Powering Progress WHAT IF? The modern electric grid is one of the 20th century s great achievements. Eliminate 1 million tons of carbon emissions

Transcription

1 Powering Progress The modern electric grid is one of the 20th century s great achievements. emissions of carbon dioxide and other greenhouse gases. Today, the role of the utility is evolving as we adjust to meet the changing expectations of customers. At PSEG, our vision of the future is one This didn t happen by chance. For more than a century, the mission and mandate of utilities were closely aligned with a major goal of where customers use less energy, the energy they use is cleaner, and its delivery is more reliable and more resilient than ever. society: Providing universal access to an around-the-clock supply of reliable, affordable power. The challenge is to realize this future without abandoning our longstanding commitment to an affordable and universal power supply. As our larger community goals have changed, energy companies such as PSEG have evolved to remain aligned with them for The energy industry is undergoing a revolution, brought on by shifting example, by helping to meet urgent deadlines for reducing global customer expectations and new, disruptive technologies. At PSEG, we do not fear disruption. In fact, it is our 115-year-old company s ability to adapt to disruptive forces that will guide us into the coming decades of change and allow us to lead the industry into this exciting new reality. WHAT IF? We believe utilities of the future not only will continue to play a central IF NEW JERSEY COULD REDUCE ENERGY CONSUMPTION BY 2 PERCENT: but also that they must play that role to ensure universal access to I t would put $130 million in the pockets of New Jersey consumers, and role for customers, for communities, and for the world around us, those benefits. Eliminate 1 million tons of carbon emissions This would be equal to taking 200,000 cars off the road IMPOSSIBLE TO ACHIEVE? That is the amount the most energy-efficient states Massachusetts and Rhode Island are now achieving. We make things work for you.

2 AFFORDABILITY OF EFFICIENCY ENERGY EFFICIENCY COSTS LESS THAN ANY OTHER SOURCE OF ELECTRICITY WHETHER TRADITIONAL SOURCES OF GENERATION, SUCH AS NUCLEAR OR COAL, OR RENEWABLES. $/MWh Levelized cost of Energy (LCOE) $350 $250 $150 $50 Energy Efficiency Generation Sources In the past, any energy savings enjoyed by customers cut into utilities revenues, creating a disincentive to invest in programs that benefit customers by reducing energy use. Today, more than two dozen states have adopted regulatory systems known as decoupling that ensure utilities can bring in enough revenue to keep energy grids running reliably and efficiently, no matter how much electricity they sell. New Jersey already uses this kind of system for gas delivery, and regulators are considering adopting similar rules for electric service. In states with decoupling, and where they have specifically directed utility companies to drive energy efficiency, they re achieving net energy savings of 2 percent. Without decoupling, meanwhile, New Jersey s savings are estimated at less than 0.5 percent. States such as Massachusetts and Rhode Island are saving more than seven times as much as New Jersey. If New Jersey reduced energy consumption by 2 percent, it would eliminate 1 million tons of carbon and return $130 million to consumers. Source: Lazard LOOE Ver 11.0 for generation: Lazard Ver 9.0 for EE Energy Efficiency PSEG believes that energy efficiency must be the single most important mission for utilities in the future and especially to ensure universal access to energy efficiency. Energy efficiency delivers clean energy benefits similar to solar or wind, but at a fraction of the cost. In fact, energy efficiency uniquely plays a vital role in reducing customer bills. But while New Jersey has set ambitious public goals for renewable energy, we have been less aggressive in the area of energy efficiency and it shows. On the latest national energy efficiency scorecard, New Jersey ranks No. 23, two places lower than we were in In actual incremental energy savings, we rank even lower: No. 30. In states that rank above New Jersey, policymakers have embraced the role of the utility in delivering universal access to energy efficiency, and adjusted their regulations to encourage the spread of energy efficiency. NEW JERSEY FALLS BEHIND ON THE LATEST NATIONAL ENERGY EFFICIENCY SCORECARD, NEW JERSEY RANKS NO. 30. WHAT ABOUT THOSE STATES THAT RANK HIGHER? THEY HAVE CONCRETE GOALS FOR ENERGY EFFICIENCY.

3 PSE&G is working with regulators at the New Jersey Board of Public Utilities on a decoupling program, which would provide a foundation for a $2.5 billion energy efficiency program to be proposed later this year the largest energy efficiency program ever put forth in New Jersey. Energy efficiency is a quadruple win providing for a cleaner environment, job creation, investment opportunities and lower customer bills. The cheapest, cleanest kilowatt-hour is the one that s never used. REDUCING AIR EMISSIONS PSEG S GENERATION FLEET HAS SIGNIFICANTLY REDUCED ITS EMISSION RATE FOR BOTH CO2 AND OTHER POLLUTANTS. PSEG Electricity Generation CO2 Emission Rate 800 Clean Energy The rise of solar and wind energy has helped satisfy the need for energy that doesn t pollute the environment. PSEG has earned a reputation as one of the most progressive utilities in the country for supporting clean energy, and we re committed to helping New Jersey meet its ambitious clean energy goals. lbs/mwh PSEG Electricity Generation Emission Rates We support Gov. Phil Murphy s clean energy agenda, which will allow New Jersey to reap the combined benefits of power generated with solar, offshore wind and nuclear working together toward the goal of a 100 percent carbon-free energy supply by To get there, it will mean increasing our development of renewable energy sources, encouraging the continued use of zero-carbon nuclear, and phasing out power plants that run solely on fossil fuels. Already, PSEG is drastically transforming its generation portfolio: We have invested nearly $2 billion to develop solar farms in New Jersey and around the U.S. Last year, we closed our last two coal-fired New Jersey power plants, and we have worked with the state to preserve the Salem and Hope Creek nuclear plants, which represent 90 percent of the state s carbon-free electric generation. We also have committed to eliminating 13 million tons of CO 2 - equivalent emissions by 2030, equal to taking 2.8 million cars off the road. We are doing so despite the fact that we already have one of the smallest carbon footprints of any utility in the U.S. And because the transportation sector is New Jersey s largest source of air pollution gas combustion vehicles are responsible for 40 percent of New Jersey s emissions PSEG wants to enable widespread electric vehicle adoption by investing in charging infrastructure at home, at work and on the road, in every neighborhood, in every community.

4 Connected Customers Customers are growing more reliant on the grid as the world trends toward greater connectivity. As other sectors, such as the retail industry, create innovative new customer experiences, utility customers want the same level of service from their energy providers. Those expectations are driving a digital transformation that reimagines today s energy grid as a network connecting homes and businesses with a universe of clean energy sources and services, using data to help customers customize their energy use in whatever manner suits their needs. Soon, the same infrastructure used to manage the grid and ensure the reliable flow of electricity could be used to provide customers with services that will help them save energy and save money. The utility could become an open platform for services based on the utility s status as a trusted energy adviser providing a link between customers and other energy-related vendors. Imagine your utility at the center of a two-way digital communication network, enabled by the introduction of smart meter technology. Such a network could: Analyze a customer s energy usage and recommend adjustments to thermostat settings or appliance use in order to help save energy and save money; Work with Smart Home assistants such as Alexa to give customers the ability to manage their energy spending or reduce their household s carbon footprint; Provide real-time outage detection and dispatch restoration crews automatically. According to our estimates, such network improvements could save customers more than $2 billion over the next 20 years. PSEG HAS LONG BEEN A LEADER IN PRODUCING CLEAN ENERGY In New Jersey, we have invested more than $1.3 billion in renewables and more than $400 million in energy efficiency Closed two remaining coal plants in N.J. Investing $2 billion in three state-of-the-art clean gas facilities Producing 40% of N.J. electricity with air emissions-free nuclear We have committed to eliminating 13 million tons of CO2-equivalent emissions by 2030

5 Momentum to Modernize Even as our company evolves, we realize that the existing energy grid remains essential to our mission. We have invested heavily in modernizing New Jersey s electric and gas infrastructure, and we are committed to ensuring that the state s energy network continues its momentum toward modernization. PSEG s modernization programs include: Our Gas System Modernization Program, which reduced methane emissions by replacing 510 miles of aging cast-iron and steel gas pipe with more durable plastic. A second phase will begin in 2019 and replace nearly 1,000 additional miles over five years. Our Energy Strong program increased energy resiliency after Superstorm Sandy by raising critical electric and gas infrastructure to prevent service disruptions during future extreme weather events. A second phase has been submitted to the New Jersey Board of Public Utilities for renewal and approval. Our Clean Energy Future program will increase our commitment to renewable energy, develop ambitious targets for energy efficiency and energy storage, and encourage electrification of the transportation sector. modernizing our $ 30 will add nearly into infrastructure the New Jersey economy by 2020 We estimate that modernizing our infrastructure will add nearly $30 billion into the New Jersey economy by 2020, supporting thousands of jobs to build and operate new facilities, as well as additional jobs that will result from the enhanced economic activity. The end result will be a stronger New Jersey economy, and a more reliable, resilient and cleaner energy grid. billion

6 Powering Progress PSEG is committed to New Jersey, to its customers and to its role as an energy industry leader. Our roots are deep. Our ongoing mission is to invest in the economy, environment and infrastructure to make the state and the communities we serve better places to live and work. We will be resilient, responsible and reliable as both a producer of clean and efficient energy and as a member of the communities we serve. We have a responsibility to ensure all customers have access to affordable, reliable energy, and that our communities everywhere are sustainable. We also have a responsibility to partner and innovate with governments and industry to ensure that, together, we are driving the agenda forward. Utilities should not simply react to disruptive ideas, but instead must be the catalyst for change, for quicker development of new technologies from renewables to smart thermostats to energy storage to all customers in every community. New technologies are coming. The future will be electrified and we will be at the center of that revolution. Just as utilities in the 20th century brought universal access to electricity and gas, we are committed to giving all customers access to 21st century technologies that allow them to manage their energy use. From power plants to industry to transportation, electricity will be the fuel of the future. PSEG will be the fuel for powering progress. Using both experience and innovation, PSEG is evolving quickly to lead both New Jersey and the energy industry toward a stronger, cleaner, more efficient future. And we will back it up with investment. Enhanced Reliability and Resiliency Cleaner Energy DEMANDS ON THE UTILITY OF THE FUTURE Access to Innovative and New Technology Affordable Energy AUGUST 2018 We make things work for you.