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Good morning and welcome to the weekly Monday edition of the New York & New Jersey Energy newsletter. We’ll take a look at the week ahead and look back on what you may have missed last week.

QUICK FIX

SMITH SQUARES OFF WITH RATEPAYER ADVOCATE — POLITICO’s Ry Rivard: New Jersey’s top environmental lawmaker has new plans to force the state ratepayer watchdog to spend less time worrying about higher utility rates: Possibly resurrecting a bill giving rates less scrutiny.

Senate Environment and Energy Chair Bob Smith last week accused Brian Lipman, director of the state’s independent Division of Rate Counsel, of repeatedly saying no to efforts to combat climate change.

Lipman’s office has expressed consistent concern that state utility customers will be socked by rising energy costs if the state’s spending on clean energy projects is unchecked.

Smith has already taken aim at Lipman’s office — with the backing of the Natural Resources Defense Council, Environment New Jersey and the New Jersey League of Conservation Voters. A bill introduced a year ago, NJ S4214 (20R), would make the rate counsel give more weight to the environmental benefits of utility companies’ proposals. The bill stalled after the ratepayer advocate received enough quiet support to deter lawmakers from voting on the bill, but Smith is clearly keen to make another go at it next year.

Lipman and Smith had several tense exchanges during a lengthy committee hearing the week of Thanksgiving. Lipman testified about a Smith bill to spend $300 million to upgrade the electric grid and another Smith bill that would give New Jersey perhaps the nation’s most ambitious clean energy target — 100 percent carbon-free power by 2035.

MORE PASSAIC RIVER DELAYS — The Department of Justice said it needs more time to finalize a settlement of claims against a cluster of companies accused of polluting New Jersey’s Passaic River. In a legal filing last week, the DOJ said that based on public comments, it plans to modify elements of a 2022 deal it proposed to collect $150 million from 85 companies accused of contaminating the Lower Passaic River. Attorneys for the government told a federal court judge that public comments had prompted it to change “aspects” of the deal and remove a “small number of parties” from the deal.

The settling companies — including BASF, Chevron, Tiffany & Co., Otis Elevator and Sherwin-Williams — are not the only ones accused of polluting the river. Indeed, they may be responsible for a tiny percent of the cleanup costs, according to a consultant’s report prepared for the Environmental Protection Agency and the companies in 2020. The report, known as an allocation report, found the bulk of the cleanup costs should be borne by Occidental Chemical Corp. The company, known as OxyChem, has not settled all the claims against it and has also fought the settlement and questioned its integrity. OxyChem spokesperson Eric Moses said, “Unfortunately, the agency refuses to say how it intends to change the settlement terms and which companies will be part of it.”

The DOJ said it would come back to the court early next year with motions to enter the modified deal — known as a consent decree. The Passaic River has been on the federal list of toxic Superfund sites since the mid-1980s, and continued conflict may mean no end to the cleanup is in sight. — Ry Rivard

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Here’s what we’re watching in the week ahead:

WEDNESDAY
— The MTA board committees meet, starting at 9 a.m.

— The NYC Democratic Socialists of America and Public Power NY coalition hold a rally focused on implementation of NYPA’s ability to build new renewables, noon, Battery Park, New York City.

THURSDAY
— Supporters of NY HEAT hold two events pushing for Gov. Kathy Hochul to include the measure in her executive budget proposal, 11 a.m. at the New York State Capitol in Albany and noon at City Hall Park, New York City.

What you may have missed

ADVANCED CLEAN CARS II — Gov. Phil Murphy’s administration said Tuesday it would formally adopt a new rule to ban the sale of new gasoline-powered cars by 2035.

The rule, already adopted by California and New York, is considered a key step to curbing climate change and signals the end of the internal combustion engine’s era. Murphy began paving the way to adopt the rule during a major climate speech earlier this year.

While opposition to the rule didn’t become a major election issue, despite Republican attempts, it stirred some pre-election criticism from fellow Democrats.

In a statement, Murphy said the rule “will improve air quality and mitigate climate impacts for generations to come.”

Critics are concerned the rule limits consumer choice and that the state’s charging infrastructure is not yet ready to handle so many electric cars. — Ry Rivard

EMPIRE WIND MOVES AHEAD — POLITICO’s Kelsey Tamborrino: The Interior Department on Tuesday approved the construction and operation of the Empire Wind project offshore New York — renewing support for a U.S. industry hammered by economic challenges. The approval marks the Biden administration’s sixth for a commercial-scale offshore wind project. The U.S. offshore wind industry has been battered by high inflation rates and other economic challenges that has stalled progress in recent weeks. Danish energy company Ørsted said late last month that it was killing plans to build a pair of wind farms in New Jersey, which has amplified efforts in New York to save or replace its own at-risk offshore wind projects.

CLEAN ENERGY LATER — POLITICO’s Ry Rivard: In an attempt to calm union opposition, New Jersey lawmakers won’t vote on a nation-leading clean energy legislation until next month.

Negotiations over the next few weeks will focus on getting labor unions to drop their opposition to a bill to put the state on the path to get 100 percent of its electricity from zero-carbon sources by 2035 — the most aggressive clean energy goal of any large state. The chair of the Senate Environment and Energy Committee held the bill following a lengthy hearing Monday, though he still hopes to get it to the governor during the end-of-year lame duck session.

The chair, Sen. Bob Smith (D-Middlesex), spent hours taking in and sometimes fending off criticisms of the bill from the state’s ratepayer watchdog, the solar industry and even environmental groups who said it does not go far enough.

He lambasted some advocates by comparing them to a “hijacker” trying to turn the bill into something it’s not — particularly the solar industry, which came in pleading for carve-outs and subsidies.

But union opposition could not be so easily dismissed. Labor worries the bill is inviting too much clean energy from out of state, including from projects that are already built. But respectable modeling suggests those worries are overblown.

Getting the bill to the Senate floor, through the Assembly and to the governor was “still doable” this year, Smith said. In the Senate, the bill could get second referenced to the Senate Budget and Appropriations Committee, where there could be more skepticism about renewable energy targets than there is in Smith’s committee.

PEAKERS STAY OPEN — POLITICO’s Marie J. French: Fossil fuel plants on barges will remain available to meet New York City’s electricity needs until a transmission line for Canadian hydropower comes online. The state’s independent grid operator determined Monday that four peaker power plants, otherwise slated for retirement due to state emissions rules, need to stay online to avoid a reliability shortfall. The New York Independent System Operator has been hinting at the likely outcome for months, but made it official in a report.

The state Department of Environmental Conservation adopted rules aimed at shutting down the dirtiest New York City peakers, which supply energy on the highest demand days and run infrequently, in 2019. Shuttering peaker plants, which have historically been sited in low-income and predominantly Black and brown neighborhoods, is a major priority for environmental justice groups. The plants emit higher levels of health-harming co-pollutants when they run, contributing to concerns about poor air quality and disproportionate health impacts in nearby communities. But the NYISO found that the next wave of planned retirements to meet the state rules risked an energy shortfall in New York City on a 95 degree day in 2025 when two generators or transmission lines go offline. Under the state’s rules, the grid operator can unilaterally keep peakers online if it finds a reliability need.