New Jersey Resources CEO Gives Testimony at U.S. House of Representati

New Jersey Resources CEO Gives Testimony at U.S. House of Representatives Subcommittee Hearing

    Business Editors/Energy Editors

    WASHINGTON--(BUSINESS WIRE)--Feb. 16, 2005--

Urges Natural Gas Supply and Energy-Efficiency Provisions for the Energy Policy Act of 2005
    Laurence M. Downes, chairman and CEO of New Jersey Resources (NYSE: NJR), provided testimony today before the U.S. House of Representatives Energy and Commerce Subcommittee on Energy and Air Quality at a hearing on the Energy Policy Act of 2005. Mr. Downes spoke as chairman of the American Gas Association (AGA), the national trade association of U.S. natural gas utilities, on behalf of more than 56 million customers served by member companies.
    In his testimony, Mr. Downes urged Congress to take action to get more natural gas supplies to market and promote energy efficiency so that customers would benefit from a more abundant, reliable supply of natural gas. "Demand for natural gas is growing. Prices are high and volatile. Customers are bearing the burden, and prompt action must be taken," Mr. Downes said.
    According to Mr. Downes, "The difficulties our industry faces today cannot be solved simply by increasing supply. There is no single solution. We must also improve energy efficiency, because a unit of natural gas conserved benefits consumers at least as much as a new unit of gas produced."
    As a first recommendation in the action plan he spelled out for Congress, Mr. Downes said the federal government should make an objective assessment of the rules that restrict resource activity on federal lands, in light of new technology that allows for development of natural gas resources in an environmentally sensitive way. He also asked Congress to support the U.S. Interior Department's efforts to continue expediting permits for natural gas production.
    Secondly, Mr. Downes said, "We need to ensure that an Alaskan natural gas pipeline is constructed and that imports of liquefied natural gas (LNG) are increased." For his third point, he stated, "We must reaffirm our strong commitment to environmental values." He noted that "natural gas is the bridge to a future that relies more heavily on renewable forms of energy," emphasizing that AGA values energy exploration and production that is undertaken "with the highest level of environmental sensitivity."
    Finally, Mr. Downes noted that the way the federal government often measures energy efficiency ignores huge energy losses and called on Congress to direct agencies to change those measurements. Specifically, he said, "Existing federal energy-efficiency legislation should be amended to require that energy efficiency is measured on a full fuel-cycle and a full life-cycle basis - from wellhead to burner tip and from the source to electric appliance."

    (Full text of testimony attached.)

    About New Jersey Resources

    New Jersey Resources (NYSE:NJR), a Fortune 1000 company and a member of the Forbes Platinum 400, provides reliable retail and wholesale energy services to customers in New Jersey and in states from the Gulf Coast to New England, and Canada. Its principal subsidiary, New Jersey Natural Gas, is one of the fastest-growing local distribution companies in the United States, serving more than 450,000 customers in central and northern New Jersey. Other major NJR subsidiaries include NJR Energy Services and NJR Home Services. NJR Energy Services is a leader in the unregulated energy services market, providing customer service and management of natural gas storage and capacity assets. NJR Home Services offers retail customers heating, air conditioning and appliance services. NJR's progress is a tribute to the more than 5,000 dedicated employees who have shared their expertise and focus on quality through more than 50 years of serving customers and the community to make NJR a leader in the competitive energy marketplace. For more information, visit NJR's Web site at njliving.com.

Oral Testimony of Laurence M. Downes Chairman, American Gas Association House Energy and Commerce Committee Subcommittee on Energy and Air Quality February 16, 2005

-- Good morning, Mr. Chairman and members of the Committee.

I am Larry Downes, Chairman of the American Gas Association and Chairman and CEO of New Jersey Natural Gas, a local natural gas utility serving 455,000 customers in New Jersey. The American Gas Association, which has 195 members, is the national trade association of America's natural gas utilities. Collectively, our members serve more than 56 million customers throughout the nation.

-- Thank you for your leadership in addressing the most pressing issue facing our industry today--ensuring reasonably priced natural gas for America's consumers.

-- Natural gas is America's preferred fuel for homes and businesses, in large part because of its environmental advantages.

-- The nation's energy needs require a two-prong attack on the problem: by bringing forth more supply and by promoting energy efficiency.

-- We know that demand for natural gas is growing.

Supply is struggling to keep up.

Prices are high and volatile.

Customers are bearing the burden.

Prompt action must be taken.

What should we do?

I'd like to suggest four areas.

-- First, we must make an objective reassessment of restricted federal lands and streamline federal permitting processes.

Large tracts of federal lands are currently restricted for resource activity.

These limitations were appropriate when put in place decades ago.

Today technology allows for the development of our nation's resources in an environmentally friendly way. We must look at which limitations remain necessary for protecting our environment and which do not. In addition, current permitting processes seriously delay producers' ability to develop the nation's ample resource base. Given the nation's energy needs, we need to expedite these procedures.

-- Second, we need to ensure that an Alaskan natural gas pipeline is constructed and LNG supplies are increased.

We applaud Congress for passing the package of provisions last fall that were needed to jump-start an Alaskan pipeline, which could play a major role in our long-term supply picture. We urge you to enact provisions that will expedite and streamline the building of LNG import facilities, which are also a necessary step in bringing prices down.

-- Third, we must re-affirm our strong commitment to environmental values.

Natural gas is the cleanest of the fossil fuels, and it is in great demand. And natural gas is the bridge to a future that will rely more heavily on renewables. It is sometimes suggested that our industry seeks a "relaxation" or a "loosening" of our nation's environmental values.

We do not.

In fact, our commitment to the environment has never been stronger. And we recognize that all of our suggested initiatives must be undertaken with the highest level of environmental sensitivity -- Fourth, energy efficiency is as much an answer to our problem as is increasing gas supply.

-- The difficulties our industry faces today cannot be solved simply by increasing supply.

-- There is no single solution.

-- We must also improve energy efficiency.

Because a unit of gas conserved benefits consumers at least as much as a new unit of gas produced.

-- In the past quarter century the average residential household has reduced its natural gas consumption by 25%.

But more needs to be done.

-- At the state level, many AGA member companies are exploring regulatory strategies to ensure and encourage greater efficiency and conservation

-- Apart from that, however, here in Washington we need to change how energy efficiency is measured and not ignore huge energy losses.

What are these energy losses?

They are the energy lost between the time an energy-producing raw material is extracted and when it is delivered to the ultimate consumer. Existing federal energy efficiency legislation should be amended to require that energy efficiency is measured on a full fuel-cycle and a full life-cycle basis - from wellhead to burner tip and from the source to electric appliance.

-- In summary:

-- We can determine how this problem is solved. -- It is not an issue of inadequate resources. -- It is an issue of making the right policy choices. -- We can choose to have plentiful, clean natural gas at affordable prices. -- We can choose to have economic growth and robust employment. -- The decision is in your hands. -- Our customers are counting on us.

Thanks for your time.

--30--BS/ny*

CONTACT: New Jersey Resources Media: Kevin Connelly, 732-938-1031 or Investors: Dennis Puma, 732-938-1229

KEYWORD: NEW YORK NEW JERSEY INDUSTRY KEYWORD: OIL/GAS ENERGY UTILITIES SOURCE: New Jersey Resources

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