New Jersey PACT – Regulatory Activity to Expect in 2021 for Control of Greenhouse Gas Emissions and Land Use Regulation

January 11, 2021
Carol F. McCabe, Esq. and Diana A. Silva, Esq.
MGKF Special Alert - New Jersey Forecast 2021

This year will be busy for NJDEP, with the state’s wide-ranging efforts to address climate change moving into a rulemaking phase.  New Jersey’s Protecting Against Climate Threats (PACT) initiative was launched via Governor Murphy’s Executive Order No. 100 in early 2020, promising via NJDEP regulation to:

  • Establish a greenhouse gas monitoring and reporting program to identify all significant sources of statewide greenhouse gas emissions, including carbon dioxide and short-lived climate pollutants, and monitor progress toward the limits set forth in New Jersey’s Global Warming Response Act;
  • Establish criteria to govern and reduce emissions of carbon dioxide and, where necessary, short-lived climate pollutants, including but not limited to, black carbon, hydrofluorocarbons, and methane; and
  • Integrate climate change considerations, such as sea level rise, into all of NJDEP’s regulatory and permitting programs, including but not limited to, land use permitting, water supply, stormwater and wastewater permitting and planning, air quality, and solid waste and site remediation permitting.

Commissioner McCabe’s Administrative Order No. 2020-01 established aggressive timeframes for these and other PACT-related actions, and NJDEP embarked on significant stakeholder efforts in 2020 to address these directives.  Initial rulemaking proposals are expected to address air emissions and land use issues, as discussed below.  

Enhanced Greenhouse Gas Regulation – Stationary and Mobile Sources
Stakeholder meetings were held throughout the year, with meetings in September and October focused on the development of regulatory standards for greenhouse gas emissions from various sectors, including utilities, the transportation sector, cargo handling, oceangoing vessels, and stationary sources.  In a December stakeholder session, NJDEP previewed upcoming rulemakings that will be proposed in April 2021 which, according to the agency, are expected to include the following:

  • Electricity Generating Units (EGUs). Existing fossil-fuel fired EGUs will be subjected to CO2 emission limits, expressed as an efficiency standard, that will ratchet down over time.  New base load EGUs will be subject to a CO2 emission limits based on rate achieved by the most efficient combined cycle units. New non-base load and modified EGUs will be subject to case-by-case review.
  • Commercial and Industrial Boilers. NJDEP expects to work toward a phasedown of small fossil-fuel fired commercial and industrial boilers (< 5MMBtu/hr) via imposing permit conditions for permit approval and requiring boiler fleet owners to submit a boiler fleet report and replace small, older fossil-fuel combustion boilers with non-fossil fuel boilers.
  • Heavy Fuel Sales Ban. NJDEP intends to institute a ban on the sale of No.4 and No.6 heavy liquid fuels, with an exception for marine vessels.
  • Advanced Clean Truck and Fleet Reporting. California’s rules applicable to Class 2b (delivery vans) and Class 8 (long haul tractor trailers) are expected to be adopted by reference, to include a manufacturer zero-emission truck sales requirement starting in model year 2025 in New Jersey and increasing through model year 2035.  Reporting requirements for large fleet owners will also support future development of zero emission fleet purchase requirements and assess infrastructure needs.
  • Low NOx Rule. NJDEP also expects to adopt by reference the California Medium and Heavy-Duty Vehicle Omnibus Rule and establish stricter NOx limits for some medium-duty and all heavy-duty engines and vehicles, taking effect in model year 2025.  The rule includes longer warranty requirements to ensure that future emissions controls are covered by the manufacturer using original manufacturer parts.
  • Medium-Duty Vehicle Inspections. This expected rule will establish standards and test procedures for inspections of Class 2b through Class 5 medium-duty diesel vehicles (such as large pickup trucks, step vans and delivery trucks).
  • Cargo Handling Equipment. California’s diesel fleet modernization rule will be adopted by reference to require existing diesel-powered cargo handling equipment at ports and intermodal rail yards to upgrade to cleaner technology and require that new purchases meet the tightest standards (i.e. Tier 4), likely phased in starting in 2023.  Required transition to full electric will be considered for a future rulemaking, as will a requirement for the provision of shoreside power for oceangoing vessels. 

Land Resource Regulation – Sea Level Rise and Inland Flooding
NJDEP has also been active in the stakeholder process to incorporate climate change considerations into its land resource protection rules, with new proposed regulations anticipated to be published as early as the first quarter of 2021.  The primary focus of NJDEP’s PACT land use regulations will be on addressing the impact of sea level rise and more extreme rainfall events associated with climate change, as NJDEP estimates that approximately 35 percent of the state’s land area is subject to flooding, including in already heavily developed areas of the state.  The following land resource protection programs are expected to be impacted by regulatory changes as announced by the agency at a December stakeholder session:

  • Flood Control. NJDEP is currently considering proposing a variety of new regulations aimed at mitigating the impact of sea level rise and flooding concerns, that will likely cut across multiple land development regulatory programs.
    • “Inundation Risk Zone” - The potentially most significant new regulation is the development of an “Inundation Risk Zone,” consisting of land beyond current floodplain boundaries that is mostly dry, but that is expected to be inundated daily by tidal waters or permanently by the year 2100. It remains unclear precisely how NJDEP intends to utilize or implement the Inundation Risk Zone into its regulatory permitting and compliance programs – but the potential ramifications for coastal development in New Jersey could be significant, potentially limiting or imposing new requirements on development in these areas that make development impractical, or possibly affecting landowners’ ability to acquire flood hazard insurance for their properties.
    • “Coastal Buffer Zone” – NJDEP is also considering proposing a new “coastal buffer zone” consisting of area adjacent to beaches, dunes, or coastal bluffs along the Atlantic Ocean or the Delaware Bay/River that is vegetated, and that acts as a transition between the coastal area and upland development. The “coastal buffer zone” would overlap with the “inundation risk zone” but with differing regulatory goals - the “coastal buffer zone” will focus on increasing the width of beaches and use of dunes to buffer upland development from coastal hazards and flooding.
    • Adjustment of Floodplains and Flood Hazard Areas – NJDEP has also suggested that it will propose an adjustment of the 100-year floodplain to make it reflect expected future conditions, rather than historic flood levels (which is the current basis for FEMA floodplain mapping), and which forms the basis for many land development protocols and restrictions in tidal and fluvial areas.
      • Tidal areas - NJDEP is considering creation of a “Climate Adjusted Flood Elevation,” that will expand the tidal flood area by adding an additional 5 feet to the FEMA 100-year flood elevation.
      • Fluvial Areas – NJDEP is considering two options: (1) utilizing the FEMA 500-year flood elevation to require design flood plus 2 feet, or the FEMA 100-year flood elevation plus 3 feet; or (2) calculating the flood hazard area limits using hydrologic and hydraulic calculations based on 125 percent of the 100-year storm.
    • Elevation Standards – NJDEP is looking to require that new residential and critical infrastructure will require the first floor to be constructed 1 foot above the new “Climate Adjusted Flood Elevation.”
    • Rebuilding requirements – NJDEP has also proposed potentially more stringent requirements to rebuild or reconstruct property damaged by flooding that will require more than NJDEP’s current restrictions, and which prohibit any habitable space below the FEMA 100-year flood elevation.
  • Stormwater Management. NJDEP is considering amending the threshold for what is considered to be “major development” that triggers stormwater management planning and permitting requirements and is also considering adopting new standards to apply to redevelopment projects that reconstruct impervious surfaces on a property.
  • Dam Safety. NJDEP is also expected to publish proposed regulations to increase the freeboard height requirements for dam construction under NJDEP’s Dam Safety Standards, likely doubling the current requirement from one foot to two feet.
  • Permits-by-Registration. NJDEP is proposing to replace “permits-by-rule” by a “permits-by-registration” system, that would allow NJDEP to better track cumulative impacts and address standards in impaired watersheds.  It is currently unclear which permits-by-rule would be converted to permits-by-registration, or whether current permits-by-rule will be converted into general permits.

As these multiple examples from just NJDEP’s air and land use regulatory programs demonstrate, NJDEP is set to roll out potentially significant PACT-related changes in 2021.  Affected industry sectors should monitor and track the PACT initiative as it progresses into the rulemaking phase, evaluate the potential impact of new regulations, and provide input to NJDEP during applicable comment periods.