A2935

An Act establishing the Energy Facilities Siting Commission, amending P.L.1977, c.146, and supplementing Title 48 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. (New section) As used in sections 1 through 7 of P.L. , c. (C. ) (pending before the Legislature as this bill):

"Applicant" means any person who makes application for a site certification pursuant to the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).

"Application" means any request for approval of a particular site or sites filed in accordance with the procedures established pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill), unless the context otherwise requires.

“Associated facilities” means storage, transmission, handling, or other related and supporting facilities connecting an energy facility with the existing energy supply, processing, or distribution system, including, but not limited to, communications, controls, mobilizing or maintenance equipment, instrumentation, and other types of ancillary transmission equipment, off-line storage or venting required for efficient operation or safety of the transmission system and overhead, and surface or subsurface lines of physical access for the inspection, maintenance, and safe operations of the transmission facility and new transmission lines constructed to operate at nominal voltages of at least 115,000 volts to connect a thermal power plant or alternative energy facility to the power grid.

"Biofuel" means a liquid or gaseous fuel derived from organic matter including, but not limited to, biodiesel, renewable diesel, ethanol, renewable natural gas, and renewable propane.

“Commission” means the Energy Facilities Siting Commission established by section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill).

“Energy” means the same as the term is defined in section 3 of P.L.1977, c.146 (C.52:27F-3).

“Energy facility” means any energy plant or “on-site generation facility” as defined by P.L.1999, c.23 (C.48:3-51) and its associated facilities.

"Energy industry" means the same as the term is defined in section 3 of P.L.1977, c.146 (C.52:27F-3).

“Energy plant” means the following facilities:

(1) Any nuclear power facility where the primary purpose is to produce and sell electricity;

(2) Facilities which will have the capacity to receive liquefied natural gas in the equivalent of more than one hundred million standard cubic feet of natural gas per day, which has been transported over marine waters;

(3) Any underground reservoir for receipt and storage of natural gas capable of delivering an average of more than one hundred million standard cubic feet of natural gas per day; and

(4) Facilities capable of processing more than twenty-five thousand barrels per day of petroleum products or biofuel into refined products except where such biofuel production is undertaken at existing industrial facilities.

“Expanded energy facility” means the reconstruction or enlargement of an energy facility and its associated where the net increase in physical capacity or dimensions resulting from such reconstruction or enlargement meets or exceeds those capacities or dimensions set forth by the criteria established by the commission pursuant to section 4 of P.L. , c. (C. ) (pending before the Legislature as this bill).

"Petroleum products" means the same as the term is defined in section 3 of P.L.1977, c.146 (C.52:27F-3).

“Site certification” or “certification” means a binding agreement between an applicant and the State which shall embody compliance to the siting criteria, in effect as of the date of certification, which have been adopted pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) as now or hereafter amended as conditions to be met prior to or concurrent with the construction or operation of any energy facility.

2. (New section) a. There is established in, but not of, the Department of the Treasury a public body corporate and politic, with corporate succession, to be known as the “Energy Facilities Siting Commission.” The commission shall constitute an instrumentality of the State exercising public and essential governmental functions, and the exercise by the commission of the powers conferred by this or any other act shall be deemed and held to be an essential governmental function of the State. The purposes of the commission shall be to:

(1) prepare and publish criteria for the siting of new energy facilities;

(2) propose and adopt site designations for the number, location, and type of new and expanded energy facilities needed in the State;

(3) deny or grant applications to construct energy facilities at designated sites; and

(4) promote energy production in New Jersey by minimizing the amount of restrictions placed on where energy facilities can be located throughout the State.

b. The commission shall consist of five members, with at least one member that resides in each of the northern, central, and southern regions of the State. Three shall be experts in the energy industry, one shall have experience in engineering, and one shall have experience in commercial land use and planning. As used in this subsection: “northern region” means Bergen, Essex, Hudson, Morris, Passaic, Sussex, and Warren counties; “central region” means Hunterdon, Middlesex, Monmouth, Mercer, Ocean, Somerset, and Union counties; and “southern region” means Atlantic, Burlington, Camden, Cape May, Cumberland, Gloucester, and Salem counties.

c. Of these members one shall be appointed by the President of the Senate, one shall be appointed by the Speaker of the General Assembly, and three shall be appointed by the Governor, with the advice and consent of the Senate, for a term of three years, provided that of the members of the commission first appointed, two shall serve for terms of one year, two for terms of two years, and one for terms of three years, so that one member from each of the three categories of membership shall be appointed to serve for a term of each such duration. Each of these members shall hold office for the term of his appointment and until his successor shall have been appointed and qualified. A member shall be eligible for reappointment. Any vacancy in the membership occurring other than by expiration of term shall be filled in the same manner as the original appointment, but for the unexpired term only.

d. Each member may be removed from office by the appointing authority, for cause and after opportunity for a hearing, and may be suspended by the appointing authority pending the completion of the hearing. Each member who shall miss three consecutive meetings of the commission without being excused for good cause by the chairman shall be deemed to have vacated his office.

e. The Governor shall appoint a chairman, who shall schedule, convene and chair commission meetings, and a vice-chairman, who shall act as chairman in his absence. The members of the commission shall appoint an executive director, who shall be the chief administrative officer and secretary of the commission. The executive officer shall serve at the pleasure of the commission, and shall be a person qualified by training and experience to perform the duties of his office.

f. The powers of the commission shall be vested in the members thereof in office, and a majority of the total authorized membership of the commission shall be required to exercise its powers at any meeting thereof.

g. The members of the commission shall serve without compensation, but the commission may, within the limits of funds appropriated or otherwise made available therefor, reimburse members for actual expenses necessarily incurred in the discharge of their official duties.

h. A true copy of the minutes of every meeting of the commission shall be prepared and forthwith delivered by and under the certification of the secretary thereof to the Governor. No action taken at the meeting by the commission shall have effect until 10 days, Saturdays, Sundays, and public holidays accepted, after the copy of the minutes shall have been so delivered, unless during the 10-day period, the Governor shall approve the minutes, in which case the action shall become effective upon that approval. If, in the 10-day period, the Governor returns the copy of the minutes with a veto of any action taken by the commission at that meeting, the action shall be of no effect.

3. (New section) The commission shall have the following powers:

a. To adopt bylaws for the regulation of its affairs and the conduct of its business;

b. To sue and be sued;

c. To enter into contracts upon such terms and conditions as the commission shall determine to be reasonable, and to pay or compromise any claim arising therefrom;

d. To call to its assistance and avail itself of the services of such employees of any State, county or municipal board, board, commission or agency as may be required and made available for such purposes;

e. To contract for and to accept any gifts or grants or loans of funds or financial or other aid in any form from the United States of America or any agency, instrumentality or political subdivision thereof, or from any other source and to comply, subject to the provisions of the act, with terms and conditions thereof;

f. To employ an executive director, consulting engineers, architects, attorneys, real estate counselors, appraisers, and such other consultants and employees as may be required in the judgment of the commission to carry out the purposes of P.L. , c. (C. ) (pending before the Legislature as this bill), and to fix and pay their compensation from funds available to the commission therefor;

g. To hold public meetings or hearings within this State on any matter related to the location and operation of an energy facility;

h. To do and perform any acts and things authorized by P.L. , c. (C. ) (pending before the Legislature as this bill) under, through or by means of its own officers, agents and employees, or by contract with any person;

i. To construct an energy facility, if necessary, pursuant to section 6 of P.L. , c. (C. ) (pending before the Legislature as this bill);

j. To adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c. 410 (C. 52:14B-1 et seq.) rules and regulations necessary to implement the provisions of P.L. , c. (C. ) (pending before the Legislature as this bill); and

k. To authorize energy facilities to be constructed and operated in a manner that is exempt from State and local land-use regulations.

4. (New section) a. The commission shall, within one year of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), prepare and publish to its Internet website the criteria for the siting of new or expanded energy facilities. Such criteria shall be designed to promote energy production throughout the State, the State's energy self-sufficiency, and the promotion of a stable electricity grid.

b. The provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), or any other law to the contrary notwithstanding, the commission shall prepare and adopt criteria for the siting of new or expanded energy facilities as follows:

(1) Within six months of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall prepare and make available to all interested persons preliminary criteria for the siting of new or expanded energy facilities;

(2) Within eight months of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall conduct public meetings on the preliminary criteria in the several geographic areas of this State. Notice of these meetings shall be published, at least 30 days in advance thereof, in at least two newspapers circulating in the specific geographic area where the meeting will be held. Notice of these meetings shall also be transmitted, at least 30 days in advance thereof, to every municipal clerk and environmental commission within the specified geographic area where the meeting will be held;

(3) Within nine months of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall consider and evaluate any comments made at the public meetings, make such revisions to the preliminary criteria as it deems necessary or appropriate, and schedule a public hearing on the revised criteria. Notice of this hearing shall be published, at least 30 days in advance thereof, in at least four newspapers of general circulation in this State;

(4) Within 10 months of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall conduct the public hearing on the revised criteria; and

(5) Within one year of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall consider and evaluate any comments made at the public hearing, make such changes to the revised criteria as it deems necessary or appropriate, and adopt and publish to its Internet website the criteria for the siting of new or expanded energy facilities.

5. (New section) a. The commission shall propose and adopt site designations for the number, location, and type of new or expanded energy facilities needed in the State. The provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) or any other law to the contrary notwithstanding, these sites shall be proposed and adopted in the following manner:

(1) Within 18 months of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), the commission shall propose sites for new or expanded energy facilities, transmit written notice thereof, by certified mail, to the governing body of the affected municipalities;

(2) Within six months of the receipt of any grant moneys, the commission shall complete a site suitability study on the proposed site;

(3) Within 45 days of the completed site suitability study, an adjudicatory hearing concerning the proposed site shall be conducted by an administrative law judge. The affected municipality shall be a party of interest to such hearing, and shall have the right to present testimony and cross-examine witnesses. Intervention in this hearing by any other person shall be as provided by the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.);

(4) Within 30 days of the close of such hearing, the administrative law judge shall transmit his recommendations for action on the proposed site to the commission. The judge shall favorably recommend the proposed site as suitable for an energy facility unless he finds clear and convincing evidence that locating an energy facility on the proposed site will constitute a substantial detriment to the public health, safety, or welfare of the affected municipality; and

(5) Within 30 days of the receipt thereof, the commission shall affirm, conditionally affirm or reject the recommendations of the administrative law judge and adopt or withdraw the proposed site. Such action by the commission shall be considered to be final agency action thereon for the purposes of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) and shall be subject only to judicial review as provided in the Rules of Court. If the commission fails to act upon the recommendations of the administrative law judge as required in this subsection, the failure shall constitute commission affirmance of those recommendations.

b. When determining proposed site locations, the commission shall consider:

(1) former or current energy facilities;

(2) facilities with an established connection to the electrical grid; and

(3) land or facilities which are owned and operated by the State, with the exception of any areas protected by the Green Acres Program, State Park Service and State Forest Service, and any State or federal designated wildlife refuges.

c. The designation, by the commission, of a site as suitable for an energy facility pursuant to this section shall make the construction and operation of the facility exempt from all State and local land-use laws, ordinances, rules, or regulations, including, but not limited to, the requirements of "The Wetlands Act of 1970," P.L.1970, c.272 (C.13:9A-1 et seq.), the "Freshwater Wetlands Protection Act," P.L.1987, c.156 (C.13:9B-1 et al.), the "Coastal Area Facility Review Act," P.L.1973, c.185 (C.13:19-1 et seq.), the "Pinelands Protection Act," P.L.1979, c.111 (C.13:18A-1 et seq.), the "Highlands Water Protection and Planning Act," P.L.2004, c.120 (C.13:20-1 et al.), the “Flood Hazard Area Control Act,” P.L.1962, c.19 (C.58:16A-50 et seq.), and P.L.2020, c.92 (C.13:1D-157 et seq.). The owner or operator of the energy facility may construct and operate that facility without regard to any local zoning ordinance, and the use shall not be required to be submitted to or approved by any county or municipal governing body, zoning or planning board, or other agency. The energy facility shall be constructed and operated in compliance with federal law and the "State Uniform Construction Code Act," P.L.1975, c.217 (C.52:27D-119 et seq.). The commission may conduct inspections during construction under the supervision of the State Uniform Construction Code Office.

c The commission may designate alternate or additional sites for new or expanded energy facilities, at the request of any energy industry, and the requestor shall have the burden of proof concerning the suitability of the site in proceedings conducted pursuant to subsection a. of this section.

d. The commission may, upon its own motion or at the request of the governing body of any affected municipality, repeal or withdraw any adopted site for a new or expanded energy facility if, in the discretion of the commission, such action is consistent with the purposes and provisions of P.L. , c. (C. ) (pending before the Legislature as this bill).

e. The commission may issue grants in order to conduct site suitability studies of proposed sites for energy facilities, pursuant to this section, from any State, federal or other funds which may be appropriated or otherwise made available to it for this purpose.

f. In the event that any site proposed by the commission pursuant to this section is located in more than one municipality, the notices required herein shall be transmitted to each affected municipality or agency thereof, and all of the affected municipalities shall be considered a single party for the purposes of the adjudicatory hearing held pursuant to this section.

6. (New section) a. No person shall on an approved site commence construction of any new or expanded energy facility without a site certification.

b. The commission shall review all applications for site certification and engineering designs for new and expanded energy facilities. Applications for certification shall be upon forms prescribed by the commission and shall be supported by such information and technical studies as the commission may require.

c. The provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), or any other law to the contrary notwithstanding, the review of all applications for site certification and engineering design approval for new energy facilities shall be conducted in the following manner:

(1) Not less than 90 days prior to filing an application for certification and engineering design approval, the applicant shall submit to the commission and the governing body of the affected municipality a letter of intent to apply for certification and engineering design approval, and a brief description of the nature of the proposed energy facility;

(2) The commission shall transmit, by certified mail, a complete copy of any application submitted pursuant to this subsection to the governing body of the affected municipality;

(3) Within six months of the receipt of a complete application, the commission shall reject the application or grant approval thereof, which approval shall establish design and operating conditions for the proposed energy facility, requirements for the monitoring thereof, and any other conditions required under State rules and regulations. Such approval or denial of an application by the commission shall be considered to be final agency action thereon for the purposes of the "Administrative Procedure Act," and shall be subject only to judicial review as provided in the Rules of Court.

d. The commission may charge and collect, in accordance with a fee schedule adopted as a rule and regulation pursuant to the "Administrative Procedure Act," such reasonable fees as may be necessary to cover the costs of reviewing applications pursuant to this section.

e. The commission may, upon request of an owner or operator and after public hearing, exempt an energy facility below a certain size or of a particular type from being considered an energy facility for the purposes of this section, provided that such exemption is consistent with the eligibility standards contained in rules and regulations adopted by the commission.

f. In the event that any application reviewed by the commission pursuant to this section is for a certification and engineering design approval for a proposed energy facility on a site located in more than one municipality, the notices required herein shall be transmitted to each affected municipality or agency thereof, the municipal review of the proposed facility and operator shall be conducted jointly by all of the affected municipalities.

g. In the event that there are no applications for a site designated and adopted by the commission, the commission may construct and operate an energy facility, in accordance with the rules and regulations adopted pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill). Any energy facility operated by the commission shall be exempt from the tax imposed under the “Sales and Use Tax Act,” P.L.1966, c.30 (C.54:32B-1 et seq.) and the societal benefits charge imposed pursuant to section 12 of P.L.1999, c.23 (C.48:3-60).

7. (New section) The owner or operator of an energy facility located at a site which was adopted by the commission pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) shall be eligible for any applicable State funding or grant programs.

8. (New section) The provisions of P.L. , c. (C. ) (pending before the Legislature as this bill) shall supersede and preempt any municipal or county rule, regulation, code, or ordinance concerning the regulation of siting energy facilities.

9. (New section) The commission shall, pursuant to the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C. 52:14B-1 et seq.), adopt such rules and regulations as may be necessary for the performance of their respective responsibilities pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill).

10. Section 13 of P.L.1977, c.146 (C.52:27F-15) is amended to read as follows:

13. a. The Division of Energy Planning and Conservation is empowered and directed to intervene in any proceedings before, and appeals from, any State department, division, commission, authority, council, agency or board (hereinafter referred to as "State instrumentalities" ) including the Board of Public Utilities charged with the regulation, supervision or control of any business, industry or utility engaged in the production, processing, distribution, transmission or storage of energy in any form, when, in the discretion of the commissioner, such intervention is necessary to insure the proper consideration by such State instrumentalities of the State energy master plan, or any part or aspect thereof, adopted by the department pursuant to section 12 of [this act] P.L.1977, c.146, or any rule or regulation promulgated by the department pursuant to the provisions of [this act] P.L.1977, c.146. To facilitate the intervention provisions of this section, each such State instrumentality shall consider the department a party of interest in any proceedings before such instrumentality with respect to energy and shall give the same notice to the department as is given to every other party of interest in such proceedings of any meeting, public hearing or other proceeding of such instrumentality in implementing its regulatory, supervisory or control powers, responsibilities and duties with respect to such businesses, industries or utilities.

b. It being the intention of the Legislature that the actions, decisions, determinations and rulings of the State Government with respect to energy shall to the maximum extent practicable and feasible conform with the energy master plan adopted by the department pursuant to section 12 of [this act] P.L.1977, c.146, the department shall prepare, periodically revise and distribute to each State instrumentality charged with the regulation, supervision or control of any business, industry or utility engaged in the production, processing, distribution, transmission or storage of energy in any form, such guidelines as the department determines to be relevant to assist each such instrumentality in conforming with said energy master plan in implementing its regulatory, supervisory or control powers, responsibilities and duties with respect to such businesses, industries or utilities.

c. With respect to the siting of any energy facility in any part of New Jersey, the [department] Energy Facilities Siting Commission established pursuant to P.L. , c. (C. ) (pending before the Legislature as this bill) shall, the provisions of any law to the contrary notwithstanding, have jurisdiction coextensive with that of any other State instrumentality, and to that end, no State instrumentality with the power to grant or deny any permit for the construction or location of any energy facility shall exercise its powers without referring to the Division of Energy Planning and Conservation, for its review and comments, a copy of such application and all papers, documents and materials appurtenant thereto filed by the applicant with such State instrumentality. [Prior to making a final decision with respect to any such application, the State instrumentality with power of approval over such application shall solicit the views of the department thereupon. Such views shall be communicated to the State instrumentality with the power of approval over such application in the form of a report describing the findings of the department with respect to such application. Such report shall be prepared by the Director of the Division of Energy Planning and Conservation and shall be signed by said director and by the commissioner. In the event that such report is not prepared and transmitted to the State instrumentality with power of approval over such application within 90 days after the department's receipt of such application, such State instrumentality shall act upon such application pursuant to the law providing its power of approval thereof. In the event that the views of the department, as contained in its report, with respect to any such application differ from the views of the State instrumentality with the power of approval over such application, there shall be established an Energy Facility Review Board which shall consist of the Director of the Division of Energy Planning and Conservation, the director or chief executive officer of the State instrumentality with the power of approval over such application, and a designee of the Governor. The decision of the Energy Facility Review Board created with respect to a specific energy facility application shall be binding with respect to such facility and shall be implemented forthwith by the State instrumentality with the power of approval over such application.

In implementing its responsibilities pursuant to this subsection, the department shall have the power to adopt, by regulation, a fee schedule for reviewing applications for the construction or location of energy facilities; provided, however, that fees shall be charged to applicants for permits to construct or locate energy facilities only in those instances where the nature and extent of the proposed energy facility are such as to necessitate the employment of consultants or other expert personnel from without the department before the department can make its determination with respect to any such application, and that such fees shall in any event be the minimum amount necessary to permit the department to fulfill its responsibilities under this section.]

The provisions of this section shall not be regarded as to be in derogation of any powers now existing and shall be regarded as supplemental and in addition to powers conferred by other laws, including municipal zoning authority.

(cf: P.L.1977, c.146, s.13)

11. This act shall take effect immediately.

STATEMENT

This bill establishes the Energy Facilities Siting Commission (Commission), in but not of the Department of the Treasury. The purpose of the commission is to prepare and publish to its Internet website criteria for the siting of new or expanded energy facilities; propose and adopt site designations for the number, location, and type of new or expanded energy facilities needed in the State; deny or grant applications to construct energy facilities at designated sites and promote energy production in New Jersey by minimizing the amount of restrictions placed on where energy facilities can be located throughout the State.

The commission will consist of five members, with at least one member that resides in each of the northern, central, and southern regions of the State. Three will be experts in the energy industry, one will have experience in engineering, and one will have experience in commercial land use and planning. The bill authorizes the commission, amongst other things, to: hold public meetings or hearings within this State on any matter related to the location and operation of an energy facility; to adopt rules and regulations necessary to implement the provisions of the bill; and to authorize energy facilities to be constructed and operated in a manner that is exempt from State and local land-use regulations.

The bill directs the commission, within one year of the effective date of the bill, to prepare and publish to its Internet website criteria for the siting of new energy facilities. The bill directs the commission to design the criteria to promote energy production throughout the State by reducing the limitations on where energy facilities are sited. The bill directs the commission, by various dates established in the bill, to:

(1) prepare and make available to all interested persons preliminary criteria for the siting of new energy facilities;

(2) conduct public meetings on the preliminary criteria in the several geographic areas of the State;

(3) consider and evaluate any comments made at the public meetings, make revisions to the preliminary criteria as it deems necessary or appropriate, and schedule a public hearing on the revised criteria and hold public hearing on the revised criteria;

(4) evaluate comments made at the public hearing, make such changes to the revised criteria as it deems necessary or appropriate, and adopt and publish to its Internet website final criteria for the siting of new energy facilities.

Additionally, the bill directs the commission to propose and adopt site designations for the location, number and type of new energy facilities. The bill outlines the process by which sites are to be proposed and adopted and guidelines for how the commission will determine suitable proposed sites. Under the bill, all new or expanded energy facilities cannot commence construction without site certification. The commission is to review all applications for site certification which will be prescribed by commission. The bill establishes the review process by which all applications for site certification are to occur. Furthermore, the bill allows for the commission to construct and operate an energy facility at a site designated by the commission, in the event there are no applications for site construction by a private owner or operator of an energy facility.

The bill exempts construction and operation of the facility on a site designated by the commission from all State and local land-use laws, ordinances, rules, or regulations. The bill allows an owner or operator of an energy facility which has received site certification to construct and operate that facility without regard to any local zoning ordinance or approval of a local zoning board. Under the bill, the commission may designate additional or alternative sites by request of anyone in the energy industry and at the request of an affected municipality or on its own, repeal or withdraw any adopted site for a new energy facility.

The bill is to supersede and preempt any municipal or county rule, regulation, code, or ordinance concerning the regulation of siting energy facilities. The bill allows the commission to adopt rules and regulations as may be necessary for the performance of their respective responsibilities. Under the bill, the owner or operator of an energy facility located at a site which was adopted by the commission pursuant this bill is be eligible for any applicable State funding or grant programs.

Finally, the bill amends State law regarding the siting of any energy facility in any part of New Jersey to reflect the board’s control over siting along with the process of siting energy facilities as established by this bill.