Presentation on reinvestment in New Jersey infrastructure.

1. What’s Coming
for New Jersey Utilities
Clinton J Andrews

2. Is demography destiny?
New Jersey population projections
6
7
8
9
10
11
1990 2000 2010 2020 2030
Population(millions)
Millions
Year
Linear Regression
Historical Migration
Economic-Demographic
Zero Migration
History
lwd.dol.state.nj.us/labor/lpa/dmograph/lfproj/sptab1.htm
Demography is only one
of the influential factors

3. Is mission to satisfy demand?
Infrastructure Investment Challenge
0
20000
40000
60000
80000
100000
120000
140000
160000
180000
200000
2010 2020 2030 2040 2050
Year
Capacity
Supply
Demand
Shortfall
Excess
Capacity
Mission is to balance
supply & demand

4. Traditional
Infrastructure
Planning
Satisfy demand cost-effectively
Select large, centralized solutions
1. Does current supply = demand?
2. Any supply capacity to be retired?
3. Forecast future demand?
4. New supply capacity needed?
5. Which supply type?
6. How finance?
7. Where site new facilities?
Does this approach
still make sense?

5. Demand growth for some NJ utilities
-0.1
-0.05
0
0.05
0.1
0.15
0.2
1960 1970 1980 1990 2000 2010
3 per. Mov. Avg.
(Natural Gas)
3 per. Mov. Avg.
(Electricity)
3 per. Mov. Avg.
(Potable Water)
www.eia.gov/state/seds/seds-data-complete.cfm?sid=NJ#CompleteDataFile www.nj.gov/dep/dsr/trends/pdfs/watersupply.pdf

6. Demand growth for some NJ utilities
-0.1
-0.05
0
0.05
0.1
0.15
0.2
1960 1970 1980 1990 2000 2010
3 per. Mov. Avg.
(Natural Gas)
3 per. Mov. Avg.
(Electricity)
3 per. Mov. Avg.
(Potable Water)
www.eia.gov/state/seds/seds-data-complete.cfm?sid=NJ#CompleteDataFile www.nj.gov/dep/dsr/trends/pdfs/watersupply.pdf

7. Demand growth for some NJ utilities
-0.1
-0.05
0
0.05
0.1
0.15
0.2
1960 1970 1980 1990 2000 2010
3 per. Mov. Avg.
(Natural Gas)
3 per. Mov. Avg.
(Electricity)
3 per. Mov. Avg.
(Potable Water)
www.eia.gov/state/seds/seds-data-complete.cfm?sid=NJ#CompleteDataFile www.nj.gov/dep/dsr/trends/pdfs/watersupply.pdf

8. U.S. electricity demand growth (%)
-2
0
2
4
6
8
10
12
14
1950 1960 1970 1980 1990 2000 2010 2020 2030 2040
3-year moving average
Trendline
www.eia.gov/forecasts/aeo/MT_electric.cfm#growth_elec

9. Implications
• Reinvestment not
growth
– Take advantage of
technological change
• Rebalance portfolios
– Need some criteria
• Restructure value
chains
– Add value

10. Scale vs Efficiency
• Demand = Population x Services x Efficiency
= Population x (Technology/Person) x
(Demand/Technology)
• Supply = Sites x Capacity x Efficiency
= Sites x (Technology/Site) x (Supply/Technology)

11. Electricity from Coal
Efficiency vs Production Environmental Impact
Dahmus, G.E.(2007) Applications of Industrial Ecology: Manufacturing, Recycling, and Efficiency, Ph.D. dissertation in Mechanical
Engineering, Massachusetts Institute of Technology., Cambridge, MA.

12. Refrigeration
Efficiency vs Production Environmental Impact
Dahmus, G.E.(2007) Applications of Industrial Ecology: Manufacturing, Recycling, and Efficiency, Ph.D. dissertation in Mechanical
Engineering, Massachusetts Institute of Technology., Cambridge, MA.

13. Embrace technological changes
• Smarter grid
• Distributed generation
• Efficient end
uses, smarter buildings
• DC’s re-emergence
• Electrification of
transportation
• Cheaper natural gas
(due to extraction
technology)
www.nest.com www.automobilemag.com/green/reviews/0911_2009_tesla_roadster_electric_car

14. For more information…
policy.rutgers.edu/faculty/andrews

15. BACKUP SLIDES

16. Demand growth for some NJ utilities
-0.1
-0.05
0
0.05
0.1
0.15
0.2
1960 1970 1980 1990 2000 2010
3 per. Mov. Avg.
(Natural Gas)
3 per. Mov. Avg.
(Electricity)
3 per. Mov. Avg.
(Potable Water)
www.eia.gov/state/seds/seds-data-complete.cfm?sid=NJ#CompleteDataFile www.nj.gov/dep/dsr/trends/pdfs/watersupply.pdf

17. U.S energy use per capita and per
constant dollar of GDP (1980 = 1.0)
-
0.20
0.40
0.60
0.80
1.00
1.20
1980 1990 2000 2010 2020 2030 2040
Per capita
Per dollar
www.eia.gov/forecasts/aeo/MT_energydemand.cfm#declines