Environment New Jersey Budget Testimony To End the Clean Energy Fund Budget Raids

Good morning, members of the Senate Budget Committee. My name is Doug O’Malley, Director of Environment New Jersey, one of the state’s largest citizen advocacy organizations, representing more than 80,000 dues-paying members and activists across the state.

It is time to end the raids on the Clean Energy Fund. New Jersey weathered the pandemic’s financial storm, and now it is the time for the Legislature to correct the ongoing raids  to fully fund the Clean Energy Fund by ending these ongoing raids. It’s time to fight climate change without holding one hand behind our backs. This is the year to end these raids. Clean Energy Fund raids slow down the transition to a clean renewable energy future. We urge the New Jersey Legislature to use the FY24 budget to finally to end these raids.

I want to read a statement from LaShaunda Carter who has campaigned to end the raids of the Clean Energy Fund as well. She runs Sanctuary for Veterans, a Burlington County -based non-profit, which works to help vets – including with energy costs.

“Nine years ago, long before the pandemic, I was a recipient of the Comfort Partners energy efficiency assistance program. The funding allowed me to buy a new heater, weatherize my windows and patio door, and make critical repairs to my kitchen and bathroom that I would not have been able to afford as a single mother and homeowner. I can say that Comfort Partners was a true blessing — I was able to keep my home healthy and warm in the short term, and in the long term I used less energy and saved hundreds of dollars each year on my electric bills.”

Diverting the Clean Energy Fund year over year since 2010 has led to nearly $2 billion being lost that should have supported New Jersey’s transition to clean, renewable energy and the jobs, public health benefits and more affordable electricity bills that come with that transition.

Now is the time to stop these raids. With a record $10 billion surplus and millions more coming in from the federal government, there has never been a better moment than now to end these diversions and ensure the full $344 million available in FY24 for the Clean Energy Fund goes towards taking action on climate change, supporting clean energy, and improving public health.

We do not want to see a reduction in NJ Transit funding, but rather believe that funds should either come from a newly created dedicated source or the General Fund. The state can fund NJ Transit while simultaneously stopping diversions from the Clean Energy Fund. We are proud to join more than 50 organizations, representing labor, faith, business, environmental and community constituencies calling for an end to these ongoing raids.

The Star Ledger editorial board wrote earlier this month: “The last budget included only a vague reference to bus electrification – which has been unbearably slow in its rollout — and this year’s diversion will wind up in the NJT general budget with no strings attached. That is not the purpose of the fund, and Murphy knows it. That’s why he vowed to end this plundering during the 2017 campaign; that’s why the administration gave annual assurances that he would phase out these diversions.” We look forward to your support to end the Clean Energy Fund raids.

Clean Energy Fund Raids Background: Utility customers support New Jersey’s Clean Energy Fund (CEF) through surcharges on their monthly bills. The funds are intended to help the state achieve its goals to reduce reliance on fossil fuels and shift to renewable energy. Since Fiscal Year 2010, lawmakers have raided the Clean Energy Fund to plug budget holes and finance line items unrelated to clean energy. In total, lawmakers have raided $1.98 billion (in 2022 dollars) from the Clean Energy Fund. The diversions include $242 million under Governor Corzine, more than $1.2 billion under Governor Christie, and more than $533 million under Governor Murphy. Link to NJPP report. 

The Time is Now To End the Raids for the Clean Energy Fund

• The full $344 million available in FY24 for the Clean Energy Fund must be used for its intended purposes – taking action on climate change, supporting clean energy, and improving public health.
• Diverting funds targeted for clean energy initiatives, including subsidies for home energy efficiency projects, hampers the state’s ability to reach its clean energy goals which are critical in helping to stave off the worst effects of severe weather events (climate change).
• The future of New Jersey depends on new and exciting investments in clean energy. We need this money, combined with federal funds, to modernize our state and invest in our future.

What are the Impacts of Not Ending the Raids on the Clean Energy Fund?

• With a record $10 billion surplus and millions more coming in from the federal government, there has never been a better moment than now to end these diversions and use  Clean Energy Fund dollars to support initiatives that the funds are intended for.
• Environmental justice and equity are at stake. New Jersey must stop disinvesting funds meant to move us closer to a more equitable, sustainable future for all.
• The annual raid on the Clean Energy Fund is a major disappointment from a budgetary standpoint. Taking money from one fund to support another is not a long-term, strategic solution to fix fiscal problems. Raiding is poor financial planning and an unsustainable.
• Protecting the Clean Energy Fund in FY24 state budget is critical to expand a wide range of programs to reduce air pollution, develop clean and renewable sources of energy, lower rates and create good, family sustaining jobs
• This clean energy funding is a crucial piece in the broader context of clean energy investments in the future of New Jersey. We cannot achieve our goals unless we combine these dollars with monumental federal investments coming to New Jersey to support our renewable energy future.
• Investing in clean energy will create tens of thousands of jobs. If done equitably, New Jersey’s clean energy transition will ensure Black, Indigenous and people of color (BIPOC) as well as low- and middle-income residents have access to these jobs.
• Low- and middle-income families will see substantial long-term benefits through clean energy investments if the funding is actually allocated for programs like subsidies for home energy efficiency projects and electric vehicle purchases.

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