    [From the U.S. Government Printing Office, www.gpo.gov]

                                     ENERGY FACILITY SITING       ISSUES
                                     IN NEW JERSEY'S COASTAL ZONE

                                         A Staff Working Paper

                                             Helga Busemann

                                             December, 1977

                       New Jersey Department of Environmental Protection
                                     Division of Marine Services
                                 Office of Coastal Zone Management
                                            P. o. Box 1889
                                     Trenton, New Jersey 08625

                 Tj
                 163.25         inancial assistance from the U. S. Department
                  E56           tional Oceanic,and Atmospheric Administration,
                 B87       0    al Zone Management, under the provisions of
                 1977           the federal Coastal Zone Management Act of 1972

                                         ABSTRACT

                  The requirement of the New Jersey Coastal Area Facility Review
             Act and the Federal Coastal Zone Management Act that energy facility
             siting be included in any coastal planning has mandated that the New
             Jersey Office of Coast.al Zone Management (NJOCZM) address the siting
             of energy facilities in the coastal zone.

                  This report frames the issues facing coastal energy planners.
             Issues addressed include nuclear power, Outer Continental Shelf oil
             and gas exploration and development, deepwater ports, liquefied
             natural gas, and the more general issues of energy conservation and
             the siting of energy facilities. The report includes an overview of
             how energy is used and produced today in New Jersey.

                  The report sets forth some principles which will guide the
             NJOCZM in developing energy facility siting policies within the
             coastal zone.

                  The report is intended as a working document to provoke dis-
             cussion by energy users and energy producers, by local, state, and
             federal officials and agencies, by private interests and by the
             public. Hopefully, these discussions will lead to a further refine-
             ment of the issues, from which responsible and coherent coastal
             energy facility siting policies will emerge which can be incorporated
             into New Jersey's coastal management strategy.

                                      property Of CSC LibrarY

                                   U - S - DEPARTMENT OF COMMERCE NOAA
                                   COASTAL SERVICES CENTER
                                   2234 SOUTH HOBSON AVENUE
                                   CHARLESTON SC 29405-2413

        Qs_

                                                                             7,@

                                      ACKNOWLEDGEMENTS

                   Many people helped in assembling this report. Without their
              assistance this report would not have been possible. Acknowledge-
              ments are due particularly to John Echeverria who spent the summer
              of 1976 researching and writing earlier drafts of this report.
              Special thanks are also due to David Blitzer, Columbia University,
              Lorraine Carruso, Center for Coastal and Environmental Studies at
              Rutgers University, Donald Scarry and Stella Krawie of the Division
              of Planning and Research in the Department of Labor and Industry.
              Stella Krawie's help with Section II was particularly valuable.

                  Thanks also go to Dr. Glenn Paulson, Assistant Commissioner for
              Science within the New Jersey Department of Environmental Protection
              and to David N. Kinsey, John Weingart and Edward Linky of the Office
              of Coastal Zone Management for their many comments and suggestions,
              as well as to Cesar Pellon and Marvin Atwood for preparing the maps
              and figures.

                  Finally, grateful acknowledgement is made to Clarissa Wilson
              and the entire staff of DEP's Word Processing Center for their
              patience in typing this report, as well as to Susan Drake and Linda
              Forchi for their help with the earlier drafts.

                                     TABLE OF CONTENTS

                  Energy Issues and  Policy Alternatives for New Jersey
                                    Tables of Contents

                                                                         Page

                  Abstract                                                 i
                  Acknowledgements                                        ii
                  Table of Contents                                       iii
                  Tables                                                  iv
                  Figures                                                  v

            I.   Introduction                                              1

            II.  Role  of Energy in New Jersey:                            3
                 A.    Background                                          3
                 B.    Consumption                                         3
                 C.    Cost of Fuel                                        6
                 D.    Availability of Fuel                                8
                       1.   Petroleum                                      8
                       2.   Natural Gas                                   11
                       3.   Electricity                                   13
                            a.   Nuclear Power                            22
                            b.   Nuclear versus Coal                      22
                            C.   Future Demand of Electricity             22

            III. Energy Conservation and Alternative Energy Sources       26
                 A.    Conservation                                       26
                       1.   Transportation and Land Use                   27
                       2.   Residential and Commercial                    27
                       3.   Industry                                      28
                       4.   Utilities                                     29
                 B.    Coal                                               30
                 C.    Solar Energy                                       31
                 D.   -Wind Energy                                        31
                 E.    Conclusion                                         32

            IV.  Proposed Energy Facilities:                              34

                 A.    Outer Continental Shelf Exploration and            34
                         Development
                       1.   Issues                                        34
                       2.   Background                                    35
                       3.   OCS Scenarios--What to Expect                 39
                       4.   OCS Facilities                                40
                            a.   Pipelines                                40
                            b.   Natural Gas Processing Plants            42
                            C.   Refineries                               44
                            d.   Other Facilities                         44
                 B.    Nuclear Power Plants                               44
                       1.   Issues                                        46
                       2.   Background                                    46
                       3.   Public Health and Safety Factors:             49
                            a.   Nuclear Safety                           49
                            b.   Disposition of Spent Fuel                50
                            C.   Nuclear Theft                            50

                                             -iii-

                                                                            Page

                          4.   Environmental Impacts                         51
                          5.   Siting Factors                                52
                          6.   Conclusion                                    53
                    C.    Liquefied Natural Gas (LNG)                        56
                          1.   Issue                                         56
                          2.   Background                                    56
                          3.   Safety                                        57
                               a.   Buffer Zones                             58
                               b.   Risks                                    60
                          4.   Environmental Impacts                         61
                          5.   LNG Siting - A Regional Approach              61
                          6.   State Options                                 62
                          7.   Conclusion                                    63
                    D.    Deepwater Ports                                    67
                          1.   Background                                    67
                          2.   New Jersey  as a Deepwater Port               67
                          3.   Potential Impacts                             68
                               a.   Environmental: Pipeline vs.              68
                                     Tanker to Shore
                               b.   Socio-economic                           68
                          4.   Siting Factors - Size                         69
                          5.   Legal Implications                            69
                          6.   Conclusions                                   70

              V.    State and  Federal Role in Energy Facility   Siting      72
                          1.   Legislation                                   72
                          2.   State Agencies                                72
                               a.   Department of Energy                     73
                               C.   Department of the Public   Advocate      73
                               d.   Other Agencies                           73
                          3.   Federal Role                                  74
                               a.   The Federal Interest in   Energy         74
                                     Facility Siting
                               b.   Federal Consistency                      .75
                               C.   Federal Preemption                       76

              VI.   Regional Analysis:                                       78
                    A.    Hudson River Waterfront, Newark and                78
                          Raritan Bay
                    B.    North Shore                                        79
                    C.    Central Shore                                      80
                    D.    South Shore                                        81
                    E.    Delaware Bay                                       83
                    F.    Delaware River Waterfront                          84

              VII.  Energy Facility Siting Policies                          85

              VIII. Conclusions                                              91

              Bibliography                                                   92

                                               -iv-

                                          Tables

                                                                           Page

            Table 1:   U.S. and N.J. Gross Energy Consumption 1974            5

            Table 2:   New Jersey Consumption of Energy by Sector-1974        6

            Table 3:   Cost of Energy in 1973, U.S. vs. middle Atlantic       7
                       States*

            Table 4:   Oil Refineries in New Jersey, Pennsylvania and       10
                       Delaware

            Table 5:   Power Stations in New Jersey (1976)                  16

            Table 6:   Successful Bidders in Lease Sale #40, August 1976    38

            Table 7:   Existing and Proposed Nuclear Plants for             47
                       New Jersey

                                            -v-

                                            Figures

                                                                            Page

              Figure 1 Petroleum Refineries                                    9

              Figure 2 Major Natural Gas Pipelines in New Jersey             12

              Figure 3 Electric Power Plants in New Jersey                   14

              Figure 4   Major Electric Transmission Lines in                15
                         New Jersey

              Figure 5   Location of Tracts Leased in August 1976            36
                         ib Relation to the New Jersey Coast

              Figure 6   Definition of Pine Barrens                          43

              Figure 7   Location of Tanker Casualties on the                59
                         Delaware River (1969-1974)

             I. INTRODUCTION

                  Energy production and environmental protection are viewed
             by some as incompatible goals because energy has become associated
             with growth while the latter symbolizes "no growth", at least to
             some. The conflict is particularly acute in New Jersey where
             competition between land uses is intense and where energy plays such
             an important role in the state's economy, with the state's largest
             industry, the petroleum and petrochemical industry, based on energy.
             Existing energy facilities, located close to New Jersey's two ports
                the district of the Port Authority of New York and New Jersey in
             the northeast and the Port of Camden on the Delaware River in the
             west -- have contributed to the industrialization and growth of the
             state's economy. Some types of energy facilities have been proposed
             and even constructed by electric and gas utilities along the state's
             recreational shoreline, outside of these traditional locations.
             This shoreline may also have to accommodate land-based facilities
             resulting from the U.S. Department of the Interior's oil and gas
             development program off the shores of New Jersey. While the State
             has played some role in energy planning to date,.the recent natural
             gas crisis indicates that the State should assume a more active role
             as far as securing an adequate supply of energy for its residents
             and businesses and ensuring that appropriate sites be set aside for
             this purpose.

                  The New Jersey Coastal Area Facility Review Act (CAFRA) of 1973
             and the federal Coastal Zone Management Act of 1972 (and its 1976
             Amendments) require that energy facility siting be addressed in the
             development of a comprehensive coastal management program. The
             federal act goes further than CAFRA in seeing a national interest
             associated with some energy facilities and requiring that this
             national interest be addressed in the state's program. This paper
             attempts to address some of these issues. NJOCZM recognizes, of
             course, that the provision of energy resources involve numerous
             interests at the local; state, federal,@ public and private levels,
             and that any energy plan must be drafted in concert with these
             various interests. This paper should be regarded, therefore,
             as providing a preliminary perspective on the energy issues facing
             the state's, coastal zone. The policy recommendations submitted
             provide the beginning for a coherent strategy to guide NJOCZM's
             mandated role regarding energy facilities.

                  Section II outlines the role of energy in the economy and
             environment of New Jersey.

                  Section III describes some conservation measures which could
             reduce energy demand. It also suggests alternative energy sources
             for the future.

                  Section IV outlines the key issues concerning the siting
             of nuclear and conventional electric generating plants, liquified
             natural gas facilities, deepwater ports, and facilities related to
             the exploration, development, and production of oil and gas, espe-
             cially from the Outer Continental Shelf (OCS).
                  Section V outlines state and federal involvement-in energy
             facility siting in New Jersey's coastal zone.

                                            -1-

                     Section VI indicates the location of existing energy facilities
                for the six regions of the coast, and provides an initial appraisal
                of the ability of these regions to absorb additional energy facility
                development.

                     Section VII presents draft energy policy recommendations which
                NJOCZM will be considering in developing energy facility siting
                guidelines for the coastal zone.

                    Section VIII concludes this discussion paper with a brief
                summary and conclusion.

                                              -2-

             II. THE ROLE OF ENERGY IN NEW JERSEY'S ECONOMY

                  This section describes the role of energy in New Jersey's
             economy for the purpose of placing the later discussion on proposed
             energy facilities into clearer perspective.

                  A.   Background

                  Even though New Jersey does not produce any fuel of its own
             (aside from an insignificant portion of hydroelectric power at
             Jersey Central Power and Light's Yard Creek pumped storage plant D),
             its largest industry, the petroleum and petrochemical industry, is
             based on petroleum and natural gas by-products or feedstocks. The
             size of this industry is due in part to New Jersey's location and
             particularly to its ports on the Hudson and the Delaware Rivers
             which were catalysts for industrialization.

                  New Jersey's economy is mostly fueled by imported oil and
             domestic natural gas. Until the early 19701s, the State's favorable
             seaboard location provided a cost advantage over other parts of
             the country which had to pay considerably more per barrel for
             domeslic fuel oil and higher transportation costs for importing
             fuel.   It is not surprising, therefore, that New Jersey was
             severely affected by the 1973/74 oil embargo by the Organization of
             Petroleum Exporting Countries (OPEC) and its aftermath, which
             resulted in prices rising from $5.25 per barrel in 1973 to between
             $12 and $16 per barrel   n 1976, depending on the country from which
             petroleum was imported.    Given New Jersey's reliance on imported
             petroleum and the uncertain policies of the OPEC countries, New
             Jersey is, to say the least, in a precarious position with respect
             to its oil supply. This is one reason, it has been claimed, that
             New Jersey should not oppose or delay the development of Outer
             Continental Shelf oil and/or gas off its coast, which might increase
             its supply of energy and lessen its dependence on domestic or
             foreign sources. While this claim may not turn out to be correct,
             in fact, New Jersey's policy has been to encourage the rapid explor-
             ation of the Outer Continental Shelf off its coast provided this be
             accomplished in a manner which is compatible with maintaining
             coastal environment and tourism economy.

                  B.   Consumption

                  Table I shows that in 1974 New Jersey consumed 75 percent
             of its energy in the form of petroleum, and 19 percent in the
             form of natural gas, with the remainder split between coal and
             nuclear fuel. New Jersey's petroleum consumption is almost double
             that of the proportion of the nation, whose share is about 45
             percent. By contrast, on a proportional basis, the state uses about
             one third less natural gas than the nation. This gas is, however,
             important especially for those industries who cannot easily use
             alternative fuel types in their processing operations such as the
             glass industry. Petroleum and natural gas more than offset the
             state's consumption of coal, which is one sixth of the per state
             national average of 18 percent. (See Table 1). While nuclear fuel
             constituted two percent of the state's overall consumption in 1974,
             it contributes over twenty percent to New Jersey's electric power
             generation. This is about double the national average for nuclear
             Powered electricity.

                                            -3-

                   Fuel is used mainly for space heating and lighting in the
              residential and commercial sectors. Four industries--chemical,
              petroleum, food and paper--are the major consumers of fuel in the
              industrial sector. The transportation sector runs entirely on
              petroleum. As Table 1 indicates, just over one third of New Jersey's
              petroleum was consumed by the transportation sector.

                                            -4-

                                             Table I
                    United States and New Jersey Gross Energy Consumption
                                              1974

                                        (trillion Btuls)

              Energy Source                           New Jersey        United States

              Petroleum                              1274.2    75.3%    33,414    45.9%

              Coal                                     86.2     5.1%    13,241    18.1%

              Natural Gas
              (including natural gas
              liquids)                                292.9    17.3%    21,733    29.8%

              Nuclear                                  38.6     2.2%      3,290     1.6%

                   Total                            1,691.9   100.0%    72,880   100.0%

               Gross energy consumption refers to all types of energy at the
               time it is incorporated into the economy, comprising inputs of
               primary fuels or their derivatives, and output of hydropower and
               nuclear power converted to theoretical fuel inputs. Gross energy
               includes energy used for producing, processing and transportation.

              SOURCE:  New Jersey: Federal Energy Administration Annual State
                       Energy Consumption, September 30, 1975.

                       United States: U.S. Department of the Interior, Bureau of
                       Mines, News Release, April 5, 1976 (1974 is the latest
                       year for which state statistics are available).

                                              -5-

                     Th'e proportions of fuel used in New Jersey in the residential,
                industrial, commercial, transportation and utility sectors are shown
                in Table 2.

                                             Table 2

                            New Jersey Consumption of Energy by Sector
                                               1974
                                           Trillion BTU's

                                                                          1
                                                                      1974
                                                     BTU's           Percent

                Residential                          394.9            21.0
                Industrial                           250.7            14.0
                Commercial                           287.9            16.0
                Transportation                       520.1            28.0
                Utility                              381.9            21.0
                Agriculture                             3.4
                                                     1838.9          100%
                1Federal Energy-Administration, "Gross Energy Consumption,
                 State of New Jersey", September 30, 1975 (Computer Printout).
                2Industry includes agriculture which constitutes less than one
                 percent of energy consumption.

                Note that one fifth of all energy is consumed by the utility sector.

                     C.   Cost of Fuel

                     New Jersey enjoyed a fuel cost advantage for many years,
                but it has now been placed at a disadvantage due to the steep
                rise in prices dating back to the early 1970's, including the
                decisions of the OPEC countries to increase their prices. This
                has placed New Jersey's industries at a competitive disadvan-
                tage with respect to much of the rest of the nation. Table 3.
                indicates that the Mid-Atlantic region, of which New Jersey is a
                part, pays 32 percent more for electric energy, 41 percent more for
                natural gas, 16 percent more for petroleum, and 13 percent more for
                coal than the national average. The price structure for these three
                consuming sectors is not, however, uniform. The residential sector,
                for example, paid 943.7 cents per million British Thermal Units
                (c/mmBTU) in 1973 which is double the 445.5 (c/mmBTU) that industry
                paid. Nevertheless, industry in the Mid-Atlantic paid about 25
                percent more for its fuel than the national average in 1973. The
                relatively low price of natural gas explains why the utilities
                switched to this fuel, and why they have been so severely affected
                by curtailments of interstate gas supplies. Coal, which cost       -less
                in 1973 than any of the other fuels, is strictly regulated by
                both the state and federal government because of the difficulties
                in mining it and the emissions associated with burning coal.
                Renewed attention is, however, being given to coal because of high
                costs and other factors associated with alternative oil, gas and
                nuclear fuels.

                                                -6-

                                               Table 3

                                     Cost of   Energy in 1973
                                U.S.  versus Middle Atlantic States

                            (Cents Per Million British Thermal Units)
                                     Electric Natural #2 Oill          #6 Oi12 Coal
              United States           Energy       Gas

              Residential            697.5      125.1        161.6
              Commercial             674.1       95.2        142.8
              Industrial             342.9       50.1        99.2         74.2     46.2
              Electric Utility                                   3
               Plants                            35.2        78.3         85.3     41.9

              Average Price          571.5       76.4        33.0         26.1     20.95

              Middle Atlantic

              Residential            943.7      160.3        N/A
              Commercial             899.8      127.3        94.4
              Industrial             445.5       82.5        87.7         71.4     51.4
              Electrij Utility                                   3
               Plants                          63.4          82.8         66.7     47.5

              Average Price          763.       108.3        43.85        27.6     23.75

              Middle Atlantic
              Price as a
              Percentage of U.S.
              Price                  34%        +41%        +32%          +0.5% +13.3%

              Source:    -Gas Facts American Gas Association, 1973
                         -Mineral Yearbook, U. S. Bureau of Mines 1973
                         -Edison Electric Institute Statistical Yearbook 1973
                         -Petroleum Facts, American Petroleum Institute
              1#2 Oil is distillate fuel oil used for heating in the residential
               and commercial sector.

               #6 Oil is residual oil (heavy fuel oil) used to generate elec-
               tricity.

               These figures include some of #2 oil.
              4The Middle Atlantic region, as defined by the Edison Electric
               Institute, includes New York, Pennsylvania and New Jersey.

                                                -7

                    While the price of petroleum is regulated by the Federal
               Energy Administration, New Jersey consumers would possibly benefit
               from lowere& transportation costs from oil and gas coming from the
               Baltimore Canyon.

                    D.   Availability of Fuel

                         1.    Pet roleum

                    New Jersey is a major refining center on the Atlantic Coast
               with a refining capacity of 715,000 barrels of oil per day. Its
               five operating refineries, and the Hess refinery which was closed in
               1974 but which could become functional again, if needed, are shown
               on Table 4 and Figure 1. All could probably be substantially
               expanded in capacity at the existing site.

                    New Jersey is expected, within the next ten years, depending on
               the rate of exploration and development, to be the principal refiner
               of w'@iatever pe roleum is discovered off the New Jersey and the New
               England coast.

                    Apart from refineries in northern New York (Buffalo) and New
               Hampshire and one that is shut down in    Rhode Island, there are no
               refineries on the east coast north of the Jersey refineries.
               Petroleum found offshore and not refined in New Jersey would prob-
               ably be refined in the adjacent Pennsylvania or Delaware refineries
               fronLting on the Delaware River. It should be noted that most of the
               companies which obtained leases from the Department of the Interior
               sale in August 1976 have refineries in either Pennsylvania, New
               Jersey or Delaware, except for Shell Oil Company.

                    While existing refinery capacity in the region will probably be
               adequate to handle any petroleum found in the first OCS lease sale,
               additional lease sales could generate the need for more refining
               capacity and facilities, at existing or new sites.

                    Conversations with oil industry representatives indicate
               that because of the high investments associated with building new
               refineries, that they expect to expand rather than build new refin-
               eries.

                                               -8-

              Figure
           Petroleum Refineries
                                       S U S S E X           4,

                                                 100
                                                    -19  %9V        0

                                                    Coo
                                    4c/

                                           0
                                        M             E S S E k4
                                                                 EXX014
                                                     NEWARK
                                                                 HESS
                                                    UNI
                                                       0         CHEVRON
                               H U N TERDON
                                              CO
                                             q-
                                             4@/    Cl)

                                          C@                        z
                                     r_j
                                     j                              Lu
                                       MERCER,-,                    0
                                        TRENTON )@'   0 U T H      0

              ARCO                               0                Q
              G U L F                             0
              TEXACO           CAMD@N   <

              MOBIL
              B P                41-
                          <
                           0                  0
              SUN            C,                                 _j
                                               4'
                   S A
        GETTY                       ly
                            4f
                            \  11 "\</          C
                               VI  A T L, A N T I
                     /C
                      U4fq
                                                            0 4 a    le

                                                             Scale In MIJOS

                                                      SOURCE
                                             DEPDraft Environmental Map
                                                  of New Jersey
                       DELAWARE     4r.,              Energy

                                                    May, 1975

                                       -9-

                                              Table 4
                                   Oil Refineries in New Jersey,
                                     Pennsylvania and Delaware

                Refinery                         Location              Capacity
                New Jersey                                       (barrels/calendar day)
                Amerada-Hess                    Port Reading             70,0001
                Chevron                         Perth Amboy            168,000
                Exxon                           Linden                 285,000
                Mobil                           Paulsboro                98,0002
                National Oil Recovery           Bayonne                   6,000
                Texaco                          Westville                88,000
                Pennsylvania                                           715,000

                Atlantic Richfield           Philadelphia, Pa.         185,000
                British Petroleum            Marcus Hook, Pa.          161,000
                Gulf                         Philadelphia, Pa.         204,000
                Sun                          Marcus Hook, Pa.          165,000
                                                                       715,200

                Delaware

                Getty                        Delaware City, Del.       140,000

                Total Mid-Atlantic Refinery Capacity                  1,570,200
                New Jersey Share of Mid-Atlantic   1not
                including shut down Hess refiner@                        41%

                1Inoperative since early November, 1974.
                2This plant was shut down in July 1977. When operational it
                 refines both contaminated crankcase oil and #2, #4 and #6 oil.

                Source:    Oil and Gas Journal, March 28, 1977.
                           DEP, Draft Environmental Map of New Jersey - Energy,
                                May, 1975.
                           Federal Energy Administration, Strategic Petroleum
                                Reserve Office, Draft Environmental Impact Statement,
                                Strategic Petroleum Reserves, June 1976, p. IV-151,
                                Table IV-42.

                                                _10-

                  New Jersey's six refineries have the processing capacity of
             715,000 barrels per calendar day (365 days).

                  The National Oil Recovery refinery is located in Hudson County
             and the Exxon and Chevron refineries are located in Union and
             Middlesex Counties on the Arthur Kill. The Texaco and Mobil refin-
             eries are located south of Camden in Gloucester County (See Figure 1
             and Table 3). The Amerada-Hess facility, also on the Arthur Kill,
             has been closed since 1974. The refinery could become operative
             again if the capacity were needed, which is possible since Hess was
             one of the companies which obtained shaies in eight tracts it bid on
             with Mobil Oil in the Baltimore Canyon.

                       2.   Natural Gas

                  Natural gas is a fuel which became popular in New Jersey
             because of its low cost, and clean handling and burning charac-
             teristics. In 1972, it constituted 28.4 percent of the energy
             consumed in NSw Jersey. Its share of the fuel market dropped to
             19.0 in 1974.    This was due in part to curtailments in interstate
             shipments of natural gas from the Gulf Coast. It is too early to
             say whether an increase in the price of interstate gas by the
             Federal Power Commission in the summer of 1976 will result in an
             increase in the supply.

                  Gas is supplied to New Jersey's four gas utilities, Public
             Service Electric and Gas (PSE&G), South Jersey Gas Company, New
             Jersey Natural Gas Company and Elizabethtown Gas Company. These
             purchased natural gas from six pipeline companies, the largest of
             which is Transcontinental Pipeline Company (Transco) (See Figure 2
             for map of gas pipelines.)

                  Gas is used in about equal proportions by the residential and
             commercial sectors. It is in the industrial sector, however, in
             which its use is crucial, especially in the stone, clay, glass,
             chemical and primary metal industry, where the precise temperature
             controls and flame characteristicg ens .ured by gas burning are
             important to avoid contamination.

                  In a study of large users of gas in 1975 by the New Jersey
             Department of Labor and Industry, 32.6% of industrial users sampled
             knew of no feasible alternative or substitute for natural gas.

                  To fill the gap left by curtailments, Public Service Electric
             and Gas Company and Transco have sought overseas sources of the
             gas which would have to be imported in liquefied form in special
             tankers. A contract was signed with Sonatrech in Algeria in 1975
             to import the gas, although PSE&G has not yet obtffined the necessary
             import license from the Federal Power Commission.

                  In May 1976, the U.S. Department of the Interior estimated
             that between 2.6 and 9.4 trillion cubic feet of gas would  9be found
             over a 25 year period in the Lease Sale 40 area offshore.
             This breaks down to 104 billion cubic feet per year or one third
             of New Jersey's consumption of gas in 1973 in the low case and
             300 billion cubic feet in the high case. Three hundred billion

                                     Figure 2
                    MAJOR NATURAL GAS
                    PIPELINES IN NEWJERSEY                              SUSSEX                                     )0 19@-

                                                                                          V-N  L

                                                               R,                                    ESSEX
                                                                                                    0 nip     t

                                                                                             @-7 UNION
                                                                    4,**
                                                         H UNTERDONI@

                       LEGEND

            m ommon-mms TENNESSEE GAS PIPELINE CO.
                       DIV. of TENNECO INC.
                       TEXAS EASTERN TRANSM. CORP.                                0  0
                       SOUTH JERSEY GAS CO.                           M RCE
                       N.J. NATURAL GAS Co.                                                     tA001 \A
            ,,won,     TRANSCONTINENTAL
                       GAS PIPE LINE CORP.

                                                                                4               0
                                                     A                                           0
                                                    S                                            OA
                                                <1 10:1@                                          7

                                                           0 0101
                                            Or!
                                                                                    04,

                                                  0

                                      S A  L% E M
                                             10

                                                                    ATLANTIC

                                                                  %\
                                                                                            40

                                          C
                                             SERt4/VD
                                                                  r      Al

                                          DELAWARE
                                              BAY                                         Prepared by N.J. D E P - OCZM
                                                                                                                    1976

                   0   4   8        16
                            - iiiii-ma
                  Scale in Miles

            cubic feet is the amount of gas New Jersey consumed in 1973. Gas
            found in the Baltimore Canyon would lessen the pressure to import
            this gas, whose shipment, unloading and transfer pose siting and
            public safety problems.

                 Conservation could reduce the demand for natural gas to some
            extent. Natural gas is not, however, a fuel which can be easily
            replaced by other forms, specially since its non-polluting charac-
            teristics make it attractive in existing industrial areas which have
            to meet Federal and State air quality standards. It is also desirable
            in undeveloped areas where it will not contribute to degradation of
            existing air quality.

                      3.   Electricity

                 Electricity is a secondary form of energy generated by steam,
            which in turn can be produced by using petroleum, gas, uranium or
            coal to heat water. In New Jersey the major share of electric power
            is generated by petroleum and nuclear energy. New Jersey's 27
            electric generating plants are shown in Figure 3 and listed on Table
            6. Figure 4 indicates major electric transmissions lines.

                 Electricity is provided by five utilities: Public Service
            Electric and Gas Company, Atlantic City Electric Company, Jersey
            Central Power and Light Company, Rockland Electric Company, and the
            municipally-owned City of Vineland Electric Utility. With the
            exception of Rockland Electric, these are members of the Pennsylvania-
            New Jersey-Maryland Interconnection (PJM), an integrated power pool
            with a combined generating capacity of 1.5 million kilowatts. The
            purpose of the pool is to create a reserve of power for unusual
            demand conditions such as the breakdown of equipment. The inter-
            change of power provides flexibility in meeting demand and lower
            costs to consumers. PJM is also a member of the Mid-Atlantic Area
            Coordination Agreement, (MAAC) a compact designated to improve
            service reliability through coordinated planning for new facilities
            and coordination with adjacent utility groups.

                 while electricity at the point of consumption is clean and
            pollution free, its production is fraught with pollution producing
            impacts. The burning of coal, for example, has been discouraged by
            strict state and federal statutes regulating air emissions. In
            response, utilities have turned to oil, gas and nuclear energy to
            fuel their electric generating plants.

                 New Jersey's twenty-seven power plants are shown in Table 5.
            Of these, two are nuclear-fueled, four have gas units, three use
            coal and the remainder rely on oil. One pumped storage facility
            exists near Blairstown at Yards Creek off the upper Delaware River.

                                           -13-

                         Figure 3
            ELECTRIC POWER PLANTS IN
                      NEW JERSEY

                              YARDS  CREEK                                         &
                                                                       11-N %I,

                                                                                                 BERGEN
                                                                      VL                   x
                                                                              )ESSER-'
                                                          M
                                                                                                 HUDSON
                                                                            It NEWARKI           ESSEX
                                                                                                 KEARNY
                    GLEN GARDNER                                                                 BAYONNE
                                                                           UN ION
                                            hUNTERDON                                            LINDEN
                    GILBERT                    x                                                 SEWAREN
                                                                                                 WARREN
                                                                          x                      SAYREVILLE
                                                                        4*t
                   RIEGEL                                              4c@j   x                  EDISON
                                         ION

                                                      ME R C
                   MERCER                                   NTON               0 U T H
                                                                       0

                   BURLINGTON
                                                                        0

                   NATIONAL PARK
                                           CAmbEN
                                           C,                                              OYSTER
                   MICKLETON
                                                                                           FORKED RIVER)
                                                                 4P
                            I\                                     A
                                                 4-
            DEEPWATER                                                                      CEDAR

           VINELAND
                        S A                                                                             z

         SALEMS                                                                   (ATLANTIC)            _j
        OPE CREEK)    x                           A T L A N    T I C
                                                                              x
              CARLL                                                    0
              CORNE

                                                                                           SOURCE
                                              4f                       B. L. ENGLAND
                                                        A.                         MID ATLANTIC AREA
                                                                                COUNCIL, MAAC SYSTEMZ
                            DELAWARE                          MIDDLE               PLANS4 APRIL 1,19-r?
                                 8 A Y

              0 4 0       945
                       - @j                            Ptants in parentheses are under construction
                                                       or have been proposed.
                                                    -14-

            Figure
            MAJOR ELECTRIC TRANMISSION LINE
                      IN NEW JERSEY

                                                                                             RAMAPO

                                       BUSHKIU

                                 YARDS CREEK         KITTATINNY                     WALDWICK
                                                                       .WHAR            NEWMILFOR
                                   PORTLAND X                             WHIPPANY     CEDAR CR.
                                                                                4               HENI X BERGEN
               PENNSYLVANIA                                      GRESTON
                                                                                      RDSELA
                                                                                                      HUDSON
                                                  GLEN GARDNE        MORRMISTOWN          KEARNY X         FARRAGUT
                                           GILBE                                   LD  NE 8 WA)(
                                                                                  LIND N           BAYONNE
             ALBURTIS                                                                          0GOETHALS
                                                   BRANCHOU            BENNETT             SEWARER
                                                                          LA.
            HOSENSACK                                                                   WERNER

                                                                           BRUNSWICK
                                                               SAYERVILLE X                RED
                                                         PLEASANT VY.        EDISON       BANK

                                                                   TRENTON
                                                     LAWRENCE
                         WHITPAI          BUCKINGHAM                              ATLANTIC      E
                                                     CR DEN       M.ERCER                      VI
                                                             URLINGTON       LARRABEE
                                          RICHMOND                       COOKSTOWN

                                             CAMDEN
                                  GLOUCESTER              COXS COR.
            CHICHESTER                                                          OYSTER
                                                                                 CREEK

                              MICHLETON
         KEENEY             DEEPWATER                 NEW FREEDOM               CEDAR     X                LEGEND
                                                          -UNDER                                           500KV CIRCUIT
                                                   J-*--CONSTRU                                            345KV CIRCUIT
                                                     X VINELAND                                            230 KV CIRCUIT
         NCOMPLETE                        x  CARLLS                                  40
            SALEM                            CORNER                                                 X      GENERATION STATION

                                                                                                           SWITCHING STATION
                                                                                                    0        OR SUBSTATION

                                                                                                 wmm@      CAFRA BOUNDARY
                                                                        ENGLAND                               S011RCE

                                                                                                       NEW JERSEY MASTER
                                                       MIDDLE                   01234 a    12 16           SITING  STUDY
                                                        x                           SCALEINMILES           January   1975

                                                                  -15-

                                              Table 5

                                Power Stations in New Jersey, 1976
                                  Source & Key to Abbreviations

               A.    Key to Abbreviations

                     COMPANY

                     ACE       Atlantic City Electric Group
                     JCPL      Jersey Central Power & Light (a subsidiary of
                               General Public Utilities Service Corporation)
                     PSEG      Public Service Electric & Gas
                     Vineland  The City of Vineland Electric Utility
                     i         Joint Ownership (see footnotes)

                     TYPE

                     cc        Combined Cycle (Combustion Turbine and Steam Turbine)
                     CT        Combustion Turbine
                     F         Fossil-fueled Steam
                     N         Nuclear-fueled Steam
                     D         Diesel
                     PH        Pumped Hydro

                     PRIMARY FUEL

                     0         Oil
                     C         Coal
                     G         Gas
                     N         Nuclear

                     COOLING

                     OT        Once Through
                     CL        Cooling Tower, Closed Loop
                     SP        Spray Pond

               B.    Source of Information

                     MAAC Systems Plan, Mid-Atlantic Area Council, April 1, 1976:
                     Draft Environmental Map of New Jersey-Energy, DEP, May 1975;
                     Electricity Generation and Oil Refining, MESA New York Bight
                     T@tlas, monograph 25, July, 1975; Public Service Electric and
                     Gas, Atlantic City Electric Company, Jersey Central Power and
                     Light, the City of Vineland Electric Utility.

               C.    Footnotes to Table 5 appear on page 46.

                                               -16-

                                                  Power Stations in New Jersey, 1976  1

        Station         Unit No. Company Type  Normal New MW Capacity Primary Fuel Cooling              Location
                                                  Summer      Winter                           Municipality      County
        Bayonne          1,22      PSEG     CT      30           48          0        AIR      Bayonne           Hudson
        Bergen           1         PSEG      F      27          290          0*                Ridgefield Pk.    Bergen
                         2                   F      27          290          0*       ---
                         3                  CT      14           15          G        ---
        B.L. England     1         ACE       F     120          127          C         OT      Upper Twp.        Cape May
                         2                   F     160          160          C         OT
                         3                   F     160          160          0         CL
                        Diesel               D        .8           8         0        AIR
        Burlington       5         PSEG      F     118          123          0*        OT      Burlington        Burlington
                         6                   F     120          128          0*        OT
                         7                   F     180          185          0*        OT
                         8                  CT      14           15          0         OT
                         9                  CT     141          172          0        AIR
                        10                  CT      70           86          0        AIR
                        10                  cc     107          122          -         OT
                        11                  CT     141          172          0        AIR
        Carlls Corner    1&2       ACE      CT      74           92          0        AIR      Upper Deerfield Cumberland
        Cedar            1         ACE      CT      46           53          0        AIR      Stafford Twp.     Ocean
                         2                  CT      23           26          0        AIR
        Deepwater        1         ACE       F      78           82          0         OT      Lower Penns Neck  Salem
                         3                   F      53           54          0         OT
                         4                   F      54           54          0         OT
                         5                   F      24           24          0        ---
                         6                   F      80           81         O/G        OT
                         7                   F      25           25          0        ---
                         A                  CT      17           22         O/G       AIR
        Edison          1,2,3      PSEG     CT     360          456          0        AIR      Edison            Middlesex

                                                                 -17-

                                                                                                                    Page 2

        Station         Unit No. Company Type    Normal New MW Capacity Primary Fuel Cooling               Location
                                                   Summer       winter                            municipality       County

        Essex            1          PSEG      F     104          110           0          OT      Newark             Essex
                         9                   CT      47            60          0         AIR
                        10                   CT     120          152           0         AIR
                        11                   CT     141          172           0         AIR
                        12                   CT     141          172           0         AIR
        Gilbert         1,2         JCPL      F      45            46          0          OT      Holland Twp.       Hunterdon
                         3                    F      72            73          0         AIR
                        Cl-C4                CT     100          124           0         AIR
                        4-7                  CT     224          288           0         AIR
        Glen Gardner    A-1-8       JCPL     CT     160          208           0         AIR      Lebanon Twp.       Hunterdon
        Hudson           1          PSEG      F     383          415           0*         OT      Jersey City        Hudson
                         2                    F     600          620           C          OT
                         3                   CT     104          120           0          OT
        Kearny           7          PSEG      F     142          148           0*         OT      Kearny             Hudson
                         8                    F     146          148           0*         OT
                         9                   CT      14            15          G         AIR
                        10                   CT     120          120           0          OT
                        11                   CT     120          120           0          OT
                        12                   CT     150          280           0         AIR
        Linden          1,4         PSEG      F     244          284.          0          OT      Linden             Union
                         2                    F     225          225           0          OT
                         3                   CT      14            15          G         AIR
                        5-8                  CT      96          120           0         AIR
                         9                   CT     150          208           0         AIR
        Mercer           1          PSEG      F     296          300           C          OT      Hamilton Twp.      Mercer
                         2                    F     290          300           C          OT
                         3                   CT     104          120           G         ---
        Mickleton        1          ACE      CT      57            79          0         AIR      E.Greenwich Twp.   Gloucester

                                                                     -18-

                                    q
                          milt    M    M      M

                                                                                                                    Page 3

         Station          Unit No. Company Type   Normal New MW Capacity Primary Fuel    Cooling           Location
                                                    Summer       Winter                           Municipality       County

         Middle           1,2         ACE     CT      40           48          0         AIR      Middle Twp.        Cape May
                           3                  CT      37           45          0         AIR
         National Park     1          PSEG    CT      15           18          0         AIR      National Park      Burlington
         Oyster Creek      1          JCPL     N     620          650          N          OT      Lacey Twp.         Ocean
         Riegel            1          JSPL    CT      22           28          G         AIR      Milford            Hunterdon
         Salem             3                  CT      38           42          0         AIR      Lower
                                       3                                                          Alloways Creek     Middlesex
         Salem             1                   N     1090         1090         N          OT      Lower
                                                                                                  Alloways Creek     Middlesex
         Sayreville       1-3         JCPL     F      84           90          0          OT      Sayreville         Middlesex
                           4                   F     118          126          0          OT
                           5                   F     123          127          0          OT
                          C -C                CT     212          292          0         AIR
         Sewaren           1  4       PSEG     F     104          107          0*         OT      Woodbridge         Middlesex
                           2                   F     ill          113          0*         OT
                           3                   F     107          109          0*         OT
                           4                   F     124          127          0*         OT
                           5                   F     326          344          0          OT
                           6                  CT      52           60          0          OT
         Vineland          1        Vineland  CT      29           35          0         AIR      Vineland           Cumberland
                          4,5,6                F        7            7         0          SP
                           7                   F        8            8         0          OT
                           8                   F      12           12          0          OT
                           9                   F      17           17          0          OT
                          10                   F      23           23          0          OT
         Werner           1,3         JCPL     F      30           34          0          OT      South Amboy        Middlesex
                           4                   F      58           60          0          OT
                          Cl-C         4      CT     212          292          0         AIR
         Yards  Creek     1,2,1       1       PH     330          330                    ---      Blairstown         Warren

                                                                     -19-

                                               B. Major Plants Proposed or Under Construction

           Station         Unit No. Company Type New MW Capacity Primary Fuel Cooling                    Location
                                                                                                   Municipality       County
           Salem5          2(1979)     J3        N      1115               N          OT
           Hope Creek 7    1(1982)     J8        N      1100               N          CL           Lower Alloways     Salem
                        9                                                                            Creek Township
           Forked Riv7r    1(1982)     JgPL      N      1120               N          CL           Lacey Township     Ocean
           Hope Cre�k      2(1984)     J10       N      1100               N          CL
           Atlantic        1(1985)     J         N      1150               N          OT           Offshore
           Atlantic        2(1987)               N      1150               N          OT           Atlantic City

                                                                  -20-

                                   C.    Footnotes to Table 5

              *Coal burning equipment in place.

              1.   In addition to plants in New Jersey, several New Jersey electric
                   Utilities own major shares in three plants in Pennsylvania.

                         Peach Bottom Nuclear Plant, Peach Bottom,
                         Pennsylvania, 2 units, 2090 MW (normal winter
                         rating), PSEG: 888 MW; ACE: 78.5 MW.

                         Conemaugh "minemouth" Coal Plant, West
                         Wheatfield, Pennsylvania, 6 units, 611 MW
                         (normal winter rating), PSEG: 302 MW; ACE:
                         MW; ACE: 21 MW; GPU 143.5 MW.

              2.   When  units are listed on the same line, capacity listed
                   refers to combined capacity.

              3.   PSE&G: 42.55%; Philadelphia Electric Company (PEC):
                   42.55%; ACE: 7.45%; Delmarva Power and Light (DPL):
                   7.45%.

              4.   JCPL: 50%, PSEG: 50%.

              5.   Project exempt from CAFRA as construction commenced prior
                   to September 19, 1973.

              6.   Dates in parenthesis represent expected first year of operation.

              7.   Issued conditional CAFRA permit January 28, 1976.

              8.   PSEG: 90%; ACE: 10%.

              9.   CAFRA permit pending.

              10.  PSEG: 80%; ACE: 10%; JCPL: 10%.

                                              -21-

                    Utilities make use of gas turbines to supplement electrical
               generation when demand is high.

                    In 1976, over twenty-four percent of New Jersey's electric power
               was generated by nuclear energy, even though nuclear power con  St
               tutes only two percent of New Jersey's total energy consumption.

                          a.   Nuclear Power

                    Nuclear power in New Jersey is provided by the Oyster Creek
               plant, operated by Jersey Central Power and Light Company and owned
               by the General Public Utilities Corporation (GPU) and the Salem
               plant in Lower Alloways Creek, which began operating in December
               1976. GPU generates 54 percent of its electricity from the Oystel.
               Creek plant and the Three Mile Island nuclear unit in Pennsylvania.
               Public Service Electric and Gas Company, which supplies 80 percent
               of New Jersey's 7.5 million customers, meets 15 percent of its
               electric needs with nuclear energy from its Peach Bottom plant in
               Pennsylvania. Atlantic City Electric, through its share in the
               Pennsylvania Peach Bottom plant, met 18 percent of its electric
               needs with nucle ff energy in 1976 and expects to increase this to 27
               percent in 1977.

                         b.   Nuclear versus Coal

                    Utilities claim that one of the advantages of nuclear power is
               that it is less costly than petroleum, gas or coal. Indeed, each of
               the three investor-owned utilities claimed in their 1975 Annual
               Reports that the use of nuclet5 power was responsible for keeping
               down the cost of electricity.     The major expe-nse with nuclear
               plants involves their high capital cost. Fossil fuel plants are
               less expensive to build but incur higher operating and fuel costs.
               How long nuclear power plants can maintain this cost advantage
               is not clear since both C?Rital and fuel costs have been rising
               precipitously since 1974.-    Indeed, studies have been conducted
               which would dispute the cost advantf@e of nuclear power over coal,
               claiming the two to be about  equal.

                         C.    Future Demand for Electricit

                    The figures which the utilities have submitted to the Public
               Utility Commission in the New Jersey Master Siting Plan indicate
               they anticipate energy demand to almost double over a 15 year '
               period, from 13,0 99 megawatts (MW) to 25,000 MW at a rate of 4 1/2
               percent per year.     These figures include reserves for equipment
               failures. About one-third,of this electricity (or 7,825 MW) is
               expected to be generated by nuclear fuel.

                     Whether the utilities will be able to continue to increase
               their nuclear capacity is an open question because of the problems
               which nuclear energy is posing in terms of storage, disposal,
               operations and public resistance.

                                             -22-

                  An issue is whether the growth rates forecast by utilities are
             valid since even a one percent differential could mean the dif-
             ference between building or not building the power plant. Until
             recently energy growth rates predicted by utilities went unchallenged.
             Now, with fuel curtailments, constantly-rising prices and adverse
             environmental impacts associated with building electric generating
             stations, utility forecasts are coming under closer scrutiny. The
             4 1/2 percent annual growth rate now predicted by New Jersey util-
             ities for 1975-1989 is much lower than the 7.5 percent annual growth
             experienced between 1963 and 1973. Whether these lower projections
             are low enough is under review by the Public Utility Commission,
             which for the first time in its higtory is holding hearings on the
             energy growth plans of utilities.

                  Resistance to power plants, particularly nuclear plants, with
             their attendant environmental problems and risks is understandable
             because, in the haste to industrialize, New Jersey sacrificed large
             segments of land, rivers and waterfront, especially in the northeast,
             to development. New Jerseyans are possibly more sensitive today,
             therefore, to the effects of industrialization than previously.
             This is so, even with the benefit of hindsight which gives the state
             the authority to ensure that the blight associated with yester-year's
             development is not repeated. It is a fact, however, that in 1976
             New Jersey was an importer of electric energy when half of the
             nuclear generj@ed electricity came from the Peach Bottom Plant in
             Pennsylvania.    Resistant though it may be to more power plants,
             New Jersey cannot expect other states to incur risks and environmental
             degradation on its behalf that it is unwilling to incur within its
             own boundaries.

                  The next chapter discusses some of the alternatives which might
             reduce the pressure to build more power plants in the coastal
             zone.

                                            -23-

                                             Footnotes
               lNew Jersey Manufacturers Association  Energy Council, "Energy
                 and New Jersey's Economy -- 1975 and Beyond, April, 1976, p. 1.
               2 American Petroleum Institute, Basic Petroleum Data Book, Table
                 6, October, 1976.
               3 U.S. Department of the Interior, Draft Environmental Statement,
                 Proposed 1977, Outer Continental Shell Oil and Gas Lease Sale,
                 Offshore the North Atlantic States, OCS Sale #42 (1976). The U.S.
                 Department of the Interior noted that oil production from the
                 Georges Bank "...is considered most likely to be tankered to
                 existing refineries in the northern New Jersey or Delaware River
                 Basin areas", p. 5, vol. 1.
               4 The twelve companies which will be heading up off shore operations
                 in the Baltimore Canyon are listed in Table 7.
               5 N.J. Governor's Task Force on Energy, Energy - a Report to
                 the Governor of New Jersey, May 1974. Federal Energy Administration,
                 "Gross Energy Consumption Total", Mimeograph computer printout,
                 September 30, 1976, and Table 1.

                 Minde, Theodore, A., "How New Jersey Industry Uses Natural
                 Gas" - reprint from New Jersey Economic Indicators, May 30, 1976.

                 Ibid.
               8 Public Service Electric and Gas Company, 1975 Annual Report,
                 P. 11.
               9 U.S. Department of the Interior, Final Environmental Impact
                 Statement, Lease Sale #40, May 1976.
               10 Data provided by Louis DeMattheis, Public Service Electric
                 and Gas Company, March 21, 1977.
               11 Communication by Fred Abbate, Atlantic City Electric Company,
               12 February 22, 1977.
                 Public Service Electric and Gas Company stated in its Annual
                 Report that its customers saved $80 million in 1975 due to nuclear
                 versus fossil fuel usage. Jersey Central Power and Light Company
                 noted that 53 percent of its power was supplied by nuclear power;
                 and that its customers saved $70 million by using nuclear power.
                 Atlantic City Electric noted that it too saved by using nuclear
                 power: 2.7 cents versus 31.8 cents for the fossil fuel equivalent.
               13,, Fuel Shortage Forecast for U.S. Nuclear Plants within Decade
                 or Two", Wall Street  Journal, June 7, 1976, p. 1. The article
                 .indicated that the price of fuel went from $8.00 per pound in
                 January 1974 to $35.00 per pound in January 1976.

                                              -24-

            14See, for example, Dubin-Bloome Associates, P. C. New York,
              A Study of Electric Energy Usage in the Public Electric and Gas
              Company, Service Territory State of New Jersey, Prepared for the
              Public Rate Counsel, Department of the Public Advocate, June 30,
              1976 and Charles Komanoff, "Power Plant Performance" Council on
              Economic Priorities, New York 1976. See also, Nuclear Power
              Issues and Choices, by the Mitre Corporation, sponsored by the
              Ford Foundation, (Cambridge-Ballinger Publishing Co., 1977).
            15 Public Service Electric and Gas Company et al, N.J. Master
              Siting Plan: Major Electric Generating Projects 1975-1989,
              January 1975.
            16Hearings on utility projections began February 7, 1977 before
              the Public Utility Commission.
            17 New Jersey utilities generated 10.7 billion killowatt hours of
              electricity including 4.9 billion Kilowatt hours from Public
              Service Electric and Gas Company's, Peach Bottom plant.

                                           -25-

                III..ENERGY CONSERVATION AND ALTERNATIVE TECHNOLOGIES

                     There is general agreement among geologists that the United
                States is well on its way to depleting its oil and gas resources.
                There is no consensuf, however, whether this will be in thirty or
                sixty or more years.     The rate of depletion of United States
                energy resources depends on a number of factors, including tech-
                nology and price. Advances in technology, for example, would make
                it possible to extract oil and gas reserves considered marginal or
                even uneconomic in the past. As long as price plays an important
                role, it is not easy to obtain a clear answer from geologists or the
                industry as to the absolute energy resources in the ground except
                that the United States is well on its way to depleting its oil and
                natural resources.

                     This section discusses conservation and alternative technol-
                ogies, including coal, solar and wind energy, which may come into
                wider use in New Jersey within the next ten or more years. They are
                discussed in this paper because they may be the energy sources on
                which we may have to increasingly depend as oil and natural gas
                supplies decline. These alternatives should be considered in the
                energy element of any state's coastal zone management program.

                     A.   Conservation

                     Conservation in this discussion means using energy more
                efficiently. Conservation could reduce pressure on the coast to
                build more and larger energy facilities. In addition, it should        be
                viewed as the bridge between declining oil and gas supplies and the
                newer technologies afforded by solar, wind and coal energy.

                     The impetus for states to develop energy conservation programs
                is provided by the federal Energy Policy and Conservation Act 1975
                (EPCA). This Act provides financial assistance for states to
                develop energy conservation plans and reduce energy demand by       five
                percent by 1980. A five percent reduction in energy consumption in
                New Jersey represents 97 trillion British Thermal units (BTU's),
                the equivalent of one billion gallons of oil.

                     The former State Energy Office (i   ncorporated into the new
                Department of Energy) submitted New Jersey's energy conservation
                plan to the Federal Energy Administration in April 1577. New
                Jersey's conservation plan includes phasing out of gas pilot
                lights, which consume about 8.2 percent of New Jersey's natural gas.
                The State Energy Office projected energy savings of 60 percent in
                the residential and commercial sectors, 30 percent in the industrial
                and 10 percent in the transportation sectors.

                     Each of the main sectors of the economy -- transportation,

                tunities for achieving energy conservation. They are discussed
                commercial, residential, industry and utilities -- offer oppor-

                briefly below.

                                                -26-

                       1.   Transportation and Land Use

                  The automobile has, of course, had the greatest impact on
             dispersing land uses and increasing energy consumption. In 1976,
             the nation's transportation sector, of which the automobile is the
             principal element, consumed 6,960,000 barrels of oil per day. This
             is the equivale@t of 40 percent of the daily demand of 17,280,000
             barrels of oil, or 67 percent of our daily domestic oil pro-
             duction. While state government can provide incentives and sanctions
             for car'and van pooling, pressure has to be applied on the industry
             to produce more efficient gasoline engines or to develop battery
             powered engines.

                  Not only is the automobile a significant consumer of energy,
             but it has had a revolutionary effect on dispersing land uses and
             human settlements. Most notably it has produced suburbia, a notor-
             ious consumer of energy and land resources.

                  The Cost of Sprawl, a recent study for the Council on Environ-
             mental Quality (CEQ), shows that significant energy savings can
             be achieved by cluster and planned unit developments in contrast to
             the grid patterns which are so costly in terms of laying down roads
             and utility lines. The CEQ study found, for example, that clusterd
             developments can save 8.14 percent energy as a result of reduced
             auto travel, and lessen air pollution, while at the same time
             conserving open space and preserving wildlife. The study also found
             that shopping centers were 20 percent less   costlY4 to build and
             service than shops built along strips of highway.

                  While it is too late to change existing land uses, the New
             Jersey Office of Coastal Zone Management has the opportunity under
             CAFRA, the Federal Coastal Zone Management Act and implementation of
             the State's energy conservation plan under EPCA to ensure that
             developer-s and local planning agencies consider clustering and
             planned unit developments as alternatives to the traditional patterns
             of land development.

                       2.   Residential and Commercial

                  Space heating constitutes a major item of energy used in the
             residential and commercial sectors. Rising fuel bills and the
             severe winter of 1977 exposed a major weakness in the construction
             of homes and buildings. Many people in self-defense insulated
             their homes to keep in the heat. New Jersey's energy conservation
             plan provides incentives for a more organized home insulation
             program.

                  Energy conservation building codes are probably the most
             efficient mechanism for producing energy consumption savings in
             the home and commercial sector. Updated codes should, for example,
             prohibit the type of office building that it is totally dependent
             on year-round air conditioning, heat and ventilation. As of 1977,
             New Jersey has a Uniform Construction Code, enacted to standardize
             the various municipal building codes. Energy sub-code regulations
             to be issued later in 1977 will 5address insulation, glazing of
             windows, lighting and the like.

                                            -27-

                         3.   Industry

                    industry provides many opportunities to conserve energy both in
               the way that it uses energy and in the products that it makes, such
               as automobiles, boilers and appliances. EPCA, for example, mandates
               that automobile manufacturers produce more energy efficient cars and
               that industry label electric appliances as to their energy efficiency.

                    One of the most substantial impacts that large industries could
               have on conservation would be to adopt cogeneration as a way of
               doing business. Cogeneration is the process hereby one unit of
               energy is used twice resulting in a net energy saving. It is used
               mostly by steam-using plants which can use the energy to first
               generate electricity and then reuse it at a lower temperature to
               provide steam. Excess electricity, beyond industry's needs, is
               delivered to the utility. In West Germany, cogeneration provides 29
               percent of the country's electricity in contrast with the United
               States where cogeneration constitutes only four percent of electricity
               produced. New Jersey provides two percent of its electricity
               through cogeneration. It has been estimated that the state could
               increase industrial electricity substantially through its large
               number @f steam-using industries, such as large food and chemical
               plants.
                    To be successful, excess electricity ha's to be fed into the
               utility's grid system. This presents a potential problem since this
               would necessitate new agreements between industry and utilities, as
               well as initial costs for equipment to hook up industry and utility
               equipment. While the incentive for such arrangements never existed
               in the past when energy was cheap and when discounts were offered to
               large volume users, this situation no longer holds. Under a rigidly
               enforced conservation program, incentives to cogenerate electricity
               could be provided, at least, during the initial start up period.
               Beneficial spin-offs of cogeneration to the utilities include
               reduction in the need for peaking equipment and the assurance of
               dependable supplies of electricity during peak periods. The sale
               of excess electricity to the utility on a guaranteed basis would
               thus help the latter in meeting peak load demand and possibly
               reducing the need for new generating equipment.

                    Heat recovery is another way in which industries could con-
               serve energy. Counties and municipalities, faced with enormous
               solid waste problems, spend money transporting garbage to land-
               fill sites and spend time worrying about where to find new sites
               for landfills. Methane, a byproduct of solid waste combustion,
               is an adequate substitute for natural gas which was in such short
               in January and February of 1977. Such gas could be used to run
               generators. It would be much more beneficial to recover heat
               energy from solid waste than dot the landscape with landfills
               which preempt other land uses.

                    Sludge could also be recovered and converted to heat. At
               present sludge is dumped at sea at considerable financial and
               environmental cost. The burning of sludge could produce gas
               which could be used to power gas generators. Not only would the
               .sludge be recycled to produce energy, but it could help save the

                                             -28-

             ocean adjacent to New Jersey which through algae bloom and fishkills
             in 1976 served notice that its capacity to absorb wastes was not
             unlimited. The technology of resource recovery is new. What is
             needed to make it marketable are incentives and, possibly, demon-
             stration grants. Such incentives must come from both the state and
             federal government. New Jersey should also lobby the federal
             government to restructure interstate freight rates in favor of
             transporting recycled rather than virgin materials.

                       4.   Utilities

                  Utilities are both producers and consumers of energy. As
             consumers, they are becoming increasingly significant as Table 2,
             Section II shows. Possibly the greatest contribution that utilities
             could make to energy conservation would be to reduce peak demand.
             Peak demand is the load which customers place on the generating
             system during extreme periods of heat or cold when everyone turns
             on the power switch at once. Peaks occur on a daily basis, on
             mornings and evenings, for example, as people are leaving and
             returning from work. Seasonal peaks can occur on a hot and humid
             summer's day when everyone turns on their air conditioning or in the
             depth of winter when everyone turns up thermostats simultaneously.
             Peak loads are generated more frequently on an average in the winter
             than in the summer.

                  "Base" load represents the consumer's average demand on the
             electric generating system of the utilit-ies. Peak demand constitutes
             the highest demand that a customer will make on a utility at any
             time. Utilities project their need for new power plants and equip-
             ment on peak rather than base loads.

                  Utilities have a duty to supply peak loads even when these
             occur only infrequently. To meet these peaks they have to build
             equipment which is expensive but which stands idle for much of
             the year representing a loss of valuable resources. Some New
             Jersey utilities supplement their base loads (regular operating
             equipment) with gas turbines. These turbines are more expensive in
             terms of operating costs though they are less expensive in terms of
              apital. Some utilities, however, build peaking units solely to
             satisfy peak demands. From an economist's point of view such an
             c

             investment is a poor one. From an environmental point of view, such
             plants, in that they preempt other uses to which the land they
             occupy could be used, represent a lost opportunity, since power
             plants usually locate adjacent to rivers, streams or shoreland on
             which society places a premium.

                  There is no real incentive, however, for utilities to seek
             alternative ways of meeting peak demands because they are entitled
             @y law to a fixed return on their capital investment. A reduction
             in peak demand could, however, mean the building of fewer plants.
             Recent studies indicate that a reduction of even one percent in
             the growth rate can redu5e peak demands and sometimes the need for
             additional power plants.

                                           -29-

                     Reducing or leveling peak demand through rate restructuring has
                been suggested as one way of lowering peak demand and reducing the
                need for peak capacity or equipment. Both Public Service Electric
                and Gas (PSE&G) and Jersey Central Power and Light (JCP&L) are
                experimenting with this. The rationale behind restructuring rates
                is to offer price incentives to the customers so they will find
                it more profitable to use appliances during off peak hours and
                promote greater efficiency of generating equipment around the clock.
                The extent to which people will allow rates to influence their
                lifestyle is the subject of PSE&G and JCP&L studies. Price restruc-
                turing, it is believed, will encourage energy conservation. Tradi-
                tionally it has been the high volume (industrial) user, who has
                profited from discounts rather than the low volume residential
                user who has had to pay a minimum fee for power whether or not it is
                used. Restructuring industrial rates needs more study since some
                users have to use a fixed amount of energy in the manufacturing
                process. Altering the rate structure could be economically detri-
                mental. This is, naturally, why large volume industrial users of
                energy should investigate the feasibility of cogeneration.

                     B.   Coal

                     Coal, which was at one time New Jersey's principal energy
                source, today constitutes 3.5 percent of New Jersey's energy
                supply. Emissions, high handling and transportation costs have
                all but eliminated its use in favor of the cheaper oil and gas.
                With rising prices, depletion of domestic oil and gas sourcesf
                growing dependence on foreign energy sources and the advent of
                nuclear power, coal is being looked upon anew, especially as
                United States recoverable reserves of coal are on the order of 1.50
                billion tons of which we only 8used 665 million tons in 1976, or less
                than one half of one percent.

                     Unfortunately, 93 percent,of low sulfur coal, the only kind
                that federal regulations permit to be burned, is located in the
                West. To make coal burning in the East feasible, pollution control
                technology is needed to remove sulfur from the coal. Some of
                this technology, such as scrubbers, is available but is expensive.
                .It is unlikely, therefore, that utilities will generally install
                expensive pollution controls until other energy becomes as or more
                expen-sive.

                     There is a considerable ongoing debate concerning the cost
                of co,al versus-nuclear power, with both proponents and opponents
                claiming a cost advantage. A cost comparison, however, includes
                so many variablez on which debaters place different weights, that
                objectIvity Is hard to come by. What can be said,*however, is
                that the difference in cost between nuclear and coal plants Is
                .narrowing -rap-idly to the point where they may be considered almost
                -about equal,.9

                                               _30-

                   While traditionally it has been soft,.bituminous coal which
             has been burnt by the utilities, the New Jersey Department of
             Environmental Protection has been looking at anthracite coal which
             has a low sulfur content but which cann?h be burned in existing
             boilers because of its hard properties,      which make it difficult
             to grind down to manageable proportions.       The use of anthracite
             coal would entail changing boiler equipment and result in higher
             prices, at least during the switchover period. Again, tax credits
             might have to be offered to make the switch more palatable to
             utilities.

                   C.   Solar Energy
                   From a pollution perspective solar energy is nea5ly ideal. The
             problem has been to concentrate this energy (2.4 x 10        BTU's
             per yeff) which is dispersed at a relative low intensity over the
             earth.     While research is underway to harness solar power in the
             future to  generate electricity, solar heating and cooling systems
             are already commercially available in New Jersey.

                   The most simple or "passive", method of solar heating consists
             of capturing sunlight through a glass and dark metal collector,
             with the glass trapping the energy and the dark metal serving to
             convert it to heat. The heat is then stored in air or water con-
             tainers and conducted through space by convection. Passive solar
             systems can also incorporate design features in buildings to take
             advantage of the sun's daily and seasonal patterns. A more sophis-
             ticated "active sys@em" uses pipes and valves to circulate the heat
             to where it is needed. Heat could be stored for several days in
             New Jersey even when the sun is not shining; however, most solar
             energy users today rely on backup fossil-fueled or electrical
             system to tie them over during prolonged sunless periods. The
             application of sunlight for cooling and air conditioning is based on
             the same principle as that for heating - only in reverse. Solar
             receptor panels, which are normally opened to let in the sun for
             heat, are closed during the day and opened at night to use the
             radiant cooling power available from the night air.

                   D.   Wind Energy

                   The marketing of wind systems seems to be further away than
             solar energy systems. More needs to be known about the capacity
             of the wind to produce energy on a continuing basis. Also more
             needs to be known about the optional size and capacity of wind
             generators and the market that these might serve. Unlike solar
             energy, wind cannot be directly stored. This means that consumers
             may need backup systems. These are questions which need to be
             further studied. If wind and solar energy are the energy resources
             of the future, builders and architects will have to give more
             attention to siting such facilities so that the efficiency of these
             resources will be maximized.

                                             -31-

                    E.   Other Sources

                    Geothermal energy, which comes from hot springs, has not
               been discussed because New Jersey does not have such springs.
               Hydro-electric power has not been discussed either, in view of
               New Jersey's potential for this source.

                    F.   Conclusion

                    This chapter has discussed some short- and long-term altern-
               atives to today's energy resources. As long as New Jersey is
               heavily reliant on foreign fuels, this state will probably have to
               pursue the various options in tandem until one or two energy tech-
               nologies emerge which particularly favor the New Jersey economy.

                    Hindering the New Jersey Office of Coastal Zone Management's
               energy facility siting planning is a lack of consensus concerning
               New Jersey's future. If rapid growth, as the utilities would have
               one believe, is to be the goal, then more energy facilities will be
               needed. On the other hand, if the State's future has slower growth
               or (not likely) zero growth, it may not be necessary to build some
               of the large scale, high investment facilities projected for the
               next decade. In the latter case, a strict program of conservation
               and the introduction of more energy efficient technologies such as
               cogeneration, plus solar and wind power, could start to replace some
               of the large scale facilities which have such a large impact on
               surrounding coastal land and water systems. There may be a trend
               towards at least slower growth, as the state undergoes the agonizing
               switch from a manufacturing to a service economy and as it is losing
               its traditional industrial base.

                                             -32-

                                         Footnotes
            ISee U.S. Geological Circular #725, "Geological Estimates of
             Undiscovered Recoverable Oil and Gas Resources in the United
             States", U.S. Geological Survey, Reston, Va., 1975.
            2Energy Policy and Conservation Act of 1975.
            3oil and Gas Journal, January 31, 1977, page 107.
            4Real Estate Research Corp., The Cost of Sprawl, prepared for the
             Council of Environmental Quality, April 1974 page 15, 24, 11-13.
             Table 4 showed that utilities in high density planned communities
             cost $3,335.00 in contrast to $5,151.00 and were 64 percent less
             expensive than utility lines in sprawled out developments. The
             study pointed out, however, that high concentrated development
             produces air pollution which is not present in the low sprawl
             situation.
            5Uniform Construction Code, P.L. 1975, New Jersey Administrative
             Code Chapter 23 Title 5.
            6Roger W. Williams, The Potential for Electricity Generation
             as a Product of Industrial Steam Production in New Jers.@y, Princeton
             University, Center for Environmental Studies; Report #31, June
             1976.

             See, Peter M. Meier and David Morell, Issues in Clustered
             Nuclear Siting, Policy Analysis Division, Brookhaven National
             Laboratory, New York, September 1976, p. 10 and Dubin-Bloome
             Associates, A Study of Electrical Energy Usage in the Public
             Service Electric and Gas Company, Service Territory of New Jersey,
             June 1976, Figure 1-4, p. 19.

             USGS estimates that total coal resources approximate 3.21
             trillion tons, National Petroleum Council, U.S. Energy Outlook,
             December 1972, page 135. The 665 million tons figure comes from
             the Federal Energy Administration. It includes bituminous and
             lignite coal, but not anthracite coal.
            9See, for example, Charles Komanoff, Power Plant Performance,
             Council on Economic Priorities, New York, 1976. The study compares
             nuclear and coal capacity factors among the variables. Capacity
             factor is the net generating capacity over a year. The study
             shows that while projected at 70-80%, nuclear plants through
             the year 1975 have actively operated at 59.3 percent. Coal plants
             have performed at 66.9 percent between 1960-1973. This has been
             criticized by the Federal Energy Administration.
            10 Anthracite coal is hard coal. It has a lower volatility
               than soft bituminous coal and would require utilities to make
               change in design if used in existing boilers.
            11 University of Oklahoma, Science and Public Policy Program,
               Energy Alternatives: A Comparative Analysis, May 1975    15  page
               11-3. Note that-the U.S. uses about 15 quads (15 x 10       per
               year). 2.4 x 10'" represents 18,000 times of much energy
               as is consumed world-wide.

                                            -33-

               IV. PROPOSED ENERGY FACILITIES

                    This section describes the environmental and land use impli-
               cations associated with siting energy facilities which have been
               proposed for the coastal zone. The range of facilities includes
               Outer Continental Shelf (OCS) exploration and development activ-
               ities, nuclear and conventional electric generating stations,
               liquified natural gas (LNG) terminals and deepwater ports.

                    A.   Outer Continental Shelf Exploration and Development

                         1.   Issues

                    New Jersey's strategic location adjacent to the Baltimore
               Canyon in the Atlantic Ocean could make the state a center for OCS
               activities and add impetus to its petrTchemical industry, which is
               already New Jersey's leading industry.   The development of
               hydrocarbon resources might also increase New Jersey's access to oil
               and, especially natural gas, making it.less vulnerable to the type
               of curtailments which closed schools, and plants and laid off
               workers in January and February of 1977.

                    Some, noting that oil and gas reserves in the Baltimore
               Canyon may be equivalent to less than six months of total United
               States consumption of oil, question whether the disruption to the
               environment is worth the benefit. They are opposed not only by
               industrial and pro-development groups, but also by the southern oil
               producing states who are questioning why they should continue to
               supply New Jersey with hydrocarbon fuels with sacrifice to them-
               selves while New Jersey is unwilling to make the same sacrifice.
               (This assertion ignores that New Jersey has all of the petroleum
               fuel cycle except the production of crude oil.)

                    Generally, however, the OCS issue concerns mitigation of the
               adverse impacts of OCS development rather than outright opposition.
               Even spokesmen for the three counties of Ocean, Atlantic and Cape
               may, which are involved in the law suit which voided the August 1976
               lease sale, have stated that they are not so much opposed to off-
               shore development per se as they are to the manner in which it is
               being done by the U.S. Department of Interior's Bureau of Land
               Management.

                    The State's position, espoused by the Governor of New Jersey
               in testimony in Atlantic City on the draft Environmental Impact
               Statement prepared as part of the process of leasing offshore tracts
               before the Bureau of Land Management in January 1976, has been to
               strike a balance. in that testimony, the Governor opposed "refinery
               construction on the beaches or any other development... incon-
               gruous to the special character and lifestyle of New Jersey's
               seashore towns", and welcomed the "establishment of OCS-related
               onshore facilities that are compatible wit@ the coastal environment
               and... [the] economic interest in tourism".

                                             -34-

                       2.   Background

                  Depletion and the resulting cutback in production of
             domestic gas and oil and the increasing dependence on foreign fuels
             resulted in a presidential directive in 1973 to accelerate explor-
             ation of frontier areas, including the Outer Continental Shelf lands
             adjacent to New Jersey's coastal waters (known as the Baltimore
             Canyon) for new sources of these fuels. Geologists believe that
             sediments in the Baltimore Canyon are similar to those found in the
             Gulf of Mexico and th@t the Baltimore Canyon may hold sizable
             hydrocarbon reserves.

                  The U.S. Department of the Interior shortly thereafter sche-
             duled two lease sales in the Baltimore Canyon: lease sale #40 and
             #49. Interior has also scheduled lease sale #42 in the North
             Atlantic Ocean offshore Massachusetts on the Georges Bank. Lease
             sale #40 took place in August 1976. Lease Sale #42 is now sche-
             duled for 1978 and Lease Sale #49 for 1979. Lease Sale #40 yielded
             $1.1 billion in bids for 93 tracts leased; companies which were
             successful in obtaining leases are listed in Table 7. The location
             of tracts leased in August 1976 are illustrated in Figure 5. It
             should be noted that the majority of the oil companies which obtained
             leases in August 1976 have oil refineries either in northeastern New
             Jersey (Chevron, Exxon, and Amerada Hess), or on the New Jersey side
             of the Delaware River (Mobil and Texaco), or across the Delaware
             River in Pennsylvania (Atlantic Richfield, Gulf and Sun) or in
             Delaware City, Delaware (Getty Oil). Only Shell Oil, the second
             highest bidder with fifteen tracts, has no refineries in this
             region, but does own a large tract of land in Gloucester county
             along the Delaware River, where construction of a refinery was once
             proposed.

                  If the U.S. Department of the Interior's projections are
             correct, 1.4 billion barrels of oil and 9.,f trillion cubic feet of
             gas could ultimately be 5ecovered from this sale over a twenty to
             twenty-five year period.   This breaks down to 16 million barrels
             a year or 43,835 barrels per day in the low case and 56 million
             barrels a year or 153,424 barrels a day in the high case. If these
             federal estimates are correct and if the current United States
             demand of 17 million barrels a day stays constant, OCS resources from
             Lease Sale 40 would contribute only one-fourth of one percent in the
             low case and nine-tenths of one percent in the high case. Put still
             another way, Lease Sale 40 would provide 23.5 days of the nation's
             current oil consumption in the low case and 82.3 days of its con-
             sumption in the high case. Increasing demand could, however, reduce
             Lease Sale 40's relative contribution to the nation's oil supply
             still further.

                  The Natural Resources Defense Council, Inc. (NRDC), several New
             York and New Jersey counties, and, for a time, the State of New
             York challenged in federal court the adequacy of the Environmental
             Impact Statement (EIS) filed by the Department of the Interior which
             accompanied the sale. The alleged inadequacies related to the
             failure of Interior to sufficiently address the powers which states
             and local governments have and might exercise to veto pipelines in
             state waters, notwithstanding federal preemption, as well as other
             issues.4

                                           -35-

                    7 6'                            750                             74@                               7'3'                           72         R   I       "'j '@@77
                                                        %-
                                                             1%                 NEW YORK                             CONNECTICUT
                                                          go 10
                     410                                                                                                                                                                                  4 1*

                     PENNSYLVANIA
                                               r                                    i New York
                                               I                                            City
                                               I-IN

                                                             NEW JERSEY

                                                                                                                                                                                                          4 0'-
                                                                                                                                                                    %:
                                                                                                        :in@
                     00
                    Philadelphia(L'                                                                                                                                ---- --

                                                                                                                          .......           ..           ...
                                                                                                                                              A
                                                                                                                                                                %%

                                                                                           c
                                                                                tlanti                                      .........
                                                                                City           X.

                                           %

                                                                                                                                                                                                          3
                  -390

                                                    Rehoboth
                               DELAWARE
                                                       Beach

                           MARYLAND
                                                                       ..... .       .... %

                                                                                ...........

                                                                      ............
                                                               ......                                                                                                                                     38*
                 -3
                                                                                                                                             Figure 5;

                                                      ... ...... ..                                                                  -"ION OF TRACTS LEASED III
                                                                                                                            LOCA'@
                                                                                                                            AUGUST 197,,) IN RELATION TO THE
                          VA.
                                                                                                                            NEW JERSEY COAST
                                                                           X

                                   .........     ....                                                                                    leased areas (sale #40)
                                                                                                                            Industry Interest in Lease sale 4V:
                                                      .......                                                                                                                                             37*-
                    370

                                                                                                                                         call area boundary

                   VA.
                                                                                                                                         high interest areas

                                                                                                                                         low interest areas

                   N.

                                                                              11.10     50 miles
                                                                                                                                                                                                          360-
                    36'
                    6-                             7 15-11 el                         7 14'                 306           73*                                 7 (2'                              71f
                        N.J. Department of Environmental Protection                                                       Office of Coastal Zone Management

                   A February 1977 lower court decision was overturned in August
             1977  by the U.S. Second Circuit Court of Appeals in New York which
             held  that:

                   While speculation in an EIS is not precluded-There comes
                   a point when the chain of 'jfs" gets too long and too tenuous
                   to be of any practical usel.

                   Even so, the recently issued Final Env    ironmental Impact State-
             ment  on Lease Sale 42 discusses potential pipeline routes from
             the Georges Bank to the coast of Rhode Island and Massachusetts.
             This indicates somewhat ironically that the litigation connected
             with Lease Sale 40 while not securing the assurances sought by the
             plaingiffs, did benefit analysis of the issues in the subsequent 42
             sale.

                                              -37-

                                                 Table 6
                                Successful Bidders in Lease Sale #40
                                               August 1976

                           Companies                                  Tracts Leased

                Exxon                                                         30
                Chevron/Atlantic Richfield
                       (This group also includes: Hamilton
                       Brothers oil Co., Murphy Oil Corp.,
                       Ocean Production Co., and ICI Delaware
                       Inc.                                                   13
                Shell  (This group includes: Cities Services
                       CO., Continental Oil Co., Louisiana
                       Land & Exploration Company, U.S. Steel
                       Corp., Energy, Development Corp.,
                       (subsidiary of Public Service Electric
                       and Gas of New Jersey) Sante Fe Minerals,
                       Weeks Natural Resources, Inc., and
                       General American Oil Co. of Texas)                     12
                Continental Oil                                               9
                Murphy                                                        8
                Mobil Oil (This   includes: Sun Oil Co., Getty
                           Oil Co., Amerada Hess Corp., Diamond
                           Shamrock Corps., and Anadarko Pro-
                           duction Co.                                        7
                Houston Oil and Minerals                                      4
                Gulf Oil                                                      3
                Tenneco                                                       2
                Texaco (This group includes Skelly Oil, Allied
                        Chemical and Transco.)                                2
                Transco                                                       1
                Sun Oil                                                       1
                Union Oil                                                     1

                Source: Derived from "Bid Recap By Area and Tract", U.S. Department
                          of the Interior, Bureau of Land Management, Computer Print-
                          out, Report 1, Lease Sale 40, August 17, 1976.

                                                  -38-

                Some companies expect to be drilling in the Atlantic Ocean
           before the end of 1977. Already they have filed a "Notice of
           Support Activity" in accordance with a stipulation attached to
           the leases acquired August 17, 1976. These Notices are addressed
           to the Governor of states affected by Lease Sale 40 and include
           information on expected facilities, employment and supplies required
           as a result of the Sale. As of this writing (September 1977)
           companies which have submitted "Notices" intend to use Atlantic City
           for their helicopter operations and Rhode Island as their suppo5t
           base. (See below for definition and function of Support Base).

                The following are the major federal permits which are required
           before drilling can commence:

                -Application for Permit to Drill from U.S. Geological Survey
                 (30 CFR 250)

                -Section 10 Permit from the U.S. Army Corps of Engineers
                 (Rivers & Harbors Act). This permit is to construct, install,
                 maintain and operate structures and appurtenances required for
                 oil and gas drilling.

                -National Pollution Discharge Elimination System (NPDES)
                 from the U.S. Environmental Protection Agency (Federal Water
                 Pollution Control Act of 1972). This covers discharges from
                 drilling operations.

                Before going further, it may be useful to describe what
           may be expected to occur should OCS development occur.

                     3.   OCS Scenarios -- What to  Expect

                The first phase in OCS development  is the exploration of
           the tracts to determine if the expected  resources do, in fact,
           exist in commercial quantities. During   this phase, companies will
           set up staging areas along the shore to  permit supply and crew
           boats to service the rigs which will be  drilling exploratory wells.
           Staging areas consist of docks and berthage space and require up to
           five acres of land for office space and open and closed warehousing
           for fuel and material storage. A helicopter pad is a necessary
           adjunct to such a facility. Staging area facilities may be shared
           by several companies to provide economies of scale. One major
           technical requirement of a staging area is that it have channel
           depth of between 15 and 20 feet for the service and crew boats
           shuttling back and forth to the offshore tracts. In New Jersey, the
           channel depth requirement may limit staging areas to the Port of New
           York and New Jersey, Atlantic City, Cold Spring Harbor in Cape May
           County and the harbors'along the Delaware River. The exploration
           phase may last from one to five years, depending on the results of
           drilling. The most visible and audible impact in New Jersey during
           this phase may be the helicopters shuttling back and forth to the
           offshore rigs.*
                If exploration is successful, the stage could be set for
           development drilling, which constitutes Phase Two. Exploration and
           development frequently overlap. For example, development could take
           place one year following successful exploration in one area, while
           less successful exploration could continue for several more years
           without development drilling in other areas.
                                          -39-

                     During the development stages, large steel drilling platforms
                will be built at some locations and floated into place offshore.
                Platform building is not expected to take place, at lease initially,
                in New Jersey. Instead, platforms may be built in the Gulf of
                Mexico, in shipyards along the Chesapeake Bay or in Newport News and
                floated into position. Permanent staging areas will also be sought.
                This might involve conversion of the temporary (exploration phase)
                base to permanent status. During the early development phase,
                associated industries which, for example, supply drilling mud and
                tools and diving services, will move into the area. During this
                phase, pipelines may be planned and built and land acquired for the
                storage of materials. In the late development stage, tank farms,
                processing plants and other facilities, such as booster stations (to
                pressurize oil and gas in pipelines to keep it flowing) may be
                built. Although tankers have not been ruled out, there is a
                strong likelihood that pipelines to shore will be constructed if at
                all economically feasible. It is during the development stage that
                economic impacts will be the greatest, with construction providing
                jobs and creating demands for services and housing. Access roads to
                activity centers may also be expected to be congested with trucks
                bringing in materials.

                     During the final phase of actual commercial production, which
                could begin five to six years following a lease sale, there will be
                a winding down of construction jobs and related activity, although
                services such as diving and provision of supplies for the rigs will
                continue. Production itself could last another ten to twenty
                years.

                          4.   OCS Facilities

                     If OCS development takes place, a diversity of onshore facil-
                ities will be needed. For example, while oil can be landed by
                either tanker or pipeline, USGS stipulations require any oil found
                offshore to be pipelined where technically and economically feasible.
                Pipelines will be needed, if not for oil, then at least for gas
                because of the enormous expense involved in liquifying gas for
                shipment by tanker. New Jersey's refinery capacity may have to be
                expanded to refine the Baltimore Canyon oil, especially if New
                Jersey also becomes the refiner of any New England oil discoveries,
                as has been suggested in the Final Environmental Impact Statements
                prepared for New England's Lease Sale (#42) issued in 1977. Some
                refineries may also have to be retrofit or adjust their facilities
                to accommodate Atlantic Ocean oil, the chemical composition of which
                may be different from Gulf of Mexico or Arabian oil and which is
                presently an unknown. High sulfur oil, for example, requires
                different refining and processing than low sulfur oil. In the case
                of gas, processing plants would have to be built to remove impur-
                ities. New Jersey has little familiarity to date with such OCS gas
                processing plants, since none have ever been built here. Discussed
                below are some of the facilities which will have the largest envi-
                ronmental and socioeconomic impacts on New Jersey.

                                              -40-

                           a.   Pipelines

                  The nature of oil and gas make it infeasible to transport oil
             and gas in the same pipeline. While industry has the option of
             transporting oil by tanker or pipeline, this option does not exist
             for gas, because the processes of liquefying and reconverting it
             are very costly. Natural gas pipelines, at the very least, then,
             will be needed to land any Baltimore Canyon gas.

                  Ninety-eight percent of OCS oil is landed by pipeline in the
             United States. It is expected that any find in the Baltimore Canyon
             will also be landed this way. Only if the oil find were to be very
             low -- producing less than about 150,000 barrels per day according
             to industry officials -- would tankers be considered an alternative
             to pipelines.

                  The Final Environmental Impact Statement for Lease Sale #40
             indicated that between 100 and 570 miles of pipeline might be
             needed. Many of these pipelines would constitute small diameter
             gathering lines connected to the various platforms in the offshore
             lease area. The oil coming ashore would be brought back in a large
             diameter, "common carrier" trunk line. Meters off and onshore
             ensure that oil from the different platforms is allocated and
             credited to the appropriate company.

                  The high cost of underwater pipelines ($1.75 million per mile)
             make it desirable that offshore lines be routed along the most
             direct path from platform to shore, except where other constraints,
             such as earthquake or other geological hazards, natural areas of
             overriding concern, shipping channels and the like, exist. A map of
             Lease Sale #40 (Figure 5) indicates that New Jersey's 124 mile ocean
             shoreline will be a prime candidate for any pipeline corridor. This
             has created great concern because of the potential disruption that
             such landfall might pose to the barrier islands, beaches and wet-
             lands. Visits by officials of the N.J. Department of Environmental
             Protection to recently built oil and gas pipeline landfalls in
             Louisiana, Chesapeake Bay and the North Sea indicate that apart from
             temporary disturbances during construction, pipelines can be con-
             structed with no long term adverse impacts. Inspection of landfalls
             in Chesapeake Bay and the North Shore showed that within one
             year of construction, natural vegetation and marsh communities
             reestablished themselves.

                  Fortunately, other facilities associated with pipelines, such
             as pumping stations, are not coastal-dependent and can be sited away
             from the beach, up to five miles inland. Because of scouring and
             wave action in inlets, it is likely that any pipelines which are
             permitted to come ashore in New Jersey will be routed across beaches
             rather than through inlets; this also would reduce conflicts with
             fishing and navigation.

                  Until oil and gas are actually discovered offshore and their
             quantity known, all attempts to locate pipeline corridors are
             speculative. Nevertheless, common sense indicates that the industry
             will prefer to link up any offshore pipelines to the New Jersey,
             Pennsylvania or Delaware refinery complexes. It is also possible
             that, in order to facilitate the acquisition of pipelines easements,

                                           -41-

                attempts will be made to use existing rights-of-way along highways
                and railroad beds.

                     One right-of-way that has been mentioned is the Atlantic
                City Expressway leading to Camden and the refineries bordering oil
                the Delaware River. Currently, this also seems a preferable candi-
                date from the point of view of avoiding offshore hazards such as
                sand waves, clam and fishing grounds, the Shrewsbury Rocks off
                Monmouth County, and shipping channels along the Delaware River in
                the south and Raritan Bay in the north.

                     One area through which pipelines should not be permitted
                (except perhaps along existing established rights-of-way, such as
                the Atlantic City Expressway) are the Pine Barrens 760 square miles
                of which have been singled out by the Department of Environmental
                Protection as a "critical area".   The federal Environmental Pro-
                tection Agency (E.P.A.) in responding to DEP's Call for Information
                on the siting of energy facilities in New Jersey noted that:

                          We recommend that inland development be increased
                          at already industrial areas instead of in more
                          sensitive areas such as the Pine Barrens. This
                          ecosystem is unique to the Northeast and is one 8
                          of the last true wilderness areas in the state.

                     While "inland development" is not defined, it does not seem
                unreasonable to infer that pipelines would be included in this
                recommendation.

                     Aside from their unique aesthetic aspect, the Pine Barrens
                are situated on a deepwater aquifer which might in the future serve
                as a drinking source for southern New Jersey. The presence of this
                water reservoir might, therefore, be another reason for ruling the
                Pine Barrens out as a place to locate a pipeline, or, at the least,
                to insure very stringent requirements to prevent pipeline ruptures.

                     Figure 6 indicates the area in which offshore oil and gas
                pipelines should be excluded. This covers the Mullica River and
                Cedar Creek watersheds and portions of the Rancocas Creek and
                Toms River watersheds which DEP has identified as "critical"
                for water quality and sewerage purposes.

                          b)   Natural Gas Processing Plants

                     in the event that natural gas were found offshore in sig-
                nificant quantities, gas processing plants would be needed and would
                constitute a new industrial activity in New Jersey. Such plants
                would have to be located close to the gas pipeline landfall, but not
                necessarily directly on the shoreline. The plants could be located
                up to ten miles from the shoreline. Gas processing plants do not
                require large amounts of land -- about ten acres per unit -- but
                they do create air emissions. The Final Environmental Impact
                Statement on Lease Sale #40 indicates that between three and eight
                plants might be needed. One plant can process between 300 to 500
                million cubic feet of natural gas per day.

                                              -42-

                                                                   @PASSAIC

                                                                              BERGEN

         Figure 6:
                                            WARREN        MORRiS
         DEFINITION OF
        'PINE BARRENS                                                   @ESSEX
                                                                                   D s 0

                                                         5             UNION
                                                         ",SOMERSET
                                         HUNTERDON

                                                                                ow
                                                         \-_-,)MIDDLESEX

                                                       MERCER            MONMOU

                                                                               ..........

                                                BURLINGTD

                                                . . .........
                                                                                                   PINE BARRENS
                                                                                                   VEGETATION
                                                 .... .......      ........
                                                     ................ ..........
                                          ...........

                                                                      SW
                                                                 A
                                                                                                   OFFSHORE OIL
                                                        ....... ...........
                                                                                                   OR GAS
                                                                                                   PIPELINE
                                                                WV
                            SALEM
                                                                                                   EXCLUSION
                                                                                                   AREA

                                                 .. ........
                                   't U KA(,AAD     ......

                                          ... .. ..........

                                                                             STATE OF NEW JEWY
                                                                              DEPARTMENT OF

                                                       -43-

                         c)   Refineries

                    The Department of the Interior's Environmental Impact State-
               ments on Lease Sale #40 assumed that domestic crude would exactly
               replace foreign crude and that the existing capacity of refineries
               in this area would, therefore, be sufficient to process crude
               petroleum from the Baltimore Canyon. Nevertheless, some believe
               that petroleum from the Baltimore Canyon and Georges Bank may be
               added to (and not totally replace) foreign crude and that total
               petroleum demands in this area might grow. In this case there is a
               possibility that new or expanded refineries would be needed in New
               Jersey. In addition, because of the enormous inve'stment involved il
               building a new refinery, it is possible that the Hess refinery,
               closed in 1974, with a capacity of 70,000 barrels a day, would be
               reopened. Nevertheless in today's economic market a 70,000 barrel
               refinery is considered small and refiners may still prefer to expan(.
               existing plants rather than refurbish the small Hess refinery.

                    Some planners believe it is preferable to cluster or contain
               industrial development in one or two regions within the state to
               protect the environment in other areas of the state. The decision
               to locate a refinery in a concentrated industrial complex might not,
               however, be possible because of air pollution control standards for
               the region which might be exceeded by a refinery. On the other
               hand, the location of a refinery in a comparatively pristine area,
               even if it were not to violate any air pollution standards, might
               arouse community opposition because of satellite industries which
               might start to locate nearby and produce adverse visual, aesthetic
               and odoriferous impacts. In addition, many New Jerseyans fear more
               refineries because of the potential carcinogens they have read mighi
               be related to petrochemical development. Others believe that New
               Jersey already has enough refineries and does not need the compar-
               atively few new jobs -- about 400 -- that are associated with the
               average capital-intensive refinery operation.

                    Refineries are not dependent on coastal locations, but they
               have large cooling water requirements. They could thus be located
               on some inland waterway. To protect the biota in water systems fron
               thermal effects, new refineries might need to be equipped with
               closed cycle cooling as well as the latest air pollution control and
               recovery systems to protect both public health and the environment.

                         d)   Other Facilities

                    Other OCS facilities include support bases, repair yards,
               pipe coating yards and platform construction. At least for some,
               these are the facilities that it would be desirable to attract into
               New Jersey's coastal zone since they are labor-intensive, compatible
               with the marine environment and have no inherent polluting side
               effects. Where at all feasible, ancillary facilities such as
               pumping stations which are not dependent on waterfront access
               should be sited outside of the coastal area designated by CAFRA
               and two miles inland of the ten foot contour interval elsewhere
               in the state.

                                             -44-

                                         Footnotes

              Statement of Governor Brendan T. Byrne at the Department of
              the Interior's Hearings on the Draft EIS for the Proposed Mid-
              Atlantic Oif and Gas Lease Sale, Atlantic City, New Jersey, January
              27, 1976.
             29, Significant Possibilities Line Atlantic Shelf -- Offshore
              U.S. Theaters -4", Oil and Gas Journal, September 13, 1976, p.
              116.

             3
              U.S. Department of the Interior, "Proposed 1976 Outer Continental
              Shelf Oil and Gas Lease Sale Offshore the Mid-Atlantic States
              OCS Lease Sale #40" -- Final Environmental Impact Statement,
              May 1976.

              County of Suffolk et al vs. Secretary of the Interior et al.
              Docket 75C208; The Natural Resources Defense Council, Inc. vs.
              Secretary of the interior Docket 76C1229 Eastern District of
              New York, February 1977.   New York State which was involved in the
              initial injunction of the Lease Sale in August 1976 withdrew the
              case. The New York counties involved are Suffolk and Nassau. The
              Department of the Public Advocate filed amicus briefs on behalf of
              Cape May, Ocean and Atlantic Counties.
             5County of Suffolk, Nassau et al v. Secretary of the Interior,
              National Ocean Industries et al, U.S. Court of Appeals, 2nd
              Circuit, Docket #77-6049, 77-6050, Decided August 25, 1977.

              Final Environmental Impact Statement of Lease Sale #42, 1977,
              at page 668 discusses two routes a potential pipeline could take,
              with the northern route impacting on Massachusetts, New Hampshire
              or southern Maine and the southern route impacting southern Massa-
              chusetts or Rhode Isand. Criteria used to come up with these
              pipeline routes were based on bottom criteria of the Georges
              Bank and potential erosional effects. (Note, because of the
              relatively small find anticipated, the Department of the Interior
              has assumed as its first alternative that tankers rather than
              pipelines will be used to ship oil onshore.)
             7The seven companies which submitted Notices of Support Activity
              are Conoco, Exxon, Gulf Energy and Minerals, Mobil Oil, Murphy
              Oil, Shell Oil and Texaco.
             8Letter from Gerald M. Hansler, P.E., U.S. Environmental Pro-
              tection Agency, dated March 3, 1976, to Commissioner David J.
              Bardin, in response to the DEP "Call for Information". The
              "Call" was issued to energy companies and others in 1975 and
              1976 to solicit information concerning energy facility siting.
              An analysis of responses was issued in March 1977 by the Office
              of Coastal Zone Management.

                                           -45-

                    B.    Nuclear Power Plants

                          1.   Issues:

                    Nuclear energy provides New Jersey with about twenty-five
               percent of its electricity today. This percentage is expected to
               increase as other proposed nuclear units are completed. New Jersey
               utilities claim that nuclear power lessens their dependence on
               foreign oil and contributes to the favorable balance of payments of
               the United States. They also prefer nuclear power because its
               generation violates no air pollution standards, in contrast to
               generating electricity by oil and coal where even a low sulfur
               content may pose air pollution problems in densely populated areas.
               Finally, the utilities claim that nuclear power is cheaper for their
               customers, with the lower fuel and operating costs more than off-
               setting the higher capital costs of nuclear power plants.

                    Despite these advantages, many people in New Jersey are con-
               cerned about increasing reliance on nuclear energy because of the
               possibility, although remote, of a catastrophic nuclear accident.
               The problem of disposing and storing nuclear wastes, which remain
               radioactive for thousands of years, is also a concern. The poten--
               tial misuse of certain nuclear materials for making bombs or cre-
               ating other havoc is also disturbing.

                    These are not issues, however, over which the State of New
               Jersey has much control given the U.S. Nuclear Regulatory Commis-
               sion's preemptive authority in many nuclear matters, including
               issuance of construction and operating licenses to the utilities.
                    Indeed, the State has relatively little leverage ii nuclear
               matters, except with respect to some aspects of siting.         (Legis-
               lation being drafted by the Carter Administration would, if enacted
               potentially enlarge the state's role, but at this writing this
               situation is unclear.) And even here, in the absence of compre-
               hensive land use legislation, such as CAFRA, for example, a muni-
               cipality may have more effective bargaining power than the State,
               since it is the municipality which must ultimately issue the building
               permit. Because of the difficulties that utilities have had with
               obtaining approval for nuclear power generators, one utility, Public
               Service Electric and Gas Company has proposed building an offshore
               floating nuclear generating plant to be anchored out in the ocean
               just within the three-mile limit in the mouth of Little Egg Harbor
               Inlet adjacent to Brigantine National Wildlife Refuge.

                          2.   Background

                    New Jersey has two operating nuclear power plants, four units
               under construction, and two additional proposed units pending state
               and federal. approval (See Table 8 for Existing and Proposed Nuclear
               Plants for New Jersey).

                    The state's first nuclear power plant, the Oyster Creek unit,
               began operating in 1969 and is located in Lacey Township, Ocean
               County. Its proximity to Barnegat Bay has created problems for

                                               -46-

             fishing and boating interests becadbe of the thermal waters which
             are discharged from the plant into Barnegat Bay which have stimu-
             lated the growth of destructive wood-boring shipworms. The warmer
             waters have had the effect of changing migration patterns of
             fish (particularly the Atlantic menhaden, New Jersey's most impor-
             tant coTmercial species) which no longer migrates south for the
             winter.

                                             Table 8
                     Existing and Proposed Nuclear Plants for New Jersey

                  Name of Plant         Operation CAFRA Status       Cooling System
                  and Location

                   Oyster Creek             1969      Pre-CAFRA        Once-Through
                    Lacey Township                                       Cooling
                                                                         (under review)

                   Salem #1                 1976      Pre CAFRA        Once-through
                    Artificial Island                                    Cooling

                   Salem #2                 1979      Pre CAFRA        Once-through
                    Artificial Island                                    Cooling

                   Hope Creek #1            1982      CAFRA Condi-     Cooling Tower
                    Artificial Island                 tional approval

                   Hope Creek #2            1984      CAFRA Condi-     Cooling Tower
                    Artificial Island                 tional approval

                   Forked River             1982      Pre-CAFRA        Cooling Tower
                    Lacey Township

                   Atantic Generating       1985      CAFRA Appli-     Once-through
                    Station (two units)     1987      cation Pending     Cooling

             When the plant closed down,    as it did in the winter   of 1972, 1973
             and 1974 for repairs, the fish, accustomed to the warmer water and
             unable to adjust, died. A plant shutdown in the summer of 1973 also
             resulted in a fish kill leading one court to conclude that (as had
             many biologists previously) sudden change of temperature in the
             plant discharge rather than any specific temperature was enough to
             produce a fish kill. The damage produced by shipworms boring
             away at piers and maSinas in the nearby waters has provoked lawsuits
             against the utility.

                  Jersey Central Power and Light Company is building a second
             unit, the Forked River unit, next to the Oyster Creek plant.
             Although the Forked River plant application was approved by the
             federal government prior to CAFRA, substantial construction work
             did not start until recently, which led DEP's Division of Marine
             Services to call for a CAFRA review. After an appeal by the utility,
             the Hearing Officer declared in October 1976 that the Forked River
             unit was exempt from CAFRA review because sufficient on-site con-
             struction had taken place prior to the effective date to qualify
             for exemption status. Therefore, the Forked River unit did not need
             a CAFRA permit.

                                              -47-

                     Contrary to  assertions that people will not live close to
                nuclear plants because of fears of high radiation levels or an
                accident, Lacey Township (in which Oyster Creek is located) has
                experienced a building boom in recent years. This population
                increase and other factors led the Department of Environmental
                Protection to establish a moratorium in 1976 on large-scale resi-
                dential construction within four miles of the plant, until appro-
                priate land uses surrounding nuclear plants and regulatory measures
                to govern them were more thoroughly explored.

                     Three possible explanations exist for the building boom in
                Lacey Township. First, people are not afraid to live in proximity
                of nuclear plants. Second, the location of Lacey Township in the
                heart of the New Jersey's resort area has such a strong attraction
                as to overcome any other locational disadvantage. Third, low local
                property.taxes in Lacey Township due to the utility's gross receipt
                tax payments,-provide an incentive to live in the municipality.
                (The gross receipts tax is the tax that a utility company pays to
                municipalities which contain generating plants, switching stations,
                poles and wires within their boundaries. The tax constitutes 7.5
                percent of each consumer's utility bill.) In 1974 Lacey Township
                received $5,975,374.37 in tax revenues in contrast to $849,050.94      in
                1965 - a seveefold increase, resulting in low property tax payments
                by residents.

                     The gross receipts tax has also had its impact on another New
                Jersey municipality, Lower Alloways C5eek, which is intended
                to accommodate four nuclear reactors.      There the gross receipts
                tax has also kept down the property tax and increased the number of
                municipal services. To what extent building has taken place in the
                remote location (far from any popular recreational resort) is as yet
                unknown since the building moratorium that was imposed on Oyster
                Creek applies also to Lower Alloways Creek. At present one plant,
                Salem #1, is operating on Artificial Island, which is really a
                peninsula built up from dredge spoils by the Army Corps of Engineers
                earlier this century. Salem #1 began operations in late 1976. Both
                Salem #1 and Salem #2 were under construction prior to the enactment
                of CAFRA.

                     Hope Creek was the first power plant of any sort that was
                reviewed under CAFRA. It was granted a conditional permit. Condi-
                tions ranged from requiring the utility to notify DEP's Bureau of
                -Radiation regarding shipments of radioactive materiafs, refueling of
                spent fuel rods, status of storage capacity for spent fuel rods,
                potential fish mortality resulting from plant shutdowns, to banning
                the use of mixed uranium/plutonium oxide fuel rods at the Hope Creek
                facility.

                     Both the Public Interest Research Group of New Jersey and
                the Department of the Public Advocate challenged the issuance of
                CAFRA permit because of potential risks posed by the passage of LNG
                                                                                      the

                tankers past the nuclear facility. These safety questions have not
                been fully resolved although the Nuclear Regulatory CoWmission has
                issued a construction permit for the Hope Creek units.        (This is
                discussed in further detail under the LNG section.)

                                                -48-

                  The second major energy facility permit application under CAFRA
             was submitted by Public Service Electric and Gas Company on August
             20, 1974. The proposal calls for the construction of two floating
             nuclear reactors, mounted on a barge to be located 2.8 miles off-
             shore northeast of Atlantic City, the so-called Atlantic Generating
             Station. The concept of an offshore plant was intended by the
             utility to eliminate some of the problems associated with siting
             nuclear plants on land. It has, however, produced its own problems
             concerning, for example, the implications of a potential steam
             explosion on air and water which might result from a malfunction,
             such as a core meltdown, of the plant. The N.J. Office of Coastal
             Zone Management is awaiting the release of the final environmental
             impact statement and other important analyses on the offshore plant
             by the Nuclear Regulatory Commission before reviewing this application.

                       3.   Public Health and Safety Factors

                  This section discusses public health and safety issues relating
             to nuclear energy production and siting.

                            a.   Nuclear Safety

                  The greatest concern regarding New Jersey's increasing reliance
             on nuclear power for electric generation purposes is the possibility
             that a major reactor failure might occur, particularly a failure in
             the cooling system. Such an accident could result in the fracturing
             of the plant structure and the release of long-lived radioactive
             particles to the environment. The Reactor Safety Study (WASH-1400)
             performed for the N.R.C. indicated that the likelihood of a reactor
             accident was gmaller than that of many other accidents with similar
             consequences.   Specifically, WASH-1400 found that dam failures,
             airplane crashes and earthquakes were at least as likely to occur as
             a major reactor accident and that the harmful effects of such
             accidents were comparable to, or greater than those of a nuclear
             plant accident. WASH-1400 has been criticized by others, including
             the U.S. Environmental Protection Agency, as potentially under-     10
             estimating the true dangers entailed in nuclear power development.
             Dr. Glenn Paulson, Assistant Commissioner for Science within the
             Department of Environmental Protection in a speech before the
             American Nuclear Society in August 1977 referring to the WASH 1400
             study, noted that the science of statistical risk analysis did not
             deal adequately with the probability of a series of simultaneous
             failures. The risk analysis did not, for example, anticipate or
             make allowances for the series,of events that led up to the fire at
             the Tennessee Valley Authority's Browns Ferry reactor. He noted
             that to reduce some of these uncertainties, New Jersey had petitioned
             the American Atomic Energy Commission in 1974 -- unsuccessfully as
             it turned out -- to conduct analyses concerning the consequences of
             a Class 9 accident which is considered the worst type that could
             occur and which is becauseilt is considered so unlikely, is some-
             times called "incredible".

                  As a consequence of the remote but nevertheless real possi-
             bility of a reactor accident, there is concern regarding the need
             for control over population densities in the vicinity of nuclear

                                            -49-

               plants. NRC regulations (10 CFR 100) require that nuclear facil-
               ities be located in sparcely populated areas so that protective
              ,measures, such as speedy evacuation, can tak place in the event of
               an accident. A major factor in the 1973 decision of the staff of
               the then U.S. Atomic Energy Commission to reject Newbold Island in
               the Delaware River as a site for the Hope Creek nuclear plants now
               being built at.Artificial Island was the high population density in
               the Philadelphia-Trenton area surrounding Newbold Island. Unfor-
               tunately NRC does not review or regulate population growth around
               nuclear plants once they are built. The tripling of homes with a
               four mile radius of the Oyster Creek plant from 3162 to 9507 between
               1965 and 1976 led the Commissioner of DEP in M arch 1976 to declare a
               building moratorium around nuclear plants until the safety aspec@2
               of living in close proximity to such plants have been satisfied.

                         b.   Disposition of Spent Fuel

                    The currently used method of disposing nuclear waste are
               considered by many to be as great a problem as that relating to the
               safety of operating a nuclear plant. This is because of the radio-
               active nature of nuclear wastes, which may take several tens of
               thousands of years to decay. A short term problem relates to the
               transportation of the spent fuel to a secure disposal site. The
               long term problem is to secure a suitable storage site and ensure
               that none of the poisonous waste will escape into the atmosphere or
               leach into the groundwater table where it could contaminate a future
               drinking supply.

                    The Coastal Area Facility Review Act specifically charges
               the Commissioner of the Department of Environmental Protection (DEP)
               to consider the disposal of nuclear wastes from any facility that
               may be approved to assure that the proposed method for disposal of
               radioactive waste material to be produced or generated by such
               facility will be safe, conforms to standards established by the
               Nuclear Regulatory CommisH on and will effectively remove danger to
               life and the environment.

                    And indeed, in the review of the Hope Creek nuclear generating
               plant by DEP the Commissioner made formal findings that:

                    The proposed method for disposal of radioactive
                    waste material... M will be safe insofar as it
                    takes place within the State of New Jersey...
                    (ii) conforms to standards established by the
                    Nuclear Regulatory Commission and (iii) will
                    effectively remove danger to life and the envi-
                    ronment from such waste material ?iovided the
                    conditions of the permit are met.

                              C.   Nuclear Theft

                    Nuclear-powered electric generation may represent a public
               health and safety concern for New Jersey if plutonium is used in the
               future as a fuel in the state's light water reactors (LWR). During
               the fissioning of uranium-23@, plutonium-238 is produced as one

                                             -50-

             by-product of the reaction. Through reprocessing of the used or
             "spent" fuel, plutonium may be recovered for subsequent use as a
             primary fuel in LWRs. A concern is that plutonium could be stolen
             or otherwise illicitly diverted for use in the fabrication of
             nuclear weapons. In view of the lack of adequate safeguards for the
             handling of plutonium fuel, the U.S. Nuclear Regulatory Commission
             decided in 1975 to defer any decision to proceed with plutonium
             recycling.

                       4.   Environmental Impacts

                  The major environmental impacts of nuclear plants relate to
             water consumption and thermal pollution. Nuclear plants require
             thousands of gallons of water per minute for cooling when once-
             through cooling systems are used. "Once through" cooling consists
             of water being taken up through a valve, routed once through the
             reactor coolong system, and discharged into a receiving body of
             water. The Oyster Creek plant, for example, uses 640,000 gallons
             per minute in its "once through" cooling system. The.source
             of the cooling water - whether river, estuary or bay - is one area
             of concern. This factor may influence the rate of dilution of the
             heated effluent and salinity values in coastal waters. Also, the
             manner in which the water is discharged is important. Where the
             cooling water is discharged directly into a receiving body, such as
             the ocean, a river or a bay, it may adversely0 affect marine life
             because of the rise in temperature -- from 16 to 20OF -- that
             resulted during its passage through the plant. Mention kills due to
             absence of heat as well as extra heat.

                  Oyster Creek, a single reactor unit, is already, after eight
             years of operation, considered one of the older nuclear plants in
             the U.S. Newer nuclear plants are often built in units of two.
             When such plants are designed with "once through" cooling systems,
             they have the advantage that one unit can continue to function while
             the other is under repair or shutdown. This can minimize the sudden
             drop in temperature and shock which resulted in some of the fish
             kills in Oyster Creek.

                  Until screens were placed over the intake water valves in
             nuclear reactors, many marine organisms and fish larvae were sucked
             into the cooling mechanism by virtue of the force or velocity
             exerted by the intake system. Efforts have been made to reduce
             these intake pressures, but marine organisms continue to be entrapped
             in many plants operating today. This is a disadvantage of once-
             through cooling and, to a lesser extent, other cooling techniques as
             well.

                  Alternatives to "once-through" cooling systems exist in the
             form of cooling ponds, which require much land, and cooling towers.
             Towers evaporate the waste heat into the air thus and reduce the
             thermal impact upon the receiving waters. The proposed Forked River
             plant to be located next to Oyster Creek is designed with a tower
             approximately 500 feet high. The two Hope Creek plants on the
             Delaware will be built with cooling towers, in contrast to the two

                                           -51-

               flonce-through" Salem units. As water is evaporated through cooling
               towers, condensation (fogging) may occur, which may alter the
               microclimate surrounding the plant.

                    In addition, the water that cooling towers take up is not
               all returned to the receiving channel, but to the atmosphere,
               and represents an absolute loss to the river or stream system.
               During droughts, diminished flows could result in adverse effects
               downstream or salt water intrusion. The Delaware River Basin
               Commission recently directed two utiities on the Delaware to
               provide back-up water storage for theifonuclear Power Plants as
               a safeguard during drought conditions.    In addition, when
               seq water is used for cooling, the deposition of salt from the
               tower may be harmful to the soil, especially if the fallout is
               onto agricultural land. From an aesthetic viewpoint, cooling
               towers produce vapor plumes and local fogs which result from the
               condensation of warm air leaving the tower and mixing with cooler
               surrounding air. Such mists are particularly severe during colder
               months when temperature differentials are at their greatest.

                    The need for the State to be concerned with protecting its
               waters from thermal pollution was emphasized by the National marine
               Fisheries Service, which, in response to the "Call for Information",
               recommended:

                         ... any energy related facility or project
                         which will chemically, thermally, or radio-
                         actively pollute, or require severe habitat
                         alteration, should be excluded from estu-
                         aries, bays1gnd near shore ocean waters of
                         New Jersey.

                    It is unclear to what extent the Nuclear Regulatory Commission
               would support this strong recommendation, which would effectively bar
               nuclear and other facilities requiring "once through" cooling from the
               state. Resolution of this problem by the relevant federal agencies
               will be one factor to be worked out in the coastal planning
               process.

                         5.   Siting Factors

                    In New Jersey, historically the initial decision to site an
               electric generating facility, conventional or nuclear has been made
               by the utilities. The new state legislation creating a Department
               of Energy and proposed new federal siting legislation might alter
               this pattern in the future.

                    Because of difficulties that utilities have encountered in
               obtaining site approvals, new approaches to siting energy facilities
               have been sought. One strategy favors clustering, where siting
               approval is required only once for several units. In this way,
               economies of scale can be achieved, for the acquisition of buffer
               areas and the adoption of elaborate security systems, for example.
               While clustering maylgave certain advantages in the case of small
               scale installations,   clustering of nuclear plants may pose
               enormous stresses on the land and water environment.

                                             -52-

                 The proposal to build a plant 2.8 miles offshore, off Atlantic
             City, represents an extreme approach to siting and is an indicator
             of the frustration that utilities have experienced in siting nuclear
             plants on land. The offshore plant is intended to solve the prob-
             lem of finding both a location remote from population centers
             and a reliable cooling source. The potential escape of radioactivity,
             in the event of an accident, into the ocean or the air above and
             uncertainty as to the behavior of the radioactivity has given
             rise, however, to intensive local opposition by the counties located
             closest to the plant. In addition, N.J. DEP has vigorously expressed
             concern about a steam explosion and the effects of steam condensate
             escaping into the air and "falling out" over land.

                 The opposition raised by the offshore power plant has, in fact,
             turned out to be as intense as any that has been raised against
             land-based plants. One reason is the not inconsiderable burden of
             setting a precedent not only nation, but worldwide.

                 Approval is not likely to come soon. In addition to the
             permits which must be obtained from the U.S. Nuclear Regulatory
             Commission, the Public Service Electric and Gas Company needs to
             obtain special permission to build the plant in state waters beyond
             the pierhead line. New Jersey's riparian statutes do not authorize
             the Natural Resource Council in DEP to lease or grant lands seaward
             of the bulkhead and pierhead line along the Atlantic coast. Under
             current state law, this would require an act of the legislature.

                       6.  Conclusion

                 Today, five nuclear generating plants (Oyster Creek, Salem 1
             and 2, Hope Creek 1 and 2) are in operation or have been approved in
             New Jersey. This is one-twelfth of all nuclear plants in the
             country, not an insignificant number in view of New Jersey's high
             population density, and does not include the Forked River or Atlantic
             generating plants. Even with this comparatively large number of
             plants and energy conservation measures, it has been said by some
             utilities that additional nuclear plants are needed to meet New
             Jersey's future needs. Whether this is indeed so, will, it is
             hoped, emerge from both the Master Plan which the new Department of
             Energy is preparing and the hearings being held by the Public
             Utility Board on New Jersey's future energy needs.

                                           -53-

                                            Footnotes

                 Federal and state criteria call for nuclear plants to be located
                 in low density population areas to facilitate evacuation that might
                 be necessitated by a nuclear accident. Federal Regulations
                 (10 CFR 100) requires that a utility designate an exclusion area
                 zone in which no building may take place. This area is usually
                 owned by the utility. Surrounding the exclusion zone the utility
                 must identify the low population zone (LPZ) of sufficient size to
                 facilitate the evacuation of the population within these boundaries.
                 Beyond this, the utility should identify population center distances
                 which is the distance between the reactor and the nearest
                 boundary of a community with 25,000 residents.- Although a utility
                 must be in control of activities within the exclusion area, it need
                 not have control, under federal regulations, over activity occurring
                 in the other two outer zones. In March 1976 the Commissioner of the
                 Department of Environmental Protection imposed a building moratorium,
                 under CAFRA, of 4.0 miles and 6.4 miles around Oyster Creek and
                 Artificial Island respectively, pending a study of appropriate land
                 uses surrounding nuclear plants in New Jersey's Coastal Area. This
                 was deemed necessary to check uncontrolled growth that seemed to be
                 taking place around Oyster Creek. (The difference in the mileage
                 figures relates to the size differences of the plants.) See DEP
                 News Release and testimony of Commissioner David J. Bardin before
                 the Committee on Energy and Environment, New Jersey Senate, March
                 10, 1976.
               2 migration0is induced when temperature of the water falls below
                 59 F. 87 F represents an upper limit of tolerance. For more
                 see: Appendix B to "Full Term Operating License Environmental
                 Technical Specifications for Oyster Creek Nuclear Generating
                 Station", Docket #50-219, Ocean County, New Jersey, New Jersey
                 Central Power and Light Company, June 28, 1976. See also Richard
                 Kantor, Estuarine and Wetland Resources, A Staff Working Paper,
                 N.J. Department of Environmental Protection, Office of Coastal Zone
                 management (January 1977), p. 71 and U.S. Environmental Protection
                 Agency, Fish Kills Caused by Pollution in 1973, U.S. Government
                 Printing Office, Washington, D.C. (p.21).
               3 N.J. Supreme Court in New Jersey vs. Jersey Central Power and
                 Light Company, 69 N.J. 102 (1976).
               4 In the Matter of Jersey Central Power and Light Company v.
                 N.J. Department of Environmental Protection, Docket #DEP ER76-203,
                 October 26, 1976. Appealed to Superior Court, Appellate Division,
                 DK. #A-1789-76.
               5 See Supra Note 1.
               6 Meier, Peter, M. and David Morell, Issues in Clustered Nuclear
                 Sitin_q, Brookhaven National Laboratory, September 1976, p. 260.
               7 Hope Creek Opinion #20, September 3, 1976, contained twenty-two
                 decisions.

                                              -54-

             8Nuclear Regulatory Commission, Safety Evaluation Report, Supple-
               ment #5, Hope Creek 50-354, March, 1974. The Department of the
               Public Advocate filed exceptions to the decision by the Atomic
               Safety and Licensing Board of the N.R.C. See New York Times
               (New Jersey edition) April 8, 1977, p. B2.
             9 U.S. Nuclear Regulatory Commission, Reactor Safety Study an
               Assessment of Accident Risks in U.S. Commercial Power Plants
               (Executive Summary), October, 1975.
             10 For a critique of the Rasmussen study, see U.S. Environmental
               Protection Agency, Reactor Safety Study (WASH 1400): A Review
               of the Final Report, EPA-520/3-76-009, June 1976. This study
               found forty-five deficiencies in the Rasmussen study. Most of
               these deficiencies related to the possible failures in the equip-
               ment. A more significant deficiency related to an inadequate
               comparison by Rasmussen of the risks between nuclear and other
               means of electrical power generation.
             11 Glenn Paulson, "Nuclear Power Plants: The Potential Role
               of Non-Federal Government Agencies or Does the NRC Really Con-
               trol Everything?" in a speech before the American Nuclear Society
               in Idaho, August 1977.
             12 Ibid. Note also Testimony of David J. Bardin, Commissioner,
               N.J. Department of Environmental Protection before the Committee
               on Energy and Environment, N.J. Senate, Toms River, N.J., March
               10, 1976.
             13 Coastal Area Facility Review Act, N.J.S.A. 13:19-11.
             14 Hope Creek Opinion, supra note 7, paragraph #142(h) p. 44.
             15 Letter by William G. Gordon, National Marine Fisheries Service,
               to David N. Kinsey, February 25, 1976, responding to DEP's Call
             16 for Information.
               See P. Meier and D. Morrell, Issues in Clustered Nuclear
               Siting: A Comparison of a Hypothetical Energy Center in New
               Jersey with Dispersed Siting, BNL 50561, Brookhaven National
               Laboratory, 1976.

                                           -55-

                     C.   Liquefied Natural Gas

                          1.   Issue

                     As a result of many factors, domestic supplies of natural gas,
               have been  curtailed to New Jersey utilities. Some of these utilities
               are now seeking alternative sources of the fuel abroad. For effi.-
               ciency, transportation over the ocean for long distances requires
               natural gas to be liquefied in transit and revaporized at the port
               of destination. Shipment of liquefied natural gas (LNG) through
               heavily travelled state waters and through population corridors
               and its transfer to reprocessing plants are of state concern
               because of the catastrophic effects that an accidental spilling     of
               the highly volatile gas could have on life, property and the
               environment.

                          2.   Background

                     LNG is natural gas which has been cooled and compressed.so that
               it can be more easily transported or stored. New Jersey gas util-
               ities store domestic LNG at relatively small several facilities
               throughout the state (including Burlington, Carlstadt, Elizabethtown,
               Hackettstown, Hamilton, Howell and Stafford Townships) to supplement
               their regular supplies of natural gas during periods of peak demand.
               Regulations covering the installation, safety and maintenance of LNG
               tanks and facilities are contained in regulations issued by the New
               Jersey Department of Libor and Industry, pursuant to the Occupational
               Safety and Health Act.

                     Public Service Electric and Gas (PSE&G) has taken over owner-
               ship of a large LNG facility, not yet in operation, in Rossville,
               StIaten Island on the Arthur Kill waterway in New York. The facility
               faces the New Jersey towns of Perth Amboy, Woodbridge and Carteret
               which contain two refineries, numerous tank farms, and PSE&G's own
               conventional generating plant in Sewaren. Middlesex County, which
               testified on this terminal in 1974, opposed its location because of
               the proximity of the terminal to the inherently dangerous and
               explosip industrial facilities and to the large population living
               nearby.    To become operational, PSE&G needs a firm contract
               from its Algerian partner as well as a license from the Federal
               Power Commission to import this gas. Gas from this facility
               would presumably be pipelined to PSE&G's customers in New Jersey.

                     Both the Tenneco Company and the Transcontinental Pipeline
               Company (Transco) have previously applied to DEP for riparian,
               wetlands, air and water permits to construct LNG facilities along
               the Delaware River in Deptford and Logan Townships in Gloucester
               County. No action has been taken on these permits pending a deci-
               sion by the Federal Power Commission (FPC). In December 1976, FPC
               staff issued a draft environmental impact statement on the Tenneco
               application, re 5ommending that the project not be built because of
               safety hazards.    At the same time the staff issued an amendment
               to the final environmental impact statement on the Transco project
               recommending that that project  4likewise be withdrawn on the basis
               of its latest safety analysis.

                                               -56-

                  Although the FPC has not yet acted on its staff's recommenda-
             tions, it appears as if both projects are moot, since Tenneco has
             announced that it will be building a terminal in Canada and Transco
             has announced the withdrawal of its application. It now remains for
             the FPC to act on PSE&G's application in Staten Island.

                  Boston is the only city on the East Coast which is currently
             importing LNG through its harbor. (Construction of two LNG terminals
             in Cove Point, Maryland and Savannah, Georgia are scheduled for
             completion in 1978. To avoid accidental collisions, the U.S. Coast
             Guard, responsible for the safety of shipping in navigable rters,
             clears shipping lanes for the LNG tankers in Boston Harbor .   LNG
             shipments to the Distrigas facility in Boston occur about once every
             twenty days. The U.S. Coast Guard escorts the LNG tankers to the
             Distrigas facility two miles upstream. The Tenneco and Transco
             applications would have involved 406 annual shipments (an average of
             more than one per day) and might have resulted in considerable
             disruption to existing shipping traffic. The FPC's recent decision
             to allow Distrigas in Massachusetts to increase its LNG imports has
             buoyed the people in Staten Island, New York, who are opposed to
             PSE&G obtaining an import license for its Staten Island LNG terminal.
             The community believes that increased supplies of LNG to Massa-
             chusetts may find their way to the New York area by gipeline,
             obviating the need for a new New York area terminal.

                  The next section discusses some of the environmental impacts
             associated with LNG shipments.

                       3.   Safety

                  Transshipment of LNG involves liquefying the gas in the exporting
             country, shipping it in specially built low-temperature (cryogenic)
             tankers, and then regasifying it upon entry into the importing
             country.

                  The nature of supercooled LNG is such that upon accidental
             release, the gas evaporates and greatly expands in volume. It is
             during the period of evaporation, when the highly concentrated gas
             forms a neutrally buoyant cloud over the water, spreading as a
             plume, that the danger of an accident is greatest. An ignition of
             the dispersing vapor plume could set off a fire several miles
             downwind of the source and create a hazard to life and property
             anywhere in the path of the plume.

                  The shipment of LNG represents a moving hazard since there
             is always the possibility of a collision with another vessel and a
             subsequent spill. The potential for such accidents is increased
             in estuaries, harbors and heavy shipping lanes, especially in
             population corridors.

                  The Department of the Public Advocate has challenged DEP's
             issuance of a CAFRA permit and the Nuclear Regulatory Commiss-ion's
             (NRC) issuance of a construction permit to build the twin Hope
             Creek reactors on Artificial Island in Lower Alloway Creek because
             of the possible catastrophic effects that a LNG tanker spill acci-
             dent could produce in the vicinity of the nuclear cluster. Not-

                                            -57-

               withs tanding the ruling by the NRC's Atomic Safety and Licensing
               Board that the probability of a cloud of gas igniting over the pliant
               was minimal and that construction should proceed, the Public Advocate
               has appealed that decision to the NRC's Atomic Licensing and Appeal
               Board. That Appeal Board remanded the issue back to the Safety and
               Licensing Board to further address the safety issue. A decision is
               expected by December 1978.

                     An FPC analysis of tanker accidents in the Delaware River
               revealed that accidents were about 30 percent higher than the
               average casualty rate of other major U.S. ports.       Dangerous areas
               of the river include the junction of the Chesapeake and Delaware
               Canal and the Marcus Hook and the Paulsboro area (See Figure 6).
               The frequency with which tanker accidents occur was demonstrated
               only too vividly in December 1976 and January 1977 when the Delaware
               River was the scene of a number of tanker accidents, following
               shortly after Pe grounding and rupture of the Argo Merchant tanker
               off Nantucket.

                     The Delaware River does not, unfortunately, presently have
               a vessel traffic separation (VTS) scheme; such a radar-operated
               system monitors and directs shipping traffic much like air traffic
               is controlled at airports. While the U.S. Coast Guard (which would
               operate a VTS system) recognizes the need for it in the Delaware
               River, it is expensive and is only being introduced slowly in U.S.
               ports.     (a) Buffer Zones

                     Any buffer zone for LNG facilities should have two elements:
               the conventional (fixed) buffer around the facility itself and the
               (temporary) buffer on either side of the shipping channel. Acci-
               dents at the fixed LNG facility constitute a lesser hazard, according
               to the FPC, than an accident occurring in transit which could affect
               a potentially larger number of people.

                     In 1974, Governor Byrne's Cabinet Energy Committee established
               an LNG Task Force to study 1@azards and set siting criteria for LNG
               facilities, including their buffer zones. The Task Force discovered
               considerable disagreement concerning appropriate buffer zones.
               Because of this uncertainty and because of Federal preemption and
               federal interest in LNG faciities, the States of New Jersey, Penn-
               sylvania, New York and Delaware petitioned the FPC in May 1976 t     To
               issue uniform standards for siting and operating LNG facilities.

                     Opinions differ on the size of needed buffer zones."

                     Experiments by the Massachusetts Institute of Technology
               indicated that a flammable vapor cloud of LNG could spread as far
               away as 55 to 60 miles from the spill site. Exxon indicated a ris
               area of up to 20 miles for a 125,000 cubic meter spill. The U.S.
               Bureau of mines indicated a combustion distance in excess of 40
               miles.11

                                               -58-

                                                        Figure 7
                                                        Location of Tanker Casualties
                                                        on the Delo-wore River
                                                        (1969 - 1974)

                                                          MANTUA CRIECK                          SCHUYLKILL RIVIA

                                                           0    COLLISIONS
                                                           4    4            1
                                                                N:OUNDIRS
                                                                                                                                CA56ALTMI NORTH OF
                                                                                                          @Pbdddelvhlq          SCMUYLKILL MIVEi-
                                        IMARCUS HOOK                                                         ZONE r A
                                         10 COLLIS"                                                                                6 GROUNDINGS
                                                        104,                         ZC                                             9 RANKING&
                                          a GROUNDING,
                                           I RAMMINS                                                   COLLISM
                                                                                                                                                           L., @,,to,,Cq
                                                                        ZONE 0
                                                                                         1111-oft      PROPOSED TRANSCO LAIS PROJECT
                                                                                         C

                                                                        FIN 75

                                                                        RIMM N

                          COLLISION                                                                                                  It EV     JERSEY
                         6       NDING                  ZONE C

                          COLLISION
                          GROUNDING                                     R'",
                       I   RAMMINSS                     ZONE                                                                       %                           A
                              Ct-oo-ko IS
                          Dew.ort Carol                                                                  A

                                                                  0 GROUNDINGS                         /.<k.

                            GROUNDING

                                                                                                 R.V9,

                                                                                                                                                                            ATLANIC
                                                                                                                                                                              COUNTY

                            kEW CASTLE
                              C
                                 OUNTY
                                        KENT COUNTY                                                                                               R,

                                                                                      ZONE A

                                                                                                                                                                   ILI
                                                                                                      St M.25

                                                                        3 ROU DiNGS                                                                             N
                                            DELAWARE

                                                                                  2 COLLISIONS
                                                   0 Dower                        2 GROUNDINGS
                                                                                                                             DELAWARE DAY

                                                                                            Oil  6*'ge
                                                                                            L i911101i.. A,..
                                                                               4 COLLISIONS              z*.@,                                          GROUNDINGS
                                                                               I GROUNDING
                                                                                                                                           Ar"

                                                                                                             Areo
                                                                                                       Big S110.0 B-c*)                                    CAPE
                                                                                                             GROUNDING                                       WAY

                                                                                                                   COLLIS;ON               RMIOO

                                                                                                                                                  PILOT
                                       0 1 1 3 4 6                      10                                                                         AREA
                                                     @,,t ------------- I
                                                  MIL.ES

                                                                                                                       COP* h.-lopo.            Source: Supplement lo the Final
                                                                                                                                                Environmental Impact Statement
                                                                                                                                                For the Construction and Operation of
                                                                                                                                                an LNG Import Terminal at Raccoon Island
                                                                                                       -59-                                     Federal Power Commision, December,1976

                    An LNG facility located on the lower Delaware River, according
               to these assumptions, would include a risk zone of at least twenty
               miles and encompass Cumberland and Cape May counties in New Jersey
               as well as parts of Pennsylvania and Delaware. A forty mile risk
               corridor would include the same counties plus, Atlantic, Camden,
               Gloucester and Salem counties and Philadelphia and Wilmington. In
               1975, the FPC calculated that a 125,000 cubic meter spill (contents
               of a total tanker) would produce  T2 vapor cloud with a 3.73 mile
               radius and extend for 7.46 miles.     In 1976, it revised this
               estimate by reducing the maximum spill probability to one fifth, or
               25,000 cubic meters, the capacity of one of the five LNG cargo
               tanks, th  T3 maximum quantity expected to be ruptured during an
               accident.    Using this assumption, plus stable atmospheric
               conditions and a wind speed of five miles per hour, the radius   of a
               potential vapor cloud was estimated at 2,510,jeet, extending 3937
               feet, with a dispersion time of 4.5 minutes.

                    While the risk corridor (corresponding to the size of the vapor
               cloud) is estimated by the FPC to be smaller than that calculated by
               MIT, Exxon, or the U.S. Bureau of Mines, it is large enough to pose
               significant risks to the population living on either side of the
               Delaware River. As such, the decision whether to permit LNG tankers
               up the river is one that the three states abutting the river,
               namely, New Jersey, Delaware and Pennsylvania should be involved
               in.

                    Experiments on the size and potential impacts of an LNG vapor
               cloud are continuing. For example, since shipment by tanker consti-
               tutes the greatest danger surrounding LNG, scientists are considering
               the solidification of natural gas in transit. This technology is      15
               not proven, however, and must be viewed as a long term alternative.

                              (b)  Risks

                    The Federal Power Commission calculated the probable fatalities
               resulting from a vapor cloud (mobile-type) accident and from a pool
               radiation (fixed-site) fire in West Deptford and Logfg Township in
               Gloucester County and found them to be unacceptable.      Probabilities
               were based on:

                         a)   probability of an accident (collision)
                              along the designated route,
                         b)   probability of a spill, given (a),
                         c)   probability of ignition of vapor cloud
                              given (a) and (b) ,
                         d)   probability of a radiation fire (from
                              fixed site) given (a) and (b) above,
                         e).  probability of fatalities within the
                              estimated risk corridor.

                    The FPC projects 750 fatalities, with a probability of 9.2 x
               106 (or 92 per ten million trips) per exposed person per year, for
               a vapor cloud fire (This is comparable to being struck by a mete-
               orite or being involved in a nuclear accident.)17    The FPC attri-
               buted 185 fatalities, with a probability of 9.5 x 105 (or 95 per
               one million trips) per exposed person per year, to a pool radiation
               accident, that is an accident which would occur at a fixed site.

                                              -60-

             (This is comparable to poisonings or drownings.) The projection of
             fatalities for vapor cloud accidents was greater, though with a
             lesser probability of occurrence than projections for radiation
             fires.

                       4.   Eny.ironmental Impacts

                 Because of the large buffer zone that should be established,
             few sites in New Jersey lend themselves to LNG facilities. The LNG
             facilities proposed on the upper Delaware River in West Deptford
             and Logan Township would pose a constant danger to the large
             population and nearby industrial facilities. Downstream, hazards to
             the population would be less, but adverse impacts on the estuarine
             environment would be considerable.

                 The lower Delaware River and estuary are the site of valuable
             saltwater marshes, wetlands and oyster beds which would be affected
             by the construction of LNG facilities. Construction at Bayside
             .n Greenwich Township, which has been mentioned as an alternate site
             for LNG oTgrations, would entail 13-18 million cubic yards of
             dredging.    In addition, periodic maintenance dredging would be
             required as large tankers require adequate channel depths. Re-
             gasification of LNG would also entail the use of large quantities of
             water, which, upon discharge, would be considerably colder than the
             surrounding water Y9 cause of the nature of processing the super-
             cooled liquid gas.    The effects of having unnaturally cold water
             in one part of the river and unnaturally warm water emanating from
             the nuclear units at Artificial Island might wreak havoc with the
             marine flora and fauna. These potential effects have not been
             addressed to date.

                       5.   LNG Sitinq--- ARegional Approach

                 The nature of an LNG spill is such that its    impact could extend
             over many miles. An LNG facility built on either side of the
             Delaware River would, of necessity, have to include the three
             bordering states in any contingency planning. The Staten Island
             facility would likewise necessitate an interstate arrangement
             between New Jersey and New York. Therefore, LNG siting becomes a
             matter of regional concern which should be addressed by the region.

                 A regional facility serving the customers of several gas
             utilities could end up being much larger than contemplated by any
             one of the utility applicants individually. This might be an
             advantage or disadvantage. Economies of scale might make it
             advantageous for a reprocessing plant to be of a large enough size
             to reprocess the LNG of several utilities. A single unit would call
             for the utilities to share dock and storage space and possibly
             involve some institutional changes in doing business. The disad-
             vantage is that an accident at a large concentrated facility might
             be worse than one at a smaller facility.
                 A regional approach to siting has the advantage of providing a
             large number of sites from which to make a selection and would
             result in enhanced safety and reduced risk. The FPC identified
             several alternate sites along the Delaware River and Chesapeake

                                            -61-

                Bay.20 It found none of them satisfactory, with the exception of
                Cove Point, Maryland, which has already been licensed by the FPC
                for an LNG facility to serve the needs of the Columbia Gas Company.
                Staff to the FPC indicated that if the West Deptford and Logan
                Township sites were rejected by the FPC, expan2lon of the Cove Point
                facility should be explored as an alternative.

                     One alternative to an LNG facility plant on the shoreline
                would be a deepwater port linked to the shore  by a pipeline for an
                inland processing plant. This would eliminate the dangers to the
                people living along the Delaware River. The implications of
                deepwater ports in general are discussed in Section D.

                          6.   State Options

                    The State has several alternatives with respect to siting LNG
                facilities:

                          a)   It could ban LNG facilities entirely.

                          b)   It could ban LNG until development of  the Outer
                               Continental shelf in the Baltimore Canyon indicates
                               that there is no gas there in commercial quantities.
                               (If gas were found offshore, the need for LNG would
                               be considerably reduced. Gas projections for Lease
                               Sale 40 range from 104 billion cubic feet (bcf) to
                               512 bcf per year for a field life of about 25 years.
                               This represents between 30 and 193 percent of New
                               Jersey's 265.9 bcf gas consumption in 1976. While
                               offshore gas would not necessarily be dedicated to
                               New Jersey, the likelihood of some of it going to the
                               mid and @2w Atlantic region in the event of a strike,
                               is good.

                          c)   It could sanction limited LNG shipments until OCS
                               development starts and reveals extensive gas finds.

                          d)   It could sanction deepwater ports for LNG linked to
                               the shore by pipeline. This would eliminate LNG
                               tankers in the inland waters of the state and their
                               potential for accidental collisions and spills of
                               LNG. A recent study examined the feasibility of        23
                               building-a LNG terminal off the coast of Los Angeles.
                          e)   It could permit LNG terminals along the Lower Delaware
                               River, sacrificing a portion of the wetlands.

                               It could permit LNG facilities at the proposed
                               locations based on the. remote statistical probability
                               of such accidents occuring.
                    Decisions  among these and other options involve scientific
                analysis and value judgements and must be made in consultation
                with other federal, state and local units of government as well
                interested and informed segments of the public.                  as

                                              -62-

                      7.   Conclusion

                 The Federal Power Commission holds the most important key to
            LNG because it both regulates the prices of interstate gas and
            issues the permits to import LNG. Deregulation of the price of gas
            could conceivably create the needed incentives for producers to
            increase natural gas production for interstate commerce and lessen
            the need to import it. Importation of LNG, on the other hand, would
            create a dependency on gas similar to that which the nation developed
            for petroleum. A build-up of this type of dependency is contrary to
            the goal of reducing U.S. vulnerability to foreign embargoes.

                 Given LNG's shipping hazards and the alternative of conser-
            vation, a more prudent course would appear to be a public education
            program to conserve gas. In any event, since LNG siting issues
            involve several states, LNG should be treated as a regional matter
            with decisions concerning siting and the use and distribution of
            LNG to be decided by the affected states.

                                          -63-

                                              Footnotes
                 1Occupational Safety and Health Act, P.L. 1973, N.J.S.A. 34:6A,
                  Regulations withdrawn NJAC 12:110-179, 1975, NJAC 12:180-205 in
                  effect.
                 2Middles'ex County Planning Board testimony before the Advisory
                  Council on Environmental Protection on Liquid Natural Gas Facilities
                  of the Distrigas Company, September 13, 1974.
                 3See Federal Power Commission, Bureau of Na  tural Gas, Draft
                  Environmental Impact Statement, "West Deptford LNG Project",
                  Docket #CP76-16, December 1976, p. 158.
                 4See "Supplement to Final Environmental Impact Statement for
                  the Construction and Operation of LNG Import Terminal at Raccoon
                  Island", December 1976, Docket CP73-258, 259 and Docket CP267-270,
                  incl.
                 51n Boston, the U.S. Coast Guard requires 72 hours notice (by
                  telex) of the arrival of an LNG tanker. It in turn provides
                  24 hours notice to pilots and towing boats in the harbor that no
                  shipping will be allowed during transit of the LNG tanker. Before
                  a LNG tanker is permitted to proceed into the harbor, it is boarded
                  by U.S. Coast Guard personnel for inspection.
                 6Robert E. Huber, "LNG Foes Glad to See Massachusetts Gas OKV,
                  Staten Island Advance, April 18, 1977.
                 7Jansen, Donald, "Effort Made to Bar Atomic Power Plant", New York
                  Times, April 8, 1977.
                 8
                  See Draft Environmental Impact Statement (DEIS) West Deptford,
                  Supra note 3, page 110.
                 9The Olympic Games tanker spilled 134,000 gallons of oil into
                  the Delaware River near Marcus Hook on December 27, 1976. The
                  Argo Merchant spilled 7.5 million gallons offshore Nantucket.
                 10 Petition for rule making in the matter of the need for site
                   selection and facility operation criteria for liquified natural
                   gas terminals. The Petition dated May 6, 1976 (Docket RM 76-13)
                   to the Federal Power Commission was submitted by the Attorney
                   Generals for New Jersey, New York and Pennsylvania; the Township
                   of Woodbridge; Congressman John M. Murphy, from New York; and the
                   New Jersey Public Advocate. It was printed in the Federal Register
                   June 4, 1976.
                 11 Memorandum from R. Katz to R. Dyba, entitled "LNG Siting Group",
                   July 17, 1975.
                 12Federal Power Commission, Attachment #5, to the Final Environ-
                   mental Impact Statement for the, "Construction and Operation
                   of an LNG Import Terminal at Staten Island, New York", July
                   15, 1975, p. 2.

                                                -64-

            13See DEIS West Deptford, Supra note 3, introductory note.
            14 Ibid, p. 107. Note a higher windspeed would facilitate dis-
               persion of the methane gas and reduce the time-length of the fire;
               conversely a calmer wind would lengthen the time and extent of the
               fire.
            15 William P. Strumbos has done considerable work in this field.
               See U.S. Patent 3,834,174, "Cryogenic Transportation Method
               and Apparatus Therefore", September 10, 1974 and V.U. Minorsky
               and George G. Sharp, Inc., "LNG Vessels Regulatory and Economic
               Consideration", before the Gulf Section of the Society of Naval
               Architects and Marine Engineers, February 11, 1972.

               Note also experiments by U.S. Coast Guard on the behavior of
               LNG flames, Coastal Zone Management Newsletter, October 20, 1976.,

            16
               See Supplement to Final Environmental Impact Statement, Raccoon
               Island, supra note 3.
            17 Determinations of the acceptable levels of risks to society
               were made by the Rasmussen study group in assessing nuclear risks.
               The group identified several classes of accidents:
                  a) probability of 1 accident in     1,000 (1:1000) or 10   4
                  b) probability of 1 accident in    10,000 (1:10,000) or 10 5
                  c) probability of 1 accident in   100,000 (1:100,000) or 10   6
                  d) probability of 1 accident in 1,000,000 (1:1,000,000) or 10

               Type (a) accident, associated with industrial occupational hazards
               and some sport events, was viewed as societally unacceptable.

               Type (b) and (c) accidents, associated with drownings, poisonings
               and fires, were acceptable to varying degrees, and

               Type (d) accident was viewed as negligible and associated with
               meteorites and nuclear accidents.

               See U.S. Nuclear Regulatory Commission: "Reactor Safety Study:
               An Assessment of Accident Risks in U.S." Wash 1400 (NUREG 75/0114)
               P. 11.
            18 DEIS, West Deptford, supra note 3, Table 28, page 151.
            19 Ibid, page 80.
            20 Ibid, page 132. Aside from the West Deptford and Logan Township
               (Raccoon Island) sites, FPC identified two additional sites along
               the Delaware River; namely, Bayside in New Jersey, and Cherry
               Island near Wilmington, Delaware, Stillpond Neck, Baltimore
               Harbor, Sotterly @oint, Scarborough Neck and Cove Point, Maryland
               were other sites identified along Chesapeake Bay.

                                           -65-

                2lIbid, page 157.
                22Telephone communication with Alan Day, Outer Continental Shelf
                  Office, Bureau of Land Management, Nw York City, September 22
                  1976. Note that the Final Environmental Impact Statement for
                  Lease Sale 42 indicates the likelihood that the bulk of any
                  natural gas produced would be consumed either in New England or
                  the Mid-Altantic, "since shipping the gas against the strong
                  geographical price gradient appears unlikely". p. 1001.

                 23
                  See Fairchild Stratos Division, Offshore LNG Receiving Terminal
                  Project. Prepared for Western LNG Terminal Company, Los Angeles,
                  California, March 1977. See also H.W. Backhaus,"'Offshore LNG
                  Handling System aimed at Severe Conditions", Oil and Gas Journall
                  September 26, 1977, p. 60.

                                              -66-

                  D.   Deepwater Ports

                       1.   Background

                  Deepwater ports are floating or fixed structures for transfer
             of oil and gas that are located in open waters outside coastal ports
             and harbors. They represent siting alternatives for shoreside
             marine terminals. They were conceived to accommodate large tankers
             unable to negotiate the narrow channel depths characteristic of so
             many of the waterways in the United States and to avoid the other-
             wise necessary dredging and maintenance of these relatively shallow
             channels. The United States Department of Transportation   as
             approved the building of two ports in Louisiana and Texas.
             Both the high cost of constructing such ports and the need for
             special legislation to permit deepwater port construction in
             New Jersey waters beyond the pierhead line make it unlikely that
             they will be built in the near future. Deepwater ports should not
             however, be ruled out entirely, due to the development of Outer
             Continental Shelf hydrocarbon resources, possible LNG operations and
             the increased shipping traffic and spills that these two energy
             technologies might generate. Indeed, the recent tanker spills on
             the Delaware River revived the issue of a deepwater port in Delaware
             Bay and even caused people previously opposed to the concept to
             reconsider the matter.

                  The Delaware River and New York Harbor have the deepest channel
             depths in New Jersey, both with 40 feet depths. Both ports can
             accommodate tankers up to 70,000 deadweight tons (dwt), but are
             unable to handle the very large crude carriers, known as "VLCCs"
             which can accommodate upwards of 250,000 dwt. in vessel depths
             exeeding 80 feet. The larger tankers are preferred by industry
             because they generate economies of scale. However, not all channels
             in New York Harbor are maintained at 40 feet. Tankers destined to
             serve refineries along the Arthur Kill must first lighter or transfer
             some of their cargo to smaller ships or barges, in the main channel.
             A deepwater port linked to the shore by a pipeline would eliminate
             the need for such lightering and result in greater efficiency. More
             importantly, it could reduce the amount of oil spilled during each
             transfer operation.

                  Economics, however, dictate that a deepwater port be of suf-
             ficient size to justify its costs and that the throughput of hydro-
             carbon5 in the port be sufficient to supply the refineries on
             shore.

                       2.   New Jersey as a_Deepwater Port Site

                  Potential sites for deepwater port development off the coast
             of northern New Jersey and in Delaware Bay have been identified
             in several studies of deepwater ports. The New Jersey offshore
             region has been identified because of the large demand for petro-
             leum products in the Mid-Atlantic region, and the existing con-
             centra@ion of refineries in the New York Port and Delaware River
             areas.   Six specific reasons for considering New Jersey a
             likely site for deepwater ports were identified in a 1974 study by
             Arthur D. Little, Inc.:-

                                           -67-

                   1)   pipeline investments for a Mid-Atlantic terminal are less
                        than the investment required for other alternatives,

                   2)   there is an existing base of refinery infrastructure
                        in the Mid-Atlantic,

                   3)   The Mid-Atlantic region (including New York State)
                        is the largest petroleum product demand region in the
                        United States,

                   4)   Mid-Atlantic refinery capacity in 1970 was 35-40% of
                        Mid-Atlantic demand (including New York) and 25% of
                        Petroleum Allocation District I demand [That is, the
                        Mid-Atlantic region could sustain additional refinery
                        capacity],

                   5)   a deepwater terminal for direct receipt of VLCC's would
                        allow transportation cost savings to refiners over trans-
                        shipment from the Caribbean or Canadian Maritimes,

                   6)   Mid-Atlantic refineries have a transportation cost
                        advantage over Gulf Coast refineries in supplying upper
                        East Coast markets.

                        3.   Potential Impacts

                   This section describes some of the onshore impacts that
              have been predicted to result from a deepwater port.

                   (a) Environmental - Pipeline versus Tanker Line to Shore

                   The decision to link a deepwater port to land by tanker
              or pipeline is a crucial one. While pipelines are preferable
              from the point of view of reducing spillage in transfer operations,
              their use might be limited in New Jersey because of a lack of
              appropriate landfalls, as outlined in the discussion on OCS facil-
              ities. The location of a pipeline landfall could be the determining
              factor in locating a deepwater port, since with pipeline costs being
              so high, economics will favor the shortest and most direct route
              between two points.

                   Both the Sandy Hook area and Delaware Bay would be desirable
              deepwater port sites since they are close to existing refineries
              and processing industries. Great care would, however, be needed in
              siting potential terminals in these areas, because of the heavily
              used shipping lanes.

                   (b) Socio-economic

                   Whether measured by the number of persons employed or increased
              levels of air and water pollution, the impacts of deepwater facil-
              ities construction are potentially significant. Direct environmental
              impacts would result from routine and accidental offshore oil spills
              and onshore refinery and storage facilities. Of potentially greater
              importance are the environmental and socio-economic impacts from
              petrochemical and other forms of industrial development that might

                                            -68-

              result if a deepwater port significantly increased total crude oil
              deliveries to the region rather than just replacing deliveries from
              smaller tankers.

                    For example, in examining the possible effects on Cumberland
              and Cape May counties of deepwater port construction, Arthur D.
              Little estimated that 14 square miles of land would be needed in the
              counties 4to build "at least 9 new refineries and 13 new petrochemical
              plants".    Such land would, of course, preempt valuable wetlands,
              farmland and result   in a significant change in lifestyles and the
              social economy of the area.

                         6. Siting Factors

                    The size of an offshore terminal and the purpose for which it
              is intended are factors that should be weighed in decision-making
              concerning deepwater ports. An offshore terminal to handle LNG
              might, for example, be preferable to tankering LNG up inland water-
              ways. Middlesex County, while opposed to deepwater ports on a
              generic  @asis, has favored a deepwater port to handle LNG for safety
              reasons.    Equally, a small port tailored to New Jersey and the
              immediate region might be an acceptable alternative to a larger port
              serving the total East Coast's petroleum and gas needs. A large
              port might produce extensive onshore and offshore activities
              and alter the character of the region. Offshore tanker and transfer
              activity could result in chronic oil discharges and in the gradual
              deterioration of the state's ocean waters.

                    The possible adverse synergistic impact produced by a petro-
              leum-LNG accident would seem to rule out a port to handle both
              LNG and petroleum, and favor one (or more) smaller port(s) for each
              community.

                         7.    Legal Implications

                    As with other energy technologies discussed, offshore terminals
              are the subject of Federal concern and preemption. The federal
              Deepwater Port Act of 1974 gives an adjacent state certain pre-
              rogatives with respect to approving the siting of deepwater ports
              outside of its territorial waters. These prerogatives extend
              only fifteen miles seaward of the state.        It is likely that
              a spill occurring 20 to 30 miles offshore might affect the adjacent
              states directly or indirectly. Beyond cleanup, however, aq adjacent
              state's power to recover damages from a spill are limited.

                    Special legislation would be needed to build a deepwater
              port in New Jersey territorial waters, since, as with floating
              nuclear plants, the Natural Resources Council lacks authority to
              convey grants to riparian lands for any purpose beyond the pierhead
              line.

                    Opposition to a deepwater port has been pronounced in New
              Jersey6 as demonstrated by a number of bills opposing deepwater
              ports.    Opposition has been based on a fear Of oil spills asso-
              ciated with deepwater ports. While these cannot be ruled out,
              there are a number of stipulations that the State could attach

                                               -69-

               to any offshore terminal such as limiting the size of the tanker
               permitted to berth at the port. This might reduce the possibility,
               of spilled oil actually reaching the shore and might be preferable!
               to increasing the probability of spills and accidents on the state's
               waterways.

                         8.  Conclusions

                   Much more information on the economics, risks, and environ-
               mental costs and benefits concerning offshore terminals is needed.
               They do, however, provide alternatives to the movement of LNG
               tankers in inland waters, should LNG imports be permitted. In the
               event that extensive petroleum or gas deposits are found in the
               Baltimore Canyon, offshore terminals could provide a means of
               diverting hydrocarbons not intended to be refined, processed or used
               in the state or region to other destinations on the east coast,
               without these resources having to touch New Jersey's mainland. In
               this way, they would reduce the adverse onshore environmental
               impacts and emissions associated with storage tanks and booster
               stations and make this land available for other uses.

                                             -70-

                                        Footnotes

             United States Congress, Office of Technology Assessment, Coastal
             Effects of Offshore Energy Systems, November 1976, p. 1847. The
             Texas (Seadock) terminal is proposed for 26 miles off Freeport;
             capital costs are estimated at $659 million. The Louisiana (LOOP)
             terminal is planned for 19 miles off the coast and is estimated
             to cost $348 million for the early phase and $800 million for
             the expanded version.

             Ibid, p. 186, Figure IV-38 anticipates the volume of imported
             oil in the Atlantic Region (New Jersey, Delaware, New York and
             Pennsylvania) to be of the order of 1.5 mbd in 1980 and 2.0 mbd
             in 1985.
            3U.S. Army Corps of Engineers, US Deepwater Port Study, by
             Robert R. Nathan Associates, October 30, 1972 (for the Institute
             of Water Resources, US Department of the Army, Corps of Engineers);
             U.S. Army Corps of Engineers, Philadelphia District, Atlantic
             Coast Deepwater Port Facilities Study, Arthur D. Little, Inc.
             Potential Onshore Effects of Deepwater Oil Terminal-Related
             Industrial Development, Vol. I through IV. A Report to the Council
             on Environmental Quality, 1974.

             Arthur D. Little, Inc., 1974 Report, Supra note 1, p. 179.
            5The Middlesex County Planning Board passed a Resolution January
             11, 1973 opposing deepwater ports. However, in its statement on
             "Liquid Natural Gas Facilities of the Distrigas Company" before the
             Public Forum Conducted by the Advisory Council on Environmental
             Protection, September 13, 1974 it favored an offshore port for
             LNG.
            6The Deepwater Port Act sets up a Deepwater Port Liability Fund
             (33 USC 1517). This is a no fault fund for clean up and is in the
             amount of $100 million to be raised by charging a 2 cent per barrel
             loading tax.
            7Deepwater Port Act of 1974, 33 USC 1501 et seq. "Adjacent"
             states are defined as those which would be directly connected by
             pipeline to a deepwater port or located within 15 miles of a
             deepwater port (Section 1508). Licenses for deepwater ports will
             not be issued by Secretary of Transportation without the approval
             of the Governor in adjacent states. Licenses are to be consistent
             with state coastal management programs, or be conditioned on
             such consistency. This consistency clause stands separately
             from the federal consistency clause of the Coastal Zone Manage-
             ment Act of 1972 and may be invoked prior to completion of a
             state's management program.
            8Senate Bill 22 was introduced on January 13, 1976 and referred
             to the Committee on Energy, Agriculture and the Environment
             Assembl&Bill 350 was introduced January 13, 1976 and referred
             to the   mmittee on Transportation and Communications.

                                          -71-

               V.   STATE AND FEDERAL ROLE IN ENERGY FACILITY SITING

                    This chapter describes the involvement of the state and
               federal government in energy facility siting in New Jersey's Coastal
               Zone. Local government perspectives on proposed energy facilities
               are provided in the next section.

                    A.   State Role

                         1.   Legislation

                    The Coastal Area Facility Review Act (CAFRA) provides DEP with
               the specific authority to regulate the siting of specified, major
               energy facilities in a defined coastal area. A CAFRA permit is
               required before any malor energy facility can be constructed in   the
               State's coastal area, including electric power generation plants;
               petroleum refineries; storage, handling, and transfer facilities for
               crude oil, gas (natural and manufactured), and finished petroleum
               products; above or underground pipelines designed to transport
               petroleum or natural gas; and marine terminals and cargo handling
               facilities. In addition, CAFRA requires that a permit be obtained
               for construction of a variety of facilities which may be spurred is
               a result of proposed oil and gas development offshore New Jersey.

                    The CAFRA Permit Section of the Office of Coastal Zone Manage-
               ment, Division of marine Services within DEP leads the multi-agency
               review process on CAFRA permit applications. The major CAFRA energy
               facility application to date concerned the @ope Creek nuclear plants
               conditionally approved on October 20, 1975.

                    Some state-level land use jurisdiction over energy facilities
               along the coast is also provided ingirectly by the New Jersey
               Wetlands Act and Riparian Statutes.   Any energy development which
               entails the destruction of the State's designated coastal wetlands
               requires a Wetlands permit. State riparian jurisdiction extends to
               those lands now or formerly flowed by mean high tide. -No riparian
               grant, license, or permit may be issued for any proposed use of the
               s*tate-owned tidelands sea bed which is not consistent with the
               "public interest". Standards for the exclusion of certain types of
               facilities from parts of the coast or criteria for the protection of
               certain lands and waters could be enforced by one or a combination
               of these laws.

                    Under the Act reorganizing the Department of Environmental
               Protection, the Department is charged with the regulation of facil-
               ities which handle hazardous substances or emit harmful emissions. 4
               This in effect empowers the Department to regulate pollution emitted
               from refineries and gas processing plants outside the jurisdiction
               of the CAFRA, Wetlands and Riparian Acts.

                         2.   State Agencies
                    Numerous other agencies of state government in New Jersey
               consider energy matters today.

                                              _72-

                            (a) Department of Energy

                 On July 11, 1977 the Department of Energy (DOE) was established
             (PL 1977, Ch. 146). It has been charged during the first year of
             its formation to draw up a ten year master plan for the production,
             distribution, consumption and conservation of energy in the state.
             DOE has absorbed the Department of Public Utilities, now the Board
             of Public Utilities and the former State Energy Office. Section
             13(c) gives the Department coextensive jurisdiction with other state
             agencies regarding the siting of energy facilities. At the same
             time, no state agency such as the Office of Coastal Zone Management
             may grant or deny a permit relating to the construction or location
             of an energy facility without due consultation with the DOE. The
             statute provides for an Energy Facility Review Board concerning the
             disposition of energy applications in the event of disagreements
             among agencies. (b) Department of the Public Advocate

                 The Division of Rate Counsel in the Department of the Public
             Advocate was established in 1974 to represent the public interest
             before the Publ@c Utility Commission whenever public utilities seek
             rate increases.   The function of the Rate Counsel is to ensure
             that increases being sought are justified and fair. Consequently,
             every time a utility in the state has sought a rise in the price of
             electricity or gas, the Rate Counsel has become involved.

                 The Public Advocate's public interest mandate involves it in
             environmental protection issues. Indeed, the Public Advocate has
             become involved in many of the energy issues referred to in this
             working paper. It has challenged decisions by NJDEP and the Nuclear
             Regulatory Commission on the Hope Creek nuclear facility and the
             Offshore Atlantic Generating Station. Though not directly a party
             to the proceedings, the Public Advocate has filed briefs on behalf
             of the three New Jersey counties who are involved in litigation
             on the U.S. Department of Interior's Environmental Impact Statement
             concerning OCS Lease Sale No. 40.

                 The Public Advocate has also opposed the siting of LNG facil-
             ities in New Jersey and joined the Attorney General of New Jersey
             and the States of Delaware, New York and Pennsylvania in their
             petition to the FPC for siting guidelines on LNG facilities.

                            (c) Other Agencies

                 Though not specifically concerned with siting decisions,
             other departments are involved with energy matters. The Department
             of Community Affairs administers the energy subcode of the Uniform
             Construction Code. (Note that the new Department of Energy statute
             requires DOE to review functions performed by other state agencies
             relating to energy and recommend to the legislature those programs
             which should appropriately be transferred to DOE. It is possible
             that the administration of the energy subcode of the Uniform Con-
             struction Act will be transferred to DOE.) The Department of
             Labor and Industry, Division of Planning and Research publishes
             energy statistics in its monthly New Jersey Indicators and analyzes

                                           -73-

                selected energy issues from time to time. In addition, there is
                the Governor's Cabinet Energy Committee, consisting of the Commis-
                sioners of @he various state Departments which steered the state
                through the gas crisis in January and February of 1977 before the
                creation of the Department of Energy.

                          3.   Federal Role

                     The Federal government's involvement in regulating energy,
                particularly pricing, the stockpiling of emergency supplies and
                their allocation in time of need is considerable. The importance
                of energy to the health of the national economy resulted in the
                creation of a Federal Department of Energy on October 1, 1977. In
                the interest of improved efficiency, the agency has absorbed several
                agencies such as the Federal Energy Administration and Federal Power
                Commission as well as certain functions carried out by existing
                Departments. The new Department will, for example, administer the
                naval oil and shale reserves formerly administered by the Department
                of Defense; establish values to be used in leasing outer continental
                shelf lands, a function formerly performed by the Bureau of Land
                Management; and set conservation standards in buildings previously
                set by the Department of Housing and Urban Development. With
                respect to nuclear matters, the Energy Research and Development
                Administration has been transferred to the new Department, while the
                Nuclear Regulatory Commission will continue to function as an
                independent agency. New Jersey expects to work closely with the new
                Department as it becomes organized and develops its identity.

                     This section discusses the national interest which federal
                agencies attach to energy facility siting, as well as the matter of
                federal preemption and federal consistency.

                               (a) The Federal Interest in Energy Facility Siting

                     In order to merit approval of the State's program under the
                federal Coastal Zone Management Act, New Jersey must address
                energy facility siting in its management program. Before the
                Department of Commerce can approve the program, the Secretary must
                find:

                      ...adequate consideration of the national interest
                      involved in the siting of facilities necessary to
                      meet re9uirements which are other than local in
                      nature.

                     The 1976 Amendments to the Coastal Zone Management Act have

                the national interest. Each state's coastal management program
                made explicit the presumption that energy development involves

                is now required to include:

                     a planning process for energy facilities likely to
                     be located in, or which may significantly affect,
                     the coastal zone, including but not limited to, the
                     process for anticipat4ng and managing the impacts
                     from such facilities.

                                              -74-

                   The national interest clause as it relates to energy develop-
              ment is clearly relevant to New Jersey. The chief rationale advanced
              by the Department of the Interior for the accelerated OCS leasing
              program, of which Lease Sale #40 is one element, is that it would
              help reduce the nation's dependence on foreign oil. It might well
              be argued that a State policy opposing the construction of certain
              OCS-related facilities along the Jersey coast would be contrary to
              the "national interest" and therefore would constitute grounds for
              the disapproval of the State's coastal program.

                    It remains unclear to what degree the "national interest" will
              influence energy facility siting policies in New Jersey. Certainly
              a state such as Delaware, which has banned heavy industry categor-
              ically from its coastal area, might have to give a stronger accounting
              for its action than New Jersey, whose coastal law requires balancing
              of economic and environmental interests. Prior to the passage of
              the 1976 Amendments, Robert Knecht, Assistant Administrator in the
              U.S. Office of Coastal Zone Management, stated that a management
              program would not necessarily fail to be approved "...because it
              excludes such facilities as refineries or power plants from the
              coastal zone".

                             (b) Federal Consistency

                   The "federal consistency provision" of the Coastal Zone Manage-
              ment Act encourages the federal government to cooperate with states
              in managing energy facility development. After a state's management
              program has been approved by the Secretary of Commerce, any appli-
              cant for a federal "license or permit to conduct an activity affecting
              land and water uses in the coastal zone of that state" must certify
              that the proposed activity is consistent with the approved manage-
              ment program. No license or permit may be granted by the federal
              agency involved until the state has concurred in the certification,
              unless the Secretary of Commerce determines that the activity is
              consistent with the objectives of the AT@ or is otherwise required
              in the interest of "national security".

                   The 1976 Amendments to the Coastal Zone Management Act specif-
              ically extend the range of activities covered under federal
              consistency to OCS development. Any plan for the exploration and
              production of OCS resources must be accompanied by a certification
              that each activity described in the plans is consistent with any
              federally-approved state coastal management program.

                   In conjunction with the requirement that the national interest
              involved in the siting of energy facilities be reflected in the
              state's management program, the federal consistency clause provides
              one important base for a state energy facility siting policy.
              The national interest provision requires that the need for new
              energy development, both on a national and state-level basis, be
              considered early in the course of program development. The con-
              sistency provision helps the state to subsequently insure that
              energy facility constructionlV11, in fact, conform to the state's
              coastal management strategy.

                                            -75-

                        3.   Federal Preemption

                   Federal preemption is an issue common to the production
              of nuclear power, the development of Outer Continental Shelf
              resources and the distribution of liquefied natural gas. There
              appears to be varying degrees to which federal agencies will pursue
              their federal preemption prerogatives. The U.S. Atomic Energy
              Commission, for example, deferred to New Jersey on a siting issue
              when it refrained from acting on the Newbold Island site for a
              nuclear reactor. On the other hand, a federal court reviewing a
              Federal Power Commission approval to build a LNG storage facility i:
              the Hackensack Meadowlands was adamant in upholding the FPC's
              preroga  ve over a state agency which had denied the building
              permit.

                                            -76-

                                         Footnotes

             Coastal Area Facility Review Act, N.J.S.A. 13:19-1 et seq.
             2Hope Creek Opinion #20, October 20, 1975.

                 The proposed Forked River nuclear plant was exempted by a
             Hearing Officer from the CAFRA permit process on the grounds that
             building had begun before the enactment of the CAFRA statute in
             1973.
             3Wetlands Act N.J.S.A. 13:9A et seq. and Riparian Statutes,
             N.J.S.A. Titles 12 and 13.

             Department of Environmental Protection Act, N.J.S.A. 13:1D et
             seq.

             Oil Spill Compensation and Control Act, Chapter 141, L. 1976.
             6Public Utility Commission Act N.J.S.A. 48:2-1 et seq.
             7The Public Rate Counsel was established by.N.J.S.A. 52:17E-15
             "Public Interest" is defined as "...public interest shall mean an
             interest or right arising from the Constitution, decisions of
             court, common law or other laws of the United States or of this
             State i'nhering in the citizens of this state or in a broad class
             of such citizens".(N.J.S.A. 52:17E-30)
             8Coastal Zone Management Act of 1972, P.L. 92-583, Section 306(c).
             9Coastal Zone Management Act Amendments of 1976 P.L. 94-370.
             10 Quoted in Rubin, Kenneth A., "The Role of the Coastal Zone
              Management Act of 1972 in the Development of Oil and Gas from
              the Outer Continental Shelf", Natural Resources Lawyer, Vol.
              8, No. 3.

              Coastal Zone Management Act, P.L. 94-370, Sec. 307(d).
             12 For a discussion on federal consistency, see, Topper, Andrea
              Grappling withIntergovernmental Relations: Federal Consistency
              and the Coastal Zone Management Act of 1972, As Amended. Master's
              Thesis submitted to the Graduate School of Public and Inter-
              national Affairs, University of Pittsburgh, April 1977.
             13 Transcontinental Gas Pipeline Corporation vs. Hackensack
              Meadowlands Development Commission, 464 F2d 1358.

             The court hinted that it might have acted differently if the state
             agency had guidelines or standards in effect at the time of the
             denial based on planning and safety considerations.

                                           -77-

               VI. REGIONAL ANALYSIS

                    This section briefly indicates the location of existing
               energy facilities for six regions of the coast, and analyzes
               the ability of these regions to absorb additional energy facility
               development.

                    A.   Hudson River Waterfront, Newark and Raritan Bay

                    The coast in this region of the state is outside the present
               CAFRA boundary. It is the site of many energy facilities, as well
               as other forms of industrial and commercial development. It includes
               the Port of New York and New Jersey, administered by the New York-
               New Jersey Port Authority of New York and New Jersey, and the
               Hackensack Meadowlands, which are governed by the Hackensack Meadow-
               lands Development Commission.

                    New Jersey's portion of the Port of New York and New Jersey is
               one of the most intensely developed areas in the country. Within
               Bergen, Hudson, Union and Middlesex counties are located seven
               electric generating plants, two oil refineries (one of which is
               currently not operating), and numerous oil and gas pipelines and
               their storage areas. included among the numerous port facilities in
               the region are marine terminals that receive crude oil, refined
               petroleum products and a wide variety of petrochemicals.

                    The use of this region for energy-related purposes is facil-
               itated by its accessibility for ocean transport. The channel in New
               York harbor is maintained at a depth of forty feet.

                    The presence of an energy infrastructure and the proximity
               of the area to high energy demand centers suggest that this region
               will continue to be an important location for energy facility
               development. in fact, the Port Authotity of New York and New Jersey
               is currently investigating the suitability of sites in the Port as a
               staging area for OCS exploration. Finally, although no LNG facil.-
               ities exist in New Jersey, PSE&G has such facilities on Staten
               Island, directly across from the Arthur Kill from New Jersey.

                    The State regulates energy facilities in this region indirectly
               through the processing of air and water permits and the issuance of
               riparian grants, leases, and permits. A proposal to build chemical
               storage tanks in Bayonne-Jersey City, for example, came to the
               attention of the Department of Environmental Protection (DEP) by
               virtue of permits the company needed to comply with state and
               federal air and water standards and riparian permits which it   needed
               to build to the pierhead line.

                    Because the region is already so intensively developed, refinery
               expansion or the construction of a gas processing plant, for example,
               could be viewed as having relatively small incremental impacts on
               the environmental quality or aesthetic character of the region.
               Residents in the area, however, see development pressures from two
               perspectives. On the one hand, they welcome the jobs which energy
               development would bring. They also feel that they have contributed
               their fair share in providing the state and the region with energy
               facilities which have degraded the quality of their air, water and
               aesthetic environment.

                                              -78-

                  B.  North Shore

                  Middlesex and Monmouth counties constitute the northern
            boundaries of CAFRA. Middlesex abuts Raritan Bay and has, in
            contrast to Monmouth, a high concentration of energy facilities.
            The "Jersey Shore" begins with Monmouth County and its orien-
            tation to the ocean.

                  Middlesex County contains four electric generating stations
            and one petroleum refinery. The Raritan River has a channel depth
            of 30 feet, and accommodates small tankers travelling to the various
            energy facilities fronting on the Arthur Kill Waterway.

                  In the event that oil and gas is commercially produced in
            the Baltimore Canyon, these counties may be affected. Efforts may
            be made to route offshore pipelines north of Sandy Hook to existing
            refineries in Linden and Perth Amboy. While this strategy would
            protect ocean beaches and leave the barrier islands undisturbed, the
            offshore waters could pose several hazards to pipeline placement by
            virtue of an explosive dumping area and existing shipping lanes off
            Sandy Hook. Because of the heavy shipping in this area, it will be
            necessary to assure that pipelines, if used, be deeply imbedded in
            the ocean floor so that ship anchors do not pose unnecessary risks.

                  While Monmouth County might not feel the pressures to the
            degree of Middlesex, it could be impacted by spills in the event
            that tankers were used because of the increased statistical risk of
            oil spills associated with tankers. In this case, tourism in the
            area might suffer.

                  In 1972, Jersey Central Power and Light Company proposed
            to site an oil-fueled generating plant in Union Beach, on Raritan
            Bay. The application, which falls under the Wetlands Act and other
            authorities, is presently dormant.

                                           -79-

                    C.   Central Shore

                    Ocean County's main coastline is protected by two barrier beach
               islands separated by Barnegat Inlet, which has an average channel
               depth of ten feet. It includes Long Beach Island and Island Beach
               State Park. Because of the great recreational and ecological
               significance of this section of the Atlantic coast, Ocean County
               would be among those areas of the State most susceptible to the
               adverse affects of energy facility development.

                    Nonetheless, Ocean County is the site of two electric power
               plants, including the Oyster Creek nuclear station in Lacey Township.
               Rated at 650 MW, the Oyster Creek station was the first commercial
               reactor in the nation when it-began operating in 1969. Jersey
               Central Power and Light has started to build a second nuclear
               plant, known as Forked River, immediately adjacent to Oyster Creek,
               in Lacey Township.

                    Ocean County's proximity to the Baltimore Canyon makes it
               a potential site for hydrocarbon pipelines, gas processing facil-
               ities and other OCS-related facilities. The shallow channel depths
               of the Barnegat inlet would seem to preclude Ocean County, however,
               as a staging area. The great importance of recreation in this
               County raises major concerns over potential conflicts with OCS
               activities.

                    A moratorium on the issuance of CAFRA residential permits
               within four miles of the Oyster Creek plant was imposed in March
               1976 by the Department of Environmental Protection pending a
               study to determine appropriate land uses surrounding nuclear
               plants.

                    The Board of Chosen Freeholders of Ocean County has officially
               opposed proposals for further nuclear power plant construction
               within its jurisdiction.

                                             -80-

                 D.   South Shore

                 Like Ocean County, the South Shore of Cape May, Atlantic,
             and Burlington counties is devoted to low intensity land uses, such
             as recreation, with which energy development may conflict. Atlantic
             City, however, has special potential as a location for OCS-related
             energy facility development, because of an established infrastruc-
             ture, manpower, and available land.

                 Four electric generating-stations are located on the South
             Shore. Although no nuclear stations presently exist in the region,
             the Public Service Electric and Gas Company has submitted a proposal
             to construct a floating nuclear plant 2.8 miles off of Little Egg
             Harbor. The twin reactors would be placed on barges and surrounded
             by a massive breakwater. A proposal to construct a floating nuclear
             plant 2.8 miles off Atlantic City.is under review by the U.S.
             Nuclear Regulatory Commission. The earliest possible date for the
             start of operations is the mid-1980's. Special state legislation
             would be needed by the utility to use State waters beyond the
             pierhead line. A CAFRA permit is also required.

                 A moratorium on the issuance of CAFRA residential permits
             within four miles of the Oyster Creek plant was imposed in March
             1976 by the Department of Environmental Protection pending a study
             to determine appropriate land uses surrounding nuclear plants.
             Both Atlantic and Cape May Counties have adopted resolutions op-
             posing both floating and land based nuclear plants within their
             jurisdictions.

                 The Atlantic City area has been viewed as a potential staging
             area for OCS activities. The Absecon Inlet has a channel depth of
             between 15 and 20 feet suitable for some OCS support vessels. The
             channel is, however, subject to frequent shoaling. Although most
             oil and gas companies which obtained leases in Sale 40 will be using
             Davisville, Rhode Island as their support base during exploration,
             one company at least, has expressed an interest in using Atlantic
             City as its operating base.

                 In 1975, stratigraphic well drilling by a consortium of oil
             and gas companies under the supervision of U.S. Geological Survey
             was conducted out of Atlantic City. Although interest in onshore
             OCS-related development by local government in Atlantic City has
             lapsed somewhat since the passage of the referendum approving
             casino gambling, the area's proximity to the offshore tracts makes
             it a natural candidate for some onshore OCS activities. Lessees,
             for example, have identified Atlantic City in their exploration
             plans as their helicopter base to carry personnel back and forth to
             the rigs. Also, the U.S. Geological Survey, which oversees OCS
             operations, opened an office in the City in April 1977. In addition,
             the Atlantic City area, which is closest to some of the offshore
             lease tracts, is a possible site for a potential pipeline since
             economics will favor the shortest, most direct route to land off-
             shore oil and gas. If Atlantic City area were to serve as a land-
             fall, a pipeline might be routed westwards along the existing
             right-of-way of the Atlantic City Expressway to the Delaware
             River area refineries or northwards to the Linden and Perth Amboy
             refineries.

                    Some indication of the role perceived by Atlantic City for
               OCS activities will probably be indicated in the Master Plan that
               is currently being prepared by the Office of Angelos Demetriou of
               Washington, D.C.

                                             -82-

                  E.   Delaware Bay

                  Cumberland and Salem Counties have been the focus of energy
             proposals for two reasons: large land areas are available for
             development in both counties; and the low population means that a
             smaller number of human lives are at risk from nuclear or other
             types of energy-related accidents, than would be the case elsewhere
             in the State.

                  The two counties are the site of three fossil-fueled and four
             nuclear fueled electric generating stations. (See Figure 3, p. 13).
             The first of the nuclear units, known as Salem #1, began operations
             in December 1976. The Hope Creek nuclear generating units are
             expected to commence operations in 1982 and 1984. The Hope Creek
             units were approved in 1975 under the Coastal Area Facility Review
             Act.

                  Artificial Island, which will ultimately accommodate all four
             nuclear units was formed from dredge spoils from the Delaware
             River. It has been deemed a suitable site for.energy development
             because of its distance from population centers and the availability
             of cooling waters. Further energy development at this location,
             however, would place an increased thermal load on the environment.

                                           -83-

                    F.   Delaware River Waterfront

                    Like the Hudson River Waterfront, the Delaware River Water-
               front, including Gloucester, Camden, Burlington and Mercer counties,
               is also a center of energy facilities in New Jersey.

                    The Delaware River Waterfront, including both New Jersey and
               Pennsylvania, is the site of numerous energy facilities. The
               facilities in New Jersey include two refineries and four electric
               generating stations. In addition, numerous transcontinental hydro-
               carbon pipelines either terminate in this region or traverse the
               region en route to facilities in New Jersey along the Hudson.

                    This region is also the proposed location of two LNG facilities.
               The El Paso Eastern Company has applied to both the Federal Power
               Commission and New Jersey Department of Environmental Protection to
               build an LNG port terminal facility in Logan Township, Gloucester
               County. Tenneco LNG, Inc. has proposed a facility for West Deptford,
               also in Gloucester County. An environmental impact statement by
               staff to the Federal Power Commission on the LNG projects recommended
               that the Tenneco application be denied on the basis of safety
               hazards. The State has petitioned the FPC to issue LNG facility
               siting guidelines, prior to action on these applications. At the
               moment, both of these proposals are dormant.

                    The City of Camden has been identified as a possible site for
               some OCS activities, particularly the construction of a platform
               building yard. It is likely that Camden will be impacted by
               secondary and induced effects of OCS as a result of its proximity to
               the Mobil and Texaco refineries and its existing industrial base and
               infrastructure. Again as with Atlantic City, it is expected that
               this would have a rejuvenating influence on the City's economy.
               As in the case of the Hudson River waterfront, the relatively small
               incremental impact on the environmental quality or aesthetic charac-
               ter of the region produced by energy facility development must be
               balanced against the need to equitably distribute the effects of
               development, positive as well as negative.

                                             -84-

           VII. ENERGY FACILITY SITING POLICIES

                NJOCZM's involvement in energy planning and siting stems
           from the suitability that a coastal or waterfront site affords an
           energy facility in terms of access for transportation and cooling..
           Also, NJOCZM has a mandate to include energy facilities in its
           coastal zone management program. In developing the energy element
           of this coastal plan, NJOCZM has been hampered by the lack of
           state-specific data on energy supply, demand and projections.
           Hopefully, this situation will change as the new Department of
           Energy starts work on the Master Plan it is charged to prepare
           during its first year of operation. This should simplify the data
           gathering and analysis NJOCZM has been performing and permit more
           time to concentrate on developing more specific energy facility
           siting policies.

                The energy facility siting policies reproduced below are
           those which ap? ear in A Coastal Management Strategy for New Jersey
           -- CAFRA Area, a document required by the 1973 Coastal Area
           Facility Review Act (NJSA 13:19-16). They were based on consul-
           tations with staff of DEP, the new Department of Energy and on
           responses received by utilities, energy companies and individuals to
           the Interi!9 Land Use and Density Guidelines for the Coastal Area of
           New Jersey   and3the Call for Information on Coastal Area Energy
           Facility Siting issued in 1975 and 1976. They were also based on
           research conducted in preparing earlier drafts of this report.
           Clearly, these policies are but one step in the complex task of
           establishing comprehensive energy programs and planning. In suc-
           ceeding publications, NJOCZM will work to refine these policies
           and to spell out their implications for specific coastal regions
           and sites.

                These policies indicate general criteria NJOCZM will use
           to evaluate a specific coastal energy facility proposal. They
           provide an opportunity for interested individuals and groups to
           comment on the direction indicated by the policies and their com-
           patibility with draft policies for other coastal uses, and to
           suggest beneficial next steps in coastal energy policy making.
           Lastly, these policies offer a position to be compared and coor-
           dinated with positions taken by the many other agencies at all
           levels of government with responsibility for coastal and/or energy
           decision making.

           GENERAL ENERGY FACILITY SITING POLICY

                1.   Energy Facilities will be approved only after review
                     by DEP and the New Jersey Department of Energy (P.L.
                     1977, C. 146, N.J.S.A. 52:27-1 et seg.) to insure the
                     protection of both the built and natural environment
                     of the coast and of public health, safety and welfare,
                     to the maximum extent feasible. Energy facilities
                     must demonstrate consistency with the master plan to
                     be 12repared by the Department of Energy for the pro-
                     duction, distribution, consumption and conservation
                     of energy. The overlapping responsibilities of the
                     Department of Environmental Protection and the Depart-

                                          -85-

                         ment of Energy require early consultation between these
                         two agencies to promote efficiency and the orderly siting
                         in the coastal zone of clearly needed energy facilities.

                    Where the Department of Energy and the Department of Environ--
               mental Protection do not agree on a specific energy facility appli-
               cation (for example, concerning the need for a particular energy
               facility in the coastal zone, or for a specific proposed site for
               one type of energy facility), the disputed decision shall, in accord
               with state law, be submitted to the State's Energy Facility Review
               Board for final administrative action.

               GENERAL OUTER CONTINENTAL SHELF (OCS) OIL AND GAS EXPLORATION
                                   AND DEVELOPMENT POLICY

                    2.   Rapid exploration of the Mid-Atlantic, North Atlantic,
                         and other offshore areas with potential reserves of
                         crude oil and natural gas is encouraged, as long as
                         all activities related to these potential offshore
                         energy resources are carried out in a manner that
                         respects the built and natural environment of the coastal
                         zone.

                    The decision of the U.S. Department of Interior to lease
               offshore tracts for crude oil and natural gas exploration presents
               New Jersey with new onshore and marine-related environmental
               problems and opportunities. New Jersey supports offshore explor-
               ation, recognizing the national need to identify  new energy supplies,
               as long as this new industrial activity does not conflict with the
               State's second most important industry, tourism, which depends upon
               the 6igh quality and public perceptions of the coastal environment.

               ONSHORE SUPPORT BASES

                    3.   Onshore support bases to support offshore oil and gas
                         exploration, devel02ment, and production (including
                         facilities for work boats, crew boats, pipeline barges,
                         and storage facilities) shall be encouraged to locate
                         in built-up urban areas of the coast that have land
                         already committed to heavy or light industrial uses
                         and adequate harbor facilities. Preferable locations
                         for onshore support bases include urban waterfront areas
                         where onshore physical, economic, social, and insti-
                         tutional impacts will be less than the impacts likely
                         to take place in those less industrially developed
                         areas which are more dependent upon tourism and the
                         resort industry.

                    With offshore exploratory activity expected to begin off
               New Jersey in the Baltimore Canyon in early 1978, the offshore
               oil and gas industry is likely to seek onshore support bases
               closer to th*e offshore tracts than the prsent temporary bases
               established by the major oil, gas, and offshore service and supply
               companies at Davisville, Rhode Island. This policy recognizes that
               the New Jersey coast is favored by proximity to the offshore tracts
               as a site for onshore staging bases, and carries out the basic
               policy to concentrate rather than disperse industrial development in
               the coastal zone.              -86-

            OFFSHORE PLATFORM CONSTRUCTION YARDS

                 4.   Platform construction yards will be encouraged in built-up
                      areas which have the requisite acreage, adeguate industrial
                      infrastructure, ready access to the open sea, adequate
                      water depth, and where the operation of such a yard would
                      not alter existing recreational uses of the ocean and
                      waterways in the area.

                 If offshore exploration proves successful, then the develop-
            ment phase of OCS activity in the Mid-Atlantic may require a site
            or sites for constructing the steel platforms used offshore, in
            addition to the platform construction yard tentatively planned for
            the vicinity of St. Charles on the Chesapeake Bay on the Delmarva
      4     Peninsula in Virginia. Platform yards typically do not have the
            adverse air and water quality impacts associated with some other
            industries. Platform construction yards are labor intensive and
            could exert potentially disruptive effects on the economy and
            social structure of undeveloped areas. For these reasons, offshore
            platform construction yards are encouraged to seek locations in the
            already developed areas of the New Jersey coast.

            PIPELINES AND ASSOCIATED FACILITIES

                 5.   Crude oil and natural gas pipelines will be permitted
                      to bring hydrocarbons from offshore New Jersey's coast
                      to existing refineries and oil and gas transmission and
                      distribution systems, subject to the following conditions:

                      (a)  The number of pipeline corridors, including trunk
                           pipelines for natural gas and oil, shall be limited,
                           to the maximum extent feasible, and designated fol-
                           lowing appropriate study and analysis by Department
                           of Environmental Protection and the New Jersey
                           federal, state and local agencies and affected
                           industries,

                      (b)  The initial corridor shall, to the maximum extent
                           feasible, be located along existing rights-of-way
                           and shall avoid undevelo2ed regions of the Pine
                           Barrens; specifically, the corridor shall avoid
                           the Mullica River and Cedar Creek watersheds and
                           portions of the Rancocas Creek and Toms River
                           watersheds (the 760 square mile region identified
                           by DEP as a proposed "critical area" for sewerage
                           purposes and proposed non-degradation water quality
                           standards) and other undeveloped parts of the Pine
                           Barrens, and instead follow already existing devel-
                           oped or disturbed rights-of-way such as the Atlantic
                           City Expresswayr
                      (c)  Major pum@inq stations and other ancillary facilities
                           to                 eipelines shall be encouraqed at
                           Tocations outside of the coastal area
                           CAFRA and
                                     t@@Lo -es @lna@r!_O@t e@t@A foot contour
                           interval elsewhere in the state,

                                          -87-

                          (d). Proposals to construct oil and gas pipelines through
                               all or part of the coastal zone shall be evaluated
                               by DEP and the Department of Energy, in terms of
                               the entire new potential pipeline corridor through
                               the State of New Jersey, including all of the'
                               contemplated ancillary facilities, including but
                               not limited to gas processing plants, oil 'storage
                               terminals, booster stations, and other related
                               facilities. These ancillary facilities shall
                               preferably be located well inland from coastal
                               waters and protected by adequate visual, sound,
                               and vegetative buffer areas. The ancillary facil-
                               ities along the pipeline shall also be located
                               outside of the coastal zone to the maximum extent
                               feasible.

                          (e)  A pipeline corridor through the state coastal
                               waters, as well as through the territorial sea
                               of the United States, shall, to the maximum extent
                               feasible, avoid dumps, heavily used waterways,
                               geological faults, and especially productive vege-
                               tation, fish or shellfish habitats. The pipeline
                               corriddor shall be trenched to a depth sufficient
                               to withstand exposure by scouring.

                    New Jersey recognizes that pipelines, rather than other modes
               of transportation such as tankers and barges, are  the most environ-
               mentally sound method of bringing ashore crude oil and natural gas
               from offshore wells. At the same time, the potential onshore
               effects of pipelines on the sensitive ecosystem, of the coast and
               the Pine Barrens, and the visual, noise, and odor impacts poten-
               tially associated with the ancillary facilities require that New
               Jersey proceed cautiously and prudently in selecting pipeline
               corridors, specific alignments, and locations for ancillary facilities.

               OIL REFINERIES AND PETROCHEMICAL FACILITIES

                    6.    New oil refineries and petrochemical facilities are
                          discouraged in the CAFRA region of the coastal zone,
                          and prohibited on barrier islands. Expansion or mod-
                          ernization of existing oil refineries and petrochemical
                          facilities at existing sites will be encouraged if
                          such expansion does not violate applicable state and
                          federal air and water quality standards.

                    Oil refineries and petrochemical facilities will not be
               permitted in areas where they might conflict with the resort-
               tourism industry or areas of recreational or biological value.

               CRUDE OIL  STORAGE

                    7.    Crude oil storage facilities will not be permitted
                          on barrier islands. Storage facilities for crude oil,
                          in the absence of refining facilities, will be per-
                          mitted only in established ports and harbors and where
                          new or expanded oil storage facilities will not con-
                          tribute unacceptably to overall regional air or water
                          quality degradation.

                                               88-

                  Crude oil storage facilities are not coastal-dependent and
             will not be permitted where they might limit recreational or
             open space uses of the coast.

             TANKER TERMINALS

                  8.   multi-company use of existing and new tanker terminals
                       will be encouraged to the maximum extent practicable
                       consistent with anti-trust laws. New or expanded tanker
                       facilities will be discouraged only if they would
                       increase tanker operations and increase associated
                       onshore development in a manner incompatible with the
                       character of non-industrial parts of the coastal zone.

                  Onshore tanker facilities pose potential environmental impacts
             Tanker terminals encourage secondary development activity that
             need not necessarily be situated near the coast. New tanker facil-
             ities will be encouraged in existing ports and harbors.

             DEEPWATER PORTS

                  9.   If a deepwater port were proposed, at the very least,
                       its pipeline routing would be required to follow the
                       pipeline policies above; more broadly, the entire pro-
                       posal would be carefully evaluated in terms of the
                       potential positive and negative roles a deepwater port
                       could play in protecting or harming the broad range
                       of coastal resources.

                  Offshore tanker terminals, sometimes called deepwater ports,
             have the potential for reducing spills associated with tanker
             movements in coastal waters. Also, deepwater ports offer potential
             economies of scale as they may accommodate supertankers that are
             too big to enter New Jersey's ports. At present, while two deep-
             water ports are under active consideration along the Gulf Coast,
             no proposals for deepwater ports appear likely in the near future
             in New Jersey.

             BASE LOAD ELECTRIC GENERATING STATIONS

                  10.  New or expanded fossil fueled electric generating stations
                       powered by coal and oil will be discouraged in "Preser-
                       vation" and other environmentally sensitive areas, and
                       will be directed toward relatively built@up areas, con-
                       sistent with applicable air and water quality standards.

                  11.  No further nuclear electric generating stations will
                       be approved in the coastal zone unless: (a) the Depart-
                       ment of Environmental Protection and the New Jersey
                       Department of Energy are satisfied of the safety and
                       risk potential of this energy technology, ncluding
                       any differences between offshore and land-based plants,
                       (b) the two agencies are assured that operation and
                       disposal of the spent fuel poses no unacceptable safety
                       or environmental hazards to New Jersey residents, (c)
                       the two agencies receive clear proof through the Depart-

                                            -89-

                         ment of Energy's Master Plan that nuclear facilities
                         are needed and vitally important to the public health
                         welfare, and economic well-being of New Jersey resi-
                         dents, (d) the Department of Environmental Protection
                         is assured that the location of the facility will not
                         result in near-by population density increases over
                         the operating lifetime of the facility which might make
                         impossible suitable protective actions in the case of
                         a serious accident, and (e) the Department of Environ-
                         mental Protection and the Department of Energy are
                         satisfied that no other feasible and economical energy
                         alternative exists for the timely and efficient pro-
                         duction of needed electrical power.

                    New Jersey's CAFRA region has two operating nuclear generating
               stations: Oyster Creek in Ocean County and Salem Unit I at Artificial
               Island in Salem County. Four nuclear plants are under construction:
               Salem Unit 2, Forked River in Ocean County, and Hope Creek Units .1
               and 2, on Artificial Island in Salem County (the Hope Creek units
               received CAFRA permits in 1975). A floating nuclear plant, the
               Atlantic Generating Station Units 1 and 2, is proposed by Public
               Service Electric and Gas Company for site 2.8 miles off Little Egg
               Harbor Bay, about 12 miles from Atlantic City.

               LIQUIFIED NATURAL GAS (LNG)

                   12.   Until the risks inherent in LNG terminal operations
                         are sufficiently identified and overcome, and until
                         such terminals are found to be consistent with the
                         public health safety, and welfare of nearby residents,
                         LNG terminals shall be built only at sites remote from
                         substantial concentrations of human populations. No
                         LNG terminal shall be approved in the coastal zone
                         until the Federal Power Commission (FPC) responds affirm-
                         atively tothe petition by New Jersey and its neighboring
                         states for the issuance of siting criteria that adequately
                         consider the safety hazards associated with this energy
                         technology. If the FPC does not respond positively
                         to the petition by New Jersey and others, then New Jersey
                         should attempt to create an interstate task force to
                         define appropriate siting criteria for this type of
                         energy facility, whose impacts could clearly affect
                         several states.

                    LNG facilities have been proposed in recent years for Deptford
               and Logan Townships in Gloucester County, New Jersey, and on Staten
               Island, New York from where the LNG would be pipelined to New
               Jersey. Because tankering, transfer and storage of LNG pose sig-
               nificant risks to safety and health and the environment (which may
               not necessarily be restricted to one state) New Jersey recommends
               that the siting of LNG facilities be treated on a regional basis.

                                             _90-

            SOLAR AND  WIND POWERED GENERATING PLANTS

                13.    Solar and wind powered generating plants, including
                       experimental and demonstration projectss, will be
                       encouraged to locate in the coastal" zone to the extent
                       that these plants do not unreasonably affect scenic
                       or recreational values and meet existing state and
                       federal environmental requirements.

                  New energy technologies, such as solar and wind powered
            plants, should be encouraged as the Nation seeks imaginative
            responses to the energy challenge.

                  Planning for Energy Facilities

                  DEP/OCZM will continue to sponsor studies at both the state
            and county level to provide maximum information regarding the
            need for energy facilities, the impacts of different types of
            facilities and the ability and willingness of specific coastal
            locations to accommodate specific energy facilities. Where appro-
            priate, these studies will be carried out in cooperation with other
            public agencies at the local, state and/or federal level.

            VIII. CONCLUSION

                  The complex problems and questions raised by energy issues
            are new to most New Jersey residents. Hindering the process is
            the rapidity with which new and often conflicting information
            on energy matters is being issued necessitating constant review,
            analysis and updating. Indeed, constantly changing decisions
            by the state and federal government, which in turn reflect reordered
            r)riorities on energy matters, have already resulted in several
            revisions of this draft, and it is highly likely that between the
            completion and printing of this report, events will occur which will
            supersede some of the statements made here.

                  Decisions on energy policy can dramatically affect each
            individual's life. They can no longer be considered "too technical"
            to allow for the concerns and comments by members of the general
            public. This paper is an attempt by the New Jersey Office of
            Coastal Zone Management to provide the public with information on
            energy facility siting in the state and to propose initial siting
            policies.

                  In asking for comments on this paper, the Office of Coastal
            Zone Management seeks criticisms of the suggested policies. It
            also  seeks corrections, comments and suggestions on the factual
            materials presented. Policies to best meet New Jersey's energy
            needs will emerge only from a decision-making process which pro-
            vides the information and opportunity for participation by a wide
            range  of people.

                                            _91-

                                         SELECTED BIBLIOGRAPHY

                     Books

                     American Petroleum Institute. Basic Petroleum Data Book.
                          Washington, D.C., 1976.

                     Cecil, J. L. and Morrell, David, New Jersey Natural Gas Shorta2e:
                          A Policy Analysis. Upton, New York: Brookhaven National
                          Laboratory, 1976.
                     Dubin-Bloome Associates, P.C. A Study of Electrical Energy.
                          Usage in the Public Service Electric and Gas Co., Service
                          Territory of New Jersey. Prepared for the N.J. Department
                          of the Public Advocate Division of Rate Counsel, New York,
                          1976.

                     Edison Electric Institute. Statistical Year Book of the
                          Electric Utility Industry for 1974. New York, 1975.

                     Fairchild Stratos Division, Offshore LNG Receiving Terminal
                          Project, March 1977 (Report #R-76153).

                     Isar d, Walter, et al. Regional Economic Impacts of Nuclear
                          Power Plants. Upton, New York: Brookhaven National
                          Laboratory, 1976.

                     Kash, Don E., et al. Energy Under the Oceans, Norman, Oklahoma:
                          University of Oklahoma Press. 1973.

                     Komanoff, Charles. Power Plant Performances -- Nuclear and
                          Coal Capacity Factors and Economics. New York: Council
                          on Economic Priorities, 1976.

                     Meier, Peter M., and David Morrell. Issues in Clustered
                          Nuclear Siting: A Comparison of a Hypothetical Nuclear
                          Energy Center in New Jersey with Dispersed Nuclear Siting.
                          Upton, New York: Brookhaven National Laboratories, 1976.

                     Mitre Corporation, Nuclear Power Issues and Choices. Cambridge
                          Ballinger Publishers, 1977

                     Morrell, David and Singer, Grace. State Legislature and EneE-u
                          Policy in the Northeast: Challenge      and Conflict in the
                          Legislative Arena. Princeton University: Center for
                          Environmental Studies, Report #40, 1976.

                     New Jersey Manufacturers Association, Energy Council.       Energy
                          and New Jersey's Economy, 1975 and Beyond. April 1975.

                     Public Service Electric and Gas Company Atlantic City Electric
                          Group, et al. New Jersey Siting Plan-Major Electric
                          Generating Projects 1975-1979. January 1975.

                     Public Service Electric and Gas Company, "Nuclear vs. Fossil
                          Capacity Economic Evaluation" undated (1976?) mimeograph.
                     Public Service Electric and Gas Company, "PSE&G Forecasting
                          Methodology", mimeograph, dated January 29, 1976.
                                                -92-

                 Public Service Electric and Gas Company. 1975 Annual Report.
                      Resource Planning Associates, Inc. Identification and
                      Analysis of Mid-Atlantic Onshore OCS Impacts. Prepared
                      for the Middle Atlantic Governor's Coastal Resources
                      Council. Cambridge, Massachusetts, 1976.

                 Shell Oil Corporation. The National Energy Outlook 1980-1990.
                      September 1976.

                 Topper, Andrea. Grappling with Intergovernmental Relations:
                      Federal Consistency and the Coastal Zone Management Act
                      of 1972, As Amended. Unpublished Master's Thesis, Graduate
                      School of Public and International Affairs, University
                      of Pittsburgh, April 1977.

                 University of Oklahoma. Energy Alternatives: A Comparative
                      Analylsis. Norman, Oklahoma, 1975.

            2.   Journals and Papers

                 Coastal Zone Management Newsletter, October 20, 1976.

                 Backhaus, H.W., "Offshore LNG Handling System Aimed at Severe
                      Conditions", Oil and Gas Journal, September 25, 1977.

                 Dickenson, Ernest. "Existing with the Atom", New York Times,
                      November 7, 1976.

                 Minde, Theodore A. "How New Jersey Industry Uses Natural
                      Gas", reprint from New Jersey Economic Indicators, May 30,
                      1976.

                 Oil and Gas Journal, "Significant Possibilities Line Atlantic
                      Shelf-Offshore U.S. Theaters - 4", September 13, 1976.

                 Paulson, Dr. Glenn, Nuclear Power Plants: The Potential
                      For Non-Federal Government Agencies or Does the NRC
                      Really Control Everything? Paper Presented before
                      the American Nuclear Society, Idaho, August 1977.

                 Rubin, Kenneth A. "The Role of the Coastal Zone Management
                      Act of 1972 in the Development of Oil and Gas from the
                      Outer Continental Shelf". Natural Resources Lawyer,
                      volume 8.

                 Sawmill, John C., "Facing Energy Reality", New York Times,
                      November 1, 1976.

                 Schipper, Lee and Lichtenberg, Allan J. "Efficient Energy
                      Use and Well-Being: The Swedish Example". Science,
                      December 3, 1976.
                 Scholl, Jaye. "How a Few Towns Get Rich from Your Energy
                      Bill", New Jersey Magazine. September, 1976.

                                          -93-

                      Wall Street Journal. "Fuel Shortage Forecast for U.S. Nuclear
                            Plants within Decade or Two". June 7, 1976.

                3.    Federal and Congressional Documents

                      Federal Energy Administration. "Gross Energy Consumption
                            Total", mimeograph computer printout. 1975.

                      Federal Power Commission. Construction and Operation of a
                            LNG Import Terminal at Staten Island, New York, Final
                            Environmental Impact Statement. 1967.

                      Federal Power Commission. Coastal Program Guidelines for
                            New Jersey.

                      U.S.  Congress. House. Report of Committee of Conference       on -the
                            Coastal Zone Management Act Amendments of 1976. (S. 586)
                            #94-1298, 1976.

                      U.S.  Congress, Office of Technology Assessment. Coastal
                            Effects of Offshore Energy Systems. 1976.

                      U.S.  Department of Defense, Army Corps of Engineers. U.S.
                            Deepwater Port Study. (Prepared by Robert R. Nathan
                            Associates for the Institute of Water Resources). 1972.
                      U.S.  Department of@ the Interior. Draft Environmental Statement,
                            proposed 1977 Outer Continental Shelf Oil and Gas Lease
                            Sale, Offshore the North Atlantic States, OCS Sale #42.
                            (1976).

                      U.S.  Department of the Interior. Proposed 1976 Outer Continental
                            Shelf Oil and Gas Lease Sale Offshore the Mid-Atlantic
                            OCS Lease Sale #40. Final Environmental Impact Statement.
                            1976.

                      U.S.  Department of the Interior, Geological Survey. Geological
                            Estimates of Undiscovered Recoverable Oil and Gas Resources
                            in the United States. Circular #725, (1975).

                      U.S.  Environmental Protection Agency, Fish Kills Caused by
                            Pollution in 71973, Washington, D.C.: U. S. Government
                            Printing Office, 1973.

                      U.S.  Environmental Protection Agency. Reactor Safety Study
                            (WASH 1400): A Review of the Final Report. Report
                            #EPA-520/3-76-009. 1976.

                      U.S.  Nuclear Regulatory Commission. Safety Evaluation Report,
                            Supplement #5, Hope Creek. Docket #50-354, 50-355.
                            1976.

                                                  -94-

             4.   State Documents

                  New Jersey Department of Environmental Protection, Testimony
                       by David J. Bardin, Commissioner, before the Senate
                       Committee on Energy and Environment, March 10, 1976.

                  New Jersey Department of Environmental Protection, Statement
                       by David J. Bardin, Commissioner, September 29, 1976
                       on the defeat of the Outer Continental Shelf Lands
                       Amendment Act bill.

                  New Jersey Department of Environmental Protection, Donald
                       T. Graham, Director, Division of Marine Services, "CAFRA
                       and the Shore: Towards Partnership of Builders, Local
                       Officials and DEP": Address given before the New Jersey
                       Shore Builders Association, October 28, 1976.

                  New Jersey Department of Environmental Protection, Division
                       of Marine Services, Office of Coastal Zone Management,
                       Estuarine and Wetlands Resources, Staff Working Paper
                       by Richard Kantor, January 1977.

                  New Jersey Department of Environmental Protection, Tes timony
                       by Dr. Glenn Paulson, Assistant Commissioner, on S. 1407,
                       S. 1721 and S. 1494 before the N.J. Senate's Committee
                       on Energy and the Environment, 1977.

                  New Jersey Department of Environmental Protection. "Call
                       for Information" New Jersey Register, January 1976.

                  New Jersey Department of Environmental Protection, Office
                       of Coastal Zone Management. CAFRA Opinion #20 Hope
                       Creek Generating Station. 1975.

                  New Jersey Department of Environmental Protection, Office
                       of Coastal Zone Management. Interim Land Use and Density
                       Guidelines for the Coastal Area. 1976.

                  New Jersey Department of Environmental Protection, Division
                       of Marine Services, Office of Coastal Zone Management,
                       A Coastal Management Strategy for New Jersey - CAFRA
                       Area, September 1977.

                  New Jersey Economic Development Authority, 1975 Annual Report.

                  New Jersey Governor Brendan T. Byrne's Statement before the
                       Department of the Interior during the Hearings on the
                       Proposed Mid-Atlantic Oil and Gas Lease Sale, Atlantic
                       City, New Jersey, January 27, 1976.

                  New Jersey Governor's Task Force on Energy, Energy--A Report
                       to the Governor of New Jersey. 1974.

                  New Jersey State Energy Office. Proposal to the Office of
                       Energy Conservation and Environment, Federal Energy
                       Administration, February 28, 1975.

                                           -95-

                   New Jersey, State of et al. Petition for rule-making in the matter
                        of the need for site selection and facility operation
                        criteria for liquified natural gas terminals. May 6, 1976
                        Docket #RM76-13 submitted to the Federal Power Commission.

                   Pennsylvania, Commonwealth of. House Committee on Mines and
                        Energy Management. "Nuclear Power", Undated (1976?)
                        mimeograph.

                                            -96-

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