Yesterday, April 17, the state of New Jersey issued an energy master plan, notable for the frankness with which it address's the state's current and medium-term needs and resources. The plan carries the imprimatur of state governor Jon S. Corzine, notable too, because Corzine is squarely in the political mainstream, very smart, and--as a former partner in Goldman Sachs--comfortable thinking about macro variables.
Today's news reports emphasized the plan's suggestion that it may be necessary to build a new nuclear power plant to meet needs. But that notion is not contained in the report's executive summary and gets only passing mention on pp. 71-72 of the main text. Still, it is indeed significant that a state of New Jersey's importance and a governor of Corzine's stature has officially declared itself willing to take another look at nuclear.
Framing the difficult situation facing the state, the report states up front that natural gas prices and electricity prices doubled from 2002 to 2007, threatening the state's long-term economic competitiveness and livability. Meanwhile, energy demand has been rising sharply, along with electricity exports to the New York City metropolitan area , even as electrical generating capacity and transmission have failed to keep pace.
The plan proposes building code revisions that would make new construction 30 percent more energy efficient, while the efficiency of existing buildings would be improved by means of tighter standards for appliances and equipment. The state would seek to meet 22.5 percent of its needs from renewables by 2025, with the addition of 1,500 megawatts in solar capacity, 1,200 MW in wind, and 1,500 MW in combined heat and power.
But even with those ambitious measures, the plan anticipates that the state's current fleet of generating facilities will not be adequate to meet long-term power demand. Hence the cautious nod to nuclear.
If Corzine hews to the nuclear line, he will be following in the footsteps of Great Britain, which is in the painful process of committing itself to the construction of a new generation of nuclear power plants, mainly because of concerns about global warming. The implications are turning out to be even more difficult to digest than the English may have guessed. If the UK proceeds, it's considered all but a foregone conclusion that British Energy--which owns the most plausible sites for new reactors--will be taken over, most likely by a foreign bidder.
The leading candidates are France's EDF, Germany's RWE or E.ON, and Spain's Iberdrola. So if the British find themselves consuming much more nuclear electricity in ten or fifteen years time, they'll likely be buying it from a French, German or Spanish supplier.