New Jersey Resources 2011 Annual Report Conserve to Preserve速
Our Commitment to stakeholders
• Safe, Reliable and Competitively Priced Service • Customer Satisfaction • Growth • Quality • Valuing Employees • Corporate Citizenship • Superior Return
We are committed to enhancing our customers’ quality of life by meeting their expectations for reliability and value in an environmentally responsible way, every day.
Table of Contents Financial Performance
2
Letter from the Chairman
3
Feature Section
10
Directors and Officers
22
Presenting Our 2011 Form 10-K
24
Form 10-K
25
Shareowner Information
ibc
1
Financial Performance
performance graph* $175
$150
8.87 % NJR
$125
7.28 %
Company Peer Group**
3.90 %
S&P Utilities
– 1.18 %
S&P 500
$100
$75 2006 2007 2008 2009 2010 2011
Value of $10,000 invested (9/30/06)***
Dividends per share
$1.36
$15,294
$1.44
$12,172
$33.06
2007 2008 2009 2010 2011
2007
$11,633
$1.01
$35.89
$36.31
2008
2009
$10,368
2008
2009
2010
2011
* The performance graph shows a comparison of the five-year cumulative return, including reinvestment of dividends, assuming $100 invested on September 30, 2006, in New Jersey Resources (NJR) stock, the Company Peer Group, the Standard & Poor’s (S&P) Utilities Index and the S&P 500 Index. Total return percentages have been annualized. ** The nine companies in the Company Peer Group noted above are as follows: AGL Resources, Atmos Energy, Laclede Gas, Northwest Natural Gas, Piedmont Natural Gas, South Jersey Industries, Southwest Gas, Vectren and WGL Holdings. NJR includes the performance of the Company Peer Group because the Company Peer Group has a higher percentage of natural gas utility and combination natural gas and electric utility companies of comparable size and market capitalization to that of NJR, as compared with the S&P Utilities Index.
2
$42.57 $39.22
$13,637
$1.24 $1.12
2007
Stock price at year end
*** Assumes Dividends Reinvested Forward-Looking Statements — While forward-looking statements about NJR’s expectations made throughout this report are based on information currently available and on reasonable assumptions, actual results could be materially different. Historical results are not necessarily indicative of future earnings. NJR does not assume any obligation to review or revise any forward-looking statement in light of future events.
2011
2 Utility gross margin is a financial measure not calculated in accordance with GAAP, which is defined as natural gas revenues less natural gas purchases, sales tax, a Transitional Energy Facilities Assessment (TEFA) and regulatory rider expenses, and may not be comparable to the definition of gross margin used by others in the natural gas distribution business and other industries. For further discussion of this financial measure please see our Form 10-K. According to a study NJNG commissioned by the Rutgers’ Bloustein School of Planning and Public Policy on the “Economic Impacts of Energy Infrastructure Investments,” 7.8 jobs are created for every $1 million spent on NJNG’s AIP infrastructure projects.
3
Net financial earnings is a financial measure not calculated in accordance with generally accepted accounting principles (GAAP) of the United States as it excludes all unrealized and certain realized gains and losses associated with derivative instruments. For further discussion of this financial measure, please see our Form 10-K.
1
2010
To our shareoWners
We are many things to many people, and our efforts touch lives in different and meaningful ways. This is who we are and what we do, and, as our fiscal 2011 performance shows, we deliver more than you might expect. For all those who follow New Jersey Resources (NJR) and have
and appliance services businesses. But that’s not all. We are
read my letter to shareowners over the years, the look of this
innovative thinkers, business leaders, environmental stewards
year’s annual report may come as a bit of a surprise. It could not
and community partners. We are a safe, reliable service that
be a further departure from the simple white and blue approach
enhances our customers’ quality of life. We are a channel to the
from my early days as chairman and CEO or the stunning
marketplace to advance public policy and an engine for economic
photography and powerful images of the more recent past.
development. We are a job that supports our families and a return
With its bold cover and eye-catching features, this report is as
on investment to our shareowners. We are many things to many
distinctive as our consistent performance. More importantly, I
people, and our efforts touch lives in different and meaningful
believe it fittingly represents who we are as a company. We are
ways. This is who we are and what we do, and, as our fiscal 2011
not just a pipe in the ground — we are so much more.
performance shows, we deliver more than you might expect.
When we look at our company and all that we do, we don’t see a
We are a model of ConsisTenCy. We have recorded 20
pipe; we see the people whose lives we touch, every day. We see an
consecutive years of improved financial performance, a record
innovative energy leader. We see the customers and communities
we believe is unmatched in our industry and one that is even
we serve. We see the shareowners who count on us to deliver
more impressive considering the current state of the economy.
consistent performance and dividend growth. We see the economic
Net financial earnings (NFE)1 for the year were $106.5 million, or
impact of our investments. We see opportunities to strengthen
$2.58 per basic share, compared with $101.8 million, or $2.46
and grow our business consistent with our core competencies.
per share, last year. We have paid dividends to our shareowners
We see the promise of a cleaner, greener tomorrow through our
of record since 1952, and this year, we increased our annual
commitment to environmental stewardship. And, we see a team
dividend by a total of 5.9 percent to an annual rate of $1.44 per
of hard working women and men who execute our plan, translate
share. This marked the 16th consecutive year of dividend growth.
opportunity into value and deliver results for all of our stakeholders. We are 900 Women and men, many of whom are members
At our core, it is our infrastructure investment that provides the
of the International Brotherhood of Electrical Workers, Local 1820.
solid foundation for our utility, clean energy, asset management
Our team gives their best every day to execute our business plan
3
We have saved customers an average of 5.9% annually. with focus, discipline and commitment, even under the most
by 15 percent over last year. These new customers, along with
adverse conditions as evidenced by their performance during
existing customers who expanded their use of natural gas, are
the blizzard, earthquake and hurricane we experienced this year.
expected to generate $3.5 million in additional utility gross margin2
It is their leadership and creativity that enable us to translate
annually.
opportunity into value and reward the confidence of our investors while meeting our customers’ expectations for reliability and service. I say it every year: our employees are the driving force behind all that we accomplish. We are a network of 7,000 miles of natural gas transmission and distribution main. Through this
extensive pipeline, New Jersey Natural Gas (NJNG), our principal subsidiary, delivered another year of strong performance and
New Jersey Resources (NJR) provides natural gas and clean energy services that efficiently and effectively meet our customers’ energy needs as well as delivers
was the key driver for our improved financial results. Earnings at
consistent financial performance and superior
NJNG were $71.3 million compared with $70.2 million last year,
long-term dividend growth. NJR is also a respected
an increase of 1.6 percent.
and reliable corporate partner that works to help support our local community, protect our
We are 494,964 homeowners and businesses in
New Jersey’s Monmouth, Ocean, Morris, Middlesex and Burlington counties. In fiscal 2011, NJNG added 6,783 new customers, compared with 6,189 last year. New residential construction increased by 5 percent and residential conversions increased
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environment and enhance our quality of life.
Additionally, the inherent benefits of natural gas contribute to our strong customer growth. Clean, efficient, reliable and affordable, natural gas supplies nearly one-fourth of all the energy used in the United States. With abundant, new domestic supplies available from shale reserves, that number is only expected to grow. In the last three years alone, natural gas prices have dropped significantly, presenting a distinct advantage over other fuel sources. It is clear to us that natural gas is and will continue to be an integral part of our state’s and our nation’s energy mix.
New Jersey Natural Gas (NJNG) delivers environmentally friendly natural gas that keeps homes warm and businesses running throughout Monmouth and Ocean counties as well as parts of Morris, Middlesex and Burlington counties. Dedicated to providing safe, reliable service, NJNG maintains an extensive
We are an investment of $131 million that ensures the
distribution system and is committed to helping
continued reliability of our distribution system and has the potential
its customers save energy and money with
to create over 1,000 direct and indirect jobs3 in the state. Approved
conservation and efficiency programs.
by the New Jersey Board of Public Utilities (BPU) and the Division of Rate Counsel (Rate Counsel), our Accelerated Infrastructure Programs (AIP) I and II accelerate previously planned capital projects, including main replacements, system reinforcements and expansions, throughout our service territory. The goal of these programs is to strengthen our system and stimulate the economy.
We believe that working collaboratively with our regulators is
NJNG is able to immediately earn a return on its investment at its
critical to our ability to ensure the reliability of our system and
weighted cost of capital.
provide savings to our customers. Through programs like AIP and our gas supply incentive programs, we advance public policy by
Our AIP investments are in addition to the more than $54 million
investing capital and managing our portfolio of supply, storage and
we invested in fiscal 2011 to support our growth and further
transportation capacity to help strengthen the economy. These
enhance the reliability and safety of our system. And, when it
programs also allow us to create jobs while, at the same time,
comes to safety, we have a great story to tell. According to the
benefiting our customers and shareowners. The success of these
American Gas Association Best Practices Program, we rank
programs reflects our collaborative working relationship with the
among the top quartile in the industry with the fewest leaks per
BPU and Rate Counsel.
mile, and an average emergency response time within 60 minutes of 98.9 percent. These results speak volumes about our team and
We are environmental stewards who have helped our
our unyielding commitment to ensure the safety of our customers,
customers save $28.8 million in fiscal 2011 with our Conservation
communities, employees and system.
Incentive Program (CIP) and more than $193 million since its inception in 2006. A key component of our commitment to
We are innovative programs that have saved customers
Conserve to Preserve®, the umbrella for our efforts to reduce
$49.4 million and achieved gross margin of $9.3 million for our
emissions and protect our natural resources, CIP enables us
shareowners this year alone. Developed in partnership with the BPU
to aggressively encourage energy efficiency and conservation,
and Rate Counsel, our gas supply incentive programs have helped
while allowing NJNG to recover $8.3 million in gross margin.
save customers $542 million, an average of 5.9 percent annually
Our customers, towns, state — and our business — are far
since 1992.
better off because of what we have accomplished through this
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innovative program to promote conservation, efficiency, reduce emissions and preserve our natural resources. CIP also allows us to provide essential resources and services to communities and other stakeholders who share our environmental mission. We are 6,865 high-efficiency upgrades and
6,585 home energy audits made possible through
The SAVEGREEN Project® this year. SAVEGREEN provides incentives, rebates and on-bill repayment options, along with a
NJR Energy Services (NJRES) is a recognized leader in the North American physical energy trading and asset management industry, and provides expert management of natural gas storage and capacity assets. With its outstanding customer service, NJRES manages natural gas
Home Performance with Energy Star® audit, to help make
supply, pipeline capacity and storage volumes in the
participating customers’ homes and businesses more energy-
Northeast, Gulf Coast, Mid-continent and Appalachian
efficient. These programs have helped reduce emissions by
regions, the West Coast and Canada and helps
over 14 percent and generate $73 million in economic activity.
customers maintain their competitive edge.
Recognizing the positive impact it has had on the economy and the environment, we have filed with the BPU to extend SAVEGREEN through December 31, 2012. We are over 34.7 billion cubic feet (Bcf) of storage and 1.1 Bcf a day of pipeline transportation capacity
opportunities to grow. In 2009, we launched NJR Clean Energy
that NJR Energy Services (NJRES), our unregulated wholesale
Ventures (NJRCEV), our renewable energy subsidiary, to capitalize
energy services company, manages under contract. NJRES
on the emerging renewable energy marketplace. Consistent with
utilizes this capacity to serve local distribution companies, electric
our core energy strategy, we have taken our infrastructure to
generators, industrial companies, producers and other natural
customers’ rooftops and underdeveloped land. Our residential
gas marketing companies. Using its disciplined approach and
and commercial solar programs have created approximately
strategic relationships, NJRES contributed net financial earnings
30 megawatts of clean renewable energy capacity, with over
of $18.6 million for the fiscal year, compared with $24.8 million
$140 million in committed capital investment. This will produce
last year.
enough electricity to power about 3,000 typical homes on an annual basis.
As the wholesale market continues to undergo significant changes with the availability of abundant supply and diminished
These solar investments provide our customers with renewable
volatility, NJRES has demonstrated its position as a leader in
energy solutions, electric cost savings and lower emissions
physical energy trading and asset management by identifying
totaling over 24,000 metric tons annually, while also advancing
new opportunities for growth that provide a strategic fit with its
New Jersey’s environmental and job creation goals. In its first full
wholesale services, including expanding producer services and
year of operation, net financial earnings at NJRCEV were $6.8
entering the natural gas liquids market.
million, representing 6 percent of NJR’s total net financial earnings.
We are 133,626 solar panels that provide electricity to our
We are simple, solar savings. The Sunlight Advantagetm,
customers’ homes or businesses. Just as infrastructure investment
our residential solar lease program, has grown during its first full
provides the foundation of our business, it also creates new
year of operation with over 700 leases signed. This innovative
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program provides participating homeowners with a roof-mounted
earnings at NJRHS were $2.4 million, compared with $343,000
solar system, with no upfront costs, that reduces their overall
last year, a sevenfold increase.
electric costs. We are over 5,400 hours of volunteer service our
NJRCEV also made a substantial investment in its pipeline of
employees, retirees and their families have contributed to the
commercial solar projects that significantly expanded its business
communities we serve. Through our Volunteers Inspiring Service
and, in the process, helped New Jersey’s commercial solar
In Our Neighborhoods (VISION) program, our team dedicated
market surpass California’s in 2011 to become the largest in the
over 4,400 hours to help make a difference in the lives of
United States. Five rooftop and ground-mount projects have been
others. To further our commitment to corporate citizenship, our
completed with another four under construction, including what
employees also provided 1,000 hours of volunteer service over
we believe is the largest privately-owned, net-metered solar
two days to help refurbish the facilities at the YMCA of Western
system in the Western Hemisphere.
Monmouth County’s Camp Topanemus. By sharing our time, talents and resources, we were able to help the YMCA create a
NJRCEV is able to earn a return on its residential and commercial
positive camp experience for countless children — and memories
solar investment through available federal investment tax credits
that will last a lifetime. In total, our collective efforts to support
and the sale of solar renewable energy certificates (SRECs) and
the communities we serve helped more than 1,600 nonprofit
electricity, while also supporting the state’s renewable energy
organizations fulfill their missions.
goals and saving customers money on their electric bills. We believe our fiscal 2011 performance demonstrates that our In addition to the infrastructure that delivers the natural gas to our
team is second to none, and we are not the only ones who think
customers and the solar panels that harness the power of the
so. For the third consecutive year, our customers ranked us
sun, we have a 5.53 percent stake in Iroquois Pipeline, which brings natural gas from eastern Canada to the metropolitan region and a 50 percent share in Steckman Ridge, a 12 Bcf storage facility in southwestern Pennsylvania. These Midstream Assets generated net financial earnings of $6.8 million, compared with $6.4 million last year.
NJR Clean Energy Ventures
We are 301,000 furnaces, boilers, hot water
(NJRCEV) is a renewable energy company that
heaters and air conditioning units that NJR Home
invests in, owns and operates solar projects that
Services (NJRHS) keeps operating at peak efficiency with its
generate clean power and provide low carbon
service contracts and customer relationships. An unregulated
energy solutions. NJRCEV’s portfolio of residential
retail and appliance subsidiary, NJRHS further enhanced the
and commercial projects creates economic
complete customer care experience it provides with the addition
value for host sites and shareowners alike, while
of its Premier Comfort Service Plan. This new offering provides comprehensive coverage for labor and replacement of certain
providing customers with simple, solar savings and protecting our environment.
equipment, as well as annual preventive maintenance visits. As a result of its extensive catalog of products and services, expanded solar and generator business and aggressive marketing efforts,
7
2011 was a year of significant performance. the highest in customer satisfaction with residential natural gas
of the natural gas pipeline system, supports oil to natural gas
service in the eastern United States among large utilities according
conversions and promotes the increased use of natural gas for
to the J.D. Power and Associates 2011 Gas Utility Residential
vehicles, distributed generation, fuel cell and natural gas-fired
Customer Satisfaction Studysm. We also ranked the highest in the
electric generation.
east region on the J.D. Power and Associates 2011 Gas Utility Business Customer Satisfaction Studysm. These distinctions speak
To that end, we have undertaken a comprehensive review of our
volumes about our employees and our company’s commitment
pipeline infrastructure from both historic and future perspectives.
to our customers.
Our goal is to understand how our pipeline might evolve, in
Through our collective efforts, we delivered another year of consistent results. While we are all proud of this accomplishment, we remain focused on the future and committed to building on our progress to strengthen and sustain the performance you have come to expect.
NJR Energy Holdings With the release of the New Jersey 2011 Draft Energy Master
is a midstream asset company that invests and
Plan (EMP), the Christie Administration has placed a welcome
maintains equity ownership in natural gas storage,
emphasis on the direct and distributed use of natural gas.
transportation pipelines and natural gas gathering
Accordingly, we see an exciting opportunity for natural gas to be
systems and serves local distribution companies,
a growing part of New Jersey’s energy mix. The EMP provides
electric generators, retail aggregators, large
the state’s vision for the use, management and development of energy for the decade with a focus on reducing the energy burden for customers, stimulating the economy, creating jobs and protecting the environment. While it is still a work in progress, we are pleased that the EMP underscores the state’s commitment to increasing renewable energy and encourages the safe expansion
8
industrial customers, natural gas producers and wholesale marketing companies.
terms of location, size, pressure and materials, to meet both an increased demand for natural gas and, more importantly, our customers’ energy needs. What we have determined is that our system is well positioned to handle growth in our core markets,
NJR Home Services
and that new opportunities for natural gas vehicles and distributed generation can be met with a minimum impact, depending on
(NJRHS) provides expert home-appliance,
site-specific requirements. Looking forward, we will continue to
sales and installation services. With its team of
adapt and expand our system to meet our customers’ needs and
skilled and certified technicians, NJRHS offers
the opportunities presented in the EMP.
comprehensive appliance service contracts, related products and services, solar installation
As you can see, fiscal 2011 was another solid year for our com-
programs and unparalleled care to ensure our
pany. These achievements would not have been possible without
customers’ comfort and quality of life at home.
the leadership of our Board of Directors. We are fortunate to have a dedicated, experienced and active Board who sets the tone for our company and all that we do. I would like to extend my personal gratitude to them for sharing their talents with our company. Your feedback is also important to me. Please feel free to write, call or send me an e-mail at lmdownes@njresources.com and
enabled us to go beyond being just physical infrastructure. We are
share your thoughts about our performance as well as any
comfort for our customers; a helping hand to our communities; an
suggestions for improvement.
economic engine in our state and a cleaner, greener environment for our future.
Our Annual Shareowners Meeting will be held at 10:30 a.m. on January 25, 2012, at the Robert B. Meyner Reception Center at
Guided by our disciplined strategy, and the talents of all the
the PNC Bank Arts Center in Holmdel, New Jersey. I hope that
members of NJR’s family, we will never stop working to create
you will be able to join us.
value for our shareowners, grow our business and deliver consistent performance for all our stakeholders. This is our
We all know that we live in a world of uncertainty. The economy
promise. This is our pledge. This is who we are.
continues to struggle and this year’s extreme weather was a particular challenge. Yet, it is how we responded that sets us
As always, I appreciate the trust that you place in us. We will give
apart. We’ve built a business model that focuses on stability and
our very best every day to reward your confidence and make you
consistency. That model reflects the creativity and leadership of
as proud of our company as I am.
our entire team. While change will continue to occur, our focus on our fundamentals never will.
Sincerely,
As you can see, we are so much more than just a pipe in the ground. Our rock solid infrastructure is, in fact, the living tap root that solidifies and nourishes the very essence of our company and
Laurence M. Downes
the services we provide. Its strength and value to society have
Chairman and CEO
9
It is a job.
$131
MM
With a $131 million investment in our accelerated infrastructure program
projects, New Jersey Natural Gas is helping put people
Since its inception in 2009, the number of
899
contractors participating in The SAVEGREEN ProjectÂŽ has grown to 899. These local contractors have
to work and strengthen the economy, while ensuring the
reaped the benefits of a
reliability of our distribution system and providing customers
capital infusion of more than
with the service they expect.
$73 million to date.
20 Capital
Projects
Through 20 Accelerated Infrastructure Program projects, New Jersey Natural Gas ensures the safety and integrity of our distribution system while lending significant support to New Jersey’s economy through the creation of construction jobs and related services.
Over the past six years, New Jersey natural Gas has invested over $307 million in capital improvements, including our Accelerated infrastructure program expenditures. 2011 2011
$74,026
2010
$65,977
2009
$51,411
2008
$48,764
2007
$38,657
2006
$28,036
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1,000jobs
Viking Yachts Nestled in the marshes of the Bass River in
natural gas was not available in this rural area,
southeastern Burlington County lies a little known
Viking ran its operation using fuel oil — and their
secret — New Jersey is home to a world-class
energy costs were skyrocketing. Enter New Jersey
boat manufacturer. What began in 1964, when
Natural Gas (NJNG) with an innovative option for
brothers Bill and Bob Healey bought a small wooden
significant savings.
boat-building operation, has grown into Viking Yachts, the world leader in luxury sportfishing and
Working with regulators, NJNG was able to bring
cruising yachts.
natural gas into the area and provide additional infrastructure directly to Viking, at no cost to them.
Today, this state-of-the-art 500,000 square-foot
Then we went one step further, helping them install
manufacturing facility is one of the largest employers
high-efficiency heating equipment throughout the
in Burlington County, with 783 skilled employees.
facility, which allowed the company to reduce operating
There have been challenges along the way,
costs, retain jobs and bolster their bottom line.
including the recession of the early 1990s when Viking’s workforce fell to just 80 employees. But
In partnership with NJNG, Viking Yachts has reduced
with determination and a visionary business plan,
their energy burden by $193,000 in just one year.
the Healey brothers kept the company afloat. Viking
This significant savings will help to ensure Viking’s
emerged with a vengeance, rehiring many of their
opportunity to continue to build luxury yachts that
employees along the way.
travel the world. And where Viking Yachts go, so do jobs — for captains, staff, fishing guides, mechanics
Once again, in a struggling economy, businesses
and more — a win-win for Viking Yachts and New
like Viking find themselves working hard to cut
Jersey’s economy!
expenses and save jobs. For decades, because
It is estimated that our $131 million Accelerated Infrastructure Program investment will result in the creation of over 1,000 direct and indirect jobs, providing $61 million in income and $79 million in gross state product for New Jersey.3
$ 193,000 in annual energy savings 11
It is growth. 16 years of increased
$90,000
dividends. At New Jersey Resources, we have increased our dividend for 16 consecutive years
$80,000
and paid quarterly dividends continuously since the company’s inception in 1952.
$70,000
If you invested $10,000 $60,000
in New Jersey Resources on March 31, 1995, and reinvested your dividends, your original investment would
$50,000
now be worth $81,875. The same investment in the Company Peer Group would be worth $47,876; in
$40,000
the S&P 500, $30,494.
$30,000
$20,000
$10,000
Mar 95
Jan 96 Oct 96
Jul 97 Apr 98
6,783
new customers 12
Jan 99 Oct 99
Jul 00 Apr 01
$3.5
million
Jan 02 Oct 02
$3.5 million in margin. These 6,783 new customers are expected to contribute $3.5 million to New Jersey Natural Gas’ annual utility gross margin.
Jul 03 A
90%
Apr 04
In Fiscal 2011, infrastructure-based
businesses accounted for up to 90 percent of New Jersey Resources’ net financial earnings.
20
For 20 consecutive years, New Jersey Resources has delivered improved financial results.
$81,875 NJR
$47,856 company Peer Group
$30,494 S&P 500
Jan 05 Oct 05
$3
Jul 06 Apr 07
billion in annual revenue
Jan 08 Oct 08
Jul 09 Apr 10
Jan 11 Oct 11
For 17 years in a row, the value of New Jersey Resources’ stock has increased over the previous fiscal year.
13
It is opportunity. Four Commercial Rooftop Solar Systems Currently, NJR Clean Energy Ventures has installed and is operating four commercial rooftop solar projects on fully-occupied buildings in central New Jersey. This $18 million investment generates 4.5 million kilowatt hours of clean, renewable energy annually, offers lower power costs to tenants and reduces the facilities’ carbon footprint.
Largest Solar Energy Site of its Kind in the Western Hemisphere NJR Clean Energy Ventures is investing $60 million to develop a ground-mounted solar array on the East Windsor, New Jersey campus of McGraw-Hill. When operational in fiscal 2012, this 14.1 megawatt system will be the largest privately owned, net-metered solar system in the Western Hemisphere. The 18 million kilowatt hours it will produce annually — the energy equivalent to powering 1,518 homes — will eliminate 12,687 metric tons of carbon dioxide emissions, which is the equivalent of removing 2,486 passenger vehicles from our roads.
14
Underutilized land becomes productive solar site Through an agreement with the Village at Manalapan Solar LLC, NJR Clean Energy Ventures has leased 13 acres of previously underutilized land in Manalapan, New Jersey for a state-of-the-art, ground-mounted solar system. The 3.6 megawatt, $18 million project will generate enough electricity to power 450 homes annually and eliminate greenhouse gas emissions equivalent to 609 passenger vehicles.
Single Axis Solar Tracking System Provides Greater Energy Output With an investment of $24 million, NJR Clean Energy Ventures owns and operates a 4.7 megawatt, ground-mounted solar system on an 80-acre site in Vineland, New Jersey. This single axis tracking system will produce up to 25 percent more energy compared with a fixed-tilt racking system and provide electricity to the wholesale market through the Vineland Municipal Electric Utility. With an annual production of 7 million kilowatt hours, the energy equivalent of powering 618 homes, the solar array will eliminate greenhouse gas emissions equivalent to 971 passenger vehicles.
The Sunlight Advantage In January 2011, NJR Clean Energy Ventures launched The Sunlight Advantage™, an innovative residential solar lease program offering homeowners the benefits of solar energy without the prohibitively expensive upfront investment. Homeowners lease a roof-mounted solar system for a monthly fixed cost over 20 years, which includes installation and maintenance costs. Based on current electric prices, homeowners can save up to $20,000 over the life of the lease. Due to unprecedented demand, in 2011 alone, 700 homeowners have signed leases for The Sunlight Advantage.
15
It is collaboration. Premier Comfort Heating and Cooling Plans NJR Home Services recognized an opportunity for growth and a chance to build lasting customer relationships through our service contract business. The resulting Premier Comfort Service Plan combines essential repair coverage with annual preventive maintenance. This proactive approach, combined with a dynamic marketing strategy, has generated 7,100 new or upgraded Premier Plan customers.
Seizing sustainable Opportunity Building on New Jersey’s commitment to renewable energy, NJR Clean Energy Ventures invests in, owns and operates renewable energy projects that generate clean power and provide low carbon solutions. In a very short time, this successful New Jersey Resources subsidiary has become one of the largest solar providers in the state.
Innovative programs Working with business units throughout our company, Regulatory Affairs consistently identifies new opportunities to meet the needs of our customers and shareowners through balanced and fair regulatory mechanisms. One example is our Conservation Incentive Program, which encourages energy conservation to help customers save money while protecting gross margin from declining usage and warm weather. 16
Behind the Scenes NJR Service Corporation is the team behind the team. The support they lend to all of New Jersey Resources’ subsidiaries is invaluable. From legal expertise, to financial, human resources, communications and technological support, these are the people that keep us up, running and moving forward every day.
Safety and Reliability Every Day Through historic winter snowfall, a summer hurricane and flooding that set record emergency call volume, our employees met every challenge and continued to ensure the safety of our system and reliable service to our customers.
Changing Market Dynamics As the natural gas market fundamentally shifted, resulting in decreased volatility and historically low prices, the team at NJR Energy Services viewed it, not as an obstacle but as an opportunity to market new producer services in the Marcellus Shale region. By developing expertise in the natural gas liquids arena, NJR Energy Services offers producers a way to increase the value of their product while enhancing its own profitability. 17
It is innovation.
$542
New Jersey natural gas filed
MM
Since 1992, when the New Jersey Board of Public Utilities and New Jersey Natural Gas initiated our Basic Gas Supply Service incentive programs, customers have saved $542 million — that’s more than $1,200 for the average customer! The benefits of these innovative programs, which take advantage of storage and market opportunities, accrue, not only to customers but to shareowners, and have added $9.3 million to utility gross margin in 2011.
7
to invest up to $15 million to build between seven and ten compressed natural gas vehicle refueling stations throughout our service territory, helping to stimulate the market for alternative fuel vehicles and support economic development in the state.
®
Since 2006, when New Jersey Resources created Conserve to Preserve® in support of state energy policy, we have provided tools and innovative resources that have helped our customers reduce their natural gas usage by 146 million therms, saving them over $193 million and preventing the release of more than 1.8 billion pounds of carbon dioxide. This is the equivalent of removing 153,821 passenger vehicles from New Jersey’s roads annually.
Conserve to preserve savings Conserve to preserve savings Fiscal Year 2007 Fiscal Year 2008 Fiscal Year 2009 Fiscal Year 2010 Fiscal Year 2011 Total
$193 18
$ million $ 48.2 $ 63.7 $ 23.5 $ 29.1 $ 28.8 $ 193.3
25,000
home energy reports in partnership with Opower, New Jersey Natural Gas launched a highly targeted pilot program that provides personalized Home Energy Reports
MM
to 25,000 residential customers. Key information includes comparison data on energy usage, as well as energy-saving tips and tools to save customers money.
3 in a row
The Savegreen Project
100%
New Jersey natural gas holds itself
to a higher safety standard than required by law,
proactively classifying 100 percent of its pipeline
With the launch of The SAVEGREEN Project®, New
as high consequence areas and assessing it each and every year.
Jersey Natural Gas has invested over $26 million in this energy-saving program designed to give our customers the money-saving incentives they need to make smart
60% reduction in damage incidents
energy choices for their families, homes, businesses and communities. SAVEGREEN incentives include rebates on qualified high-efficiency heating and cooling equipment, as well as a comprehensive home energy audit to identify additional ways to save energy and money. The On-Bill Repayment Program offers up to $10,000 in interestfree financing over 10 years for our customers who take advantage of comprehensive energy solutions through Home Performance with ENERGY STAR®, sponsored by New Jersey’s Clean Energy ProgramTM.
When it comes to safety, it’s all about making
To date, the program has provided rebates and
a solid connection. To ensure we all live and
incentives totaling $20 million and completed 10,644
work safely with natural gas, our Partners in
home energy audits. Based upon its success and the
Safety team works directly with municipalities
$73 million impact it has had on the local economy,
and contractors to provide damage prevention
we have filed with the Board of Public Utilities to extend
training and resources. And our Speakers’
The SAVEGREEN Project through 2012.
Bureau provides safety presentations to community groups and schools throughout our service territory. Working closely with industry leaders, peer
groups and regulators, New Jersey Natural Gas continually improves pipeline safety operations,
For the third year in a row, custom-
including design and construction techniques,
ers rated New Jersey Natural Gas
inspection programs, workforce instruction and
“Highest in Customer Satisfaction
extensive training, as well as periodic drills with
with Residential Natural Gas Service
emergency responders and state and local
in the Eastern U.S. Among Large
agencies. These efforts have led to more than
Utilities,” according to the J.D. Power
a 60 percent reduction in pipeline damage
and Associates Gas Utility Residen-
incidents since 2002.
tial Customer Satisfaction Survey.
10,644 energy audits $ 20 million in incentives 19
It is commitment. Renovate, Restore and Renew Over the course of two days this summer, nearly 200 New Jersey Resources’ employees collectively dedicated 1,000 hours of volunteer service to help renovate YMCA Camp Topanemus in Western Monmouth County. With paint brushes, shovels, ladders and other tools in hand, we helped restore essential camp buildings and facilities that are used by thousands of children each year.
A Home of Their Own For some, the dream of home ownership can seem unattainable. But we are making that dream come true for some hard-working, very deserving families through our Home Ownership Program. What started in 1996, with $25,000 in seed money to help Interfaith Neighbors renovate a single home in Asbury Park, has blossomed to 26 homes throughout Monmouth County — that’s 26 families who, for the first time, now own a house to call home. Building on this success, we partnered with Homes for All, Inc. to complete 18 of 41 new single-family affordable homes in Berkeley Township in Ocean County. And in Morris County, with Morris Habitat for Humanity, we have completed one single-family home and are currently working with them and the Morris County Affordable Housing Corporation on six ENERGY STAR®-certified, affordable townhouses. 20
Community Partners At New Jersey Resources, the reliable energy we deliver to our communities goes far beyond the natural gas services we provide. This year, we partnered with over 1,600 organizations to make a difference in our neighborhoods. This spirited sense of community is supported by our Volunteers Inspiring Service In Our Neighborhoods, or VISION program. This year, our employees, retirees, their families and friends generously gave over 4,400 hours of their own time, making the places where we live, learn and work the best they can be.
Energy Assistance No one should have to struggle to heat their home. Given the extreme weather and difficult economic times of this past year, this challenge has overwhelmed a growing number of our neighbors. Strong relationships with Community Action Program agencies, the Department of Community Affairs and the Board of Public Utilities, have allowed New Jersey Natural Gas this year to help over 51,000 customers receive energy assistance totaling over $20 million. And through the Comfort Partners program, we have assisted 1,300 customers with home weatherization measures to keep them warm and lower their energy bills.
day after day, month after month year after year. 21