The "Emission Reduction Innovation Act" is designed to enable gas public utilities in New Jersey to develop and implement "utility innovation plans" aimed at reducing greenhouse gas emissions from natural gas usage. The bill introduces definitions for key terms such as "biogas," "carbon capture and utilization," and "renewable natural gas." It specifies that these plans must include innovative resources, expected lifecycle greenhouse gas emissions reductions, cost-effectiveness analyses, and considerations for local job creation. Additionally, the plans must address benefits for low- and moderate-income residential customers and incorporate a cost recovery mechanism for incurred expenses.

The bill requires the Board of Public Utilities (BPU) to review and approve these plans in accordance with the state's greenhouse gas emissions reduction goals set by the "Global Warming Response Act." Utilities must submit annual progress reports and can adjust budgets within approved plans, with specific content requirements for the plans that last five years. The Department of Environmental Protection (DEP) is tasked with reviewing the methodology for calculating lifecycle greenhouse gas reductions within 180 days, ensuring compliance with state goals. The BPU must also follow existing guidelines for evaluating cost-benefit analyses of the proposed plans.