, because I called out the Gov.’s Office for their corrupt role in the attack on Commissioner Ed Lloyd that forced his recusal.

And I’ve been writing about the corrupt relationships between South Jersey Gas, BL England (Rockland Capital), lobbyists at the Wolf & Samson law firm, the Governor’s Office and the Pinelands Commission.

So, I can understand their motivation to prevent that story from getting media legs or the investigation it deserves.

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Friday in the Pines

March 28th, 2015 No comments

Pinelands Commission – Sheds Scandal Like Water off a Duck’s Back

I fell in love with the Pinelands … The Comprehensive Management Plan(CMP) is like the Constitution. … If we keep straying from it [the CMP] we’re going to kill it.  ~~~ (former) Pinelands Commissioner Robert Jackson (3/27/15)

In the first meeting after his decapitation by Gov. Christie and Senate President Sweeney, there was no tribute by the Pinelands Commission’s Policy & Implementation (P&I) Committee for former, deposed Commissioner Robert Jackson.

But, showing their true colors, like in the case of Commissioner Zeke Avery, the Commission did make haste to post the bio of his replacement on the Commission’s website, despite the fact that Bob Barr has not yet been sworn in yet and won’t officially become a Commissioner until the next full meeting of the Commission on April 10.

Interestingly, they left out the part of Barr’s bio where he served as Treasurer to the Cape May County Democrats and staff to Senator Van Drew (D-Cape May).

Jackson attended the hearing, from the audience, and spoke eloquently and was magnanimous, not bitter (you can watch the hearing here).

Jackson urged the public and Commissioners, rightly disgusted by the Trenton politics surrounding Barr’s appointment, not to take that out on him but to give the man a chance to listen, learn and grow into his Commission role, as Jackson said he did.

[Note: I have a very different view.]

In stark contrast, Mr. Barr continued his lack of curiosity about the Pinelands and was a no show.

Barr didn’t even attend the hearing to meet his new fellow Commissioner’s, find out what the P&I Committee actually does (he’s never been to a Pinelands Commission meeting) and meet the public who defend Pinelands preservation and the CMP.

I spoke after Jackson and focused on the emails and what I think are not only improper process, but actions by Wittenberg and Roth that are unprofessional, unethical, and warrant firing for insubordination.

Commissioner Earlen played the role of Commissioner Avery. Earlen defended Wittenberg/Roth by the same straw man claim: he encouraged the staff to communicate with applicants. He basically said that nothing unusual or inappropriate took place during the SJG MOA review.

Commissioner Lloyd disagreed, but limited his concerns to a lack of transparency and failure to include SJG communications in the administrative record. Lloyd failed to note the inappropriate role of SJG, as a regulated entity, played in the process; or the staff’s actions without authorization of knowledge of the Commission; or the staff’s false public statements; or the excessive discretion provided to staff under current MOA standard of “equivalent protection”.

Chairman Lohbauer also supported staff and created his own straw man, by claiming that “no violations of the CMP” occurred.

So, like water off a duck’s back, Wittenberg and Roth and the Governor’s Office all dodge the scandal and all accountability.

We did learn one thing new from a response by Counselor Roth to Georgina Shanley’s question about the status of the SJG litigation.

Roth said that the litigation was handled by the AG’s office and that a “statement of items comprising the administrative record” and briefing schedule had not been developed yet or approved by the Court – this makes me question whether SJG is serious about the lawsuit. A statement comprising the administrative record should have been approved by now – what explains the delay?

  • Actions Taken

1) MOA Policy Advisory Committee formed

Chairman Lohbauer began by announcing the new 7 member MOA Policy Advisory Committee to the Commission.

It is comprised on Commissioners Ashmum (Chair) and Galetta, LLoyd & McGlinchy. County and local rep, plus Fred Akers as the public rep.

There was no aggressive schedule of clear objective expressed.

Ashmum quickly made it clear that the public could “listen” to the Committee deliberate, but not provide public comments to it.

I and others objected to the lack of an ability to comment on the COmmittee’s deliberations,  but Chairman Lohbauer refused to differ with Ashmum and said public comment could be provided when the full Commission considers the Committee’s recommendations.

Bad first step.

2) approval of controversial minutes

The P&I Committee approved the minutes of the January 30, 2015 meeting, where there was significant public outrage expressed over the PPA emails.

My remarks were summarized thusly:

Mr. Bill Wolfe recommended that the Commission impose an administrative moratorium on any waivers or MOAs until it performed a critical review of the status of “equivalent levels of protection” in an open and transparent way. He said this was a recommendation he had made during the discussions of the South Jersey Gas (SJ Gas) application in July 2013. He said the documents posted on the Pinelands Preservation Alliance’s (PPA’s) web site reveal that Commission staff had engaged with the applicant starting back in 2012. Also, he described other information that he characterized as showing conflicts. He said the Committee’s upcoming closed session this morning would not constrain him from speaking about legal concerns related to the MOA. He said the public has no confidence in the Commission’s Executive Director or the Counselor due to the revelations in the posted documents. He said the Commission needs to ask for whom its staff works. There had been ongoing conversations with the governor’s office and the Board of Public Utilities (BPU). Mr. Wolfe said the Executive Director is supposed to review staff recommendations but that process was tainted by the interjection of SJ Gas. Referencing correspondence between SJ Gas and the Commission’s counselor asking about the veracity of a statement he had made, Mr. Wolfe said he wanted his comments reviewed by staff, not by the applicant. Mr. Wolfe said the recusal process for Ed Lloyd (at the time of the vote on the SJ Gas application) had been reviewed by the New York Times and emails indicated that the Governor’s Authorities Unit had been involved in near real time. He said decisions are being made not by the Commission but by Trenton.

3) Climate Change – Head in the sand posture continues

Chairman Lohbauer pulled me aside before the meeting began to talk – he apologized for the fact that the Commission did not provide a response to my March 13, 2015 request for the Commission to begin addressing cliamnte change. He said he assumed that Director Wittenberg has replied.

I repeated that request during Friday’s P&I meeting, noting that the Commission was diverting scarce staff resources and time to promote economic development projects instead of focusing on the most critical threat facing the Pinelands resources and that their own science had already documented impacts from climate change.

I also noted that the CMP already included energy efficiency standards and comprehensive regulations that discouraged solar installations, so energy and climate issues were already within the scope of the CMP and the policy was bizarre situation: strict regulations to discourage solar, while no regulation of climate and staff promote fossil infrastructure like the SJG pipeline.

Director Wittenberg responded that she would provide a written reply soon.

4) Black Run Watershed – Forest preservation or development scheme?

Staff made a presentation on the Black Run watershed, in portions of Evesham and undisturbed and preserved forested lands in  Medford.

The plan was designed to reflect a 2006 transfer of development plan developed by Medford and Evesham.

The plan involves protection of high water quality by re-designation of 4,000 acres of undisturbed forested lands from rural development area to Forest Area. The plan would reduce allowable development density from 1 unit per 3.2 acres to 1 unit per 25 acres (for a total maximum of just 70 units), and expand the boundaries of thousands of acres permanently preserved ecologically signifiant lands.

If that sounds too good to be true, you are right.

Staff found that

  • the current rural development designation “does not reflect the ecological value of the area”
  • the current rural development designation “continues to create unrealistic development expectations
  • a Forest Area resignation would reflect the current CMP standards for Forest Area

Despite those findings, and in a complete contradiction to the above findings, staff also found that Forest Area re-designation would result in:

significant, uncompensated loss of property-owner’s value

How can the reduction of development potential be “significant” if the site has significant environmental and regulatory constraints to development at the allowable RDA density of 3.2 units per acre?

Why is staff’s recommendation so heavily influenced by greatly exaggerated diminution in development potential and property value?

Based what appears to be primarily on this “significant uncompensated loss of property-owner’s value”, the plan option recommended by staff would transfer the development density reduced in the Forest Area to a 175 acre parcel o the Evesham border with Voorhees Township. That parcel is currently zoned for 55 units – the new density transfer would allow 325 units.

Very bad deal – if the development potential of the current forested land is severely contained and is a maximum of 70 units, then there is no way 325 new units is a good plan.

Plus, the proposed planning option #3 would violate the current CMP standards regarding wastewater management.

Why is staff recommending options that violate the current CMP?

As Commissioner Jackson said:

If we keep straying from it [the CMP] we’re going to kill it. 

Commissioner Ashmum raised concerns that the staff presentation lacked the full history of the Medform Evesham Plan and a discussion of all the data, objectives, and programs that plan was based on.

Other Commissioners agreed and the staff recommendations thankfully were tabled for reconsideration at the new P&I meeting.

This is something to keep an eye on.

5) New Agricultural “Pilot” – Expanded economic development opportunities

The Commission created a new Agriculture Committee and its first task will be to consider how to respond to legislative threats, led by Senator Lesniak an Assembly Democrat Andrzejczak (D-Cape May) – the same District 1 of SJG pipeline champions Senator Van Drew and Assebmlyman Fiocchi adn new Commissioner Barr.

The issue arose out of the Tuckahoe sod farm soccer tournament controversy.

Another political concession by the Commission that undermines the CMP.

As Commissioner Jackson said:

If we keep straying from it [the CMP] we’re going to kill it. 

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