Roundtable: Energy innovation Mike Renna, President & CEO, South Jersey Industries Gary Stockbridge, Region President, Atlantic City Electric & Delmarva Power

®oundtable:

Energy innovation

South Jersey is leading the charge in revolutionizing the energy industry. Here, leaders discuss the future of the energy grid.

Mike Renna

President & CEO South Jersey Industries

In what ways is SJI helping to push New Jersey toward its clean energy goals? Certainly, in the state, the region and nationally there is an emphasis on reducing our carbon footprint and greenhouse gas emissions. SJI has embraced that goal. We’ve spent a lot of time identifying areas where we as an energy delivery company could not only support those goals but, more importantly, accelerate them. SJI has committed to what I believe to be industry-leading greenhouse gas reductions for our operations. We’re looking to reduce the emissions from our operations by 70% by 2030 and 100% by 2040. Beyond that, I think we’re the first and only utility company that has committed a certain percentage of our CAPEX on an annual basis to decarbonization investments. In this case, we’re committed to investing at least 25% on an annual basis on decarbonization projects and initiatives. That’s quite a bit when you think about the fact that, on a five-year average, we’ll spend $2-3 billion in terms of our traditional CAPEX. So, 25% of that would be for decarbonizationtype investments.

What does the future of hydrogen look like? A future of hydrogen at a significantly reduced, lowcarbon gas stream is possible. It can certainly be in place by 2050. There is a misconception that gas can’t be part of the solution. I’ll further say that in the end, we’re agnostic: I don’t care what the molecular content of the fuel flowing through the pipes is, as long as it’s safe and available. If at some point down the road, we as an industry are delivering hydrogen, great. That’s the business we’re in: delivering energy.

Gary Stockbridge

Region President Atlantic City Electric & Delmarva Power

What role is Atlantic City Electric playing in the transition to greener energy? We do business in a lot of states and I think New Jersey is at the forefront regarding green energy, so kudos to the governor for his legislation and everything he has done in this regard. First and foremost, we continuously look at our fleet and facilities to make sure that we’re walking the talk relative to the conversion of our fleet to electric vehicles and running efficient buildings in contributing to that effort. The good news for us is that we play a bigger role within the state than just our own footprint. Almost all of the activities and clean energy priorities that we’ve been working on are either driven by legislation, are under regulatory review or have received regulatory approval. Thankfully, these are nearing the launch phase. All these programs will help the state achieve its green goals one customer at a time.

What does the future of the energy grid look like? In our industry, we often talk about the utility grid of the future. In my mind, this is a smarter grid with a lot of data going through it, which would help us and our customers understand how our energy is being used. It also needs to be a self-healing grid, understanding when issues are happening and performing self-repairs to a certain extent. This includes innovative technologies to improve system reliability, such as specialized equipment that can restore service faster or isolate damage in the event of a power outage. We need to be able to bring on distributed generation quicker. In the utility grid of today, we still run into issues of congestion and there’s still a general lack of knowledge regarding how energy is used.

Rick Thigpen

Senior Vice President – Corporate Citizenship PSEG

How is PSEG helping to foster South Jersey’s clean energy economy? South Jersey is now the capital of the clean energy economy in New Jersey, and PSEG is very proud to be one of the leaders in making that happen. We are continuing to carefully and thoughtfully reduce our use of fossil fuels. In June 2021, we closed the last coal plant in our fleet and we expect to sell our natural gas generation assets by the end of the year. We are transitioning our power portfolio to focus specifically on carbon-free generation — overwhelmingly nuclear and, in part, solar and offshore wind.

What is your response to critics of clean energy costs? There’s no doubt that we have to be mindful of the cost of carbon-free electricity but we also have to be mindful of the cost of inaction related to reducing our use of fossil fuels. If we do not carefully manage the consequences of climate change, we’re going to face consequences far beyond any financial cost we’re going to pay. Striking that proper balance, where people can afford the transition, is very important and we believe that preserving our existing nuclear power capabilities is an integral part of managing that transition.

How do you promote energy efficiency? We’re teaching individuals and families the importance of using less energy and to use cleaner energies when possible, and to do so in a way that doesn’t ask them to sacrifice any of the activities they enjoy. We were recently approved for a program to invest over $1 billion in energy efficiency as a partner to our customers and help them reduce their energy usage. What economic impact will your offshore wind project have? At the state level, most of our impact will be in South Jersey, where the New Jersey Wind Port is proposed. Including all the direct, indirect or induced benefits, it’s estimated that we will provide over $1.8 billion in terms of economic impact as measured by state economic growth.

To hold ourselves accountable, we’ve given a guarantee of at least $848 million in direct investment. It requires work to be held accountable to that level but it’s something we’ve chosen to do voluntarily to ensure New Jersey’s communities reap the most economic benefit possible from our project.

What is the significance of your hydrogen project? The green hydrogen project is a pilot project and is something that Atlantic Shores has some experience with globally. We really wanted to bring that to the Garden State. As far as we know, we are the first and only green hydrogen project in the state, which comes with a big responsibility. We found a great partner in SJI and they’re equally excited about the potential of hydrogen and what it can mean. We’re going to develop a 10-megawatt electrolyzer, which makes hydrogen from water and renewable power. This is why it’s called green hydrogen as opposed to other forms of hydrogen that traditionally involve hydrocarbons. A hydrogen-based economy has a lot of potential, as seen in other states. It’s a great carrier of energy and is relatively efficient. The pilot project’s primary use will be to inject hydrogen into the state’s gas grid so that it helps to decarbonize existing consumers, like transportation and industry, in New Jersey.

Joris Veldhoven

Commercial and Finance Director Atlantic Shores Offshore Wind