SREC Developments

New Jersey Senate Bill 4275

This is a bill, not yet a law.

This bill would allow the Board of Public Utilities (BPU) to increase the cost to customers of the State’s Class I renewable energy requirement during energy years 2022 through 2024 above the current limit of seven percent of the total paid for electricity by all customers in the State, under certain conditions.

Under the bill, the BPU could only make this increase if the cost of the Class I renewable energy requirement is less than nine percent of total energy costs during energy years 2019 through 2021 (the limit set by current law). In addition, the total amount paid by customers during energy years 2019 through 2024 could not exceed the sum of: (1) nine percent of total energy costs during energy years 2019 through 2021; and (2) seven percent of total energy costs during energy years 2022 through 2024, i.e. the maximum amount allowed by current law over that six-year period.

“Energy year” means the 12-month period from June 1st through May 31st, numbered according to the calendar year in which it ends.

 

https://www.njleg.state.nj.us/2018/Bills/S4500/4275_I1.HTM

 

SENATE, No. 4275

 

STATE OF NEW JERSEY

218th LEGISLATURE

 

INTRODUCED DECEMBER 5, 2019

 

 

 

Sponsored by:

Senator  BOB SMITH

District 17 (Middlesex and Somerset)

 

 

 

 

SYNOPSIS

     Allows BPU to increase cost to customers of Class I renewable energy requirement for energy years 2022 through 2024, under certain conditions.

 

CURRENT VERSION OF TEXT

     As introduced.

 

 

An Act concerning the cost to customers of Class I renewable energy and amending P.L.1999, c.23.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

      1.   Section 38 of P.L.1999, c.23 (C.48:3-87) is amended to read as follows:

      38.    a.  The board shall require an electric power supplier or basic generation service provider to disclose on a customer's bill or on customer contracts or marketing materials, a uniform, common set of information about the environmental characteristics of the energy purchased by the customer, including, but not limited to:

     (1)   Its fuel mix, including categories for oil, gas, nuclear, coal, solar, hydroelectric, wind and biomass, or a regional average determined by the board;

     (2)   Its emissions, in pounds per megawatt hour, of sulfur dioxide, carbon dioxide, oxides of nitrogen, and any other pollutant that the board may determine to pose an environmental or health hazard, or an emissions default to be determined by the board; and

     (3)   Any discrete emission reduction retired pursuant to rules and regulations adopted pursuant to P.L.1995, c.188.

      b.   Notwithstanding any provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, in consultation with the Department of Environmental Protection, after notice and opportunity for public comment and public hearing, interim standards to implement this disclosure requirement, including, but not limited to:

     (1)   A methodology for disclosure of emissions based on output pounds per megawatt hour;

     (2)   Benchmarks for all suppliers and basic generation service providers to use in disclosing emissions that will enable consumers to perform a meaningful comparison with a supplier's or basic generation service provider's emission levels; and

     (3)   A uniform emissions disclosure format that is graphic in nature and easily understandable by consumers.  The board shall periodically review the disclosure requirements to determine if revisions to the environmental disclosure system as implemented are necessary.

     Such standards shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act."

      c.    (1)   The board may adopt, in consultation with the Department of Environmental Protection, after notice and opportunity for public comment, an emissions portfolio standard applicable to all electric power suppliers and basic generation service providers, upon a finding that:

     (a)   The standard is necessary as part of a plan to enable the State to meet federal Clean Air Act or State ambient air quality standards; and

     (b)   Actions at the regional or federal level cannot reasonably be expected to achieve the compliance with the federal standards.

     (2)   By July 1, 2009, the board shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), a greenhouse gas emissions portfolio standard to mitigate leakage or another regulatory mechanism to mitigate leakage applicable to all electric power suppliers and basic generation service providers that provide electricity to customers within the State.  The greenhouse gas emissions portfolio standard or any other regulatory mechanism to mitigate leakage shall:

     (a)   Allow a transition period, either before or after the effective date of the regulation to mitigate leakage, for a basic generation service provider or electric power supplier to either meet the emissions portfolio standard or other regulatory mechanism to mitigate leakage, or to transfer any customer to a basic generation service provider or electric power supplier that meets the emissions portfolio standard or other regulatory mechanism to mitigate leakage.  If the transition period allowed pursuant to this subparagraph occurs after the implementation of an emissions portfolio standard or other regulatory mechanism to mitigate leakage, the transition period shall be no longer than three years; and

     (b)   Exempt the provision of basic generation service pursuant to a basic generation service purchase and sale agreement effective prior to the date of the regulation.

     Unless the Attorney General or the Attorney General's designee determines that a greenhouse gas emissions portfolio standard would unconstitutionally burden interstate commerce or would be preempted by federal law, the adoption by the board of an electric energy efficiency portfolio standard pursuant to subsection g. of this section, a gas energy efficiency portfolio standard pursuant to subsection h. of this section, or any other enhanced energy efficiency policies to mitigate leakage shall not be considered sufficient to fulfill the requirement of this subsection for the adoption of a greenhouse gas emissions portfolio standard or any other regulatory mechanism to mitigate leakage.

      d.   Notwithstanding any provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, after notice, provision of the opportunity for comment, and public hearing, renewable energy portfolio standards that shall require:

     (1)   that two and one-half percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from Class II renewable energy sources;

     (2)   beginning on January 1, 2020, that  21 percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from Class I renewable energy sources.  The board shall increase the required percentage for Class I renewable energy sources so that by January 1, 2025, 35 percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider shall be from Class I renewable energy sources, and by January 1, 2030, 50 percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider shall be from Class I renewable energy sources.  Notwithstanding the requirements of this subsection, the board shall ensure that the cost to customers of the Class I renewable energy requirement imposed pursuant to this subsection shall not exceed nine percent of the total paid for electricity by all customers in the State for energy year 2019, energy year 2020, and energy year 2021, respectively, and shall not exceed seven percent of the total paid for electricity by all customers in the State in any energy year thereafter ; provided that, if in energy years 2019 through 2021 the cost to customers of the Class I renewable energy requirement is less than nine percent of the total paid for electricity by all customers in the State, the board may increase the cost to customers of the Class I renewable energy requirement in energy years 2022 through 2024 to a rate greater than seven percent, as long as the total costs to customers for energy years 2019 through 2024 does not exceed the sum of nine percent of the total paid for electricity by all customers in the State in energy years 2019 through 2021 and seven percent of the total paid for electricity by all customers in the State in energy years 2022 through 2024 .  In calculating the cost to customers of the Class I renewable energy requirement imposed pursuant to this subsection, the board shall not include the costs of the offshore wind energy certificate program established pursuant to paragraph (4) of this subsection.  The board shall take any steps necessary to prevent the exceedance of the cap on the cost to customers including, but not limited to, adjusting the Class I renewable energy requirement.

     An electric power supplier or basic generation service provider may satisfy the requirements of this subsection by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection;

     (3)   that the board establish a multi-year schedule, applicable to each electric power supplier or basic generation service provider in this State, beginning with the one-year period commencing on June 1, 2010, and continuing for each subsequent one-year period up to and including, the one-year period commencing on June 1, 2033, that requires the following number or percentage, as the case may be, of kilowatt-hours sold in this State by each electric power supplier and each basic generation service provider to be from solar electric power generators connected to the distribution system in this State:

     EY 2011                 306 Gigawatthours (Gwhrs)

     EY 2012                 442 Gwhrs

     EY 2013                 596 Gwhrs

     EY 2014                 2.050%

     EY 2015                 2.450%

     EY 2016                 2.750%

     EY 2017                 3.000%

     EY 2018                 3.200%

     EY 2019                 4.300%

     EY 2020                 4.900%

     EY 2021                 5.100%

     EY 2022                 5.100%

     EY 2023                 5.100%

     EY 2024                 4.900%

     EY 2025                 4.800%

     EY 2026                 4.500%

     EY 2027                 4.350%

     EY 2028                 3.740%

     EY 2029                 3.070%

     EY 2030                 2.210%

     EY 2031                 1.580%

     EY 2032                 1.400%

     EY 2033                 1.100%

     No later than 180 days after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), the board shall adopt rules and regulations to close the SREC program to new applications upon the attainment of 5.1 percent of the kilowatt-hours sold in the State by each electric power supplier and each basic generation provider from solar electric power generators connected to the distribution system.  The board shall continue to consider any application filed before the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.).  The board shall provide for an orderly and transparent mechanism that will result in the closing of the existing SREC program on a date certain but no later than June 1, 2021.

     No later than 24 months after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), the board shall complete a study that evaluates how to modify or replace the SREC program to encourage the continued efficient and orderly development of solar renewable energy generating sources throughout the State.  The board shall submit the written report thereon to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature.  The board shall consult with public utilities, industry experts, regional grid operators, solar power providers and financiers, and other State agencies to determine whether the board can modify the SREC program such that the program will:

     -      continually reduce, where feasible, the cost of achieving the solar energy goals set forth in this subsection;

     -      provide an orderly transition from the SREC program to a new or modified program;

     -      develop megawatt targets for grid connected and distribution systems, including residential and small commercial rooftop systems, community solar systems, and large scale behind the meter systems, as a share of the overall solar energy requirement, which targets the board may modify periodically based on the cost, feasibility, or social impacts of different types of projects;

     -      establish and update market-based maximum incentive payment caps periodically for each of the above categories of solar electric power generation facilities;

     -      encourage and facilitate market-based cost recovery through long-term contracts and energy market sales; and

     -      where cost recovery is needed for any portion of an efficient solar electric power generation facility when costs are not recoverable through wholesale market sales and direct payments from customers, utilize competitive processes such as competitive procurement and long-term contracts where possible to ensure such recovery, without exceeding the maximum incentive payment cap for that category of facility.

     The board shall approve, conditionally approve, or disapprove any application for designation as connected to the distribution system of a solar electric power generation facility filed with the board after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), no more than 90 days after receipt by the board of a completed application.  For any such application for a project greater than 25 kilowatts, the board shall require the applicant to post a notice escrow with the board in an amount of $40 per kilowatt of DC nameplate capacity of the facility, not to exceed $40,000.  The notice escrow amount shall be reimbursed to the applicant in full upon either denial of the application by the board or upon commencement of commercial operation of the solar electric power generation facility.  The escrow amount shall be forfeited to the State if the facility is designated as connected to the distribution system pursuant to this subsection but does not commence commercial operation within two years following the date of the designation by the board.

     For all applications for designation as connected to the distribution system of a solar electric power generation facility filed with the board after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), the SREC term shall be 10 years.

     (a)   The board shall determine an appropriate period of no less than 120 days following the end of an energy year prior to which a provider or supplier must demonstrate compliance for that energy year with the annual renewable portfolio standard;

     (b)   No more than 24 months following the date of enactment of P.L.2012, c.24, the board shall complete a proceeding to investigate approaches to mitigate solar development volatility and prepare and submit, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), a report to the Legislature, detailing its findings and recommendations.  As part of the proceeding, the board shall evaluate other techniques used nationally and internationally;

     (c)   The solar renewable portfolio standards requirements in this paragraph shall exempt those existing supply contracts which are effective prior to the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.) from any increase beyond the number of SRECs mandated by the solar renewable energy portfolio standards requirements that were in effect on the date that the providers executed their existing supply contracts.  This limited exemption for providers' existing supply contracts shall not be construed to lower the Statewide solar sourcing requirements set forth in this paragraph. Such incremental requirements that would have otherwise been imposed on exempt providers shall be distributed over the providers not subject to the existing supply contract exemption until such time as existing supply contracts expire and all providers are subject to the new requirement in a manner that is competitively neutral among all providers and suppliers.  Notwithstanding any rule or regulation to the contrary, the board shall recognize these new solar purchase obligations as a change required by operation of law and implement the provisions of this subsection in a manner so as to prevent any subsidies between suppliers and providers and to promote competition in the electricity supply industry.

     An electric power supplier or basic generation service provider may satisfy the requirements of this subsection by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection, or compliance with the requirements of this subsection may be demonstrated to the board by suppliers or providers through the purchase of SRECs.

     The renewable energy portfolio standards adopted by the board pursuant to paragraphs (1) and (2) of this subsection shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act."

     The renewable energy portfolio standards adopted by the board pursuant to this paragraph shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 30 months after such filing, and shall, thereafter, be amended, adopted or readopted by the board in accordance with the "Administrative Procedure Act"; and

     (4)   within 180 days after the date of enactment of P.L.2010, c.57 (C.48:3-87.1 et al.), that the board establish an offshore wind renewable energy certificate program to require that a percentage of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from offshore wind energy in order to support at least 3,500 megawatts of generation from qualified offshore wind projects.

     The percentage established by the board pursuant to this paragraph shall serve as an offset to the renewable energy portfolio standard established pursuant to paragraph (2) of this subsection and shall reduce the corresponding Class I renewable energy requirement.

     The percentage established by the board pursuant to this paragraph shall reflect the projected OREC production of each qualified offshore wind project, approved by the board pursuant to section 3 of P.L.2010, c.57 (C.48:3-87.1), for 20 years from the commercial operation start date of the qualified offshore wind project which production projection and OREC purchase requirement, once approved by the board, shall not be subject to reduction.

     An electric power supplier or basic generation service provider shall comply with the OREC program established pursuant to this paragraph through the purchase of offshore wind renewable energy certificates at a price and for the time period required by the board.  In the event there are insufficient offshore wind renewable energy certificates available, the electric power supplier or basic generation service provider shall pay an offshore wind alternative compliance payment established by the board.  Any offshore wind alternative compliance payments collected shall be refunded directly to the ratepayers by the electric public utilities.

     The rules established by the board pursuant to this paragraph shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.).

     e.     Notwithstanding any provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, after notice, provision of the opportunity for comment, and public hearing:

     (1)   net metering standards for electric power suppliers and basic generation service providers.  The standards shall require electric power suppliers and basic generation service providers to offer net metering at non-discriminatory rates to industrial, large commercial, residential and small commercial customers, as those customers are classified or defined by the board, that generate electricity, on the customer's side of the meter, using a Class I renewable energy source, for the net amount of electricity supplied by the electric power supplier or basic generation service provider over an annualized period.  Systems of any sized capacity, as measured in watts, are eligible for net metering.  If the amount of electricity generated by the customer-generator, plus any kilowatt hour credits held over from the previous billing periods, exceeds the electricity supplied by the electric power supplier or basic generation service provider, then the electric power supplier or basic generation service provider, as the case may be, shall credit the customer-generator for the excess kilowatt hours until the end of the annualized period at which point the customer-generator will be compensated for any remaining credits or, if the customer-generator chooses, credit the customer-generator on a real-time basis, at the electric power supplier's or basic generation service provider's avoided cost of wholesale power or the PJM electric power pool's real-time locational marginal pricing rate, adjusted for losses, for the respective zone in the PJM electric power pool.  Alternatively, the customer-generator may execute a bilateral agreement with an electric power supplier or basic generation service provider for the sale and purchase of the customer-generator's excess generation. The customer-generator may be credited on a real-time basis, so long as the customer-generator follows applicable rules prescribed by the PJM electric power pool for its capacity requirements for the net amount of electricity supplied by the electric power supplier or basic generation service provider.  The board may authorize an electric power supplier or basic generation service provider to cease offering net metering to customers that are not already net metered whenever the total rated generating capacity owned and operated by net metering customer-generators Statewide equals 5.8 percent of the total annual kilowatt-hours sold in this State by each electric power supplier and each basic generation service provider during the prior one-year period;

     (2)   safety and power quality interconnection standards for Class I renewable energy source systems used by a customer-generator that shall be eligible for net metering.

     Such standards or rules shall take into consideration the goals of the New Jersey Energy Master Plan, applicable industry standards, and the standards of other states and the Institute of Electrical and Electronics Engineers. The board shall allow electric public utilities to recover the costs of any new net meters, upgraded net meters, system reinforcements or upgrades, and interconnection costs through either their regulated rates or from the net metering customer-generator;

     (3)   credit or other incentive rules for generators using Class I renewable energy generation systems that connect to New Jersey's electric public utilities' distribution system but who do not net meter; and

     (4)   net metering aggregation standards to require electric public utilities to provide net metering aggregation to single electric public utility customers that operate a solar electric power generation system installed at one of the customer's facilities or on property owned by the customer, provided that any such customer is a State entity, school district, county, county agency, county authority, municipality, municipal agency, or municipal authority.  The standards shall provide that, in order to qualify for net metering aggregation, the customer must operate a solar electric power generation system using a net metering billing account, which system is located on property owned by the customer, provided that: (a) the property is not land that has been actively devoted to agricultural or horticultural use and that is valued, assessed, and taxed pursuant to the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.) at any time within the 10-year period prior to the effective date of P.L.2012, c.24, provided, however, that the municipal planning board of a municipality in which a solar electric power generation system is located may waive the requirement of this subparagraph (a), (b) the system is not an on-site generation facility, (c) all of the facilities of the single customer combined for the purpose of net metering aggregation are facilities owned or operated by the single customer and are located within its territorial jurisdiction except that all of the facilities of a State entity engaged in net metering aggregation shall be located within five miles of one another, and (d) all of those facilities are within the service territory of a single electric public utility and are all served by the same basic generation service provider or by the same electric power supplier.  The standards shall provide that in order to qualify for net metering aggregation, the customer's solar electric power generation system shall be sized so that its annual generation does not exceed the combined metered annual energy usage of the qualified customer facilities, and the qualified customer facilities shall all be in the same customer rate class under the applicable electric public utility tariff.  For the customer's facility or property on which the solar electric generation system is installed, the electricity generated from the customer's solar electric generation system shall be accounted for pursuant to the provisions of paragraph (1) of this subsection to provide that the electricity generated in excess of the electricity supplied by the electric power supplier or the basic generation service provider, as the case may be, for the customer's facility on which the solar electric generation system is installed, over the annualized period, is credited at the electric power supplier's or the basic generation service provider's avoided cost of wholesale power or the PJM electric power pool real-time locational marginal pricing rate.  All electricity used by the customer's qualified facilities, with the exception of the facility or property on which the solar electric power generation system is installed, shall be billed at the full retail rate pursuant to the electric public utility tariff applicable to the customer class of the customer using the electricity.  A customer may contract with a third party to operate a solar electric power generation system, for the purpose of net metering aggregation.  Any contractual relationship entered into for operation of a solar electric power generation system related to net metering aggregation shall include contractual protections that provide for adequate performance and provision for construction and operation for the term of the contract, including any appropriate bonding or escrow requirements.  Any incremental cost to an electric public utility for net metering aggregation shall be fully and timely recovered in a manner to be determined by the board.  The board shall adopt net metering aggregation standards within 270 days after the effective date of P.L.2012, c.24.

     Such rules shall require the board or its designee to issue a credit or other incentive to those generators that do not use a net meter but otherwise generate electricity derived from a Class I renewable energy source and to issue an enhanced credit or other incentive, including, but not limited to, a solar renewable energy credit, to those generators that generate electricity derived from solar technologies.

     Such standards or rules shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act."

     f.     The board may assess, by written order and after notice and opportunity for comment, a separate fee to cover the cost of implementing and overseeing an emission disclosure system or emission portfolio standard, which fee shall be assessed based on an electric power supplier's or basic generation service provider's share of the retail electricity supply market.  The board shall not impose a fee for the cost of implementing and overseeing a greenhouse gas emissions portfolio standard adopted pursuant to paragraph (2) of subsection c. of this section.

     g.    The board shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), an electric energy efficiency  program in order to ensure investment in cost-effective energy efficiency measures, ensure universal access to energy efficiency measures, and serve the needs of low-income communities that shall require each electric public utility to implement energy efficiency measures that reduce electricity usage in the State  pursuant to section 3 of P.L.2018, c.17 (C.48:3-87.9).  Nothing in this subsection shall be construed to prevent an electric public utility from meeting the requirements of this subsection by contracting with another entity for the performance of the requirements.

     h.    The board shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), a gas energy efficiency program in order to ensure investment in cost-effective energy efficiency measures, ensure universal access to energy efficiency measures, and serve the needs of low-income communities that shall require each gas public utility to implement energy efficiency measures that reduce natural gas usage in the State pursuant to section 3 of P.L.2018, c.17 (C.48:3-87.9).  Nothing in this subsection shall be construed to prevent a gas public utility from meeting the requirements of this subsection by contracting with another entity for the performance of the requirements.

     i.     After the board establishes a schedule of solar kilowatt-hour sale or purchase requirements pursuant to paragraph (3) of subsection d. of this section, the board may initiate subsequent proceedings and adopt, after appropriate notice and opportunity for public comment and public hearing, increased minimum solar kilowatt-hour sale or purchase requirements, provided that the board shall not reduce previously established minimum solar kilowatt-hour sale or purchase requirements, or otherwise impose constraints that reduce the requirements by any means.

     j.     The board shall determine an appropriate level of solar alternative compliance payment, and permit each supplier or provider to submit an SACP to comply with the solar electric generation requirements of paragraph (3) of subsection d. of this section.  The value of the SACP for each Energy Year, for Energy Years 2014 through 2033 per megawatt hour from solar electric generation required pursuant to this section, shall be:

     EY 2014     $339

     EY 2015     $331

     EY 2016     $323

     EY 2017     $315

     EY 2018     $308

     EY 2019     $268

     EY 2020     $258

     EY 2021     $248

     EY 2022     $238

     EY 2023     $228

     EY 2024     $218

     EY 2025     $208

     EY 2026     $198

     EY 2027     $188

     EY 2028     $178

     EY 2029     $168

     EY 2030     $158

     EY 2031     $148

     EY 2032     $138

     EY 2033     $128.

     The board may initiate subsequent proceedings and adopt, after appropriate notice and opportunity for public comment and public hearing, an increase in solar alternative compliance payments, provided that the board shall not reduce previously established levels of solar alternative compliance payments, nor shall the board provide relief from the obligation of payment of the SACP by the electric power suppliers or basic generation service providers in any form.  Any SACP payments collected shall be refunded directly to the ratepayers by the electric public utilities.

      k.   The board may allow electric public utilities to offer long-term contracts through a competitive process, direct electric public utility investment and other means of financing, including but not limited to loans, for the purchase of SRECs and the resale of SRECs to suppliers or providers or others, provided that after such contracts have been approved by the board, the board's approvals shall not be modified by subsequent board orders.  If the board allows the offering of contracts pursuant to this subsection, the board may establish a process, after hearing, and opportunity for public comment, to provide that a designated segment of the contracts approved pursuant to this subsection shall be contracts involving solar electric power generation facility projects with a capacity of up to 250 kilowatts.

      l.    The board shall implement its responsibilities under the provisions of this section in such a manner as to:

     (1)   place greater reliance on competitive markets, with the explicit goal of encouraging and ensuring the emergence of new entrants that can foster innovations and price competition;

     (2)   maintain adequate regulatory authority over non-competitive public utility services;

     (3)   consider alternative forms of regulation in order to address changes in the technology and structure of electric public utilities;

     (4)   promote energy efficiency and Class I renewable energy market development, taking into consideration environmental benefits and market barriers;

     (5)   make energy services more affordable for low and moderate income customers;

     (6)   attempt to transform the renewable energy market into one that can move forward without subsidies from the State or public utilities;

     (7)   achieve the goals put forth under the renewable energy portfolio standards;

     (8)   promote the lowest cost to ratepayers; and

     (9)   allow all market segments to participate.

      m.  The board shall ensure the availability of financial incentives under its jurisdiction, including, but not limited to, long-term contracts, loans, SRECs, or other financial support, to ensure market diversity, competition, and appropriate coverage across all ratepayer segments, including, but not limited to, residential, commercial, industrial, non-profit, farms, schools, and public entity customers.

      n.   For projects which are owned, or directly invested in, by a public utility pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), the board shall determine the number of SRECs with which such projects shall be credited; and in determining such number the board shall ensure that the market for SRECs does not detrimentally affect the development of non-utility solar projects and shall consider how its determination may impact the ratepayers.

      o.   The board, in consultation with the Department of Environmental Protection, electric public utilities, the Division of Rate Counsel in, but not of, the Department of the Treasury, affected members of the solar energy industry, and relevant stakeholders, shall periodically consider increasing the renewable energy portfolio standards beyond the minimum amounts set forth in subsection d. of this section, taking into account the cost impacts and public benefits of such increases including, but not limited to:

     (1)   reductions in air pollution, water pollution, land disturbance, and greenhouse gas emissions;

     (2)   reductions in peak demand for electricity and natural gas, and the overall impact on the costs to customers of electricity and natural gas;

     (3)   increases in renewable energy development, manufacturing, investment, and job creation opportunities in this State; and

     (4)   reductions in State and national dependence on the use of fossil fuels.

      p.   Class I RECs and ORECs shall be eligible for use in renewable energy portfolio standards compliance in the energy year in which they are generated, and for the following two energy years.  SRECs shall be eligible for use in renewable energy portfolio standards compliance in the energy year in which they are generated, and for the following four energy years.

      q.   (1)  During the energy years of 2014, 2015, and 2016, a solar electric power generation facility project that is not: (a) net metered; (b) an on-site generation facility; (c) qualified for net metering aggregation; or (d) certified as being located on a brownfield, on an area of historic fill or on a properly closed sanitary landfill facility, as provided pursuant to subsection t. of this section may file an application with the board for approval of a designation pursuant to this subsection that the facility is connected to the distribution system.  An application filed pursuant to this subsection shall include a notice escrow of $40,000 per megawatt of the proposed capacity of the facility.  The board shall approve the designation if: the facility has filed a notice in writing with the board applying for designation pursuant to this subsection, together with the notice escrow; and the capacity of the facility, when added to the capacity of other facilities that have been previously approved for designation prior to the facility's filing under this subsection, does not exceed 80 megawatts in the aggregate for each year. The capacity of any one solar electric power supply project approved pursuant to this subsection shall not exceed 10 megawatts.  No more than 90 days after its receipt of a completed application for designation pursuant to this subsection, the board shall approve, conditionally approve, or disapprove the application.  The notice escrow shall be reimbursed to the facility in full upon either rejection by the board or the facility entering commercial operation, or shall be forfeited to the State if the facility is designated pursuant to this subsection but does not enter commercial operation pursuant to paragraph (2) of this subsection.

     (2)   If the proposed solar electric power generation facility does not commence commercial operations within two years following the date of the designation by the board pursuant to this subsection, the designation of the facility shall be deemed to be null and void, and the facility shall not be considered connected to the distribution system thereafter.

     (3)   Notwithstanding the provisions of paragraph (2) of this subsection, a solar electric power generation facility project that as of May 31, 2017 was designated as "connected to the distribution system," but failed to commence commercial operations as of that date, shall maintain that designation if it commences commercial operations by May 31, 2018.

      r.    (1)  For all proposed solar electric power generation facility projects except for those solar electric power generation facility projects approved pursuant to subsection q. of this section, and for all projects proposed in energy year 2019 and energy year 2020, the board may approve projects for up to 50 megawatts annually in auctioned capacity in two auctions per year as long as the board is accepting applications.  If the board approves projects for less than 50 megawatts in energy year 2019 or less than 50 megawatts in energy year 2020, the difference in each year shall be carried over into the successive energy year until 100 megawatts of auctioned capacity has been approved by the board pursuant to this subsection.  A proposed solar electric power generation facility that is neither net metered nor an on-site generation facility, may be considered "connected to the distribution system" only upon designation as such by the board, after notice to the public and opportunity for public comment or hearing.  A proposed solar power electric generation facility seeking board designation as "connected to the distribution system" shall submit an application to the board that includes for the proposed facility: the nameplate capacity; the estimated energy and number of SRECs to be produced and sold per year; the estimated annual rate impact on ratepayers; the estimated capacity of the generator as defined by PJM for sale in the PJM capacity market; the point of interconnection; the total project acreage and location; the current land use designation of the property; the type of solar technology to be used; and such other information as the board shall require.

     (2)   The board shall approve the designation of the proposed solar power electric generation facility as "connected to the distribution system" if the board determines that:

     (a)   the SRECs forecasted to be produced by the facility do not have a detrimental impact on the SREC market or on the appropriate development of solar power in the State;

     (b)   the approval of the designation of the proposed facility would not significantly impact the preservation of open space in this State;

     (c)   the impact of the designation on electric rates and economic development is beneficial; and

     (d)   there will be no impingement on the ability of an electric public utility to maintain its property and equipment in such a condition as to enable it to provide safe, adequate, and proper service to each of its customers.

     (3)   The board shall act within 90 days of its receipt of a completed application for designation of a solar power electric generation facility as "connected to the distribution system," to either approve, conditionally approve, or disapprove the application. If the proposed solar electric power generation facility does not commence commercial operations within two years following the date of the designation by the board pursuant to this subsection, the designation of the facility as "connected to the distribution system" shall be deemed to be null and void, and the facility shall thereafter be considered not "connected to the distribution system."

      s.    In addition to any other requirements of P.L.1999, c.23 or any other law, rule, regulation or order, a solar electric power generation facility that is not net metered or an on-site generation facility and which is located on land that has been actively devoted to agricultural or horticultural use that is valued, assessed, and taxed pursuant to the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.) at any time within the 10-year period prior to the effective date of P.L.2012, c.24, shall only be considered "connected to the distribution system" if (1) the board approves the facility's designation pursuant to subsection q. of this section; or (2) (a) PJM issued a System Impact Study for the facility on or before June 30, 2011, (b) the facility files a notice with the board within 60 days of the effective date of P.L.2012, c.24, indicating its intent to qualify under this subsection, and (c) the facility has been approved as "connected to the distribution system" by the board.  Nothing in this subsection shall limit the board's authority concerning the review and oversight of facilities, unless such facilities are exempt from such review as a result of having been approved pursuant to subsection q. of this section.

      t.    (1)  No more than 180 days after the date of enactment of P.L.2012, c.24, the board shall, in consultation with the Department of Environmental Protection and the New Jersey Economic Development Authority, and, after notice and opportunity for public comment and public hearing, complete a proceeding to establish a program to provide SRECs to owners of solar electric power generation facility projects certified by the board, in consultation with the Department of Environmental Protection, as being located on a brownfield, on an area of historic fill or on a properly closed sanitary landfill facility, including those owned or operated by an electric public utility and approved pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1).  Projects certified under this subsection shall be considered "connected to the distribution system", shall not require such designation by the board, and shall not be subject to board review required pursuant to subsections q. and r. of this section.  Notwithstanding the provisions of section 3 of P.L.1999, c.23 (C.48:3-51) or any other law, rule, regulation, or order to the contrary, for projects certified under this subsection, the board shall establish a financial incentive that is designed to supplement the SRECs generated by the facility in order to cover the additional cost of constructing and operating a solar electric power generation facility on a brownfield, on an area of historic fill or on a properly closed sanitary landfill facility.  Any financial benefit realized in relation to a project owned or operated by an electric public utility and approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), as a result of the provision of a financial incentive established by the board pursuant to this subsection, shall be credited to ratepayers. The issuance of SRECs for all solar electric power generation facility projects pursuant to this subsection shall be deemed "Board of Public Utilities financial assistance" as provided under section 1 of P.L.2009, c.89 (C.48:2-29.47).

     (2)   Notwithstanding the provisions of the "Spill Compensation and Control Act," P.L.1976, c.141 (C.58:10-23.11 et seq.) or any other law, rule, regulation, or order to the contrary, the board, in consultation with the Department of Environmental Protection, may find that a person who operates a solar electric power generation facility project that has commenced operation on or after the effective date of P.L.2012, c.24, which project is certified by the board, in consultation with the Department of Environmental Protection pursuant to paragraph (1) of this subsection, as being located on a brownfield for which a final remediation document has been issued, on an area of historic fill or on a properly closed sanitary landfill facility, which projects shall include, but not be limited to projects located on a brownfield for which a final remediation document has been issued, on an area of historic fill or on a properly closed sanitary landfill facility owned or operated by an electric public utility and approved pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), or a person who owns property acquired on or after the effective date of P.L.2012, c.24 on which such a solar electric power generation facility project is constructed and operated, shall not be liable for cleanup and removal costs to the Department of Environmental Protection or to any other person for the discharge of a hazardous substance provided that:

     (a)   the person acquired or leased the real property after the discharge of that hazardous substance at the real property;

     (b)   the person did not discharge the hazardous substance, is not in any way responsible for the hazardous substance, and is not a successor to the discharger or to any person in any way responsible for the hazardous substance or to anyone liable for cleanup and removal costs pursuant to section 8 of P.L.1976, c.141 (C.58:10-23.11g);

     (c)   the person, within 30 days after acquisition of the property, gave notice of the discharge to the Department of Environmental Protection in a manner the Department of Environmental Protection prescribes;

     (d)   the person does not disrupt or change, without prior written permission from the Department of Environmental Protection, any engineering or institutional control that is part of a remedial action for the contaminated site or any landfill closure or post-closure requirement;

     (e)   the person does not exacerbate the contamination at the property;

     (f)   the person does not interfere with any necessary remediation of the property;

     (g)   the person complies with any regulations and any permit the Department of Environmental Protection issues pursuant to section 19 of P.L.2009, c.60 (C.58:10C-19) or paragraph (2) of subsection a. of section 6 of P.L.1970, c.39 (C.13:1E-6);

     (h)   with respect to an area of historic fill, the person has demonstrated pursuant to a preliminary assessment and site investigation, that hazardous substances have not been discharged; and

     (i)    with respect to a properly closed sanitary landfill facility, no person who owns or controls the facility receives, has received, or will receive, with respect to such facility, any funds from any post-closure escrow account established pursuant to section 10 of P.L.1981, c.306 (C.13:1E-109) for the closure and monitoring of the facility.

     Only the person who is liable to clean up and remove the contamination pursuant to section 8 of P.L.1976, c.141 (C.58:10-23.11g) and who does not have a defense to liability pursuant to subsection d. of that section shall be liable for cleanup and removal costs.

     u.    No more than 180 days after the date of enactment of P.L.2012, c.24, the board shall complete a proceeding to establish a registration program.  The registration program shall require the owners of solar electric power generation facility projects connected to the distribution system to make periodic milestone filings with the board in a manner and at such times as determined by the board to provide full disclosure and transparency regarding the overall level of development and construction activity of those projects Statewide.

     v.    The issuance of SRECs for all solar electric power generation facility projects pursuant to this section, for projects connected to the distribution system with a capacity of one megawatt or greater, shall be deemed "Board of Public Utilities financial assistance" as provided pursuant to section 1 of P.L.2009, c.89 (C.48:2-29.47). 

     w.   No more than 270 days after the date of enactment of P.L.2012, c.24, the board shall, after notice and opportunity for public comment and public hearing, complete a proceeding to consider whether to establish a program to provide, to owners of solar electric power generation facility projects certified by the board as being three megawatts or greater in capacity and being net metered, including facilities which are owned or operated by an electric public utility and approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), a financial incentive that is designed to supplement the SRECs generated by the facility to further the goal of improving the economic competitiveness of commercial and industrial customers taking power from such projects.  If the board determines to establish such a program pursuant to this subsection, the board may establish a financial incentive to provide that the board shall issue one SREC for no less than every 750 kilowatt-hours of solar energy generated by the certified projects. Any financial benefit realized in relation to a project owned or operated by an electric public utility and approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), as a result of the provisions of a financial incentive established by the board pursuant to this subsection, shall be credited to ratepayers.

     x.    Solar electric power generation facility projects that are located on an existing or proposed commercial, retail, industrial, municipal, professional, recreational, transit, commuter, entertainment complex, multi-use, or mixed-use parking lot with a capacity to park 350 or more vehicles where the area to be utilized for the facility is paved, or an impervious surface may be owned or operated by an electric public utility and may be approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1).

(cf:  P.L.2018, c.17, s.2)

 

     2.    This act shall take effect immediately.

 

 

STATEMENT

 

     This bill would allow the Board of Public Utilities (BPU) to increase the cost to customers of the State’s Class I renewable energy requirement during energy years 2022 through 2024 above the current limit of seven percent of the total paid for electricity by all customers in the State, under certain conditions.

     Under the bill, the BPU could only make this increase if the cost of the Class I renewable energy requirement is less than nine percent of total energy costs during energy years 2019 through 2021 (the limit set by current law).  In addition, the total amount paid by customers during energy years 2019 through 2024 could not exceed the sum of: (1) nine percent of total energy costs during energy years 2019 through 2021; and (2) seven percent of total energy costs during energy years 2022 through 2024, i.e. the maximum amount allowed by current law over that six-year period.

     “Energy year” means the 12-month period from June 1st through May 31st, numbered according to the calendar year in which it ends. 

DISCLAIMER: New Jersey SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

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New JerseyPress ReleasesSREC

New Jersey Assembly Bill 5741

 

This is a bill, not yet a law.
 
Main Points:
 
Increases Net metering cap from 5.8% to 15% - without this new solar starting in 2021 will not be financeable.
 
Adjusts Ratepayer cap from current 9% moving to 7% in 2022 to a gradual step-down 9% to 8.5% to 8.0% to 5% in 2036. Solves for the "kink-years" where there is no $ for new solar in 2022,2023 and 2024. Net neutral for ratepayers. Prevents solar companies in NJ from going out of business.
 
Reduces class 1 rec ratepayer exposure from 5cents a kilowatt hour to 1 cent a kilowatt hour. Prevents money from being taken from solar owners SREC proceeds and being sent out-of-state.
 
Establishes demand for 360 Mw a year of new solar being built until 2036. Doubles the amount of solar by 2030 to 6.25 Gw. and 11% of statewide energy from solar.
 
SREC SACP levels reduced to match rate-caps. New demand helps ensure SREC prices remain stable to strong and that solar investors remain whole.
 
Keeps old and new solar owners interests aligned by keeping one SREC market.
 

-----------------------------------------------------------

Sponsored by:

Assemblyman  JOHN F. MCKEON

District 27 (Essex and Morris)

 

 

SYNOPSIS

     Revises law concerning Class I and solar renewable energy portfolio standards, solar renewable energy certificates, and net metering.

 

CURRENT VERSION OF TEXT

     As introduced.

  

 

An Act concerning Class I and solar renewable energy and net metering, and amending P.L.1999, c.23.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.  Section 38 of P.L.1999, c.23 (C.48:3-87) is amended to read as follows:

     38.  a.  The board shall require an electric power supplier or basic generation service provider to disclose on a customer's bill or on customer contracts or marketing materials, a uniform, common set of information about the environmental characteristics of the energy purchased by the customer, including, but not limited to:

     (1)   Its fuel mix, including categories for oil, gas, nuclear, coal, solar, hydroelectric, wind and biomass, or a regional average determined by the board;

     (2)   Its emissions, in pounds per megawatt hour, of sulfur dioxide, carbon dioxide, oxides of nitrogen, and any other pollutant that the board may determine to pose an environmental or health hazard, or an emissions default to be determined by the board; and

     (3)   Any discrete emission reduction retired pursuant to rules and regulations adopted pursuant to P.L.1995, c.188.

     b.    Notwithstanding any provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, in consultation with the Department of Environmental Protection, after notice and opportunity for public comment and public hearing, interim standards to implement this disclosure requirement, including, but not limited to:

     (1)   A methodology for disclosure of emissions based on output pounds per megawatt hour;

     (2)   Benchmarks for all suppliers and basic generation service providers to use in disclosing emissions that will enable consumers to perform a meaningful comparison with a supplier's or basic generation service provider's emission levels; and

     (3)   A uniform emissions disclosure format that is graphic in nature and easily understandable by consumers.  The board shall periodically review the disclosure requirements to determine if revisions to the environmental disclosure system as implemented are necessary.

     Such standards shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act."

     c.  (1)  The board may adopt, in consultation with the Department of Environmental Protection, after notice and opportunity for public comment, an emissions portfolio standard applicable to all electric power suppliers and basic generation service providers, upon a finding that:

     (a)   The standard is necessary as part of a plan to enable the State to meet federal Clean Air Act or State ambient air quality standards; and

     (b)   Actions at the regional or federal level cannot reasonably be expected to achieve the compliance with the federal standards.

     (2)   By July 1, 2009, the board shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), a greenhouse gas emissions portfolio standard to mitigate leakage or another regulatory mechanism to mitigate leakage applicable to all electric power suppliers and basic generation service providers that provide electricity to customers within the State.  The greenhouse gas emissions portfolio standard or any other regulatory mechanism to mitigate leakage shall:

     (a)   Allow a transition period, either before or after the effective date of the regulation to mitigate leakage, for a basic generation service provider or electric power supplier to either meet the emissions portfolio standard or other regulatory mechanism to mitigate leakage, or to transfer any customer to a basic generation service provider or electric power supplier that meets the emissions portfolio standard or other regulatory mechanism to mitigate leakage.  If the transition period allowed pursuant to this subparagraph occurs after the implementation of an emissions portfolio standard or other regulatory mechanism to mitigate leakage, the transition period shall be no longer than three years; and

     (b)   Exempt the provision of basic generation service pursuant to a basic generation service purchase and sale agreement effective prior to the date of the regulation.

     Unless the Attorney General or the Attorney General's designee determines that a greenhouse gas emissions portfolio standard would unconstitutionally burden interstate commerce or would be preempted by federal law, the adoption by the board of an electric energy efficiency portfolio standard pursuant to subsection g. of this section, a gas energy efficiency portfolio standard pursuant to subsection h. of this section, or any other enhanced energy efficiency policies to mitigate leakage shall not be considered sufficient to fulfill the requirement of this subsection for the adoption of a greenhouse gas emissions portfolio standard or any other regulatory mechanism to mitigate leakage.

     d.    Notwithstanding any provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, after notice, provision of the opportunity for comment, and public hearing, renewable energy portfolio standards that shall require:

     (1)   that two and one-half percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from Class II renewable energy sources;

     (2)   beginning on January 1, 2020, that  21 percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from Class I renewable energy sources.  The board shall increase the required percentage for Class I renewable energy sources so that by January 1, 2025, 35 percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider shall be from Class I renewable energy sources, and by January 1, 2030, 50 percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider shall be from Class I renewable energy sources. 

     Notwithstanding the requirements of this subsection, the board shall ensure that the cost to customers of the Class I renewable energy requirement imposed pursuant to this subsection :

     (a)  shall not exceed nine percent of the total paid for electricity by all customers in the State for energy year 2019, energy year 2020, and energy year 2021, respectively [,] ; and

     (b)  shall not exceed [seven percent] the following percentages of the total paid for electricity by all customers in the State [in any] for energy year [thereafter] 2022 through energy year 2037:

     EY 2022                 8.5%

     EY 2023                 8.5%

     EY 2024                 8%

     EY 2025                 8%

     EY 2026                 7.5%

     EY 2027                 7.5%

     EY 2028                 7%

     EY 2029                 7%

     EY 2030                 6.5%

     EY 2031                 6.5%

     EY 2032                 6%

     EY 2033                 6%

     EY 2034                 5.5%

     EY 2035                 5.5%

     EY 2036                 5%

     EY 2037                 5% . 

     In calculating the cost to customers of the Class I renewable energy requirement imposed pursuant to this subsection, the board shall not include the costs of the offshore wind energy certificate program established pursuant to paragraph (4) of this subsection.  The board shall take any steps necessary to prevent the exceedance of the cap on the cost to customers including, but not limited to, adjusting the Class I renewable energy requirement.

     An electric power supplier or basic generation service provider may satisfy the requirements of this subsection for Class I renewable energy by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection or by submitting a Class I alternative compliance payment in the amount of $10 for energy year 2021 through energy year 2037.  Any Class I alternative compliance payment collected pursuant to this paragraph shall be refunded directly to the ratepayers ;

     (3)   that the board establish a multi-year schedule, applicable to each electric power supplier or basic generation service provider in this State, beginning with the one-year period commencing on June 1, 2010, and continuing for each subsequent one-year period up to and including, the one-year period commencing on June 1, [2033] 2037 , that requires the following number or percentage, as the case may be, of kilowatt-hours sold in this State by each electric power supplier and each basic generation service provider to be from solar electric power generators connected to the distribution system in this State:

     EY 2011                 306 Gigawatthours (Gwhrs)

     EY 2012                 442 Gwhrs

     EY 2013                 596 Gwhrs

     EY 2014                 2.050%

     EY 2015                 2.450%

     EY 2016                 2.750%

     EY 2017                 3.000%

     EY 2018                 3.200%

     EY 2019                 4.300%

     EY 2020                 4.900%

     EY 2021                 [5.100%] 5.25%

     EY 2022                 [5.100%] 5.88%

     EY 2023                 [5.100%] 6.05%

     EY 2024                 [4.900%] 6.29%

     EY 2025                 [4.800%] 6.58%

     EY 2026                 [4.500%] 6.39%

     EY 2027                 [4.350%] 6.36%

     EY 2028                 [3.740%] 6.17%

     EY 2029                 [3.070%] 5.82%

     EY 2030                 [2.210%] 5.49%

     EY 2031                 [1.580%] 4.88%

     EY 2032                 [1.400%] 4.36%

     EY 2033                 [1.100%] 3.87%

     EY 2034                 3.87%

     EY 2035                 3.87%

     EY 2036                 3.87%

     EY 2037                 3.87%

     [No later than 180 days after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), the board shall adopt rules and regulations to close the SREC program to new applications upon the attainment of 5.1 percent of the kilowatt-hours sold in the State by each electric power supplier and each basic generation provider from solar electric power generators connected to the distribution system.  The board shall continue to consider any application filed before the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.).  The board shall provide for an orderly and transparent mechanism that will result in the closing of the existing SREC program on a date certain but no later than June 1, 2021.]

     No later than 24 months after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), the board shall complete a study [that evaluates how to modify or replace the SREC program to encourage the continued efficient and orderly development of solar renewable energy generating sources throughout the State.  The board shall submit the written report thereon to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature.  The board shall consult with public utilities, industry experts, regional grid operators, solar power providers and financiers, and other State agencies to determine whether the board can modify the SREC program such that the program will:

     -continually reduce, where feasible, the cost of achieving the solar energy goals set forth in this subsection;

     -provide an orderly transition from the SREC program to a new or modified program;

     -] to develop megawatt targets for grid connected and distribution systems, including residential and small commercial rooftop systems, community solar systems, and large scale behind the meter systems, as a share of the overall solar energy requirement, which targets the board may modify periodically based on the cost, feasibility, or social impacts of different types of projects [;

     -establish and update market-based maximum incentive payment caps periodically for each of the above categories of solar electric power generation facilities;

     -encourage and facilitate market-based cost recovery through long-term contracts and energy market sales; and

     -where cost recovery is needed for any portion of an efficient solar electric power generation facility when costs are not recoverable through wholesale market sales and direct payments from customers, utilize competitive processes such as competitive procurement and long-term contracts where possible to ensure such recovery, without exceeding the maximum incentive payment cap for that category of facility] .  The board shall submit a written report thereon to the Governor and, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), to the Legislature . 

     The board shall approve, conditionally approve, or disapprove any application for designation as connected to the distribution system of a solar electric power generation facility filed with the board after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), no more than 90 days after receipt by the board of a completed application.  For any such application for a project greater than 25 kilowatts, the board shall require the applicant to post a notice escrow with the board in an amount of $40 per kilowatt of DC nameplate capacity of the facility, not to exceed $40,000.  The notice escrow amount shall be reimbursed to the applicant in full upon either denial of the application by the board or upon commencement of commercial operation of the solar electric power generation facility.  The escrow amount shall be forfeited to the State if the facility is designated as connected to the distribution system pursuant to this subsection but does not commence commercial operation within two years following the date of the designation by the board.

     For all applications for designation as connected to the distribution system of a solar electric power generation facility filed with the board after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.), the SREC term shall be 10 years.

     (a)   The board shall determine an appropriate period of no less than 120 days following the end of an energy year prior to which a provider or supplier must demonstrate compliance for that energy year with the annual renewable portfolio standard;

     (b)   No more than 24 months following the date of enactment of P.L.2012, c.24, the board shall complete a proceeding to investigate approaches to mitigate solar development volatility and prepare and submit, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), a report to the Legislature, detailing its findings and recommendations.  As part of the proceeding, the board shall evaluate other techniques used nationally and internationally;

     (c)   The solar renewable portfolio standards requirements in this paragraph shall exempt those existing supply contracts which are effective prior to the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.) from any increase beyond the number of SRECs mandated by the solar renewable energy portfolio standards requirements that were in effect on the date that the providers executed their existing supply contracts.  This limited exemption for providers' existing supply contracts shall not be construed to lower the Statewide solar sourcing requirements set forth in this paragraph.  Such incremental requirements that would have otherwise been imposed on exempt providers shall be distributed over the providers not subject to the existing supply contract exemption until such time as existing supply contracts expire and all providers are subject to the new requirement in a manner that is competitively neutral among all providers and suppliers.  Notwithstanding any rule or regulation to the contrary, the board shall recognize these new solar purchase obligations as a change required by operation of law and implement the provisions of this subsection in a manner so as to prevent any subsidies between suppliers and providers and to promote competition in the electricity supply industry.

     An electric power supplier or basic generation service provider may satisfy the requirements of this subsection by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection, or compliance with the requirements of this subsection may be demonstrated to the board by suppliers or providers through the purchase of SRECs.

     The renewable energy portfolio standards adopted by the board pursuant to paragraphs (1) and (2) of this subsection shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act."

     The renewable energy portfolio standards adopted by the board pursuant to this paragraph shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 30 months after such filing, and shall, thereafter, be amended, adopted or readopted by the board in accordance with the "Administrative Procedure Act"; and

     (4)   within 180 days after the date of enactment of P.L.2010, c.57 (C.48:3-87.1 et al.), that the board establish an offshore wind renewable energy certificate program to require that a percentage of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from offshore wind energy in order to support at least 3,500 megawatts of generation from qualified offshore wind projects.

     The percentage established by the board pursuant to this paragraph shall serve as an offset to the renewable energy portfolio standard established pursuant to paragraph (2) of this subsection and shall reduce the corresponding Class I renewable energy requirement.

     The percentage established by the board pursuant to this paragraph shall reflect the projected OREC production of each qualified offshore wind project, approved by the board pursuant to section 3 of P.L.2010, c.57 (C.48:3-87.1), for 20 years from the commercial operation start date of the qualified offshore wind project which production projection and OREC purchase requirement, once approved by the board, shall not be subject to reduction.

     An electric power supplier or basic generation service provider shall comply with the OREC program established pursuant to this paragraph through the purchase of offshore wind renewable energy certificates at a price and for the time period required by the board.  In the event there are insufficient offshore wind renewable energy certificates available, the electric power supplier or basic generation service provider shall pay an offshore wind alternative compliance payment established by the board.  Any offshore wind alternative compliance payments collected shall be refunded directly to the ratepayers by the electric public utilities.

     The rules established by the board pursuant to this paragraph shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.).

     e.     Notwithstanding any provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, after notice, provision of the opportunity for comment, and public hearing:

     (1)   net metering standards for electric power suppliers and basic generation service providers.  The standards shall require electric power suppliers and basic generation service providers to offer net metering at non-discriminatory rates to industrial, large commercial, residential and small commercial customers, as those customers are classified or defined by the board, that generate electricity, on the customer's side of the meter, using a Class I renewable energy source, for the net amount of electricity supplied by the electric power supplier or basic generation service provider over an annualized period.  Systems of any sized capacity, as measured in watts, are eligible for net metering.  If the amount of electricity generated by the customer-generator, plus any kilowatt hour credits held over from the previous billing periods, exceeds the electricity supplied by the electric power supplier or basic generation service provider, then the electric power supplier or basic generation service provider, as the case may be, shall credit the customer-generator for the excess kilowatt hours until the end of the annualized period at which point the customer-generator will be compensated for any remaining credits or, if the customer-generator chooses, credit the customer-generator on a real-time basis, at the electric power supplier's or basic generation service provider's avoided cost of wholesale power or the PJM electric power pool's real-time locational marginal pricing rate, adjusted for losses, for the respective zone in the PJM electric power pool.  Alternatively, the customer-generator may execute a bilateral agreement with an electric power supplier or basic generation service provider for the sale and purchase of the customer-generator's excess generation. The customer-generator may be credited on a real-time basis, so long as the customer-generator follows applicable rules prescribed by the PJM electric power pool for its capacity requirements for the net amount of electricity supplied by the electric power supplier or basic generation service provider.  The board may authorize an electric power supplier or basic generation service provider to cease offering net metering to customers that are not already net metered whenever the total rated generating capacity owned and operated by net metering customer-generators Statewide equals [5.8] 15 percent of the total annual kilowatt-hours sold in this State by each electric power supplier and each basic generation service provider during the prior one-year period;

     (2)   safety and power quality interconnection standards for Class I renewable energy source systems used by a customer-generator that shall be eligible for net metering.

     Such standards or rules shall take into consideration the goals of the New Jersey Energy Master Plan, applicable industry standards, and the standards of other states and the Institute of Electrical and Electronics Engineers.  The board shall allow electric public utilities to recover the costs of any new net meters, upgraded net meters, system reinforcements or upgrades, and interconnection costs through either their regulated rates or from the net metering customer-generator;

     (3)   credit or other incentive rules for generators using Class I renewable energy generation systems that connect to New Jersey's electric public utilities' distribution system but who do not net meter; and

     (4)   net metering aggregation standards to require electric public utilities to provide net metering aggregation to single electric public utility customers that operate a solar electric power generation system installed at one of the customer's facilities or on property owned by the customer, provided that any such customer is a State entity, school district, county, county agency, county authority, municipality, municipal agency, or municipal authority.  The standards shall provide that, in order to qualify for net metering aggregation, the customer must operate a solar electric power generation system using a net metering billing account, which system is located on property owned by the customer, provided that: (a) the property is not land that has been actively devoted to agricultural or horticultural use and that is valued, assessed, and taxed pursuant to the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.) at any time within the 10-year period prior to the effective date of P.L.2012, c.24, provided, however, that the municipal planning board of a municipality in which a solar electric power generation system is located may waive the requirement of this subparagraph (a), (b) the system is not an on-site generation facility, (c) all of the facilities of the single customer combined for the purpose of net metering aggregation are facilities owned or operated by the single customer and are located within its territorial jurisdiction except that all of the facilities of a State entity engaged in net metering aggregation shall be located within five miles of one another, and (d) all of those facilities are within the service territory of a single electric public utility and are all served by the same basic generation service provider or by the same electric power supplier.  The standards shall provide that in order to qualify for net metering aggregation, the customer's solar electric power generation system shall be sized so that its annual generation does not exceed the combined metered annual energy usage of the qualified customer facilities, and the qualified customer facilities shall all be in the same customer rate class under the applicable electric public utility tariff.  For the customer's facility or property on which the solar electric generation system is installed, the electricity generated from the customer's solar electric generation system shall be accounted for pursuant to the provisions of paragraph (1) of this subsection to provide that the electricity generated in excess of the electricity supplied by the electric power supplier or the basic generation service provider, as the case may be, for the customer's facility on which the solar electric generation system is installed, over the annualized period, is credited at the electric power supplier's or the basic generation service provider's avoided cost of wholesale power or the PJM electric power pool real-time locational marginal pricing rate.  All electricity used by the customer's qualified facilities, with the exception of the facility or property on which the solar electric power generation system is installed, shall be billed at the full retail rate pursuant to the electric public utility tariff applicable to the customer class of the customer using the electricity.  A customer may contract with a third party to operate a solar electric power generation system, for the purpose of net metering aggregation.  Any contractual relationship entered into for operation of a solar electric power generation system related to net metering aggregation shall include contractual protections that provide for adequate performance and provision for construction and operation for the term of the contract, including any appropriate bonding or escrow requirements.  Any incremental cost to an electric public utility for net metering aggregation shall be fully and timely recovered in a manner to be determined by the board.  The board shall adopt net metering aggregation standards within 270 days after the effective date of P.L.2012, c.24.

     Such rules shall require the board or its designee to issue a credit or other incentive to those generators that do not use a net meter but otherwise generate electricity derived from a Class I renewable energy source and to issue an enhanced credit or other incentive, including, but not limited to, a solar renewable energy credit, to those generators that generate electricity derived from solar technologies.

     Such standards or rules shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the "Administrative Procedure Act."

     f.     The board may assess, by written order and after notice and opportunity for comment, a separate fee to cover the cost of implementing and overseeing an emission disclosure system or emission portfolio standard, which fee shall be assessed based on an electric power supplier's or basic generation service provider's share of the retail electricity supply market.  The board shall not impose a fee for the cost of implementing and overseeing a greenhouse gas emissions portfolio standard adopted pursuant to paragraph (2) of subsection c. of this section.

     g.    The board shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), an electric energy efficiency  program in order to ensure investment in cost-effective energy efficiency measures, ensure universal access to energy efficiency measures, and serve the needs of low-income communities that shall require each electric public utility to implement energy efficiency measures that reduce electricity usage in the State  pursuant to section 3 of P.L.2018, c.17 (C.48:3-87.9).  Nothing in this subsection shall be construed to prevent an electric public utility from meeting the requirements of this subsection by contracting with another entity for the performance of the requirements.

     h.    The board shall adopt, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), a gas energy efficiency program in order to ensure investment in cost-effective energy efficiency measures, ensure universal access to energy efficiency measures, and serve the needs of low-income communities that shall require each gas public utility to implement energy efficiency measures that reduce natural gas usage in the State pursuant to section 3 of P.L.2018, c.17 (C.48:3-87.9).  Nothing in this subsection shall be construed to prevent a gas public utility from meeting the requirements of this subsection by contracting with another entity for the performance of the requirements.

     i.     After the board establishes a schedule of solar kilowatt-hour sale or purchase requirements pursuant to paragraph (3) of subsection d. of this section, the board may initiate subsequent proceedings and adopt, after appropriate notice and opportunity for public comment and public hearing, increased minimum solar kilowatt-hour sale or purchase requirements, provided that the board shall not reduce previously established minimum solar kilowatt-hour sale or purchase requirements, or otherwise impose constraints that reduce the requirements by any means.

     j.     The board shall determine an appropriate level of solar alternative compliance payment, and permit each supplier or provider to submit an SACP to comply with the solar electric generation requirements of paragraph (3) of subsection d. of this section.  The value of the SACP for each Energy Year, for Energy Years 2014 through [2033] 2037 per megawatt hour from solar electric generation required pursuant to this section, shall be:

     EY 2014     $339

     EY 2015     $331

     EY 2016     $323

     EY 2017     $315

     EY 2018     $308

     EY 2019     $268

     EY 2020     $258

     EY 2021     [$248] $220.51

     EY 2022     [$238] $188.49

     EY 2023     [$228] $186.71

     EY 2024     [$218] $170.77

     EY 2025     [$208] $144.28

     EY 2026     [$198] $138.82

     EY 2027     [$188] $142.12

     EY 2028     [$178] $135.96

     EY 2029     [$168] $146.34

     EY 2030     [$158] $113.68

     EY 2031     [$148] $129.99

     EY 2032     [$138] $128.28

     EY 2033     [$128] $120

     EY 2034     $120

     EY 2035     $120

     EY 2036     $120

     EY 2037     $120 .

     The board may initiate subsequent proceedings and adopt, after appropriate notice and opportunity for public comment and public hearing, an increase in solar alternative compliance payments, provided that the board shall not reduce previously established levels of solar alternative compliance payments, nor shall the board provide relief from the obligation of payment of the SACP by the electric power suppliers or basic generation service providers in any form.  Any SACP payments collected shall first be made available once a year in an auction format approved by the board to owners of solar electric generation facilities possessing unsold SRECs, and following the annual auction any remaining SACP payments shall be refunded directly to the ratepayers by the electric public utilities.

     k.    The board may allow electric public utilities to offer long-term contracts through a competitive process, direct electric public utility investment and other means of financing, including but not limited to loans, for the purchase of SRECs and the resale of SRECs to suppliers or providers or others, provided that after such contracts have been approved by the board, the board's approvals shall not be modified by subsequent board orders.  If the board allows the offering of contracts pursuant to this subsection, the board may establish a process, after hearing, and opportunity for public comment, to provide that a designated segment of the contracts approved pursuant to this subsection shall be contracts involving solar electric power generation facility projects with a capacity of up to 250 kilowatts.

     l.     The board shall implement its responsibilities under the provisions of this section in such a manner as to:

     (1)   place greater reliance on competitive markets, with the explicit goal of encouraging and ensuring the emergence of new entrants that can foster innovations and price competition;

     (2)   maintain adequate regulatory authority over non-competitive public utility services;

     (3)   consider alternative forms of regulation in order to address changes in the technology and structure of electric public utilities;

     (4)   promote energy efficiency and Class I renewable energy market development, taking into consideration environmental benefits and market barriers;

     (5)   make energy services more affordable for low and moderate income customers;

     (6)   attempt to transform the renewable energy market into one that can move forward without subsidies from the State or public utilities;

     (7)   achieve the goals put forth under the renewable energy portfolio standards;

     (8)   promote the lowest cost to ratepayers; and

     (9)   allow all market segments to participate.

     m.   The board shall ensure the availability of financial incentives under its jurisdiction, including, but not limited to, long-term contracts, loans, SRECs, or other financial support, to ensure market diversity, competition, and appropriate coverage across all ratepayer segments, including, but not limited to, residential, commercial, industrial, non-profit, farms, schools, and public entity customers.

     n.    For projects which are owned, or directly invested in, by a public utility pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), the board shall determine the number of SRECs with which such projects shall be credited; and in determining such number the board shall ensure that the market for SRECs does not detrimentally affect the development of non-utility solar projects and shall consider how its determination may impact the ratepayers.

     o.    The board, in consultation with the Department of Environmental Protection, electric public utilities, the Division of Rate Counsel in, but not of, the Department of the Treasury, affected members of the solar energy industry, and relevant stakeholders, shall periodically consider increasing the renewable energy portfolio standards beyond the minimum amounts set forth in subsection d. of this section, taking into account the cost impacts and public benefits of such increases including, but not limited to:

     (1)   reductions in air pollution, water pollution, land disturbance, and greenhouse gas emissions;

     (2)   reductions in peak demand for electricity and natural gas, and the overall impact on the costs to customers of electricity and natural gas;

     (3)   increases in renewable energy development, manufacturing, investment, and job creation opportunities in this State; and

     (4)   reductions in State and national dependence on the use of fossil fuels.

     p.    Class I RECs and ORECs shall be eligible for use in renewable energy portfolio standards compliance in the energy year in which they are generated, and for the following two energy years.  SRECs shall be eligible for use in renewable energy portfolio standards compliance in the energy year in which they are generated, and for the following four energy years.

     q.  (1)  During the energy years of 2014, 2015, and 2016, a solar electric power generation facility project that is not: (a) net metered; (b) an on-site generation facility; (c) qualified for net metering aggregation; or (d) certified as being located on a brownfield, on an area of historic fill or on a properly closed sanitary landfill facility, as provided pursuant to subsection t. of this section may file an application with the board for approval of a designation pursuant to this subsection that the facility is connected to the distribution system.  An application filed pursuant to this subsection shall include a notice escrow of $40,000 per megawatt of the proposed capacity of the facility.  The board shall approve the designation if: the facility has filed a notice in writing with the board applying for designation pursuant to this subsection, together with the notice escrow; and the capacity of the facility, when added to the capacity of other facilities that have been previously approved for designation prior to the facility's filing under this subsection, does not exceed 80 megawatts in the aggregate for each year.  The capacity of any one solar electric power supply project approved pursuant to this subsection shall not exceed 10 megawatts.  No more than 90 days after its receipt of a completed application for designation pursuant to this subsection, the board shall approve, conditionally approve, or disapprove the application.  The notice escrow shall be reimbursed to the facility in full upon either rejection by the board or the facility entering commercial operation, or shall be forfeited to the State if the facility is designated pursuant to this subsection but does not enter commercial operation pursuant to paragraph (2) of this subsection.

     (2)   If the proposed solar electric power generation facility does not commence commercial operations within two years following the date of the designation by the board pursuant to this subsection, the designation of the facility shall be deemed to be null and void, and the facility shall not be considered connected to the distribution system thereafter.

     (3)   Notwithstanding the provisions of paragraph (2) of this subsection, a solar electric power generation facility project that as of May 31, 2017 was designated as "connected to the distribution system," but failed to commence commercial operations as of that date, shall maintain that designation if it commences commercial operations by May 31, 2018.

     r.  (1) For all proposed solar electric power generation facility projects except for those solar electric power generation facility projects approved pursuant to subsection q. of this section, and for all projects proposed in energy year 2019 and energy year 2020, the board may approve projects for up to 50 megawatts annually in auctioned capacity in two auctions per year as long as the board is accepting applications.  If the board approves projects for less than 50 megawatts in energy year 2019 or less than 50 megawatts in energy year 2020, the difference in each year shall be carried over into the successive energy year until 100 megawatts of auctioned capacity has been approved by the board pursuant to this subsection.  A proposed solar electric power generation facility that is neither net metered nor an on-site generation facility, may be considered "connected to the distribution system" only upon designation as such by the board, after notice to the public and opportunity for public comment or hearing.  A proposed solar power electric generation facility seeking board designation as "connected to the distribution system" shall submit an application to the board that includes for the proposed facility: the nameplate capacity; the estimated energy and number of SRECs to be produced and sold per year; the estimated annual rate impact on ratepayers; the estimated capacity of the generator as defined by PJM for sale in the PJM capacity market; the point of interconnection; the total project acreage and location; the current land use designation of the property; the type of solar technology to be used; and such other information as the board shall require.

     (2)   The board shall approve the designation of the proposed solar power electric generation facility as "connected to the distribution system" if the board determines that:

     (a)   the SRECs forecasted to be produced by the facility do not have a detrimental impact on the SREC market or on the appropriate development of solar power in the State;

     (b)   the approval of the designation of the proposed facility would not significantly impact the preservation of open space in this State;

     (c)   the impact of the designation on electric rates and economic development is beneficial; and

     (d)   there will be no impingement on the ability of an electric public utility to maintain its property and equipment in such a condition as to enable it to provide safe, adequate, and proper service to each of its customers.

     (3)   The board shall act within 90 days of its receipt of a completed application for designation of a solar power electric generation facility as "connected to the distribution system," to either approve, conditionally approve, or disapprove the application.  If the proposed solar electric power generation facility does not commence commercial operations within two years following the date of the designation by the board pursuant to this subsection, the designation of the facility as "connected to the distribution system" shall be deemed to be null and void, and the facility shall thereafter be considered not "connected to the distribution system."

     s.     In addition to any other requirements of P.L.1999, c.23 or any other law, rule, regulation or order, a solar electric power generation facility that is not net metered or an on-site generation facility and which is located on land that has been actively devoted to agricultural or horticultural use that is valued, assessed, and taxed pursuant to the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.) at any time within the 10-year period prior to the effective date of P.L.2012, c.24, shall only be considered "connected to the distribution system" if (1) the board approves the facility's designation pursuant to subsection q. of this section; or (2) (a) PJM issued a System Impact Study for the facility on or before June 30, 2011, (b) the facility files a notice with the board within 60 days of the effective date of P.L.2012, c.24, indicating its intent to qualify under this subsection, and (c) the facility has been approved as "connected to the distribution system" by the board.  Nothing in this subsection shall limit the board's authority concerning the review and oversight of facilities, unless such facilities are exempt from such review as a result of having been approved pursuant to subsection q. of this section.

     t.  (1) No more than 180 days after the date of enactment of P.L.2012, c.24, the board shall, in consultation with the Department of Environmental Protection and the New Jersey Economic Development Authority, and, after notice and opportunity for public comment and public hearing, complete a proceeding to establish a program to provide SRECs to owners of solar electric power generation facility projects certified by the board, in consultation with the Department of Environmental Protection, as being located on a brownfield, on an area of historic fill or on a properly closed sanitary landfill facility, including those owned or operated by an electric public utility and approved pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1).  Projects certified under this subsection shall be considered "connected to the distribution system", shall not require such designation by the board, and shall not be subject to board review required pursuant to subsections q. and r. of this section.  Notwithstanding the provisions of section 3 of P.L.1999, c.23 (C.48:3-51) or any other law, rule, regulation, or order to the contrary, for projects certified under this subsection, the board shall establish a financial incentive that is designed to supplement the SRECs generated by the facility in order to cover the additional cost of constructing and operating a solar electric power generation facility on a brownfield, on an area of historic fill or on a properly closed sanitary landfill facility.  Any financial benefit realized in relation to a project owned or operated by an electric public utility and approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), as a result of the provision of a financial incentive established by the board pursuant to this subsection, shall be credited to ratepayers. The issuance of SRECs for all solar electric power generation facility projects pursuant to this subsection shall be deemed "Board of Public Utilities financial assistance" as provided under section 1 of P.L.2009, c.89 (C.48:2-29.47).

     (2)   Notwithstanding the provisions of the "Spill Compensation and Control Act," P.L.1976, c.141 (C.58:10-23.11 et seq.) or any other law, rule, regulation, or order to the contrary, the board, in consultation with the Department of Environmental Protection, may find that a person who operates a solar electric power generation facility project that has commenced operation on or after the effective date of P.L.2012, c.24, which project is certified by the board, in consultation with the Department of Environmental Protection pursuant to paragraph (1) of this subsection, as being located on a brownfield for which a final remediation document has been issued, on an area of historic fill or on a properly closed sanitary landfill facility, which projects shall include, but not be limited to projects located on a brownfield for which a final remediation document has been issued, on an area of historic fill or on a properly closed sanitary landfill facility owned or operated by an electric public utility and approved pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), or a person who owns property acquired on or after the effective date of P.L.2012, c.24 on which such a solar electric power generation facility project is constructed and operated, shall not be liable for cleanup and removal costs to the Department of Environmental Protection or to any other person for the discharge of a hazardous substance provided that:

     (a)   the person acquired or leased the real property after the discharge of that hazardous substance at the real property;

     (b)   the person did not discharge the hazardous substance, is not in any way responsible for the hazardous substance, and is not a successor to the discharger or to any person in any way responsible for the hazardous substance or to anyone liable for cleanup and removal costs pursuant to section 8 of P.L.1976, c.141 (C.58:10-23.11g);

     (c)   the person, within 30 days after acquisition of the property, gave notice of the discharge to the Department of Environmental Protection in a manner the Department of Environmental Protection prescribes;

     (d)   the person does not disrupt or change, without prior written permission from the Department of Environmental Protection, any engineering or institutional control that is part of a remedial action for the contaminated site or any landfill closure or post-closure requirement;

     (e)   the person does not exacerbate the contamination at the property;

     (f)   the person does not interfere with any necessary remediation of the property;

     (g)   the person complies with any regulations and any permit the Department of Environmental Protection issues pursuant to section 19 of P.L.2009, c.60 (C.58:10C-19) or paragraph (2) of subsection a. of section 6 of P.L.1970, c.39 (C.13:1E-6);

     (h)   with respect to an area of historic fill, the person has demonstrated pursuant to a preliminary assessment and site investigation, that hazardous substances have not been discharged; and

     (i)    with respect to a properly closed sanitary landfill facility, no person who owns or controls the facility receives, has received, or will receive, with respect to such facility, any funds from any post-closure escrow account established pursuant to section 10 of P.L.1981, c.306 (C.13:1E-109) for the closure and monitoring of the facility.

     Only the person who is liable to clean up and remove the contamination pursuant to section 8 of P.L.1976, c.141 (C.58:10-23.11g) and who does not have a defense to liability pursuant to subsection d. of that section shall be liable for cleanup and removal costs.

     u.    No more than 180 days after the date of enactment of P.L.2012, c.24, the board shall complete a proceeding to establish a registration program.  The registration program shall require the owners of solar electric power generation facility projects connected to the distribution system to make periodic milestone filings with the board in a manner and at such times as determined by the board to provide full disclosure and transparency regarding the overall level of development and construction activity of those projects Statewide.

     v.    The issuance of SRECs for all solar electric power generation facility projects pursuant to this section, for projects connected to the distribution system with a capacity of one megawatt or greater, shall be deemed "Board of Public Utilities financial assistance" as provided pursuant to section 1 of P.L.2009, c.89 (C.48:2-29.47). 

     w.   No more than 270 days after the date of enactment of P.L.2012, c.24, the board shall, after notice and opportunity for public comment and public hearing, complete a proceeding to consider whether to establish a program to provide, to owners of solar electric power generation facility projects certified by the board as being three megawatts or greater in capacity and being net metered, including facilities which are owned or operated by an electric public utility and approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), a financial incentive that is designed to supplement the SRECs generated by the facility to further the goal of improving the economic competitiveness of commercial and industrial customers taking power from such projects.  If the board determines to establish such a program pursuant to this subsection, the board may establish a financial incentive to provide that the board shall issue one SREC for no less than every 750 kilowatt-hours of solar energy generated by the certified projects.  Any financial benefit realized in relation to a project owned or operated by an electric public utility and approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), as a result of the provisions of a financial incentive established by the board pursuant to this subsection, shall be credited to ratepayers.

     x.    Solar electric power generation facility projects that are located on an existing or proposed commercial, retail, industrial, municipal, professional, recreational, transit, commuter, entertainment complex, multi-use, or mixed-use parking lot with a capacity to park 350 or more vehicles where the area to be utilized for the facility is paved, or an impervious surface may be owned or operated by an electric public utility and may be approved by the board pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1).

(cf:  P.L.2018, c.17, s.2)

 

     2.  This act shall take effect immediately.

 

 

STATEMENT

 

     This bill would amend provisions in current law concerning limits on costs to customers of the Class I renewable energy requirements, solar renewable energy portfolio standards, solar renewable energy certificates (SRECs), solar alternative compliance payments (SACPs), and net metering.

     Under current law, the Board of Public Utilities (“board”) is required to ensure that the cost to customers of the Class I renewable energy requirement imposed pursuant to law does not exceed nine percent of the total paid for electricity by all customers in the State for energy year 2019, energy year 2020, and energy year 2021, respectively, and seven percent of the total paid for electricity by all customers in the State in any energy year thereafter.  This bill would revise this cap on the cost to customers by establishing a schedule for energy year 2022 through energy year 2037.  Under the schedule set forth in the bill, the cost to customers of the Class I renewable energy requirement imposed pursuant to law would not exceed nine percent of the total paid for electricity by all customers in the State for energy year 2021, and would decrease until energy year 2036 when it would not exceed five percent of the total paid for electricity by all customers in the State. 

     Current law provides that an electric power supplier or basic generation service provider may satisfy the Class I renewable energy requirements set forth in law by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection.  Under this bill, an electric power supplier or basic generation service provider would also be able to satisfy the Class I renewable energy requirements by submitting a Class I alternative compliance payment in the amount of $10 for energy year 2021 through energy year 2037.  Any Class I alternative compliance payment collected would be refunded directly to the ratepayers.

     Under current law, electric power suppliers and basic generation service providers must provide a certain percentage of their electricity from solar electric power generators.  The bill would revise the schedule set forth in P.L.2018, c.17.  Beginning in energy year 2021, under this bill, electric power suppliers and basic generation service providers would be required to provide 5.25 percent, rather than 5.1 percent.  In addition, instead of culminating in 5.1 percent in energy year 2021 and gradually decreasing thereafter until energy year 2023 as set forth in current law, this bill would establish the requirement through energy year 2037 when the required percentage would be 3.87 percent.

     Under current law, the board is required to adopt rules and regulations no later than 180 days after the effective date of P.L.2018, c.17 to close the SREC program to new applications upon the attainment of 5.1 percent of the kilowatt-hours sold in the State by each electric power supplier and each basic generation service provider from solar electric power generators connected to the distribution system.  The law further provides for the closing of the SREC program no later than June 1, 2021.  This bill would delete these provisions requiring the closing of the SREC program.

     In addition, current law requires the board to complete a study to evaluate how to modify or replace the SREC program in order to encourage the continued efficient and orderly development of solar renewable generating sources.  This bill would delete these study requirements, except that under this bill, the board would still be required to complete a study to develop megawatt targets for grid connected and distribution systems, including residential and small commercial rooftop systems, community solar systems, and large scale behind the meter systems, as a share of the overall solar energy requirement.

     Under current law, the board may authorize an electric power supplier or basic generation service provider to cease offering net metering to customers that are not already net metered whenever the total rated generating capacity owned and operated by net metering customer-generators Statewide equals 5.8 percent of the total annual kilowatt-hours sold in this State by each electric power supplier and each basic generation service provider during the prior one-year period.  This bill would increase this threshold from 5.8 percent to 15 percent.

     Lastly, the bill would revise provisions in current law regarding SACPS.  Under this bill, for energy year 2021, the SACP would be reduced from $258 to $220.51.  The bill would establish a revised schedule for SACP payments from energy year 2021 until energy year 2037 when the SACP would be $120.  The bill also would provide that any SACP payments collected would first be made available once a year in an auction format approved by the board to owners of solar electric generation facilities possessing unsold SRECs, and following the annual auction any remaining SACP payments would be refunded directly to the ratepayers by the electric public utilities.  Under current law, all SACP payments are refunded directly to the ratepayers by the electric public utilities.

DISCLAIMER: New Jersey SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
New JerseySRECSolar

New Jersey Board of Public Utilities Provides Guidance for Solar Transition

The New Jersey Board of Public Utilities (NJBPU) today proposed a rule to amend the Solar Renewable Energy Certificate (SREC) program. The rule proposal amends the SREC Registration Program (SRP) to include a process for the Board determining that 5.1 percent of the electricity sold in New Jersey has been attained from solar electric generation facilities. The Clean Energy Act of 2018 requires the closure of the current SREC program to new applications either when the state meets the 5.1 percent milestone or by June 2021, whichever comes first. The proposed rule will be published in the New Jersey Register with a 60-day public comment period.

 


“New Jersey’s solar program has been incredibly successful, recently surpassing 110,000 solar installations, creating an estimated 7,000 jobs, and rapidly approaching the 3 Gigawatt milestone. The state has a strong interest in seeing an effective solar program continue,” said NJBPU President Joseph L. Fiordaliso. “As we transition to a new solar program central to our goal of achieving 100 percent clean energy by 2050, we remain committed to ensuring a healthy solar market which continues to play a critical role for the benefit of all New Jersey residents.”


Under the rule proposed today, NJBPU staff would provide the Board with quarterly status reports on the progress toward the 5.1 percent threshold until it appears that this milestone will be reached within six months. Subsequently, staff will provide monthly forecasts. As soon as the 5.1 percent milestone is reached, staff will recommend the Board terminate the SRP. At that point, projects conditionally registered after October 29, 2018 which have not commenced commercial operations will not be certified as eligible to create SRECs.


The Board will publicly announce that the 5.1 percent milestone has been reached when the state’s installed solar capacity is estimated to have produced 5.1 percent of the retail sales estimated to have been sold over the previous twelve months. The Board is committed to providing an open and transparent public dialogue prior to the termination of the SREC registration program on whether Board action is necessary to ensure that the solar market in New Jersey continues to remain healthy.

 

About the New Jersey Board of Public Utilities (NJBPU)

The NJBPU is a state agency and regulatory authority mandated to ensure safe, adequate and proper utility services at reasonable rates for New Jersey customers. Critical services regulated by the NJBPU include natural gas, electricity, water, wastewater, telecommunications and cable television. The Board has general oversight and responsibility for monitoring utility service, responding to consumer complaints, and investigating utility accidents. To find out more about the NJBPU, visit our web site at www.nj.gov/bpu.

 

About the New Jersey Clean Energy Program (NJCEP)

The NJCEP, established on January 22, 2003, in accordance with the Electric Discount and Energy Competition Act (EDECA), provides financial and other incentives to the State's residential customers, businesses and schools that install high-efficiency or renewable energy technologies, thereby reducing energy usage, lowering customers' energy bills and reducing environmental impacts. The program is authorized and overseen by the New Jersey Board of Public Utilities (NJBPU), and its website is www.NJCleanEnergy.com.

DISCLAIMER: Maryland SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
New JerseyPress ReleasesPublic Auctions

Maryland Law Goes into Effect Requiring 50% Renewable by 2030 with a 14.5% Solar Carve-Out

May 29, 2019

New Law

This past weekend Maryland Governor Larry Hogan did not veto the Clean Energy Jobs Act which is now law. It requires at least 50% of the electricity in Maryland be derived from Tier 1 renewable sources which are at least 14.5% in-state solar by year 2030. It provides an immediate stimulus for solar by increasing the demand in 2019 to 5.5% up from the old requirement of 1.95%

Big Win for Owners and Investors in MD Solar

This law is a boon for owners of existing solar in MD, new investors of solar and any of the associated businesses involved in the development of solar projects.

SRECs; Then and Now In MD

SREC’s are the primary funding sources for solar in MD. Flett Exchange has run a market for MD SRECs since July of 2009. At that time the goal was to obtain 2% solar by year 2022 and SREC prices on Flett Exchange were $370 for MD SRECS. During the last 10 years the price to install solar decreased significantly and the 2% goal in MD was achieved quicker than expected. The state legislature and governor in MD were unsuccessful in putting new solar growth targets into law for a few years. This resulted in a slow-down of new solar development and the prices for SRECs decreased in response. Prices for MD SRECs dropped below $30 in 2016 and traded under $10 until recently. Due to the anticipated and eventual passage of this Clean Energy Jobs Act SREC prices have moved up above $60 as of today. We provide historical pricing on our website for your reference based on our Flett Exchange Daily Settlement price. Current owners of Solar in MD are taking advantage right now and selling their SRECs as the prices rise on the Flett Exchange MD SREC spot market via immediate delivery and payment.

What’s Next for Solar in MD?

The major take-away of this new law is that it creates a strong, long-term goal for demand for SRECs which is what solar investors look for.  As opposed to other states, it takes a well-balanced approach by protecting ratepayers by way of a lower compliance payment which starts at $100 and gradually decreases to $20.23 by year 2030. This is important in that solar investors want to be confident that the mandates are less likely not to be rolled back due to rate increases. The following is a table comparing the previous solar mandates to the new ones implemented via the Clean Energy Jobs Act:

 

Old Cost Cap

New Cost Cap

Year

Old % Solar

New % Solar

$150

$100

2019

1.95%

5.5%

$125

$100

2020

2.5%

6.0%

$100

$80

2021

2.5%

7.5%

$75

$60

2022

2.5%

8.5%

$60

$45

2023

2.5%

9.5%

$50

$40

2024

2.5%

10.5%

$50

$35

2025

2.5%

11.5%

$50

$30

2026

2.5%

12.5%

$50

$25

2027

2.5%

13.5%

$50

$25

2028

2.5%

14.5%

$50

$22.50

2029

2.5%

14.5%

$50

$20.235

2030

2.5%

14.5%

 

How do you Sell SRECs if you own Solar in MD?

Flett Exchange is celebrating a decade of servicing Maryland solar owners this summer! We look forward to the next ten years and assisting our current and all future Maryland Solar investors. We offer a do-it-yourself SREC service for those who don’t mind handling the GATS meter readings and transfers. If you sign up you gain access to our exchange 24x7 for immediate transfer and payment. For those who want a hassle-free full-service brokerage we offer Flett REC Manager. We will handle all of your meter readings, SREC minting in GATS and process your sales and payments immediately upon SREC creation. We are efficient at what we do so we have low fees to match. Our goal is to help you maximize your revenues on your solar investment! Sign up for either service on our website.

www.flettexchange.com

DISCLAIMER: Maryland SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
MarylandSRECMaryland Clean Jobs ActSolar

Pennsylvania SREC Prices Rally due to Senate Bill 600 Introduced

The Pennsylvania Senate introduced bill 600. This bill calls for an increase in both wind and solar in the State. Here are a few highlights:
 
Fixed Alternative Compliance Payments: ACP = the fine that has to be paid for failure to procure SRECs. The old ACP was 200% of the current price. The new ACP is more clear and protects ratepayers.
 
up to May 2021 - 200% of current price
June 2021 to May 2026 = $125
June 2026 to May 2030= $100
June 2030 to .......... $5 less per year and levels out at $45
 
RPS - The amount of solar required each year:
June 2021 to May 2022 .94%
June 2022 to May 2023 1.88%
June 2023 to May 2024 2.81% 
June 2024 to May 2025 3.75% 
June 2025 to May 2026 4.50% 
June 2026 to May 2027 5.25% 
June 2027 to May 2028 6.00% 
June 2028 to May 2029 6.75% 
June 2029 to May 2030 7.50% 
 
PA SREC prices rallied in response to the introduction. We will update our customers as the bill changes and if it becomes law. The bill is shown below:
 

 


 

PRINTER'S NO.  655

 

THE GENERAL ASSEMBLY OF PENNSYLVANIA

 SENATE BILL

No.

600

Session of

2019

INTRODUCED BY HAYWOOD, KILLION, SANTARSIERO, LEACH, FARNESE, HUGHES, SCHWANK, COSTA, COLLETT, FONTANA, TARTAGLIONE, KEARNEY, BLAKE, MUTH, STREET, A. WILLIAMS, SABATINA AND DINNIMAN, APRIL 29, 2019

REFERRED TO CONSUMER PROTECTION AND PROFESSIONAL LICENSURE, APRIL 29, 2019

AN ACT

 Amending the act of November 30, 2004 (P.L.1672, No.213), entitled, "An act providing for the sale of electric energy generated from renewable and environmentally beneficial sources, for the acquisition of electric energy generated from renewable and environmentally beneficial sources by electric distribution and supply companies and for the powers and duties of the Pennsylvania Public Utility Commission," further providing for definitions and for alternative energy portfolio standards, providing for solar photovoltaic technology requirements, for contract requirements for solar photovoltaic energy system sources, for renewable energy storage report, for energy storage deployment targets and for contracts for solar photovoltaic technologies by Commonwealth agencies and further providing for portfolio requirements in other states; and making a related repeal.

The General Assembly of the Commonwealth of Pennsylvania hereby enacts as follows:

Section 1.  The definition of "reporting period" in section 2 of the act of November 30, 2004 (P.L.1672, No.213), known as the Alternative Energy Portfolio Standards Act, is amended and the section is amended by adding definitions to read:

Section 2.  Definitions.

The following words and phrases when used in this act shall have the meanings given to them in this section unless the context clearly indicates otherwise:

* * *

"Deploy" or "deployment."  To install a renewable energy storage system through a variety of mechanisms, including utility procurement, customer installation methods or other processes.

* * *

"Renewable energy storage system."  A commercially available technology, including, but not limited to, any electrochemical, thermal and electromechanical technology, that is capable of absorbing and storing electrical energy for a period of time for use at a later time, with all of the following characteristics:

(1)  The system is co-located behind the meter with a Tier I alternative energy source or behind the point of interconnection of a Tier I alternative energy source.

(2)  The system is owned or operated by any of the following:

(i)  A customer-generator.

(ii)  An electric generation supplier.

(iii)  An electric distribution company.

(iv)  A third party that is jointly owned by two or more entities specified under subparagraphs (i), (ii) and (iii).

(3)  The system is able to demonstrate that the energy

the system discharges at all hours in a given reporting year comes from the storage of electrical energy produced by the co-located Tier I alternative energy source.

["Reporting period."] "Reporting period or reporting year."  The 12-month period from June 1 through May 31. A reporting year shall be numbered according to the calendar year in which it begins and ends.

* * *

Section 2.  Section 3(a)(3), (b), (f) and (g)(2) of the act are amended and the section is amended by adding a subsection to read:

Section 3.  Alternative energy portfolio standards.

(a)  General compliance and cost recovery.--

* * *

(3)  All costs for:

(i)  the purchase of electricity generated from alternative energy sources, including the costs of the regional transmission organization, in excess of the regional transmission organization real-time locational marginal pricing, or its successor, at the delivery point of the alternative energy source for the electrical production of the alternative energy sources; and

(ii)  payments for alternative energy credits, in both cases that are voluntarily acquired by an electric distribution company during the cost recovery period on behalf of its customers shall be deferred as a regulatory asset by the electric distribution company and fully recovered, with a return on the unamortized balance, pursuant to an automatic energy adjustment clause under 66 Pa.C.S. § 1307 (relating to sliding scale of rates; adjustments) as a cost of generation supply under 66 Pa.C.S. § 2807 (relating to duties of electric distribution companies) in the first year after the expiration of its cost-recovery period. After the cost-recovery period, any direct or indirect costs for the purchase by electric distribution companies of resources to comply with this section, including, but not limited to, the purchase of electricity generated from alternative energy sources, payments for alternative energy credits, cost of credits banked, payments to any third party administrators for performance under this act and costs levied by a regional transmission organization to ensure that alternative energy sources are reliable, shall be recovered on a full and current basis pursuant to an automatic energy adjustment clause under 66 Pa.C.S. § 1307 as a cost of generation supply under 66 Pa.C.S. § 2807.

(b)  Tier I and solar photovoltaic shares through the 15th reporting year.--

(1)  Two years after the effective date of this act, at least 1.5% of the electric energy sold by an electric distribution company or electric generation supplier to retail electric customers in this Commonwealth shall be generated from Tier I alternative energy sources. Except as provided in this section, the minimum percentage of electric energy required to be sold to retail electric customers from alternative energy sources shall increase to 2% three years after the effective date of this act. The minimum percentage of electric energy required to be sold to retail electric customers from alternative energy sources shall increase by at least 0.5% each year so that at least 8% of the electric energy sold by an electric distribution company or electric generation supplier to retail electric customers in that certificated territory in the 15th reporting year after the effective date of this subsection is sold from Tier I alternative energy resources.

(2)  [The] Through the 15th reporting year ending May 31, 2021, the total percentage of the electric energy sold by an electric distribution company or electric generation supplier to retail electric customers in this Commonwealth that must be sold from solar photovoltaic technologies is:

(i)  0.0013% for June 1, 2006, through May 31, 2007.

(ii)  0.0030% for June 1, 2007, through May 31, 2008.

(iii)  0.0063% for June 1, 2008, through May 31, 2009.

(iv)  0.0120% for June 1, 2009, through May 31, 2010.

(v)  0.0203% for June 1, 2010, through May 31, 2011.

(vi)  0.0325% for June 1, 2011, through May 31, 2012.

(vii)  0.0510% for June 1, 2012, through May 31, 2013.

(viii)  0.0840% for June 1, 2013, through May 31, 2014.

(ix)  0.1440% for June 1, 2014, through May 31, 2015.

(x)  0.2500% for June 1, 2015, through May 31, 2016.

(xi)  0.2933% for June 1, 2016, through May 31, 2017.

(xii)  0.3400% for June 1, 2017, through May 31, 2018.

(xiii)  0.3900% for June 1, 2018, through May 31, 2019.

(xiv)  0.4433% for June 1, 2019, through May 31, 2020.

(xv)  0.5000% for June 1, 2020, [and thereafter.] through May 31, 2021.

(3)  Upon commencement of the beginning of the 6th reporting year, the commission shall undertake a review of the compliance by electric distribution companies and electric generation suppliers with the requirements of this act. The review shall also include the status of alternative energy technologies within this Commonwealth and the capacity to add additional alternative energy resources. [The commission shall use the results of this review to recommend to the General Assembly additional compliance goals beyond year 15.] The commission shall work with the department in evaluating the future alternative energy resource potential.

(b.1)  Tier I and solar photovoltaic shares beginning in the 16th reporting year.--

(1)  Each electric distribution company and electric generation supplier shall purchase, at a minimum, an amount of Tier I alternative energy credits equal to the percentage of electric energy required to be sold by an electric distribution company or electric generation supplier to retail electric customers from Tier I alternative energy sources for that reporting year and as provided under this subsection. Beginning in the 16th reporting year commencing on June 1, 2021, the minimum percentage of electric energy required to be sold by an electric distribution company or electric generation supplier to retail electric customers in this Commonwealth from Tier I alternative energy sources for each reporting year is:

(i)  10.444% for June 1, 2021, through May 31, 2022.

(ii)  12.888% for June 1, 2022, through May 31, 2023.

(iii)  15.332% for June 1, 2023, through May 31, 2024.

(iv)  17.776% for June 1, 2024, through May 31, 2025.

(v)  20.220% for June 1, 2025, through May 31, 2026.

(vi)  22.664% for June 1, 2026, through May 31, 2027.

(vii)  25.108% for June 1, 2027, through May 31, 2028.

(viii)  27.552% for June 1, 2028, through May 31, 2029.

(ix)  30% for June 1, 2029, through May 31, 2030, and thereafter.

(2)  (i)  Beginning in the 16th reporting year commencing on June 1, 2021, the minimum percentage of the electric energy sold by an electric distribution company or electric generation supplier to retail electric customers in this Commonwealth that must be sold from solar photovoltaic technologies that are owned and operated by customer-generators is:

(A)  0.65% for June 1, 2021, through May 31, 2022.

(B)  0.82% for June 1, 2022, through May 31, 2023.

(C)  0.98% for June 1, 2023, through May 31, 2024.

(D)  1.13% for June 1, 2024, through May 31, 2025.

(E)  1.30% for June 1, 2025, through May 31, 2026.

(F)  1.5% for June 1, 2026, through May 31, 2027.

(G)  1.78% for June 1, 2027, through May 31, 2028.

(H)  2.11% for June 1, 2028, through May 31, 2029.

(I)  2.5% for June 1, 2029, through May 31, 2030, and thereafter.

(ii)  For purposes of the requirements under subparagraph (i), solar photovoltaic technologies that are owned and operated by customer-generators shall include any of the following:

(A)  Solar photovoltaic technologies that were certified before or on May 31, 2021, under subsection (b)(2) and qualify to generate solar alternative energy credits in accordance with section 3.1.

(B)  Solar photovoltaic technologies that qualify as customer-generators certified under subsection (b)(2).

(3)  Beginning in the 16th reporting year commencing on June 1, 2021, and each reporting year thereafter, a solar photovoltaic system that is certified before or on May 31, 2021, provided the system meets the requirements under section 3.1, shall be included in the percentage of the required solar photovoltaic energy systems owned and operated by customer-generators under paragraph (2).

(4)  A solar photovoltaic energy system owned and operated by a customer-generator in accordance with paragraph (2) shall remain eligible to receive solar alternative energy credits for no more than 15 years beginning on June 1, 2021, or 15 years beginning on the date of the solar photovoltaic energy system's certification if the certification occurs after June 1, 2021. Upon expiration of the 15-year period specified under this paragraph, the solar photovoltaic energy system shall be eligible for alternative energy credits provided for Tier I alternative energy sources under paragraph (1).

(5)  Beginning in the 16th reporting year commencing on June 1, 2021, the minimum percentage of the electric energy sold by an electric distribution company or electric generation supplier to retail electric customers in this Commonwealth that must be sold from solar photovoltaic technologies from non-customer-generators is:

(i)  0.94% for June 1, 2021, through May 31, 2022.

(ii)  1.88% for June 1, 2022, through May 31, 2023.

(iii)  2.81% for June 1, 2023, through May 31, 2024.

(iv)  3.75% for June 1, 2024, through May 31, 2025.

(v)  4.50% for June 1, 2025, through May 31, 2026.

(vi)  5.25% for June 1, 2026, through May 31, 2027.

(vii)  6.00% for June 1, 2027, through May 31, 2028.

(viii)  6.75% for June 1, 2028, through May 31, 2029.

(ix)  7.5% for June 1, 2029, through May 31, 2030, and thereafter.

(6)  No later than one year after the effective date of this subsection, the commission shall establish regulations to ensure diversification across all customer-generators under paragraph (2), including, but not limited to, solar photovoltaic systems that are interconnected at residential or commercial locations or customer-generators whose systems are for virtual meter aggregation.

(7)  This subsection shall not apply to the certification of a solar photovoltaic energy system with a contract for the sale and purchase of alternative energy credits derived from solar photovoltaic energy sources entered into before or on May 31, 2021, provided that the system meets the requirements under section 3.1.

(8)  This subsection shall apply to a contract for the sale and purchase of alternative energy credits derived from solar photovoltaic energy sources entered into or renewed for reporting years commencing after May 31, 2021.

* * *

(f)  Alternative compliance payment.--

(1)  At the end of each program reporting year, the program administrator shall provide a report to the commission and to each covered electric distribution company showing their status level of alternative energy acquisition.

(2)  The commission shall conduct a review of each determination made under subsections (b), (b.1) and (c). If, after notice and hearing, the commission determines that an electric distribution company or electric generation supplier has failed to comply with subsections (b), (b.1) and (c), the commission shall impose an alternative compliance payment on that electric distribution company or electric generation supplier.

(3)  [The] Through May 31, 2021, the alternative compliance payment, with the exception of the solar photovoltaic share compliance requirement set forth in subsection (b)(2), shall be $45 times the number of additional alternative energy credits needed in order to comply with subsection (b) or (c).

(4)  [The] Through May 31, 2021, the alternative compliance payment for the solar photovoltaic share required under subsection (b)(2) shall be 200% of the average market value of solar renewable energy credits sold during the reporting period within the service region of the regional transmission organization, including, where applicable, the levelized up-front rebates received by sellers of solar [renewable] alternative energy credits in other jurisdictions in the PJM Interconnection, L.L.C. transmission organization (PJM) or its successor.

(4.1)  Beginning June 1, 2021, the alternative compliance payment, with the exception of the customer-generator solar photovoltaic share compliance requirement specified under subsection (b.1)(2), shall be $45 multiplied by the number of additional alternative energy credits needed in order to comply with subsection (b.1) or (c).

(4.2)  Beginning June 1, 2021, the alternative compliance payment for the customer-generator solar photovoltaic share compliance requirement specified under subsection (b.1)(2) shall be as follows:

(i)  An amount equal to the product of $125 multiplied by the number of additional alternative energy credits required to comply with subsection (b.1)(2) from June 1, 2021, through May 31, 2026.

(ii)  An amount equal to the product of $100 multiplied by the number of additional alternative energy credits required to comply with subsection (b.1)(2) from June 1, 2026, through May 31, 2030.

(iii)  Beginning with the reporting year commencing on June 1, 2030, and each reporting year thereafter, the alternative compliance payment required for solar photovoltaic energy systems under subsection (b.1)(2) shall decrease by $5 from the previous reporting year until the alternative compliance payment is

$45.

(5)  The commission shall establish a process to provide for, at least annually, a review of the alternative energy market within this Commonwealth and the service territories of the regional transmission organizations that manage the transmission system in any part of this Commonwealth. The commission will use the results of this study to identify any needed changes to the cost associated with the alternative compliance payment program. If the commission finds that the costs associated with the alternative compliance payment program must be changed, the commission shall present these findings to the General Assembly for legislative enactment.

(g)  Transfer [to sustainable development funds] of alternative compliance payments.--

* * *

(2)  The alternative compliance payments shall be utilized solely for [projects] any of the following:

(i)  Projects that will increase the amount of electric energy generated from alternative energy resources for purposes of compliance with subsections (b), (b.1) and (c).

(ii)  Workforce development programs to train workers in renewable energy industries.

* * *

Section 3.  The act is amended by adding sections to read:

Section 3.1.  Solar photovoltaic technology requirements.

(a)  System requirements.--Notwithstanding section 4, in order to qualify as an alternative energy source eligible to meet the solar photovoltaic share of the compliance requirements under section 3, a solar photovoltaic system must do one of the following:

(1)  Directly deliver the electricity that the solar photovoltaic system generates to a retail customer of an electric distribution company or to the distribution system operated by an electric distribution company operating in this Commonwealth and currently obligated to meet the compliance requirements specified under section 3.

(2)  Directly connect to the electric system of an electric cooperative or municipal electric system operating in this Commonwealth.

(3)  Directly connect to the electric transmission system at a location within the service territory of an electric distribution company operating in this Commonwealth.

(b)  Construction.--

(1)  Nothing under this section or section 4 shall be construed to affect any of the following:

(i)  A certification originating in this Commonwealth and granted before the effective date of this section of a solar photovoltaic energy generator as a qualifying alternative energy source eligible to meet the solar photovoltaic share of this Commonwealth's alternative energy portfolio compliance requirements under section 3.

(ii)  A certification of a solar photovoltaic system with a binding written contract for the sale and purchase of alternative energy credits derived from solar photovoltaic energy sources entered into before October 30, 2017.

(2)  This section shall apply to contracts entered into or renewed on or after October 30, 2017.

Section 3.2.  Contract requirements for solar photovoltaic energy system sources.

(a)  Low-cost procurement for non-customer-generators.--

(1)  To assure the lowest-cost procurement, two-thirds of the annual total percentage requirement from solar photovoltaic sources as specified under section 3(b.1)(5) shall be procured through contracts of no less than 12 years and no more than 20 years for both energy and alternative energy credits required under this subsection. Energy procured to satisfy the requirements of this subsection may not be used to satisfy the procurement requirement under subsection (b).

(2)  An electric distribution company with more than one million annual megawatt hours of retail load shall:

(i)  procure energy and alternative energy credits based on the total electric energy sold to all customers in the electric distribution company's service territory, without regard to whether the supplier of the retail sales is the electric distribution company or an electric generation supplier;

(ii)  issue annual requests for proposals for competitive long-term procurement of solar energy and alternative energy credits and enter into contracts in compliance with this subsection in accordance with regulations established by the commission; and

(iii)  be entitled to a presumption of prudency and full cost recovery in distribution rates of payments for competitive procurements made under this subsection at a levelized price over the term of the contract of less than one-half of the applicable alternative compliance payment.

(3)  For purposes of any true-up required under this subsection, the following apply:

(i)  If contracts executed to meet the requirements of this section fail to deliver the quantities required in any given year, the electric distribution company shall procure alternative energy credits during the true-up period established under section 3(e)(5).

(ii)  Electric generation suppliers in the territory of the electric distribution company shall not have an obligation to purchase alternative energy credits for the share of the requirements under this section and shall not be responsible for true-up or the payment of any penalty for failure to comply with this section.

(4)  No later than December 1, 2020, the commission shall establish regulations to implement the requirements under this subsection and provide for the issuance and execution of the first competitive procurement contracts for the supply of alternative energy credits beginning with the reporting year commencing on June 1, 2021. The regulations shall address, but not be limited to, all of the following:

(i)  Competitive contract procurement.

(ii)  Alternative energy credit retirement.

(iii)  Guidance on the prudency of proposed purchases, including a presumption of prudence if the annualized cost of alternative energy credits is less than one-half of the applicable alternative compliance payment.

(iv)  Competitiveness review using standard industry practices to ensure that each solicitation is competitive and providing for the prompt re-issuance of a solicitation deemed to be uncompetitive.

(v)  Cost recovery for electric distribution companies for prudent and competitive contracts.

(vi)  Alternative energy credit true-up of procurement shortfalls in subsequent year contract procurements.

(b)  Low-cost procurement for Tier I resources.--

(1)  No later than December 1, 2020, the commission shall establish regulations providing for competitive procurement of at least one-sixth of the Tier I alternative energy required under section 3(b.1)(1), except for energy procured  under subsection (a), under contracts with a term of no less than 10 years and no more than 15 years beginning with the reporting year commencing on June 1, 2021. The competitive procurements under this subsection shall result in contracts for both energy and alternative energy credits for Tier I alternative energy resources for the purpose of satisfying the requirements under section

(3)(b.1)(1). The requirements under this paragraph shall not apply to the solar photovoltaic share requirements under section 3(b.1)(2) or (5).

(2)  In establishing regulations under paragraph (1), the commission shall collaborate with stakeholders, including, but not limited to, the department, energy generation suppliers, renewable energy developers and electric distribution companies, and determine the benefit to electric customers in this Commonwealth based on the following factors:

(i)  The savings to electric customers resulting from the procurement of alternative energy credits under this section.

(ii)  The preference for new generation resources with reduced emissions as determined by the department.

(iii)  The parties to the contracts.

(iv)  The design of the competitive procurement process.

(v)  The terms to be included in the contracts based on commercial reasonableness for the parties to the contracts.

Section 3.3.  Renewable energy storage report.

(a)  Report.--No later than one year after the effective date of this section, the commission, in consultation with the PJM Interconnection, L.L.C. transmission organization (PJM) or its successor and stakeholders, including, but not limited to, third-party electric generation suppliers and electric utilities, shall conduct a renewable energy storage analysis and submit a report to the Governor and General Assembly concerning renewable energy storage needs and opportunities and costs and benefits in this Commonwealth.

(b)  Contract.--The commission shall contract with an independent consultant selected through a competitive request for proposal process to produce the report under this section.

(c)  Report.--At a minimum, the commission shall compile the report in the following manner:

(1)  Use 2,000 megawatt hours of renewable energy storage as a benchmark target goal.

(2)  Identify and measure the potential costs and benefits of deployment based on all of the following factors:

(i)  Deferred investments in generation, transmission and distribution facilities.

(ii)  Reduced ancillary services costs.

(iii)  Reduced transmission and distribution congestion.

(iv)  Reduced peak power costs and capacity costs.

(v)  Reduced costs for emergency power supplies during outages.

(vi)  Curtailment of nonrenewable energy generators to meet peak demand.

(vii)  Reduced greenhouse gas emissions.

(3)  Analyze and estimate all of the following:

(i)  The ability to integrate renewable energy resources with energy storage systems.

(ii)  The benefits of coupling the storage to meet peak demand.

(iii)  The impact of renewable energy storage on grid reliability and power quality.

(iv)  The impact on retail electric rates over the useful life of a renewable energy storage system compared to the same services using other facilities or resources.

(4)  Consider whether the implementation of renewable electric energy storage systems would promote the use of electric vehicles in this Commonwealth and the potential impact on renewable energy production in this Commonwealth.

(5)  Analyze the types of renewable energy storage technologies currently being implemented in this Commonwealth and other states.

(6)  Consider the benefits and costs to retail electric customers in this Commonwealth, political subdivisions and electric public utilities associated with the development and implementation of additional renewable energy storage technologies.

(7)  Determine the optimal amount of renewable energy storage that should be added in this Commonwealth during the next five years to provide the maximum benefit to retail electric customers in this Commonwealth.

(8)  Determine the optimum points of entry into the electric distribution system for distributed energy resources.

(9)  Calculate the cost to retail electric customers in this Commonwealth of adding the optimal amount of renewable energy storage.

Section 3.4.  Energy storage deployment targets.

(a)  Determination.--No later than 90 days after completion of the report under section 3.3, the commission shall determine appropriate energy storage deployment targets that each electric distribution company needs to achieve by December 31, 2025, including any interim targets. In making the determination, the commission  shall consider all of the following:

(1)  The contents of the report under section 3.3.

(2)  Adopting specific subcategories of deployment by point of interconnection.

(3)  Adopting requirements or processes for all of the following:

(i)  The competitive deployment of energy storage services from third parties.

(ii)  The direct purchase of storage devices.

(4)  Appropriate accountability mechanisms, including  reporting requirements, for investor-owned electric utilities to procure energy storage in sufficient quantities to meet the targets established by the commission.

(5)  If advised by the report under section 3.3, creating a renewable peak standard that would set targets for meeting peak demand with renewable energy co-located with storage, including all of the following:

(i)  Demand response technology or energy storage that is paired solely with a Tier I alternative energy source that generates, dispatches or discharges energy to an electric distribution system during seasonal peak periods as determined by the commission or reduce load on the system.

(ii)  Renewable energy storage systems that can be co-located with the Tier I alternative energy sources or paired virtually, as long as the storage facility is within the boundaries of the same electric distribution company's service territory and specifically located to reduce peak demand.

(b)  Definitions.--As used in this section, the term "procure" shall mean to acquire by ownership a renewable energy storage system or a contractual right to use the energy from, or the capacity of, a renewable energy storage system.

Section 3.5.  Contracts for solar photovoltaic technologies by Commonwealth agencies.

(a)  Public works.--Except as provided under subsection (b), a Commonwealth agency shall require that a contract for the construction, reconstruction, alteration, repair, improvement or maintenance of public works contain a provision that, if any solar photovoltaic technologies to be used or supplied in the performance of the contract, only solar photovoltaic technologies manufactured in the United States shall be used or supplied in the performance of the contract or any subcontracts under the contract.

(b)  Exception.--The requirement under subsection (a) shall not apply if the head of the Commonwealth agency, in writing, determines that the solar photovoltaic technologies are not manufactured in the United States in sufficient quantities to meet the requirements of the contract.

(c)  Definitions.--As used in this section, the term "public work" shall have the same meaning given to it in section 2(5) of the act of August 15, 1961 (P.L.987, No.442), known as the Pennsylvania Prevailing Wage Act.

Section 4.  Section 4 of the act is amended to read:

Section 4.  Portfolio requirements in other states.

If an electric distribution [supplier] company or electric generation [company] supplier provider sells electricity in any other state and is subject to [renewable] alternative energy portfolio requirements in that state, they shall list any such requirement and shall indicate how it satisfied those [renewable] alternative energy portfolio requirements. To prevent double-counting, the electric distribution [supplier] company or electric generation [company] supplier shall not satisfy Pennsylvania's alternative energy portfolio requirements using alternative energy used to satisfy another state's portfolio requirements or alternative energy credits already purchased by individuals, businesses or government bodies that do not have a compliance obligation under this act unless the individual, business or government body sells those credits to the electric distribution company or electric generation supplier. Energy derived from alternative energy sources inside the geographical boundaries of this Commonwealth shall be eligible to meet the compliance requirements under this act. Energy derived from alternative energy sources located outside the geographical boundaries of this Commonwealth but within the service territory of a regional transmission organization that manages the transmission system in any part of this Commonwealth shall only be eligible to meet the compliance requirements of electric distribution companies or electric generation suppliers located within the service territory of the same regional transmission organization. For purposes of compliance with this act, alternative energy sources located in the PJM Interconnection, L.L.C. regional transmission organization (PJM) or its successor service territory shall be eligible to fulfill compliance obligations of all Pennsylvania electric distribution companies and electric generation suppliers. Energy derived from alternative energy sources located outside the service territory of a regional transmission organization that manages the transmission system in any part of this Commonwealth shall not be eligible to meet the compliance requirements of this act. Electric distribution companies and electric generation suppliers shall document that this energy was not used to satisfy another state's [renewable] alternative energy portfolio standards.

Section 5.  Repeals are as follows:

(1)  The General Assembly declares that the repeal under paragraph (2) is necessary to effectuate the addition of section 3.1 of the act.

(2)  Section 2804 of the act of April 9, 1929 (P.L.177, No.175), known as The Administrative Code of 1929, is repealed.

Section 6.  This act shall take effect immediately.

DISCLAIMER: Pennsylvania SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
PennsylvaniaPress ReleasesSREC

Maryland House and Senate Pass Renewable Energy Legislation

The Maryland House passed renewable energy legislation that was passed by the senate in March. It now moves to Governor Larry Hogans' desk to be signed into law.
 
It calls for a 50% RPS with a 14.5% solar carve-out. 
 

DISCLAIMER: Maryland SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
MarylandPress ReleasesSREC

Pennsylvania Nuclear Bailout Bill Could Help PA Solar

Pennsylvania Nuclear Bailout Bill Could Help PA Solar
 
Pennsylvania lawmakers are crafting a bill that would provide subsidies to keep nuclear plants open. The nuclear plants are not able to cover expenses because power prices on the wholesale market have dropped over the past few years. This is due to the large amount of natural gas brought to market. Cheap gas has already caused the mass closure of Coal plants in areas of the country. 
 
The closure of the Nuclear plants will be devastating because they provide Co2 free electricity. 5 nuclear plants provide 42% of Pennsylvania electricity.
 
It is expected that the Nuclear bill will include increased incentives for renewable energy. This happened in New Jersey in May 2018.  
 
Depending upon the details of the bill, solar owners may see their SREC prices rise. The article in the Pocono Record gives some details.
 

DISCLAIMER: Pennsylvania SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
PennsylvaniaSREC

New Jersey BPU Solar Transition Straw Proposal

The Staff of the New Jersey Board of Public Utilities (“BPU”) invites all interested parties and members of the public to participate in the continued public stakeholder process to fully inform the design of the New Jersey solar transition required by P.L. 2018, c.17 (the “Clean Energy Act”). This process will include the comments and input received previously, and will build upon the experience of the State and of other jurisdictions. Likewise, this approach is intended to be completed by the statutory deadline, and to provide stakeholders the certainty necessary for continued success for the solar industry.

On May 23, 2018, Governor Phil Murphy signed the Clean Energy Act, which directs the BPU to:

adopt rules and regulations to close the [Solar Renewable Energy Certificate] SREC program to new applications upon the attainment of 5.1 percent of the kilowatt-hours sold in the State by each electric power supplier and each basic generation provider from solar electric power generators connected to the distribution system. The board shall continue to consider any application filed before the date of enactment of P.L.2018, c.17. The board shall provide for an orderly and transparent mechanism that will result in the closing of the existing SREC program on a date certain but no later than June 1,2021.

Additionally, the Clean Energy Act directs the Board of Public Utilities to:

 

 
 

1Not a Paid Legal Advertisement


complete a study that evaluates how to modify or replace the SREC program to encourage the continued efficient and orderly development of solar renewable energy generating sources throughout theState.

Furthermore, the Clean Energy Act mandates that:

the board shall ensure that the cost to customers of the Class I renewable energy requirement imposed pursuant to this subsection shall not exceed nine percent of the total paid for electricity by all customers in the State for energy year 2019, energy year 2020, and energy year 2021, respectively, and shall not exceed seven percent of the total paid for electricity by all customers in the State in any energy year thereafter. In calculating the cost to customers of the Class I renewable energy  requirement imposed pursuant to this subsection, the board shall not include the costs of the offshore wind energy certificate program established pursuant to paragraph (4) of this subsection. The board shall take any steps necessary to prevent the exceedance of the cap on the cost to customers including, but not limited to, adjusting the Class I renewable energyrequirement.

 

 

SREC Transition Principles

Staff will be guided by the following “SREC Transition Principles”:

1.     Provide maximum benefit to ratepayers at the lowestcost;

2.     Support the continued growth of the solarindustry;

3.     Ensure that prior investments retainvalue;

4.     Meet the Governor’s commitment of 50% Class I Renewable Energy Certificates (“RECs”) by 2030 and 100% clean energy by2050;

5.     Provide insight and information to stakeholders through a transparent process for developing the Solar Transition and SuccessorProgram;

6.     Comply fully with the statute, including the implications of the cost cap;and

7.     Provide disclosure and notification to developers that certain projects may not be guaranteed participation in the current SREC program, and continue updates on market conditions via the New Jersey Clean Energy Program (“NJCEP”) SREC Registration Program (“SRP”) Solar ActivityReports.

 

 

Program Assumptions and Overview

The Clean Energy Act defines the transition point as “the attainment of 5.1 percent of the kilowatt-hours sold in the State by each electric power supplier and each basic generation provider from solar electric power generators connected to the distribution system.” For purposes of this proposal, “attainment” means that 5.1% of the actual kilowatt-hours sold in the state are being generated by solar electric power generators. This will result in the following categorization ofSRECs:


·       Legacy SRECs: SRECs created by projects that filed an SRP Registration and entered into operation prior to the attainment of the 5.1% transitionpoint.

·       Pipeline SRECs: SRECs created by projects that filed an SRP Registration but which have not entered into commercial operation prior to the attainment of the 5.1% transition point.

·       Successor SRECs: SRECs created by projects that filed an SRP Registration (or replacement mechanism) after the attainment of the 5.1% transitionpoint.

o The SREC Successor Program is the program for the allocation and valuation of Successor SRECs. The current SREC program is designated as “current SREC program”.

In this proposal, SREC Transition (or Solar Transition) is defined as those steps necessary for the definition of the 5.1% transition point; the treatment of Legacy SRECs; the treatment of Pipeline SRECs; and the treatment of Successor SRECs.

Stakeholder Process

Working within these principles and assumptions, Board Staff wishes to bring together all interested stakeholders, beginning in January, for a full discussion of the benefits and liabilities of the different approaches to developing and implementing a SREC Transition in compliance with statutory requirements.

Staff would like to set forth the following proposed schedule for the process of developing the SREC Transition process:

Dec 2018:                               Staff releases Solar Transition Straw Proposal Jan – Feb2019:                             Stakeholder meetings on the StrawProposal

April –July2019:                   Working groups & workshops conducted onspecific

elements of the Transition

Aug – Sept2019:                    Rule proposal presented toBoard

Sept – Nov2019:                    Public comment period on rule proposal Dec 2019:                                       Amendments to ruleproposal

Jan – Feb2020:                      Public comment period on rule proposal March 2020:                            Rule adopted byBoard

 

The first Solar Transition Stakeholder Meeting will be held:

Date:        Friday, January 18,2019

Location: Rutgers University College Avenue Student Center 126 College Ave, New Brunswick, NJ 08901 Multipurpose Room, 2nd Floor.

Time:       10a.m.

 

Stakeholders wishing to speak are asked to register in advance to solar.transitions@bpu.nj.gov no later than 5:00 p.m. on Wednesday, January 16, 2019. Stakeholders wishing to speak without prior registration will be allowed to sign up to do so upon arrival to the Stakeholder Meeting, and will be called to speak following the preregisteredspeakers.

Additional stakeholder meetings will be announced subsequently.

Written comments are also encouraged and must be submitted to Aida Camacho-Welch, Secretary, New Jersey Board of Public Utilities, Post Office Box 350, Trenton, New Jersey,


08625. Written comments may also be submitted electronically to solar.transitions@bpu.nj.gov in PDF or Microsoft Word format. All comments must be received on or before 5:00 p.m. on Friday, February 22, 2019. Please note that these comments may be considered “public documents” for purposes of the State’s Open Public Records Act. Stakeholders may identify information that they wish to keep confidential by submitting them in accordance with the confidentiality procedures set forth in N.J.A.C.14:1-12.3.

 

 

Request for Comments

In light of the statutory directives and the SREC Transition Principles, Staff invites stakeholders to submit comments on the SREC Transition and SREC Successor Program. Additionally, Staff seeks detailed comments on the following issues and questions.

Board Staff strongly requests that stakeholders submit quantitative information to support any assertions pertaining to numerical aspects of the SREC Transition and the SREC Successor Program. Stakeholders are therefore highly encouraged to include, as part of any comments, any calculations, graphs, and tables that are relevant and illustrative to the content of the comments. The calculations, graphs or tables must include an attachment which  clearly explains all assumptions used and a copy of any data employed (in a Microsoft Excel file or other easily shared data tool). Stakeholders may identify information that they wish to keep confidentialbysubmittingtheminaccordancewiththeconfidentialityproceduressetforthin

N.J.A.C. 14:1-12.3.

In addition to the below question, Staff also wishes to set forth the following proposal for discussion and consideration:

·       Defining attainment as being met when 5.1% of the actual kilowatt-hours sold in the  state come from solar electric powergenerators.

 

·       Recognizing that, based on the definitions proposed above, Pipeline SRECs are those projects that have filed an SRP Registration but have not entered into commercial operation prior to the attainment of the 5.1% trigger. Recognizing that those Pipeline SRECs will not be used for satisfaction of the RPS of the Legacy SRECs, in order to ensure that the current market does not becomeover-supplied.

 

·       Developing a process whereby the Pipeline SRECs are eligible for either a transitional program or able to roll into the SREC Successor Program, as developed. As part of the design process, the Board would consider how to ensure that Pipeline SRECs are considered and provided value (including whether to develop a separate program for Pipeline SRECs, or roll those Pipeline SRECs into the SREC Successor Program, as developed).

 

·       Over an 18-month period, closely monitor the price cap to ensure that it is not exceeded, with the recognition that the Board could exercise its authority to reduce the Class I RECs in the event of the cap beingexceeded.

With that in mind, Staff presents the following questions for consideration and discussion:


1)    In your direct experience, how has the current SREC program functioned over the past 5 years?

 

2)    How should any proposed SREC Successor Program be organized in conformance with the Clean Energy Act and Staff’s SREC Transition Principles? Please provide detailed quantitative and qualitative responses as to the perceived pros and cons of each of the followingoptions:

a.     a fixed priceSREC;

b.     a market-determined SREC;and

c.     any otheroption(s).

 

3)    Based on your response to question 2 above, provide precise quantitative and  qualitative recommendations as to how your preferred SREC Successor Program model would be implemented, keeping in mind the necessity of satisfying the “SREC Transition Principles” set forthabove.

 

4)    How should Legacy SRECs be valued? Should these Legacy SRECs be valued under the SREC Successor Program or valuedseparately?

 

5)    How should Pipeline SRECs be valued? Should these Pipeline SRECs be valued under the SREC Successor Program or valuedseparately?

a.     Should the Board continue the current SREC program as a separate program? If so,how?

b.     Should the Board include the current SREC program within the SREC Successor Program? If so,how?

 

6)    For any solar transition, should the Board set a megawatt (“MW”) target for annual new solar construction? If so, should those targets be defined as percentage of retail sales or a set MW cap? Under what circumstances and/or assumptions is this targetachievable?

 

7)    In any SREC Successor Program, should the Board seek to set annual MW capacity caps for new solar construction or percentages of retail sales? Why or why not? If yes, what should be the value through 2030 and why? If yes, should the Board seek to set differentiated capacity caps under the solar RPS based on projecttype?

 

8)    In the SREC Successor Program, should the Board provide differentiated SREC or solar value incentives to different types of projects? Should such differentiated SREC compensation be created through SREC multipliers, through an add-on valuation, or through some other method? Based on what factor(s) should any SREC compensation bedifferentiated?

 

9)    How should the cost cap be measured? Should any “head space” under the cost cap in the first years be “banked”? Why or whynot?

 

10)Can and should the cost cap be determined based on net costs that include some type of valuation of associated benefits? If so, what should those qualitative and quantitative benefitsbeandhowshouldtheybeassignedavalue?IftheBoardcanandshould


consider a net benefits test, should other cost impacts be included? Which ones? Why? If other cost impacts should not be included, whynot?

 

11)What steps should the Board take to implement the cost cap? In particular, please discuss the pros and cons of decreasing the Class I REC Renewable Portfolio Standards. Should any measures implemented differentiate among the different type of Class I renewable energy technologies? Should these measures differentiate among the different market sectors (e.g. utility-scale grid supply versus small residential systems)? Should these measures be technology neutral? Why or whynot?

 

12)Should the solar industry transition into a true, incentive-free market as the costs of solar begin to approach “grid parity be a goal, or even a consideration, of the SREC Successor Program? If so, how can a SREC Successor Program assist that transition? Should a transition also encompass changes to the net metering program (cf. ongoing FERC/PJM review of DERaggregation)?

 

13)Please provide comments on any significant issues not specifically addressed in the questions above, making specific reference to their applicability in the New Jersey context. Please do not reiterate previously madecomments.

DISCLAIMER: New Jersey SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
New Jersey

Implementation of New Jersey 10 Year SREC term

The Clean Energy Act, signed by Governor Murphy on May 23, 2018, included the following provision:

“For all applications for designation as connected to the distribution system of a solar electric power generation facility filed with the board after the date of enactment of P.L.2018, c.17 (C.48:3-87.8 et al.) the SREC term shall be 10 years.” L. 2018, c. 17, §2(d)(3).

At its agenda meeting earlier today, the New Jersey Board of Public Utilities clarified the language above as follows:

SRP REGISTRATIONS SUBMITTED IN THE ONLINE PORTAL ON OR BEFORE TODAY’S DEADLINE1 AND DEEMED COMPLETE WILL RECEIVE A 15-YEAR SREC QUALIFICATION LIFE.

SRP REGISTRATIONS SUBMITTED IN THE ONLINE PORTAL AFTER TODAY’S DEADLINE WILL RECEIVE A 10-YEAR SREC QUALIFICATION LIFE.

APPLICATIONS RECEIVED BY THE BOARD FOR CONDITIONAL CERTIFICATION PURSUANT TO SUBSECTION T PRIOR TO TODAY’S DEADLINE THAT FULFILL ALL CONDITIONS ESTABLISHED BY THE BOARD SHALL RECEIVE A 15-YEAR SREC QUALIFICATION LIFE.

1 The “Deadline” is defined as 11:59:59 PM EST on October 29, 2018

Additional details are as follows:

SRP Eligibility Process

To qualify for a 15-year SREC qualification life, a registration must be submitted in the online portal (http://njcepsolar.programprocessing.com/) under the status Application Received on or before 11:59:59 PM EST on October 29, 2018 (Deadline), and:

1. Contain all the items and information identified on the SRP Checklist required to be deemed complete, or

2. Within two weeks of an email from the Program Manager/Administrator to the registrant identifying one or more minor deficiencies with the registration, successfully resolve those minor deficiencies. a. If the minor deficiencies are not successfully resolved within two weeks from the date of the email, the registration will be rejected and the registrant would be required to resubmit a new registration packet.

For the avoidance of doubt:

A. Any registrations submitted after today’s Deadline will only be eligible for a 10-year SREC qualification life.

B. Any registration submitted in the online portal under the status Application Received on or before the Deadline, but that is determined to be incomplete due to a major deficiency, will be rejected and if resubmitted after the deadline will only be eligible for a 10-year SREC qualification life.

C. Any registration submitted in the online portal under the status Application Received on or before the Deadline, but that is determined to be incomplete due to a minor deficiency, will have two weeks to successfully resolve the minor deficiencies to remain eligible for a 15-year SREC qualification life.

D. Registrations having the status Pending Uploads as of the Deadline will not be considered submitted in the online portal and therefore will not be eligible for a 15-year SREC qualification life.

 For information regarding the definition of Major/Minor Deficiencies, please see:

http://www.njcleanenergy.com/srpforms

________________________

Implementation of New Jersey 10 Year SREC term

TAGS:
New JerseySREC

DC Solar Update

The DC market has been on a downward trend, moving against fundamentals based on the new RPS. However due to the grandfathering of the old DC renewable portfolio standard (RPS) buyers are not obligated to pay over $300 per SREC for some of their obligations.   We are seeing just that happen now, lower SREC payments.  It is unknown to how much of a supply the buyers have covered at the upper, new, RPS, level vs the old.  

 The normal reaction, in a quickly dropping SREC market, of a SREC seller is to hold.  We've witnessed this in the OH, PA, NJ and MD markets and in most cases (except for NJ due to they passed legislation to correct/re-tune the RPS) it does not work.  Holding in this situation creates a potential glut of SRECs for the next energy year, the carry over of unsold SRECs, and will push pricing even lower.  New SREC sellers are calculated in at a lower SREC price and will be willing to sell at the new lower levels.

 Kevin Flett  

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
Washington DCPress ReleasesSREC

New Jersey AB 3723 Passage and its Effect on New Jersey SREC Prices

September 2018

In May 2018 New Jersey AB 3723 was passed which instituted major changes to the New Jersey solar incentive market revolving around SRECs.

History:

New Jersey was one of the early leaders in providing ratepayer incentives through SRECs to solar owners. Flett Exchange launched its’ New Jersey SREC market in June of 2007 to help facilitate an open and competitive market. The SREC program was created to provide a long-term 15 year pay-back as opposed to the large up-front incentive program that existed in New Jersey. Solar installation costs dropped quicker than expected during the last decade. As of the fall of 2018 New Jersey has close to 100,000 solar installations and produces over 3% of its electricity from solar. A major market reform was instituted in 2012 which increased demand for solar. This increase in demand averted a collapse in in SREC prices which kept solar investors whole and provided demand for a few more years of new solar development which satisfied solar developers. This same change slashed the cost cap by more than 50% to protect ratepayers. By 2016 it was apparent that once again costs to install new solar dropped quicker than expected. AB 3723 was passed in May 2018.

 

AB 3723 major changes:

  1. Closes the current SREC program to new applicants by June 2021

  2. Mathematically attempts to close the SREC program by timing the curtailment of supply of new solar while increasing demand at the same time thus “pinning” high SREC prices for the next 10 – 15 years.

  3. Adds a 7% cost cap by 2022 that is complicated/impossible to model and relies on BPU action and will most likely not kick in for years. The cost cap favors the wind development portion of the RPS by protecting it from this cap. The solar portion will be most likely be ratcheted down through reduced solar compliance costs.

(Plain English: Bail-out legislation for current solar owners (Attempts to keep SREC prices above $200 for years) that at the same time gives solar developers 2 to 3 years to cash in on projects before a new incentive program is created. Ratepayers who pay for it will never understand it which limits/reduces political risk for passing it. Provides for costs shifting 5+ years out from solar compliance to wind compliance thus potentially reducing SREC prices at that time)

Price Projection and Risks for Sellers of New Jersey SRECs:

AB 3723 prevented the New Jersey SREC market from a collapse which was inevitable by 2019-2021 due to the pace of solar development in New Jersey which was significantly more than what the legislation called for. In all SREC markets that experienced similar events – PA, MD, OH, SREC prices dropped to $10 or less for years. It appears that SREC prices will remain at the $180 to $250 range for the next 3 to 5 years (2018 to 2020/22) Analysis for prices and hedging strategies going out 3+ years are available to our registered and active customers.

DISCLAIMER: New Jersey SREC prices are volatile. Buyers and sellers of SRECs must do their own research. The above projections are subject to change as market dynamics change.

TAGS:
New JerseySRECResearch

PA SREC UPDATE

On April 19, 2018, the Pennsylvania Public Utility Commission published its interpretation of Act 40 of 2017 signed by Governor Tom Wolf on October 30th 2017 in regards to the compliance eligibility of out of state solar facilities SRECs in the Pennsylvania market.  The commission ruled that unless an out of state solar facility has a binding contract for their SRECs with a renewable portfolio standard (RPS) buyer prior to October 30th 2017 the out of state solar facility will no longer have PA state certification on their SRECs after October 30th 2017.  The SRECs generated (month of generation) prior to October 30th 2017 from an out of state solar facility will retain their PA state certification and the SRECs remain eligible for the full 3 compliance years.  RPS buyers that have a contracted with an out of state facility prior to the October 30th 2017 date have 60 days to petition for qualification with AEPS.

 

Flett Exchange intends to clear all eligible PA certified SRECs.  Out of state PA certified solar facilities intending to sell must contact us and supply proof of certification (CSV file from PJM-EIS of intended inventory to sell) for verification.

 

Link to the Pennsylvania Public Utility Commission’s final implementation order of Act 40 of 2017 http://www.puc.pa.gov/pcdocs/1562754.pdf 

 

-Kevin Flett, Director of Operations

 

PENNSYLVANIA PUBLIC UTILITY COMMISSION HARRISBURG, PENNSYLVANIA 17105-3265

 

Implementationof Act 40 of 2017                         

Public Meeting held April 19, 2018 2631527-LAW

Docket No. M-2017-2631527

JOINT MOTION OF CHAIRMAN GLADYS M. BROWN & VICE CHAIRMAN ANDREW G. PLACE

Before the Commission is the Final Implementation Order (Implementation Order) regarding Act 40 of 2017. Act 40, signed by Governor Tom Wolf on October 30, 2017, inter alia, amends the qualifications to certify Tier I solar photovoltaic share facilities under Pennsylvania's Alternative Energy Portfolio Standards (AEPS) Act. Numerous comments were filedin responsetotheTentativeImplementationOrder(TIO)adoptedonDecember 21,2017,in addition to the Supplemental Interpretation the Vice Chairman and I offered in our Joint Statement. These comments have provided helpful guidance, specifically regarding legislative intent,forourdeliberationsin thisproceeding;therefore,wethankallofthosewhotookthetime to help inform the record. Today, the Commission issues this Final Implementation Order to guide the AEPS marketplace toward compliance with Act40.

 

 

 

The core issues in this proceeding are the Commission's interpretations of Sections 2804(2)(i) and 2804(2)(ii). These read:

 (2)   Nothingunderthissectionorsection4ofthe"AlternativeEnergy Portfolio Standards Act" shall affect any of thefollowing:

 

 

(i)    A certification originating within the geographical boundaries of this Commonwealth granted prior to the effective date of this section of a solar photovoltaic energy generator as a qualifying alternative energy source eligible to meet the solar photovoltaic share of this Commonwealth's alternativeenergyportfoliocompliancerequirementsunderthe"Alternative Energy Portfolio StandardsAct."

 

(ii)   Certification of a solar photovoltaic system with a binding written contractforthesaleandpurchaseofalternativeenergycreditsderivedfrom solar photovoltaic energy sources entered into prior to the effective date of thissection.

 

Interpretation of these sections has been challenging for the Commission, particularly because the verbiage in Section 2804(2)(i) is not precise. The question here is whether or not this statute is intended to 'grandfather' out-of-state facilities certified before October 30, 2017, to generate


Tier I Solar credits. Given this lack of clarity, we issued a Joint Statement in conjunction with adoption of the TIO offering supplemental statutory interpretations to spur comments in an effort to inform the record.1

 

The Office of Consumer Advocate (OCA) succinctly states the challenge in interpreting Section 2804(2)(i) of Act 40.

 

The OCA submits that the language as written in Act 40 is unclear and the OCA is unable to discern the intent of the section as written. 2

 

Likewise, the comments of Citizens for Pennsylvania's Future (PennFuture) share similar sentiments as OCA, stating:

 Section 2804(2)(i) of Act 40 is ambiguous in regard to how and when the qualification of a facility as an alternative energy generator originates.3

 

We too agree that the language of Section 2804(2)(i) is unclear. Consequently, we are obligated, under the rules of statutory construction, to ascertain the intent of the General Assembly. The Rules of Statutory Construction at 1 Pa. C.S. § 1921(b) provide that:

When the words of a statute are clear and free from all ambiguity, the letter of it is not to be disregarded under the pretext of pursuing its spirit.

 

Since, as the OCA and PennFuture point out, the verbiage here is unclear, we must now refer to 1 Pa. C.S. § 1921(c) which provides:

When the words of a statute are not explicit, the intention of the General Assembly may be ascertained by considering, among other matters:

 (2)  The circumstances under which it wasenacted.

(3)  The mischief to beremedied.

(4)  The object to beattained.

 

(6)  The consequences of a particularinterpretation

(7)  The contemporaneous legislativehistory.

(8)  Legislativeandadministrativeinterpretationsofsuchstatute.

 

The comments filed in response to the TIO have proven instructive in regard to why the General Assembly drafted this legislation, why the Governor signed it into law, and the mischief to be remedied.

 

 

 
 

1 Joint Statement of Chairman Gladys M. Brown and Vice Chairman Andrew G. Place entered December 21, 2017 at the instant Docket.

2 Comments ofOCA at page 5 filed February 5, 2018.

3 Comments of PennFuture at page I filed January 18, 2018.


Comments filed by Governor Tom Wolf, Senators Mario M. Scavello, Tom Killion, John

T. Yudichak, Jay Costa, John M. DiSanto, Steward J. Greenleaf, David G. Argall, Wayne D. Fontana, Guy Reschenthaler, and Representatives Michael B. Carroll, Eric M. Roe, Ronald S. Marsico, and Sue Helm are particularly insightful. As lawmakers who effectuated Act 40, these commenters are uniquely qualified to provide the Conunission with information regarding the intent of the statute. Each of the comments provided by lawmakers states that their intent to 'close the borders' for Tier I solar credit qualifications was consistent with the design utilized by a number of our neighboring states to promote economic development. This interpretation is consistent with the supplemental interpretation provided in our Joint Statement and contrary to the proposal of the Conunission in its TIO. Senators Jay Costa and John T. Yudichak descriptively summarize the sentiments and intentions of these lawmakers, stating the following:

 

The Commission's proposed interpretation under the Tentative Implementation Order published in the Pennsylvania Bulletin on January 6, 2018, would "grandfather" systems that are certified in Pennsylvania, rather than physically located in this state. We must respectfully disagree with this interpretation, which we find counter to the intentions of the General Assembly and especially of our colleagues who supported and voted in favor of this legislation.

 

Instead, the joint statement submitted by Chairperson Gladys M Brown and Vice Chairperson Andrew G. Place better reflects our intentions in approving this legislation. Please know that legislation to "close our solar borders" for the purposes of satisfying the Alternative Energy Standards Portfolio Act has been considered in recent sessions and discussions have been exclusive to the physical locations of systems.

 

While we certainly recognize the potential need to address and honor existing contracts, the long-term and primary goals set forth by this legislation have been clear. Specifically, we seek to join our neighboring states that similarly have "closed solar borders" and to advance our commitment to promoting economic and job growth within Pennsylvania's solar energy industry.4

 

In further support of interpreting Sections 2804(2)(i) and 2804(2)(ii) consistent with our Joint Statement, the Department of Environmental Protection (DEP) states that the intention of this provision was to provide certainty that solar photovoltaic energy facilities located within the Commonwealth would not be affected by the changes implemented elsewhere in Act 40.5 DEP also submits that the interpretation outlined in the TIO would essentially nullify the purpose of Act 40 by grandfathering enough currently-certified sources to prevent the law from having any environmental or other co-benefit whatsoever. Comments from the Pennsylvania Farm Bureau also echo this sentiment, stating that TIO interpretation would limit farmers' options for compliance with ever-increasing environmental protection standards.6

 

 

 
 

4 Comments of Senator John T. Yndichak and Senator Jay Costa filed on February 2, 2018.

5 Joint comments of the DEP and Governor Tom Wolf (DEP section at page 1) filed February 5, 2018.

6 Comments of the Pennsylvania Fann Bureau submitted February 5, 2018.


Further, ET Capital Solar Partners submits that the Commission's tentative interpretation of Section 2804(2)(i) would make the additional language of Section 2804(2)(ii) redundant.7 ET Capital Solar Partners states that if the legislative intent of Section 2804(2)(i) follows the Commission's tentative interpretation, there would be no need for the additional language of Section 2804(2)(ii) to further protect existing facilities that have entered into agreements with Pennsylvania electric-distribution companies (EDCs) and electric generation suppliers (EGSs) participating in the Pennsylvania markets. Therefore, ET Capital Solar Partners contends that the language of Section 2804(2)(ii) is further evidence that the legislative intent of Act 40 of2017 is to stimulate further investment in solar facilities within the Commonwealth. Again, the rules of statutory construction are guiding here. 1 Pa. C.S. § 1922(2) states the following:

 

In ascertaining the intention of the General Assembly in the enactment of a statute the following presumptions, among others, may be used:

 

(2) That the General Assembly intends the entire statute to be effective and certain.

 

Case law further clarifies the interpretation of this provision, stating that the General Assembly does not intend words to be "mere surplusage." 8

 

When reviewing the totality of comments described above, it becomes evident that Sections 2804(1)(i), 2804(1)(ii), and 2804(1)(iii) explicitly describe the qualifications for Tier I Solar facilities after passage of Act 40; Section 2804(2)(i) clarifies that all Tier I Solar facilities certified before passage of Act 40 that are located within the geographic boundaries of Pennsylvania are to be held harmless from this legislation; and Section 2804(2)(ii) enjoins the legislation from breaching existing contracts from out-of-state Tier I Solar facilities which were entered into before passage to serve the AEPS needs of Pennsylvania entities. Therefore, we believe we must support the adoption of our interpretations of Sections 2804(2)(i) and 2804(2)(ii) in a manner consistent with our Joint Statement to the TIO. These interpretations are as follows:

 

Sections 2804(2)(i) - We interpret the phrase "[a] certification originating within the geographicalboundariesofthisCommonwealth..."asafacilitylocatedwithinPennsylvania havingreceivedanAEPsTierIsolarphotovoltaic sharecertification.

 

2804(2)(ii)- We interpret this section to only permit out-of-state facilities that are (a) alreadycertifiedasAEPSTierISolarPhotovoltaicandthat(b)haveenteredintoacontractwith a Pennsylvania EDC or EGS serving Pennsylvania customers, for the sale of solar credits, to maintain certification until the expiration of the contract. We further wish to clarify that, consistentwiththecommentsprovidedbyETCapital SolarPartners,thismaintained

 
 

7 Comments of ET Solar Capital Partners submitted January 17, 2018.

8 Thomas Jefferson University Hospitals, Inc. v. Pa. Department of Labor and Industry, 162 A.3d 384, 393 (Pa.

2017), see also Holland v. March, 883 A.2d 449, 455-56 (Pa. 2005); Green Acres Contracting Comp. v. Commonwealth, 163 A.3d 1147 (Pa. Cmwlth. 2017) and Pa. State Police, Bureau of Liquor Control Enforcement v. Legion Post 304 Home Assoc., 164 A.3d 612,619 (Pa. Cmwlth. 2017) (holding that the rules of statutory constructionrequirethatcourts,wheneverpossible,giveeachwordinastatutorysectionmeaningandnottreatany word as surplusage).


certification should only be applicable to the amount of credits contractually committed to by an out-of-state certified facility to an EDC or EGS.9 EDCs and EGSs seeking to qualify credits under this provision are required to file a Petition within 60 days of the entry date of this order. Procedures for the 2804(2)(ii) contract approval process will be provided by the Commission at this docket.

 

Given this interpretation, we are also required to provide implementation procedures associated with banked credits. The AEPS Act permits EDCs and EGSs to bank, or place in reserve, credits produced in one reporting year for compliance in the next two reporting years.10 Implementation procedures are necessary to address handling of a credit generated by an out-of­ state Tier I solar qualified facility before October 30, 2017, and not retired in PJM's Generation Attribute Tracking System before October 30, 2017. Since Act 40 omits any directive expressly empowering the Commission to modify the attributes of such credits, we believe that these credits should retain the tier attribute assigned at the time the credit was generated. To do otherwise would appear to modify the legal status, or tier attribute, of a credit without explicit statutory authority. The Statutory Construction Act does not presume retroactive effect of statutes. 1 Pa. C.S. § 1926 provides:

 No statute shall be construed to be retroactive unless clearly and manifestly so intended by the General Assembly.

 

Further, the Commonwealth Court case provides guidance here when it determined the following:

 

A retroactive law is one which relates back to and gives a previous transaction a legal effect different.from that which it had under the law in effect when it transpired. This Court has held that "[a} law is given retroactive effect when it is used to impose new legal burdens on a past transaction or occurrence. " R & P Services, Inc. v. Commonwealth, Department of Revenue, 541 A.2d 432, 434

(Pa.Cmwlth.1988).However,section1926oftheStatuto1yConstructionAct providesthat"nostatutemaybeconstruedtoberetroactiveunlessclearlyand manifestlysointendedbythe GeneralAssembly."  1 Pa.CS.§19261.1

 

Therefore, given Act 40's omission of any directive to change the attribute of these banked credits, we submit that any out-of-state Tier I solar credit generated before October 30, 2017, should retain its Tier I solar attribute for the banking life span enumerated in AEPS. This interpretation is supported by the comments of the Retail Energy Supply Association, who states that EGSs may elect to procure varying vintage credits for use in future years in accordance with the prevailing banking rules, thus, the ability to rely on banked credits is an important component necessary for EGSs to effectively manage and satisfy their AEPS Act obligations.12

 

 

 
 

9 For purposes of implementation, any alteration, such as a change, update, or extension to a contract applicable

under this provision, and, entered into after October 30, 2017, would not be recognized under 2804(2)(i).

10 The Alternative Energy Portfolio Standards Act of 2004, 73 P.S. §§ 1648.3(e)(6)

ll Kuziakv. Borough of Danville, 125 A.3d470 (Pa. Cmwlth. 2015).

12 Comments of the Retail Energy Supply Association at 7.


In conclusion, we submit that the interpretations provided herein are necessarily required by this Commission consistent with the rules of statutory construction enumerated supra and also consistent with 1 Pa. C.S. § 1921(a), which provides that:

 The object of all interpretation and construction of statutes is to ascertain and effectuate the intention of the General Assembly. Every statute shall be construed, if possible, to give effect to all its provisions.

 

With this Order we begin the process of implementing Act 40, while recognizing that there are complexities in implementing and complying with the Act that may reveal issues which require further Commission action. The Commission will address any such issues, at this docket, and in a manner that provides all interested parties appropriate notice and opportunity to be heard.

 THEREFORE, WE MOVE THAT:

(1) ElectricDistributionCompaniesandElectricGenerationSuppliers seeking to qualify credits under Section 2804(2)(ii) of Act 40 are requiredtofileaPetitionwithinsixty(60)daysoftheentrydateof thisorder,thespecificprocedures forwhichwillbeoutlinedatthis docket

 (2)  TheLawBureauandtheBureauofTechnicalUtilityServicesprepare a Final Implementation Order consistent with thisMotion.

 

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
PennsylvaniaSREC

A New Solar Law, Short Term Gain for a Few, Long Term Loss for NJ Residents

 

The following is a write-up by Michael Flett – President of Flett Exchange, LLC in response to the passage of A-3723 in the New Jersey legislature and now on the desk of Governor Murphy to sign into law.

Renewable energy in America affects everyone today. The societal benefits are obvious - less pollution and infinite energy. In New Jersey, solar energy production is subsidized by the public either as a taxpayer through federal or state incentives or as a regular electricity consumer. They need to be part of the conversation.

Where is the support for this bill?

Due to the widespread benefits and costs one would assume that when crafting solar legislation it would include any and all stakeholders. That was not the case here in New Jersey where a renewable energy bill was quietly folded into a three bill package that included a nuclear subsidy bill and a health care insurance bill!  The environmental community, who you would think, strongly supports renewable energy called for the process to slow down for a more deliberative process in order to create a long term program that would include community solar, not just a “pilot” program. That was certainly not the case with this bill. A small group of solar owners along with financial solar dealers spearheaded the quick passage of this bill in Trenton. If enacted, this law would close the successful free-market SREC program for all future solar development after 2021. As written, it will come at a multibillion dollar cost to ratepayers and divert future payments away from new solar development.  All coming about without the widespread support and dialogue with environmentalists, ratepayers, business owners or even the majority of the homeowners or businesses that invested on solar on their homes and businesses. Flett Exchange has thousands of customers who own solar in New Jersey. These investments were made because of the SREC program and this bill extinguishes that program and causes uncertainty.

SREC = Competition = Fairness

New Jersey has been a nationwide leader for 15 years in solar development. The reason for this success is the open and competitive nature of our incentive program based on the SREC. New Jersey, in its wisdom over a decade ago, made the decision to let the market decide the most economical price for solar to bring in investment and at the same time protect the ratepayer.  Due to the rapid reduction in cost of solar, an adjustment in the states’ law around solar was made in 2012. It worked beautifully. Solar was built. State renewable goals were met. The price to the ratepayer dropped as well. There was absolute freedom for homeowners and business to compete and install solar and earn SRECs.

Due to the success of the SREC program, New Jersey achieved all of its solar build-out goals and under budget. Now, like in 2012, the laws need to be adjusted to bring in the next phase of investment in New Jersey. Consistency needs to be maintained to maintain investor confidence, protect the ratepayer, protect past investments in solar infrastructure and bring more solar to everyone. The open and free SREC market is that tool. It allows for the freedom to compete and allow homeowners and business to install solar. It ensures that if prices drop for solar energy technology in the future, the public who pays for it with their electricity bill, will not be stuck for decades with long term contracts.  The proponents of this bill are only interested in maximizing their rate of return when it comes time to selling their solar projects. They do not have the public’s interest at heart. We can do better.

Now, like in 2012, the cost to install solar has again plummeted.  The state law can be adjusted to bring in the next phase of investment in NJ based on a free and open market called the SREC. The current bill phases out the tools that made New Jersey a solar leader.

Why Remove Fairness from a Successful Program?

Why? Because by closing the SREC program large solar owners will land a multi-billion dollar payday.

Here’s how:

There are over 2,000 Mw of solar installed statewide. There are a few owners with control of 100 Mw each. Based on current free market SREC prices, the typical owner of 100 Mw of solar will earn $50 to $70 million dollars over the next 10 years in SREC payments. (This revenue is based on the forward 10 year curve of SREC prices in a freely traded SREC market prior to the run-up in prices due to this bill)

A-3723, as written, abolishes the SREC market and maximize payments. Those same large owners will earn $250 million in the next 10 years – a $180 to $200 million windfall – each. (The back-end of the SREC curve moves up due to the artificial demand created by this bill) If you add up the total amount for all 2000 Mw installed in New Jersey the cost to the ratepayer over 10 years is $8.5 billion – up from $1.4 to $2.8 billion based on the freely traded SREC. This bill as written will cost the ratepayers of New Jersey $5.7 to $7.1 billion more over 10 years! The majority of this money builds NO new solar! These projects will be sold quickly and when the real costs materialize the public will demand action. To put this in perspective, $6 billion would build an additional 3,000 Mw of new solar at an install cost of $2 a watt. $2 a watt is a fair install price for new solar for medium sized distributed systems that would benefit typical small business’ and homeowners in New Jersey.

The proponents of the legislation have provided one sided cost analysis. All the press releases and articles actually mention that it will save money which is only attainable in economic models in which the inputs are misleading and statistically near impossible.

How do we Maintain Fairness?

The New Jersey legislature and governor need to address solar development today as it was addressed in 2012. All stakeholders have to be heard. The cost analysis needs to be vetted. A clear path forward for the cost of solar development in the future needs to be planned. Plain and simple the path is:

  • Maintain open and free access to solar for all investors - SRECs
  • Maintain the competitive nature of the SREC market to protect ratepayers
  • Increase solar requirements – increase RPS
  • Decrease costs- (solar is cheaper now) – decrease the SACP
  • Introduce community solar
  • Maintain and grow the solar labor market

A-3723 demands closure of the SREC market and re-direction of ratepayer funds away from long term new solar build-out that we have today. A clear reversal of past success.

The passage of A-3723 deviates from all of the success of the market based program that is responsible for the financing of over 80,000 solar installations in New Jersey. If enacted the bill will result in a quick short-term boost in SREC payments to investors of solar in New Jersey. This has happened already in the run-up in prices from $170 to $240 in the past 6 months because of the prospect of the legislation being passed. In reality, owners of solar are being duped into supporting this legislation because of the short-term run-up in prices. In the long term it puts all solar investment in New Jersey at risk by replacing free-market mechanisms by a law that is vague in its long-term support of solar. It de-links past investment in solar from future long-term solar build out. This is a dangerous proposition for those who own solar and rely on SRECs to pay back their investment in the clean energy future of New Jersey.

Short-Term Flips – No Long-Term Path – Sorry, New Jersey

Not one segment wins in the passage of this law except for a few select solar financers. In the next few years they will be able to flip projects for huge profits to unsuspecting investors who will get caught holding the bag in the long term. New Jersey homeowners and businesses who invested in solar and relying on SRECs will be in limbo without the continuation of the SREC program. Finally, and most importantly, the environment loses, the ratepayer loses, labor loses, and the new Investor in solar loses. When the costs are calculated in the next few years it will be apparent at the magnitude of ratepayer funds that were squandered and could have been used in an efficient manner to build out our renewable energy future. The right choice is to continue with a competitive and free incentive SREC market for the benefit of everyone in New Jersey as outlined above.

This bill is not law until Governor Murphy signs it. He can also significantly change it so it retains SRECs, maintains competition, and protects current solar investors and ratepayers or veto it and start over. Most importantly, the bill needs to be changed so that ratepayer funds are used in the most efficient manner to achieve our renewable energy goals. 

 

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

Price Convergence of 2017 and 2018 SRECs

As expected, the prices of the 2017 vintage New Jersey SRECs are starting to converge with the prices of the 2018 vintages. Prices for 2017 were trading in the $220 to $230 range in recent weeks and have moved down to the $170 level today. After some up and down movement in the next few months they will be trading at a $5 discount to the 2018s which are now at $175.

The sudden move happened because there was an orderly expiration of the July delivery of the 2017 vintage SREC futures contract on Intercontinental Exchange. There was over 230,000 contracts in open interest in the July 2017 contract which is close to 10% of the whole years SREC obligation by all energy suppliers. Futures contracts can exhibit volatility in the last few trading days going into expiration if there is an imbalance of physical to deliver against the futures contract. For this reason the prices were held up for a longer period of time until the contract expired. The lack of volatility in this expiration means that all sellers had procured enough SRECs to satisfy delivery in the GATs by Monday, July, 31st.

The 2017 energy year is expected to be oversupplied by 7%. In the 2018 energy year it is expected that the installed solar in the whole state will oversupply the energy companies mandated compliance by about 14%. This is the reason why the 2018 vintage is trading at a discount to the 2017 prices last year. Of course the prices will move during the year as we see how much new solar is installed.

As always, we stress to our solar owners to sell consistently during the year to get an average price and not hold.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

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New JerseyPress ReleasesSREC

New Jersey SREC Overview - Spring 2017

SREC Prices are Stable – For Now……
 
After rallying to $250 in the beginning of January the SRECs moved down to $210 and are now steady in the $225 to $230 range.
 
SREC Supply / Demand for This Year
 
SREC supply for RY 2017 is expected to be sufficient.  According to our estimates, SRECs produced this year ending in May along with supply left over from previous years will be about 4% more than what is needed by electricity suppliers. This justifies the prices that have been trading in the $200 to $250 range during the past few months.
 
SREC prices for Future Years – (Actual)
 
The following are current prices for SRECs trading between large commercial solar owners and electricity suppliers in the over-the-counter market.  You will notice that prices decrease in coming years.
 
Ry 2018: $200   (June 2017 to May 2018)
Ry 2019: $160   (June 2018 to May 2019)
Ry 2020: $130   (June 2019 to May 2020)
Ry 2021: $85     (June 2020 to May 2021)
 
3 year strip: $163

4 year strip: $143
 
SREC oversupply estimates for Future Years – (Flett Exchange Estimates)
 
Based on our supply / demand models we expect the supply of SRECs to continue to outpace the requirements in an accelerated fashion. This oversupply will put pressure on SREC prices. An oversupply of SRECs is a result of investors and developers installing more solar than is required by law. The only two ways to avoid an oversupply is for:
 
1. Investors and developers to not overbuild
2. The legislature in New Jersey pass a law to increase the solar requirements. (This happened in 2012)
 
Multiple years of overdevelopment of solar creates an overabundance of SRECs that never go away.
 
Ry 2017: 4% oversupply
Ry 2018: 10% oversupply
Ry 2019: 20% oversupply
Ry 2020: 34% oversupply
Ry 2021: 50% oversupply
 
SREC Price Projections for Future years – (Flett Exchange Estimates)
 
If the oversupply estimates in our models are correct our price estimates are as follows. We expect a drastic drop-off to occur between 2019 and 2020. Our low price may seem extreme but we base it on price action in other states that have become oversupplied – PA – $5, MD $8 and OH – $6.
 
Ry 2018: $140-$220      (this starts this summer)
Ry 2019: $90 to $180
Ry 2020: $40 to $130
RY 2021 on $5 to $85
 
3 year strip estimate: (ry 18 – ry 20): $90 to $176

4 year strip estimate (ry 18 to ry21): $55 to $123
 
Summary:
 
The goals for solar installations set out by New Jersey law under the SREC program have worked perfectly.  The free market price of SRECs has saved the ratepayers of New Jersey hundreds of millions of dollars while it encouraged new investors to install new solar at ever cheaper prices. Outside of a minority of failed (overpriced) fixed price SREC contracts encouraged by solar developers with the blessing of the Board of Public Utilities the ratepayers of New Jersey have benefited from the freely traded SREC market and will continue to benefit for decades to come. Based on SREC market prices the solar development industry in New Jersey passed its inflection point last year and is now starting to turn. This is caused by the decrease in the rate of new solar development under current legislation. For years the legislation encouraged significant new solar development during a time when solar costs have decreased significantly. That law now calls for a lower amount of solar growth. Developers and investors must re-calibrate and develop at a slower pace equal to the mandates by this law. If not, solar development in New Jersey will halt and all investors will suffer. Ratepayers will have to pay more in the future in solar subsidies to jump-start new solar development if confidence by investors in New Jersey solar is lost.
 
If you already own solar in New Jersey and rely on SREC payments to make your investment whole you are at the mercy of new solar investors. If the new investors in solar install at a cheaper price or are willing to accept a lower return on capital then they will continue to push SREC prices lower.  That is only fair since it is an open market and anyone is allowed to invest in solar on their property.
 
Outside of a purely competitive, slight oversupply of SRECs caused by market efficiency there are two (2) controllable factors that can cause an overinvestment above legislated goals. If they are not addressed the result will be a protracted oversupply of SRECs ($10 SRECs):  (Prices in NJ dropped to $60 in 2012 when the developers overbuilt.)
 
1. A lack of knowledge by new solar investors about the amount of solar required under the law. Let’s get down to it. Solar is sold by salesmen. If they want to make the sale they will not give the customer the full story about the risk of SREC oversupply and their ability to repay with SRECs. (To most solar sales people credit they probably don’t know the risk themselves) By the time most people who are signing contracts this spring get the array installed they will get a year or less of $200 SRECs. Their systems will just add to the oversupply of SRECs.
 
2. Fixed, long term, above market priced contracts for SREC granted by the BPU are being awarded and will continue to be awarded as the market gets oversupplied.  The New Jersey Board of Public Utilities actually awarded 10 year fixed contracts just recently at $165 for 10 years fixed. Above market pricing similar to this also happened in 2011 exacerbating the oversupply of solar at that time. The overpayment of SRECs above the free market is absorbed by ratepayers which they will never know. Equally damaged by these contracts are solar investors like yourself that are not lucky enough to have an installation available at the time of the BPU solicitation. This will add uncompetitive solar installations to an oversupplied market and force SREC prices lower for all other solar investors outside of those whose losses are absorbed by the ratepayers.
 
Call to Action:
 
As for solar owners we suggest to sell your SRECs on a monthly basis and not bank any SRECs. The sale of your SRECs at prices in this $200+ area will be needed to average out your sales over the years. Future years need to be discounted based on the high probability of significantly lower prices 3+ years out. In the beginning of August your first 2018 SRECs will be minted. Those prices will be $20 to $30 less than the ones you will be selling in July. We suggest to not hold those and continuously sell them even if they are under $200. Remember, our price estimate for ry 18 (June 2017 to May 2018) is $140 to $220. With that estimate a $190 SREC is still in the middle of the range.
 
As we have since 2007, we will continue to monitor the New Jersey SREC market for you, provide transparent and actionable pricing via our exchange and offer information to help you make the best of your solar investment. In 2012 members of our team testified numerous times at the New Jersey Statehouse during the last update to solar legislation. Hopefully, through transparency of information the market will not get oversupplied as it was last time and solar investment can proceed at the legislated pace.  We will update you with SREC supply and price projections as they develop.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseyPress ReleasesSREC

NEW JERSEY SREC PRICES END A FOUR YEAR RALLY

NEW JERSEY SREC PRICES END A FOUR YEAR RALLY
 
The four year uptrend in spot New Jersey SREC prices between 2012 and early 2016 has officially ended. The market is now in a downtrend. It is making new lows and subsequently lower highs on any rallies. We should expect to see the market find new lows and trade off of varying levels of support as it digests and interprets how new investors react to lower SREC values. Will they throttle back and keep in line with State requirements or will they overbuild like they have in the past?
 
Prices trended higher from a low of $60 in the fall of 2012 to a high of $290.09 on June 13th of 2016. This can be attributed to the adjustment in the law governing solar development which was passed in 2012. The law achieved its goals up to this point as the amount of solar installed has almost exactly matched solar growth rates in the past few years. Prices are now under $220. Short-term support is at $200 and $180. If the market holds $200 now we may not see the $180 level until next spring after the BGS auction.
 
The end of the rally occurred as there were enough SRECs to satisfy all of the energy companies’ compliance needs for the RY 2016 deadline on November 1st. After hitting a low of $235 in August, RY 2016 SRECs led the way and rallied up to $265 briefly on September 27th. At that time the buying for the RY 2016 compliance dried up and energy companies could relax and take their time procuring SRECs for next years’ compliance. Requirements for SRECs increase next year however, new solar installations have been running higher than the State requirement which will produce enough of a cushion so that buyers do not have to worry about a shortfall.
 
Many sellers are still selling their SRECs on the spot market however, buyers and sellers of large blocks of SRECs have been actively negotiating 3 year deals at the $180 level for RY 17, 18 and 19 SRECs. The prices implied for each of these individual years shows where the market prices SRECs in the future:
 
NJ2017=$220
NJ2018=$200
NJ2019=$120

 
Due to the steep discount that the market is placing on SRECs three years out there is less incentive to bank and hold SRECs as sellers have in the past.
 
Year after year there has been significant SREC buying in February as winners of the statewide BGS auction hedge out a portion of their 3 year obligations. The question each year is if prices will rally because of the BGS auction. When the market was in a bull trend there was always a rally on each BGS auction. Now that the clear uptrend has stalled that rally may not repeat itself. At least possibly not to the same degree. Between now and the end of this calendar year we can expect SREC prices to find a support level in anticipation of the BGS buying. Support levels are $200 and $180. A BGS rally off those levels will run into resistance at $220 and $235.
 
Based on current market conditions we recommend to our sellers to sell spot SRECs on a continual basis, especially if the market rallies.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseyPress ReleasesSREC

New Jersey SREC Prices Drop $50

After reaching a four year high price of $290.09 on June 13th New Jersey SREC prices have dropped $50 to the $240 level.
 
There are two major reasons why the uptrend has stalled and prices have corrected slightly:
 

    1. Most New Jersey electricity compliance buyers have finished procuring their RY 2016 SRECs. Buyers needed to purchase and retire approximately 2,090,000 SRECs (They could use any SRECs generated between August of 2012 and May of 2016). In GATS there are 2,167,382 SRECs available which leaves about a 77,000 oversupply. There will be less than that available because some sellers hold their SRECs and some have been purchased for hedging purposes by other buyers. This leaves the RY 16 market almost “balanced”.  This justifies last year’s uptrend and previous $290.09 high price. Now that they have finished buying for this year the buyers seem to be stepping back and taking their time. They now have over a year to buy for their next compliance.
       
    2. The New Jersey BPU reported an increase in the amount of solar being installed. In July they released a report showing upward adjustments to the amount of solar installed last year along with a few completions of large scale grid connect projects. Since February the BPU has reported an additional 186 Mw installed which has also led to the price correction.

 

It is not expected that the market will drop quickly to levels seen in 2012 in the next year. The 2012 law throttled back the amount of large scale solar farms that can quickly oversupply an SREC market. Also, there has been a shift to more very small residential installations in the last few years and less medium size commercial installations. A surprise oversupply is unlikely however, we need to be on the lookout for a steady increase in supply. The BPU reports new solar installations monthly.
 
As for prices, sellers should not rely on steady uptrends like they saw in the 2013 – 2016 timeframe. Prices will more than likely swing like we have seen recently. We suggest to our sellers to sell if there is any short-term appreciation and if not, make sure that a periodic selling approach is taken to mitigate holding too many SRECs on a protracted down-trend.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

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New JerseyPress ReleasesSREC

Maryland SREC Update - April 2016

Supply and Demand. This is the main driving factor in MD SREC pricing.

 

Currently there is 478 mw of solar installations registered in PJM-EIS, the website that creates SRECs.  These facilities will generate an estimated 570,000 SRECs for the 2016 calendar year. Add in the unsold SRECs from 2014 and 2015 (around 100,000 SRECs) and we are looking at an oversupply of 230,000 or more SRECs after the buyers turn in their 2016 SREC purchases.

 

The 2017 vintage is oversupplied. The RPS requires approximately 615,000 SRECs to be turned in for 2017 compliance year. With the 230,000 plus SREC carry over from 2016 plus the current 478 mw of solar generating SRECs right now that demand is met and oversupplied again by approximately 115,000 SRECs. As the year goes along and more solar is installed the market become more and more oversupplied.

 

Build Rates: Maryland has been installing more and more solar year over year.  In 2013 around 40 mw was installed, 2014 around 60 mw and in 2015 124 mw!  Yes, in 2015 twice as much solar went on-line then 2014.   If this trend continues, installing double the 2015 number, we could potentially see 248 mw installed this year.  Is this build rate sustainable? Potentially yes, but that’s an aggressive amount to install. However, just this year MD has installed almost 100 mw’s and its only been 4 months. If the 2016 build rate does in fact double we could project a 400,000 SREC oversupply for 2017. If the build rate remains the same, 10 to 11 mw a month, an oversupply of 200,000 plus SRECs could happen.

 

Legislative variable: Will the current house bill HB116 http://tinyurl.com/zeklecq that just passed in the House and Senate fix the problem? The bill does call to increase the solar carve out. For 2017 the RPS for solar will be increased from 0.95% to 1.15% or increase the demand from 615,000 SREC to about 725,000 SRECs. This increase would soak up the oversupply of SRECs but not if the current build rate continues. The date in which the bill will reach the Governors desk has not been scheduled yet.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

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MarylandPress ReleasesSREC

March 2016 New Jersey SREC Market Update

New Jersey SREC Prices Slip But Remain Close to Highs
 
The New Jersey SREC market reached a four year high on February 5th with a settlement of $289.78 on the Flett Exchange trading platform. Prices retraced $14 back down to $275 and are now trading close to $280 today.
 
Why have SREC prices risen?
 
SREC prices have remained stable and risen during the past few years because the majority of new solar installed in New Jersey are small lease systems on single family homes as opposed to large scale solar farms which can at times take up 50 or more acres of farmland. Legislation passed in 2012 limited the amount of cheaper large scale grid connect projects in favor for net metered projects (solar on or next to buildings that offset that buildings electricity). Smaller systems cost more than large systems to build so they need a higher SREC price. However, with spot SREC prices at $280 to $290 and 3 year SREC contracts at $245 we should see an increase in new solar construction in the next year.
 
What are solar owners doing with their SRECS?
 
Solar owners in New Jersey are taking advantage of the rising SREC prices and are selling any banked SRECs that they have accumulated along with any that they produce on a month to month basis. We suggest to our solar owners to sell on a consistent basis, especially as prices rise.
 
How do I sell?
 
If you are a Flett Exchange customer and would like to sell your SRECs for immediate payment and delivery you can always log into your Flett Exchange account or give us a call on the trading desk at 201-209-0234. If you are a new customer you can register for an account here. If you have a large amount of SRECs call and we will try to sell your SRECs at higher block prices.
 
The Quickest and Easiest way to sell:
 
Customers can also check out our “sell now price” on our website and transfer your SRECs to “Flett Exchange, LLC” at that price on GATS. We will take care of the rest for you and mail your check or send your proceeds via ACH.
 
Thank you for your continued business over the years!
 
Mike, Shean, Kevin, Brian and Mike

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

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New JerseyPress ReleasesSREC

New Jersey SRECs Rally to Highest Levels in 4 Years!

New Jersey SRECs Rally to Highest Levels in 4 Years!
 
The New Jersey SREC market rallied to the highest levels in four years yesterday. The previous high was $282.58 on December 29, 2011 on the 2012 vintage. Yesterdays’ settlement on Flett Exchange surpassed it by just 23 cents at $282.81 for the spot 2016 vintage.
 
The 2016 vintage SREC has rallied a whopping 30% on the spot market since it started trading in July at $220 on Flett Exchange.
 
Where have SREC prices traded in previous years?
 
You can check out daily historical pricing and charts for New Jersey SRECs on Flett Exchange by clicking here. Our pricing goes back almost 9 years to June of 2007. All our pricing is based on the volume weighted average price of actual spot sales of SRECs by solar owners.
 
Why have SREC prices gone up?
 
Flett Exchange sellers, who are all solar owners, have been actively selling into this rally to take advantage of the high prices. Power companies, who are required to provide a portion of their electricity sales from solar, have been competitively procuring SRECs thus pushing prices higher. The fundamental rise in prices is partially attributable to the low rate of solar installations in New Jersey during the last year. Also, prices have risen in past years in the winter due to the hedging for a large electricity auction which is conducted each year. This may have been the case again this year giving solar owners an opportunity to capitalize on high prices once again.
 
What should I do if I have SRECs?
 
We suggest to our sellers to continue to sell at these high prices. High SREC prices encourage new solar to be installed at a higher rate because those investors will achieve higher returns on their investment. There is generally a lag of over a year in new investment in solar in response to high SREC prices. We should expect an increase in new solar installations this year which should have a dampening effect on New Jersey SREC prices.
 
What is the highest price New Jersey SRECs can go to?
 
The SACP – or the price level that energy companies will be fined for not buying enough SRECs this year – is $323. In prior years, when there were not enough SRECs produced to satisfy the amount required, (which is not the case this year) the market did not trade at the SACP. Most buyers only paid 95% of that value. 95% of this years’ cap is $306.85 for those of you who are looking for an upside objective.
 
How do I sell?
 
If you are a Flett Exchange customer and would like to sell your SRECs for immediate payment and delivery you can always log into your Flett Exchange account or give us a call on the trading desk at 201-209-0234. If you are a new customer you can register for an account here. If you have a large amount of SRECs call and we will try to sell your SRECs at higher block prices.
 
The Quickest and Easiest way to sell:
 
Customers can also check out our “sell now price” on our website and transfer your SRECs to “Flett Exchange, LLC” at that price on GATS. We will take care of the rest for you and mail your check or send your proceeds via ACH.
 
Thank you for your continued business over the years!
 
Mike, Shean, Kevin, Brian and Mike

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseyPress ReleasesSREC

New Jersey SREC prices rally to highest levels since January 2012!


New Jersey SREC prices rallied over $240 early this week to reach the highest levels since 2012! Prices are up over 30% from this time last year.
 
Prices are strong because the amount of solar installed in New Jersey on a monthly basis as reported by the Office of Clean Energy this year has been low. During the last 6 months there were only 13 Mw installed on an average basis on the reports. Monthly builds near 20Mw over a longer period of time is what is estimated to be needed to supply the energy companies with their mandated SREC requirement.
 
The overall supply for SRECs is less this year because most of the oversupply has been retired as a result of the legislation enacted in 2012. It requires a significant increase in SREC obligations in the short term. Also, that same legislation limited the installation of new large scale solar farms that led to the majority of the SREC crash in 2012.
 
We do expect to see a backlog of new larger solar farms hit the monthly installation numbers in the next few months along with other new projects that are vying for EDC fixed rate contracts. In the past solar developers have waited to install new solar in order to be eligible for the BPU mandated 10 year SREC contracts that shift risk from solar owner to the ratepayer.
 
Depending upon when this backlog of projects hits the market will determine a potential top of the market. If it does not happen for a few months the market may continue to rally. If it happens this month we may be nearing a potential top of the market.
 
We suggest to our solar owners to sell SRECs on a consistent basis to better achieve an average SREC price over the year. This also limits the risk of not selling your SRECs and the prices dropping as they did 3 years ago.
 

Flett Exchange - New Jersey SREC Price / Supply November 2015

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

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New JerseyPress ReleasesSREC

New Jersey SREC Prices Remain High on Lower Solar Installations

 
New Jersey SREC update August 2015:
 
The first of the energy year 2016 SRECs were minted on July 31st. Prices continue to remain strong in the mid $220s. It appears that there is still active buying by electric companies for their 2015 compliance which is due this fall.
 
Sellers continue to sell at these high prices and volume has been robust. Most sellers that have accumulated SRECs are selling which is why the exchange has seen selling activity in all energy years – 2013, 2014, 2015 and now 2016.
 
SREC Prices Remain High on Lower New Solar Installations
 
On July 23rd the NJ Office of Clean Energy released their NJ_Solar_Market_Update_06_30_2015-3 of how much solar was installed in June. There were 14.4 Mw installed bringing the statewide total capacity to 1,500.7 Mw. This is another relatively light month of new solar installations. The average amount of new solar installed during the last six months was only 11.5/Mw. These low monthly installation reports continue to have a bullish effect on the SREC prices. (We feel there is some type of disconnect and that a large amount of projects will hit at any month.)
 
BPU Auction Clears at $246.42
 
The BPU conducted an auction for 42,000 SRECs on July 14th and the clearing price was $246.42. This was more than $10 over the price traded in the market which may indicate that there were a few buyers that were being forced to pay up to make compliance for energy year 2015. Prices have been $15 to $20 below that level since the auction.
 

Where are prices going from here?

 
As long as buyers need SRECs for their ry 15 compliance due this fall the prices will remain strong. Once they are done we expect the market to pull back to $200 or less this fall. We also expect a very large new solar installation number to hit in the next few months. It just does not make sense that solar installations are so low on a monthly basis while the economics (low installation costs and high SREC prices) are so favorable. If new installations are being withheld they will have to hit the states reports at some time. In the meantime the current numbers from the state indicate a continually strong SREC market.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

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New JerseySREC

New Jersey Office of Clean Energy Report - June 2015

NJ_Solar_Market_Update_06_30_2015-3-3 pdf

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New JerseySREC

New Jersey SREC Prices Off From February Highs

SREC prices have risen 29% to $214.72 average in February 2015 compared to $166.30 in February 2014. Prices are currently trading $200 for new SRECs for immediate payment and delivery on the Flett Exchange trading platform. This is off from 3 year highs of $220 reached last month.
 
Prices rose in January and February due to the active hedging leading up to and after the BGS auction in which energy providers contract to sell electricity to New Jersey customers who do not choose a 3rd party supplier. The auction winners competitively manage their SREC obligations by buying spot and long term contracts from solar owners and shovel-ready solar projects. In another closely watched auction Electric Distribution companies of New Jersey sold 32,766 SRECs yesterday at a clearing price of $211.01. (Larger volumes tend to get a premium on the auctions)
 
The New Jersey Office of Clean Energy reported that 17.8 Mw of solar was installed in February bringing the total up to 1,456 Mw of operating solar. This amount of solar almost exactly matches the average amount of solar installed during the past 6, 12 and 24 months. It appears that the solar development in New Jersey is under control and is developing in line with state growth goals set out by legislation.
 
Prices for SRECs may drop in the future if the development exceeds the state mandates which is why we monitor the monthly build rates. We suggest to sell your SRECs on a consistent basis when prices are high like they are now.
 
The following is a chart showing SREC prices compared to monthly install rates.
 

New Jersey Solar - SREC Prices and Mw Installation Rates - February 2015

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey SREC Prices Reach 3 Year Highs!

New Jersey SREC Prices Reach 3 Year Highs!
 
New Jersey SREC prices have rallied to the highest level seen since January 2012! SRECs are trading above $200 for both 2014 and 2015 energy years.
 
Prices have rallied for a few reasons:
 
1. Legislation passed by the Democrats and signed into law by Governor Christie in the summer of 2012 to save the solar market is working.
 
2. The new solar installations have been very light on a monthly basis as reported by the New Jersey Board of Public Utilities. Only 7.7 Mw were installed in November.
 
3. Prices have rallied in prior years at this time of the year due to energy companies buying SRECs for hedging purposes.
 
4. There are not as many SRECs available for sale on the spot market the first half of the energy year because many of the large installations use their first SRECs to deliver against long term contracts.
 
We expect the rate of solar installations to pick up in the coming months due to the favorable economics of solar investing in New Jersey – low panel prices coupled with higher SRECs and historically high electricity prices in New Jersey. If there are high installation rates on a continual basis it will lead to lower SREC prices in the future. In the meantime prices seem to be on an up-trend.
 

If you would like to take advantage of the higher prices and sell any of your SRECs you have a few options at Flett Exchange:
 
1. Log into your account on the Flett Exchange Trading Platform to list your SRECs for sale at any price you like.
 
2. Check our ” Sell Now Price” on our Website and transfer your SRECs to Flett Exchange LLC on GATs.
 
3. Call our trading desk at 201-209-0234 and speak to one of our brokers who can help you with GATs transfers.
 
4. Large volume sellers can call our brokerage desk (201-209-0234) for direct OTC spot and forward bilateral contracts.
 
As always, we remit payment within 24 hours for spot transactions.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey SREC Market Update - August 2014

The first of the new 2015 Energy Year SRECs were minted in GATS last Friday. Prices for spot SREC sales during the last year rallied in all of the major SREC markets covered by Flett Exchange. This was mostly due to new solar development being under control along with successful legislative action taking effect in New Jersey. Solar owners were able to sell their SRECs at higher prices in all markets compared to the previous year.
 
Here are some pricing highlights:
 

RY 2013 RY 2014
 
New Jersey: $100.70 $155.65
 
Pennsylvania: $14.05 $35.66
 
Maryland: $126.15 $131.56
 
DC: $433.22 $466.60
 

(These prices are the average daily Flett Exchange settlement prices for both energy years. A listing of settlement prices back to 2007 can be found at
 

http://markets.flettexchange.com/new-jersey-srec/ 
 
The market price for SRECs for the next 12 months will be determined by 3 major factors:

 
1. The rate and cost of new solar installed
 

2. The buying/hedging activity of the electric companies
 

3. Legislative changes or new government incentives/policies
 

We suggest to our customers to sell on a consistent basis – especially if prices are at the higher end of the range. The current prices in New Jersey, which are in the $155 to $165 range, represent a subsidy of 15 to 16 cents per kilowatt hour which is almost what you would pay without solar! Remember, the idea of an SREC market is to encourage new solar development while financing previous development. It is a delicate balance subject to open competition. If solar becomes less expensive, and it has, SREC prices over the long term will continue to drop. The open and competitive aspect of SRECs allows new entrants to invest and install new solar. If the cost of installing new solar becomes less expensive (this is the reason why SREC prices have dropped over the years) new solar investors will be willing to accept a lower SREC price – even if you do not.
 

Flett Exchange customers can log into their personal account to sell and see the following information:
 

• Historic SREC charts back to 2006
• Personal SREC sales and revenue charts for all Flett Exchange transactions (you can export to PDF or excel for your accountant or your own records)
• Live SREC prices
• Sell your SRECs like you would sell a stock on our market with over 6,500 other solar owners and dozens of electric company buyers

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey SREC Market Update -July 2014

New Jersey SREC prices have been strong this year and are currently at the $180 level for the 2014 vintage SRECs. Prices have been strong due to compliance buying by energy providers. After the buying for this years’ compliance is done we expect SREC prices to drop back down. Prices could drop to $120 or lower by this fall/winter. We suggest to our sellers that you sell any accumulated SRECs into this price rally.
 
There is a chance that prices could continue to move up a little more this summer however, we suggest to take advantage of these high prices in case they drop. In the past we have found that sellers that miss selling at the high prices tend to hold SRECs for over a year and resort to hoping and praying for prices to recover. If trends continue as they have during the past few years solar will continue to become cheaper and a lower SREC value will be needed to convince new investors to build more solar.
 
CHECK YOUR GATS ACCOUNT FOR OLDER SRECS BEFORE THEY EXPIRE!
 
Some solar generators hold SRECs for many years. If you have old Energy Year 2012 (generated from June 2011 to May 2012) solar credits sitting in your GATs account you must sell them because if you do not they will lose significant value soon! Energy companies cannot use these SRECs for solar compliance after this fall. Prices for these older SRECs trade at a slight discount at this time. Prices are listed in real time on our Flett Exchange trading platform and also on our website. If you have any of these older SRECs sell them on our platform or call us and we can walk you through the sales process. We have found energy companies willing to purchase these SRECs at this time.
 
Flett Exchange customers can sell their SRECs in a variety of ways.
 
1. You can call us in the office at 201-209-0234
 
2. Check the Sell Now Price (for the correct SREC year) on our website and send the SRECs to us on GATS
 
3. Do it all on-line by accessing our trading platform.
 
We will process your payment the same day. Customers can also place orders to sell SRECs at higher prices by either calling our trading desk at 201 209 0234 or by logging on to their Flett Exchange account and placing their orders themselves. Checks go out the same day. Established customers can request EFT.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey SREC Market Update - March 2014

It has been 3 months since our last New Jersey SREC market update. During that time SREC prices moved up from the $145 area in December 2013 to a high of $185 in February 2014 and have moved back down to the mid to high $150s. $185 was the highest price for New Jersey SRECs since May 2012. Many of our customers who have been holding off for higher pricing participated on this move and sold many banked SRECs.
 
Upward price movement and market firmness can be attributed to the compliance requirement of close to 1,600,000 SRECs due this fall. This requirement is significantly higher than last year’s requirement of 596,000. It is the first compliance year covered under the solar legislation passed in 2012.
 
There will be more than enough SRECs minted and available in GATS to satisfy this fall’s requirement. Here are the existing and expected SRECs:
 
2012 in GATS= 45,860
2013 in GATS = 763,487
2014 in GATS = 790,029 (June 2013 to Jan 2014 production)
 
Balance of 2014= 450,000 (estimate of Feb to May 2014 production with Feb light due to snow)
 
SREC supply for 2014 compliance= 2,049,376 (Estimated available)
 
Estimated ry 2014 SREC demand= 1,600,000 (based on 78 Gigawatt hours of NJ electric consumption)
 
Estimated ry 2014 oversupply= 449,376
 
Based solely on the estimated available SRECs above, it would appear that the market should remain stable to weak as the spring and summer arrive and buyers finish their SREC purchases. However, there are a host of other factors that can have market-moving effects. The following is a list of bullish and bearish factors that may have an impact on pricing in the next 6 to 7 months as we approach compliance:
 
BULLISH FACTORS:
 
1. It is hard to buy SRECs in bulk in a short amount of time. If some buyers wait until the end of the year to finish buying for their 2014 compliance they may push the market higher in search of SRECs.
 
2. Buyers hedging for future years purchase SRECs in the spot market and hold them for future compliance years. This reduces the pool of available SRECs for buyers that need them for the October 2014 deadline.
 
3. 100% of the SRECs are never sold each year. There are a variety of reasons why. Some buyers feel they are worth more so they don’t sell, some don’t enter meter readings in time and some altogether forget about them (it is hard to believe but some people or businesses don’t need the money right away- must be nice!)
 
4. Speculative buyers may purchase SRECs from solar owners and force compliance buyers to pay higher prices as the compliance deadline approaches.
 
BEARISH FACTORS:
 
1. If prices go up too much compliance buyers who have bought spot SRECs for future compliance years may choose to use those SRECs for this compliance year or sell them to other compliance buyers to do the same.
 
2. SREC markets are based on law and confidence in the law. If there is any potential change in law that may possibly reduce the need to purchase SRECs in future years then buyers will not buy any more SRECs from solar owners other than what they need immediately.
 
3. If it appears that a dramatic increase in solar installations may happen like it has in the past, (due to overdevelopment) then buyers will back off of the spot market once they have procured their 2014 compliance needs. (no risk EDC contracts, large grid connect permissions from the BPU and a steady increase in lease installations have a good chance of oversupplying the market)
 
As you can see, there are many factors that can come into play in the pricing of SRECs going into compliance. We try to give our customers, both buyers and sellers, as much information as possible. You can always see our live pricing on our website along with historical pricing going back to 2007. If you log into your Flett Exchange account you can transact SRECs 24 hours a day, see all of your sales history along with historical graphs. Also, feel free to call us directly with any questions or if you need help transferring SRECs on GATS. As always our sellers are paid the same day via check or EFT – your choice!

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey Low Solar Installation Rate Lends Support to the SREC Market

The rate of new solar installations in New Jersey has been dropping for over a year. This low build rate coupled with the increasing SREC demand put in place by legislation over a year ago is why SREC prices are up 100% from a year ago. Prices for new SRECs are currently in the $140s.
 
There were only 13 Mw of new solar installed in New Jersey for the month of November. This marks 6 months in a row of low installations. As we have mentioned before, a monthly build rate of 15 to 17Mw a month over the next few years will keep the New Jersey SREC market “balanced”. The average build rate for the last 6 months was only 11.6 Mw.
 
Why is there less new solar being built in NJ now?
 
The low build rates today can be attributed to the low SREC prices last year. The projects being turned on now were in the planning phases about a year ago. Since SREC prices were under $100 very few projects were financeable. We can expect the build rate to increase in the next 6 to 12 months because of the higher SREC prices that we are seeing now.
 
The amount of new solar is likely to increase next year.
 
There will be an increase of installations due to another round of EDC (Electric Distribution Company) fixed rate SREC solicitations next year. These solicitations shift SREC risk away from solar developers and onto the ratepayers. Since there is no financial risk these programs are guaranteed to be oversubscribed.
 
Over the next 3 years there will also be a number of large grid connect projects installed. These projects are typically 7Mw each and will produce thousands of SRECs a year. The solar legislation that passed in the summer of 2012 allowed for a limited amount of grid connect solar to be installed. A limit was passed on new grid connect solar to help prevent a quick oversupply like the one that led to a collapse 2 years ago.
 

Where are Prices going?
 
New Jersey SREC prices should stay stable going into the New Year. Many sellers have been attempting to sell at $150 and it appears that it may happen again soon. The trend is slightly higher; however, it will be limited as buyers are offered multi-year contracts by new solar installations. Most new solar can be installed with a 3 to 5 years price in the $140 range. This shift from spot markets to multi-year contracts should limit the ultimate upside of the spot SREC market.
 
The SREC market is still oversupplied for the current year; however, the new SREC requirements put into place by legislation are just starting to kick in. Electricity companies in New Jersey will need to procure over 1,400,000 SRECs going forward each year compared to only 770,000 last year.
We recommend to sell SRECs on a continual basis, especially as prices move up. If you have a large facility (250kw or larger) we recommend that you lock into a long term contract as the prices rise. Flett Exchange brokers long term contracts for its customers directly with energy companies.
 
If you would like to sell any SRECs before the end of the year feel free to log on and sell or give us a call.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey SREC Prices Make New Highs - October 2013 Solar Capacity Update

Prices for New Jersey solar renewable energy certificates (SRECs) have risen in the past few months. On October 4th the 2014 energy year SRECs settled at $149.63 on the Flett Exchange Trading Platform. This is the highest price yet for the 2014 SRECs on the spot market, 30% higher than the low price of $115 on July 16th and significantly higher than the $60 all-time low SREC price last October. The Electric Distribution Companies (PSE&G, Atlantic City Electric, Jersey Central Power & Light and Rockland Electric) conducted a large SREC auction on October 17th for 76,417 energy year 2014 SRECs. It cleared at $147.00 per SREC. Prices as of this publication are slightly lower.

 

SREC prices are steady now because of 2 factors:

 

1. Legislation passed in July of 2012 dramatically increased the amount of SRECs that the energy companies need to procure on a yearly basis. Demand for SRECs this energy year will be close to 1.5 million SRECs which is up from the previous legislation which required 772,000.

 

2. The pace of solar development was slow in the past year due to the lower SREC prices. There were only 8 Mw of new solar activated per month in August and September. The average amount of solar in the last 6 months was only 14.9 Mw per month compared to 28.5 Mw a month at this time last year. It is estimated that 15-17 Mw is needed per month to achieve a perfectly “balanced” market.

 

 

The stable and upward pricing should be tempered eventually by the following:

 

1. It is expected that the monthly install rate should increase next year due to the rising SREC prices.

 

2. The New Jersey Board of Public Utilities approved another round of Solar Loans and fixed rate Electric Distribution Company SREC contracts for the next year. These contracts shift all risk away from solar developers and onto the rate-payers so it is virtually guaranteed that the build-rate will increase during the next year.

 

We don’t expect spot SREC prices to experience a new downtrend much at all during the next 8 to 10 months. SREC demand should remain strong due to hedging activity on the part of the energy companies.

 

We expect there to be periodic, short-lived rallies during the year. With that in mind, we suggest that SREC producers sell every time the market moves up. In the past, rallies in the SREC market only last a few days because it is usually a result of a buyer procuring large volumes. We suggest that if you have a price that you would like to sell your SRECs you should list them for sale on the Flett Exchange trading platform or call us 201-209-0234 to list them for you. This will ensure that you do not miss the selling opportunities.

 

The stable SREC prices right now will invoke developers to install solar at an increasing rate so it is highly unlikely for the SREC market to stay at high prices for a prolonged period of time. If the spot SREC prices get too high energy companies will contract directly with new solar developers for their next few years of SRECs. The cost to install solar is very low and new solar can be installed with SREC prices in the mid $100s on reasonably priced projects if the developer can get a 3-5 year contract. If prices move too high in the spot market buyers will hedge in the 3- 5 year market as they have in the past. We highly doubt we will see another 80 mw installed in one month like we did in February of 2012 due to the constraints put on large solar farms but it is relatively easy to maintain 20 to 25 Mw per month. That level of new solar installations on a monthly basis should appear again in about eight months to a year and may reverse this stable SREC market.

 

 

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey Solar Capacity Upadate: August 2013

The New Jersey Office of Clean Energy released the July solar installations last week. There are now 23,076 solar installations in the state with a total capacity of 1,106 Mw. There were only 11.5 Mw installed in July. This is the lowest amount of solar installed in one month since May of 2011. A continued trend of low installation months such as this should support the SREC market.

 

 

The amount of solar installed on a monthly basis is one of the most important tools used by market observers to determine if the New Jersey solar market will be overdeveloped compared to goals set by solar legislation. In previous years development outpaced sate goals. It is estimated that an average of 15 to 17 Mw a month is the pace of development needed. If more solar is installed than needed the SREC market can crash as it has in the past. If the pace of installation declines the SREC market will increase to encourage more solar development.

 

As shown by the chart above, the monthly rate of installations has been steadily decreasing.  The 6 and 12 month moving averages are close at 21.5 mw per month. In early 2012 the 6 month average was as high as 47Mw per month!

 

SREC pricing has been steady this year. We attribute this to 2 main factors. The first is the controlled pace of development and the second is electric suppliers hedging activities in preparation for the increase of SRECs required for energy year 2014. SREC demand increases over 140% from 596,000 in energy year 2013 to approximately 1,440,000 in energy year 2014. Energy year 2014 just started in June.

 

Legislation signed into law last year
 rescued the New Jersey solar market from collapse in both solar jobs and values of SRECs used by investors in solar projects. Those investors are homeowners, businesses and schools in New Jersey with solar. Ratepayers without solar who are obligated to buy SRECs due to previous commitments set forth by the BPU also benefitted from the legislation.

 

In previous years the fall has been a time of light SREC volume due to weak SREC prices. We do not expect the market to drop this fall anywhere close to the $60 level that it had last year due to the above factors. Electric suppliers have been active in the spot market hedging forward production due to the fact that SRECs now have a 5 year life. They will most likely continue to procure SRECs at a steady pace in the spot market. We expect there to be an increased interest in buyers procuring 2 and 3 year contracts from large solar facility owners. (Flett Exchange is active in brokering both spot and forward contracts directly between electric companies and solar owners)

 

As always, we encourage solar owners to sell consistently during the year. If prices increase you should sell your production forward for 2 to 3 years.

 

If you have a large volume (100, 500, 1,000) of spot SRECs to sell call us directly on the trading desk. For large volume the prices are typically a few dollars over our spot price on the screen, we do not charge you commission, you get paid the same day and you do not have to execute pages of contracts.

 

We would like to thank all of our customers for your business. Use of our exchange helps us bring market transparency to the New Jersey SREC market. This helps both buyers and sellers make the market more efficient thus bringing more solar to New Jersey!

TAGS:
New JerseySREC

New Jersey Solar Capacity Update - March 2013

The New Jersey Office of Clean Energy reported that 18 Mw of solar was installed during the month of March. This brings the installed capacity of solar in New Jersey to 1,026Mw. There are now 20,887 solar arrays in operation statewide.

 

NJ Solar - Mw Installed - March 2013

NJ Solar - Mw Installed - March 2013

 

The installation of 18 Mw in March reinforces the downward trend of solar installations in New Jersey. The average rate of installations need to be in the 15 to 17Mw per month range to match goals set out by the state. If the installation rate stays at this level it is expected that the SREC market will continue to stabilize.

 

Upon the release of this news by the New Jersey Office of Clean Energy the SREC market moved up $5. Prices for immediate delivery of SRECs are now $110 on the Flett Exchange marketplace.

More about Flett Exchange:

Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 5,000 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.

Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

 

 

 

 

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey Solar Capacity Update - February 2013

The New Jersey Office of Clean Energy reported that 35 Mw of solar was installed during the month of February. This brings the installed capacity of solar in New Jersey to over 1 Gigawatt! There are now 20,340 solar arrays in operation statewide.

 

The 35 Mw for February was higher than expected and almost double what the state needs to install on a monthly basis in order to stay in line with the Renewable Portfolio Standard requirements. The monthly install rates are watched closely because they determine the value of the Solar Renewable Energy Credits (SRECs). It is estimated that monthly install rates need to be 15 to 17 Mw a month average to keep the market balanced. 

Even though the installation rate in February was quite high, the average rate per month has been decreasing steadily. If this solar development trend continues for the next six months it will send a signal that the market is under control. One needs to keep in mind the timeframe of solar development. The 35 Mw of capacity that came on line this month represents decision making from a year to a year and a half ago. Also, some of the projects that are coming on line now are projects with fixed rate SREC contracts. Once this development pipeline runs its course the true rate of installations based on SRECs at the $100 level will be seen for the next year in the future. We should expect the average build rates to continue to decrease as the development pipeline starts to represent projects built with the current SREC prices.

 

As far as prices are concerned for this spring and summer we don’t expect the market to drop below $85. Every time the market has dropped below $100 the volume of selling decreases significantly. Since there is a large oversupply of SRECs compared to this year’s requirement we don’t expect prices to move much over the recent highs of $125. However, if compliance entities wait until this summer to procure their energy year 2013 SRECs that are due in the fall then there could be a short lived squeeze above $150. We only put a 10% chance of this happening.

 

After trading briefly over $120 the NJ 2013 vintage SREC prices are trading $105 to $110 right now. The electric distribution companies auctioned off a large block of SRECs on March 19,2013. The volumes and clearing prices are as follows:

538 NJ 2012 vintage SRECs sold for $110.15 each
57,287 NJ 2013 vintage SRECs sold for $112.01 each

 

As we have suggested in the past, sell your SRECs consistently during the year, especially during times of rising prices.
More about Flett Exchange:

Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.

Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseyPress ReleasesSREC

The New Jersey SREC Market Rallies Back over $100!

 

The New Jersey SREC market rallied up in the last week. Prices for energy year 2013 SRECs broke above $120 briefly on Monday, February 4th on the Flett Exchange SREC marketplace. This is up significantly from the low of $60 in October. As of this writing bids were $110 for energy year 2013 SRECs and $100 for the older 2012 vintage SRECs.

The market has trended higher as the rate of new solar installations in New Jersey have ratcheted back down during the last six months. Also, the first effects of the new legislation that was passed in July are also being felt. This past week there was a very large electricity auction (the BGS or the Basic Generation Services Auction) in which the winners win the ability to supply electricity for a period of 3 years in New Jersey. These 3 years correspond with the increase in SREC demand that was included in that new law. Electric companies have to procure a larger amount of SRECs and as a result this has supported SREC prices recently. This accounted for the quick jump in prices during the past week.

Increased demand should keep a floor under the market however; a prolonged rally will most likely be muted because of the very low price of new solar installations. New solar installations are only half of the cost that they were as recently as 2 years ago. Some installations in New Jersey are reportedly being built for $2 to $2.50/watt. The low cost of installation means that SREC prices do not have to be much higher than $120 to $150. If SREC prices go much higher than that a large amount of new solar will be built which will in turn depress SREC prices again.

It is also expected that the next round of selling from the Electricity Distribution Companies (EDC’s) will be announced soon. The last auction was in October. This auction may have as many as 70,000 to 90,000 SRECs. It is likely that buyers will temper their bids in the spot market until after the large auction.

As we have suggested in the past, we recommend selling your SRECs on a consistent basis to average out the prices during the year.

Flett Exchange customers can sell their SRECs in a variety of ways.

1. You can call us in the office at 201-209-0234

2. Check the Sell Now Price http://markets.flettexchange.com/new-jersey-srec(for the correct SREC year) on our website and send the SRECs to us on GATs (below is a walkthrough)

GATS Transfer Walkthrough: http://www.flettexchange.com/index.php?page=SREChelp

3. Do it all on-line by accessing our trading platform.

We will process your payment the same day. Customers can also place orders to sell SRECs at higher prices by either calling our trading desk at 201 209 0234 or by logging on to their Flett Exchange account and placing their orders themselves.

You can always ask us a question at:

info@flettexchange.com

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey Solar Installation Update - December 2012

The New Jersey Office of Clean Energy reported a build of 9Mw for the month of December. (This is a preliminary number as of January 7th). If this is actually close to the final number, it indicates that the solar industry in New Jersey is finally starting to develop within the goals of the Renewable Portfolio Standard RPS set out by law.
 

In the previous two years solar development has been in excess of the RPS goal and caused a glut of solar credits. The ratepayers in New Jersey are protected from over-development by a competitive solar credit market based on supply and demand.
 

The following is a chart which shows the monthly build rates of solar compared to the RPS goals set out by law. We ran a 6 and 12 month moving average as well. There is an overlay of the SREC pricing (a monthly average of Flett Exchange daily SREC settlement prices) which demonstrates the supply-

demand relationship.

 

 

 
More about Flett Exchange:
 

Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.

 

Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey SREC Prices May Have Found Support!

New Jersey SREC prices have rallied from an all-time low price of $60 in October to $80 most recently on the Flett Exchange trading platform. We think the market has found its bottom at this time.
 
We think that a bottom is put in place for three main reasons:
 
1. selling volume decreased dramatically at the $60 level
 
2. solar installation rates have started to decrease
 
3. most new solar investment cannot be supported by SREC levels below $90.
 
On Flett Exchange we have witnessed decreasing volume of selling at these low price levels. Many solar owners have opted to “sit it out” this fall and wait and see what prices will do. Our trading screen indicates that selling interest will pick up again at $95 and there should be resistance at that level and higher.
The amount of new solar installed on a monthly basis is the largest factor determining future SREC prices in New Jersey. Remember, the whole reason SREC prices crashed is because too much solar was put in too quickly. A build rate of only 10mw per month would have satisfied the power companies’ requirements. At one point earlier this year the 12 month average was 37 Mw installed per month. October 2012 solar installations were only 16Mw which is the lowest monthly install figure since May of 2011. With the new legislation that was passed in July an average of 15 to 17Mw per month is needed. Any more than this will put the market oversupplied once again. The next two months of installations are expected to be double this number however, the overall trend is decreasing.
 
The price of new solar installed has plummeted in the past year and it is expected to continue to decrease for the next 12 months. The decreasing cost of new solar installations means that the added revenue stream from SRECs does not have to be as high. However, a $60 SREC is not high enough to encourage most new solar development at these install prices.
 
We suggest to our sellers to sell consistently to average out your SREC sales for the year. Don’t get overzealous! Last year some people did not sell when the market rallied and are still holding all of their SRECs. It is next to impossible to sell the high so an averaging approach reduces your risk of holding large volumes of SRECs at low prices.
 
Flett Exchange customers can sell their SRECs in a variety of ways:
1. You can call us in the office at 201-209-0234
2. Check the price on our website www.flettexchange.com and send the SRECs to us on GATs
3. Do it all on-line by accessing our trading platform. www.flettexchange.com/portal/
 
You can always ask us a question at
 
info@flettexchange.com
 
More about Flett Exchange:
 
Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.
 
Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseyPress ReleasesSREC

New Jersey Electric Distribution Companies Sell 60,600 SRECs at $70.50

Jersey City, NJ:The electric distribution companies (EDC’s) sold 60,600 New Jersey SRECs at $70.50 each today in an auction. This was the price for energy year 2013 SRECs. They sold over 5,000 energy year 2012 SRECs yesterday at $70.02 each. The EDC’s sell SRECs every quarter.
 
Based on an estimated average price of the long term contracts of $350 each, this auction produced approximately an $18 million loss for the quarter. The loss is spread out among the ratepayers.
 
These SREC prices match what customers have been selling on the Flett Exchange trading platform during the last few weeks.
 
Why are prices so low?
 
Prices for New Jersey SRECs have been very weak in the past few months because of the significant oversupply due to overbuilding versus the requirement set out by the State. The oversupply is going to persist until the requirements put forth by new legislation kick in for energy year 2014. At that time SREC buying obligations increase by almost 300%. Surplus SRECs from current years will be needed in those years.
 
The amount of solar installed dictates how many SRECs are produced. If too much solar is installed compared to New Jerseys requirements then the surplus will continue and prices will stay low. We estimate that if more than 15mw a month are installed on average then the market will be oversupplied. The average install rate in the last 4 months has been about 24 mw. This is still too much but it is down significantly from an average of over 37 mw for a one year period ending this past spring. The trend is going in the right direction to balance the market.
 
What will make prices rise again?
 
Install rates are expected to drop in the first quarter of next year as the project pipeline gets built out. New installs are expected to drop due to the low SREC price. If all goes to plan the market will self correct.
 
Based on low installed costs we hear that if SRECs were to rally to $120 new installs would pick up. $70 SRECs only support the very cheapest projects. Projects at this level seem speculative based on the low rate of return at current electricity prices and SRECs. Those investors may justify their actions if they have a bullish view on solar install prices, electricity prices and SRECs.
 
Two major events that could make solar more expensive is a heavy tariff on Chinese solar panels and a elimination of Federal tax incentives for new solar.
 
More about Flett Exchange:
 
Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.
 
Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseyPress ReleasesSREC

New Jersey SRECs Settle below $100 on Flett Exchange

Solar renewable energy certificates settled at $97.75 today on the Flett Exchange SREC marketplace. This price is for immediate delivery and payment for the 2012 reporting year SRECs. The new 2013 reporting year SRECs settled at $100. This is the first time that prompt year New Jersey SRECs have settled under $100 for since May 1, 2012. The energy year 2012 SRECs traded as low as $95 during the session.
 
Prices have dropped because developers installed more solar than the aggressive solar mandates in New Jersey. Reporting year 2012 compliance called for 442,000 SRECs to be purchased by electric providers. Solar installations generated 689,550 SRECs, or 56% more than needed.
 
Buyers are still buying for their energy year 2012 compliance which ends in a few weeks. Prices do have a chance of spiking up if they have not yet purchased all they need. Flett Exchange customers can place orders above the market to take advantage of upward price spikes.
 
The requirements were increased significantly with the passage of the new bill last month. However, the excess SRECs do not need to be turned in until the Fall of 2014. Electric companies who need to buy SRECs are most likely waiting to see if installations over the next year stay in line with the State requirements. Developers installed 21 mw in July. This is a decrease from previous months. Installation totals will need to stay at this level or lower to decrease the likelihood of another oversupply.
 
Flett Exchange customers have access to the SREC market 24 hours a day via its trading platform and also broker assisted trades Monday to Friday 8am to 5pm. Sellers on Flett Exchange have sold SRECs as high as $160 since the beginning of July.
 

More about Flett Exchange:
 

Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.
 
Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

Governor Christie Signs New Jersey Solar Legislation

Trenton, NJ: Governor Chris Christie signed S1925 / A2966 into law today. This law makes adjustments to the solar incentive program in New Jersey.
 
     As most of our customers know by now, solar development in NJ during the past 2 years has exceeded State mandates for solar. Since the payments for solar production are based on a market structure called the Solar Renewable Energy Certificate (SREC), the overbuilding of solar in relation to State mandates has resulted in lower SREC prices. This had a negative effect on investors who have already installed solar and those who would like to install solar now. On the other hand, ratepayers have benefited from the low SREC payments.
 
     Since the passage of the last solar legislation over two years ago, there were two major changes in solar that required this new legislation. First, the cost of solar panels has dropped significantly and second, the solar industry in New Jersey has increased in size and has become a job creator.
 
     These events created a unique opportunity for lawmakers to adjust the program for the benefit of both ratepayers and solar investors. Simply put, reduce cost exposure for ratepayers over the long term while increasing solar development in the short term.
 
     It is encouraging to see that the Christie administration and the Democratic Controlled State Senate and Assembly came to agreement on a bill that takes advantage of external changes in the solar industry (declining solar costs coupled with an increasing willingness of investors to invest in NJ solar) and brings those advantages to ratepayers and solar investors alike. With an estimated 3 billion dollars invested so far in New Jersey solar infrastructure, political stability is the most important factor in attracting cheap capital to build out the remainder of the solar capacity mandated by State Law.
 
Here are some of the changes implemented by the new legislation:
 

  1. Increase RPS: (Renewable Portfolio Standard) Increase the amount of SRECs that need to be purchased in the short term to absorb the oversupply and maintain a higher build rate
  2. Decrease the SACP: (Solar Alternative Compliance Payment) Lower the fine level from $600+ to $339 and lower to protect ratepayers.
  3. Limit solar farm development
  4. Incentivize solar development on landfills, brownfields and large net metered projects.
  5. Aggregated net metering for electricity consumption by certain governmental bodies and school districts.

 
     Investors new and old in New Jersey solar still have to keep in mind the risk of overbuilding in the future still exists. Many solar developers lobbied for throttle mechanisms to help guarantee profits to solar owners by crowding out future development of solar in case of an overbuild situation again. This approach was rejected. Instead, land use and consideration for net benefits for net metered projects took precedent. These were all alluded to in the Energy Master Plan put out by the Christie Administration late last year. Many people in New Jersey have started to complain about solar farms and the legislature and Governors office has heard them.
 
The following have had instrumental input in either creating this legislation or influencing its outcome:
 
Governor Chris Christies’ office
Stephen M. Sweeney – Senate President
Senator Bob Smith – Environment and Energy Committee
Assemblyman Upendra Chivukula – Telecommunications and Utilities Committee
Stefanie A. Brand, Esq – Director, Division of Rate Council – State of New Jersey
 
     New Jersey Renewable Energy Coalition – a coalition of industry investors, headed by Tony Pizzutillo, was able to marry the objectives of both the Governor’s Energy Master Plan with Legislative leadership. Also, the Coalition successfully identified statewide labor organizations as proponents of the industry.
 
     There are many other renewable energy coalitions, environmental groups, electricity companies, large electricity consumer advocates, labor organizations along with New Jersey business owners and individuals who worked tirelessly over the past year to advance this legislation. I don’t feel that any one group got exactly everything they wanted but in the end it is a good piece of legislation.
 
     The only guarantee is that inputs will change as the years go on. If they are as extreme as they have been in the past two years future “tweaks” will be needed. I look forward to adding whatever information I can about SREC market structure, investors in solar and electric company interaction with RPS requirements.
 
This is a good day for all in New Jersey!

TAGS:
New JerseySREC

Businessweek and Greentechmedia articles on NJ Solar Bill

The following are two articles recapping the NJ solar bill that was passed by the New Jersey Legislature. It is awaiting Governor Christies’ signature. The legislation is geared to support the Solar Renewable Energy Credit SREC market, sustain solar development in the Garden State and protect ratepayers.

 

SREC prices have firmed up in recent weeks in anticipation of passage of the bill. Prices rallied from $130 two weeks ago to $150 today for spot sales of energy year 2012 SRECs.

 

 

Greentechmedia

 

More about Flett Exchange:
 
Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.
Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

New Jersey Legislature Passes Solar Bill

The New Jersey Legislature passed a bill A2966 on June 25, 2012 aimed at supporting solar development in New Jersey. It is now up to Governor Christie to sign the bill into law. He has 45 days to do so.

 

Solar development in New Jersey during the past year exceeded the State mandates by over 300%. The result was a collapse of the prices of Solar Renewable Energy Certificates. Without a fix, solar installations would have stopped and people who invested in solar would have experienced a few years of SREC prices in the $40 to $60 range until state mandates caught up.

 

SREC prices for spot delivery were trading $146.56 before the bill passage and experienced a small move up after passage. Forward pricing for energy years 2013 to 2015 were trading $150 to $160 before bill passage and were “talked” up to $180 – $190 in the morning after passage. We will see if actual trading in the forwards transpires at these levels and holds.

 

Solar development during the next 6 – 9 months will dictate what energy providers are willing to pay for spot and forward contracts. The new State mandates are geared for a 25mw a month build compared to the old mandates which allowed for 10mw a month to be built before the market became oversupplied. The past 12 months experienced a 37mw a month build.

 

Electric companies are buying their last SRECs for this Septembers’ compliance period right now. If the new bill is signed into law the electric companies will need to turn in over approximately 1,600,000 SRECs in September of 2014 compared to the current requirement for the same period of 772,000. The higher mandate decreases the likelihood that SRECs will be oversupplied as they are now and allows for a quicker adoption of solar in New Jersey.

 

Pricing for energy year 2012 SREC are expected to stay under $200 unless solar development in the state decreases substantially over the next few months.

 

Ratepayers are protected in this bill by the lowering of the fine levels levied against power suppliers in the case of a shortage of SRECs. Fine levels are being reduced from $600+ to $339 starting in energy year 2014. For the most part solar development risk will still rest on developers with ratepayers reaping the benefit of decreasing solar costs and increased competition in the solar industry as they have in the past in New Jersey.

 

More about Flett Exchange:

 

Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.

Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

 

DISCLAIMER: This article contains forward looking statements. Actual market action could differ materially from those anticipated. Sellers of SRECs should do their own research. Actual SREC production may differ significantly from those estimates. The company assumes no obligation to update any forward-looking statement.

TAGS:
New JerseySREC

Governor Christie Comments on New Jersey Solar Legislation (Video)

During a town hall meeting in Haddonfield on Tuesday, June 12, Governor Christie commented on the Senate and Assembly bills aimed at stabilizing the solar industry in New Jersey.

 

As for the Solar bills he said: “If they pass I will sign them”. He commented that the bills “will help to continue to support the solar industry which is a big job creator in this State”.

 

The Governor was referring to the Senate bill S1925 with primary sponsors Senator Bob Smith and Senate President Stephen Sweeney and Assembly bill A2966 with Assemblyman Upendra Chivukula as that bills primary sponsor. A bill is expected to be presented to the Governor for signature this month.

 

The spot SREC market has been trading between $130 and $140 during the past week. Without the potential passage of this bill, the SREC market would have most likely been trading below the $85 low experienced a month ago. The bill calls for significant increases in SREC purchases from energy providers, but not until the fall of 2014.  Long-term SREC prices will be less volatile with upper limits reduced.  SREC price caps are being reduced from the $600+ range to $339 and less starting in energy year 2014. The short term upward price movement due to bill passage should be limited due to the oversupply of SRECs this year and the next year. The oversupply will presumably be used for compliance in the fall of 2014.

 

Power producers, who are required by law to buy SRECs, will watch the pace of solar development over the next 6 months to determine if the market will be oversupplied once again. If developers throttle back to 20 mw /month or less the SREC market should stabilize and forward 3 year pricing should be in the upper $100s to low $200 range.

 

During Governor Chris Christies’ speech he commented on the expected closure of the Oyster Creek Nuclear plant, which is the countries oldest, in eight years. The expansion of solar along with the addition of “3 new natural gas fired power plants will be built in New Jersey in the next 5 years” should help keep power in New Jersey “cleaner and more affordable”.

 

Mark Incolllingo, a volunteer member of Haddonfield’s Sustainable NJ Green Team, asked the question in the following link to a video of a town hall meeting.

 

Here is a link to the video posted on the Star Ledger website on NJ.com:

 

 

http://videos.nj.com/star-ledger/2012/06/governor_responds_to_audience.html

 

 

More about Flett Exchange:
 
     Flett Exchange is a leading environmental exchange and brokerage firm. Our online trading platform brings transparency, price discovery, and liquidity to Solar Renewable Energy Certificates (SRECs). Our knowledgeable staff is also available to assist you in selling your SRECs for you. Over 4,400 active clients utilize Flett Exchange to negotiate the price, quantity, and details of SRECs through our brokers or on our online trading platform. Upon each SREC transaction Flett Exchange remits immediate payment to our sellers. Flett Exchange operates SREC markets in NJ, PA, DE, MD, OH, and DC supported by trained solar professionals with specialized knowledge and proven experience.
 
     Flett Exchange also brokers bilateral long-term SREC contracts between qualified counterparties. Flett Exchange buyers and sellers can secure price, quantity, and terms of SREC contracts 1-5 years in duration. Our stringent vetting process ensures that quality solar projects are presented to the market in a skillful manner. Buyers and sellers utilize Flett Exchange for long-term SREC contracts gain direct access to large pools of SRECs, while mitigating risk and locking-in profits. Please visit www.flettexchange.com to learn more about our services. (201) 209-0234.

TAGS:
New JerseySREC

Production Meters are Required for Small NJ Solar Generators to Earn SRECs

Solar owners in New Jersey who rely on estimates to earn Solar Renewable Energy Certificates (SRECs) will be required to have a production meter by November 30, 2012 or they WILL NOT earn SRECs starting with December 2012 generation.

 

Solar owners in New Jersey with arrays that are 10kw and less were given the option to rely on estimates or they could read the actual electric generation off of a meter. The electric production of a solar array is needed to generate SRECs.

 

Many solar owners that have relied on estimates do not have the required production meter (ANSI) Standard C12.1-2008 compliant productions meter) and will need to have one installed by a licensed electrician. Most meters on the inverters are not acceptable. Also, the net meter provided by the electric distribution companies are not capable of providing gross data for the purposes of generating SRECs.

 

We recommend that you call your solar installer first to find out if you have a production meter already. In some instances solar owners may void the installer warranty if they have another entity work on the array.

 

Solar owners who rely on estimates can still sell their SRECs on Flett Exchange or they can subscribe for Flett REC Manager Services. With Flett REC Manager Services our customers send their meter reading to Flett Exchange and we sell the SRECs automatically. It is easy!

 

Click on Services on the top of this page and select “managed SREC services” or fill out the forms below and email or fax them back to flett exchange.

 

www.flettexchange.com/pdf/Flett_Exchange_REC_Manager.pdf

 


www.flettexchange.com/pdf/Schedule_A.pdf

 

Here is the announcement by the New Jersey Board of Public Utilities:

 

RE, Small Wind and NM/INX List Members:

 

The Chapter 8 readopted regulations with amendments approved by the Board on May 23, 2012 were published in today’s New Jersey Register.  The readopted portions of the regulations were effective on May 1, 2012 and the amendments, new rules, repealed rules and recodification became effective today with their publication in the New Jersey Register.  As a result, two important provisions of the amendments with transition or grace periods were triggered.

 

1. SREC Registration Requirements

 

Within the NJ Renewable Portfolio Standard (RPS) regulatory amendments, at N.J.A.C. 14:8-2.4 Energy that qualifies for an SREC; registration requirement – under subsection (c) “June 4, 2012” was inserted for the placeholder language in the rule proposal; “effective date for this new rule”.  Likewise, under subsection (c) 1. ii “June 4, 2012” was inserted replacing the “effective date for this new rule” placeholder language and the deadline for submittal of an initial registration package was updated to “July 4, 2012” replacing the placeholder language; “30 days after the effective date of this new rule”.

 

2. Production Meter Requirements for Solar Electricity to be eligible for SRECs in NJ’s RPS

 

Within the NJ Renewable Portfolio Standard (RPS) regulatory amendments, at N.J.A.C. 14:8-2.9 Issuance of RECs and SRECs  - subsection (c) the date “ December 4, 2012” was inserted replacing placeholder language in the rule proposal which previously stated; “six months after the effective date of this amendment”.  The effect of this new rule will be that beginning December 4, 2012 all solar facilities connected to the distribution system in New Jersey seeking eligibility to create SRECs eligible for use in NJ’s RPS must have a production meter capable of measuring generation.

 

The NJ RPS has historically required solar systems greater than 10 kW to submit metered production data from meters compliant with the American National Standards Institute (ANSI) Standard C12.1-2008.  And NJ’s SREC Registration Program and its predecessor SREC Only-Pilot Program required all solar systems to have an ANSI compliant production meter installed regardless of system size.  However, the RPS regulations had allowed solar systems less than 10 kW to create SRECs from engineering estimates and the NJCEP rebate programs did not require ANSI compliant production meters to be installed.  The net meter installed by the Electric Distribution Companies are NOT capable of providing gross generation data useful for purposes of SREC creation.

 

 

As a result of the regulatory change and a lack of production metering, some solar systems less than 10 kW may require the installation of ANSI Standard C12.1-2008 compliant productions meter.  The practical implications from the new regulation’s effective date of June 4 which triggers the December 4, 2012 commencement of the requirement and the processes for SREC creation at the PJM-EIS GATS tracking system require that solar electric systems lacking production meters must have them installed by November 30, 2012 to ensure that solar electric generation in December 2012 be eligible for SRECs.  Board staff is working with our RE Market Managers and the staff at PJM-EIS GATS to further inform stakeholders of these changes, to provide links to lists of eligible ANSI-compliant SREC production meters, and solar installers or licensed electricians able to install them.

TAGS:
New JerseySREC

Legislation to Fix New Jersey Solar Market is Introduced!

The long awaited legislation to fix the solar market in New Jersey has been introduced! Senator Bob Smith and Senate President Stephen Sweeney introduced Senate bill S-1925 on May 14, 2012. Here are the main points:

 

  1. Increase the RPS starting in Energy Year 2014. (this is the amount of SRECs that the power companies are required to purchase)
  2. Lower the SACP (this is the fine that power companies must pay if they cannot purchase SRECs.)
  3. Switch the RPS to a percentage from a fixed number.  (this makes it easier for power companies to plan SREC purchases and also protects ratepayers in case overall power consumption drops statewide in the future)
  4. Limit solar farm (grid connected solar) development to 100mw per year for 3 years.
  5. Requirement for solar farms to obtain BPU approval to receive SRECs in the future. (this will help prevent large solar farms from overbuilding and give latitude to the BPU to approve projects that meet certain criteria)
  6. Introduction of net-metering for schools and municipalities. (this allows for these public entities to site solar in a 3 square mile radius from buildings and net-meter)
  7. Establishes a Solar Registration Program for new projects. (this will provide a much needed insight into the pipeline of solar projects in development)

 

The bill addresses the recent overbuilding in solar in New Jersey and attempts to bring the SREC market back into equilibrium. It also increases the amount of solar development for the next few years to provide a robust labor market for the solar installation community. The fine levels that power companies used to have to pay have been ratcheted down to $350 from the previous $600+ range. The reduced cost of solar in the past few years has enabled the NJ program to reduce SACP levels AND increase the amount of solar installed in the short term. Depending upon the final numbers, ratepayers will realize over 3.5 billion dollars in savings, or over 1 billion dollars in NPV.(8.37%) during the course of the program out to year 2028.

 

The bill is a result of continuous negotiations between the Democratic legislature who sponsored the bill, union leaders, and the Governors Office with technical guidance by the BPU staff. Various segments of the solar installation community along with solar investors have been lobbying hard as well. The State of New Jersey Division of the Rate Counsel set a high bar early on in negotiations creating an “anchor” savings number of 1 billion dollars in NPV for ratepayers.

 

We should expect some minor revisions to the bill, especially the SACP and RPS numbers (both of which need to increase slightly), as it works its way through the legislative process. The bill will have vulnerability if any special interests try to insert last minute additions.

 

Needed adjustments to this bill:

 

SACP numbers should be moved closer to the $400 level from the proposed $350. Low SACP numbers inhibit the medium term SREC market of 2-3 years. Solar investors will be looking to sell 3 year strips in the low to mid $200 range. If the SACP is $350 or lower then electric companies will not enter into these contracts because there is no upside since a low SACP acts as their hedge. A $400 SACP gives buyers an incentive to enter into 3 year contracts in the low $200 range. Since the NJ SREC market will be working off a 600,000 oversupply of SRECs that will not need to be turned in until September of 2014 it is imperative that a 2-3 year SREC market is vibrant. There is also an increasing probability that solar panels may rise in price in the next year due to Anti-dumping tariffs against Chinese solar panels by the US Department of Commerce DOC. There is talk of a proposal that may require 70% US made parts in Chinese solar panels to qualify for the Federal investment tax credit ITC. New York State Senator Charles Schumer mentioned “China’s unfair trading practices” recently when speaking about Solar. New York State is gearing up for a solar market that will compete with New Jersey in the next few years. Too low of an SACP may drive investment dollars from NJ to NY. These are strong arguments for a $400 SACP.

 

The proposed increase in the amount of SRECs required to be purchased by electric companies RPS should also be increased slightly. The proposed schedule is a start but slight increases in energy years 2014 -2018 may be enough to balance the market and sustain growth.

 

Here is the bill:

(go to the bottom for a summary of the bill)

SENATE, No. 1925

STATE OF NEW JERSEY

215th LEGISLATURE

 

INTRODUCED MAY 14, 2012

 

 

 

Sponsored by:

Senator  BOB SMITH

District 17 (Middlesex and Somerset)

Senator  STEPHEN M. SWEENEY

District 3 (Cumberland, Gloucester and Salem)

 

 

 

 

SYNOPSIS

Revises certain solar renewable energy programs and requirements; provides for aggregating net metering of Class I renewable energy production on certain contiguous and non-contiguous properties owned by local government units and school districts.

 

CURRENT VERSION OF TEXT

As introduced.

 

 

AN ACT concerning net metering and solar renewable portfolio standards requirements and amending P.L.1999, c.23.

 

BE IT ENACTED by the Senate and General Assembly of the State of New Jersey:

 

1.    Section 3 of P.L.1999, c.23 (C.48:3-51) is amended to read as follows:

3.    As used in P.L.1999, c.23 (C.48:3-49 et al.):

“Assignee” means a person to which an electric public utility or another assignee assigns, sells or transfers, other than as security, all or a portion of its right to or interest in bondable transition property.  Except as specifically provided in P.L.1999, c.23 (C.48:3-49 et al.), an assignee shall not be subject to the public utility requirements of Title 48 or any rules or regulations adopted pursuant thereto;

“Base load electric power generation facility” means an electric power generation facility intended to be operated at a greater than 50 percent capacity factor including, but not limited to, a combined cycle power facility and a combined heat and power facility;

“Base residual auction” means the auction conducted by PJM, as part of PJM’s reliability pricing model, three years prior to the start of the delivery year to secure electrical capacity as necessary to satisfy the capacity requirements for that delivery year;

“Basic gas supply service” means gas supply service that is provided to any customer that has not chosen an alternative gas supplier, whether or not the customer has received offers as to competitive supply options, including, but not limited to, any customer that cannot obtain such service for any reason, including non-payment for services.  Basic gas supply service is not a competitive service and shall be fully regulated by the board;

“Basic generation service” or “BGS” means electric generation service that is provided, to any customer that has not chosen an alternative electric power supplier, whether or not the customer has received offers for competitive supply options, including, but not limited to, any customer that cannot obtain such service from an electric power supplier for any reason, including non-payment for services.  Basic generation service is not a competitive service and shall be fully regulated by the board;

“Basic generation service provider” or “provider” means a provider of basic generation service;

“Basic generation service transition costs” means the amount by which the payments by an electric public utility for the procurement of power for basic generation service and related ancillary and administrative costs exceeds the net revenues from the basic generation service charge established by the board pursuant to section 9 of P.L.1999, c.23 (C.48:3-57) during the transition period, together with interest on the balance at the board-approved rate, that is reflected in a deferred balance account approved by the board in an order addressing the electric public utility’s unbundled rates, stranded costs, and restructuring filings pursuant to P.L.1999, c.23 (C.48:3-49 et al.).  Basic generation service transition costs shall include, but are not limited to, costs of purchases from the spot market, bilateral contracts, contracts with non-utility generators, parting contracts with the purchaser of the electric public utility’s divested generation assets, short-term advance purchases, and financial instruments such as hedging, forward contracts, and options.  Basic generation service transition costs shall also include the payments by an electric public utility pursuant to a competitive procurement process for basic generation service supply during the transition period, and costs of any such process used to procure the basic generation service supply;

“Board” means the New Jersey Board of Public Utilities or any successor agency;

“Bondable stranded costs” means any stranded costs or basic generation service transition costs of an electric public utility approved by the board for recovery pursuant to the provisions of P.L.1999, c.23 (C.48:3-49 et al.), together with, as approved by the board: (1) the cost of retiring existing debt or equity capital of the electric public utility, including accrued interest, premium and other fees, costs and charges relating thereto, with the proceeds of the financing of bondable transition property; (2) if requested by an electric public utility in its application for a bondable stranded costs rate order, federal, State and local tax liabilities associated with stranded costs recovery or basic generation service transition cost recovery or the transfer or financing of such property or both, including taxes, whose recovery period is modified by the effect of a stranded costs recovery order, a bondable stranded costs rate order or both; and (3) the costs incurred to issue, service or refinance transition bonds, including interest, acquisition or redemption premium, and other financing costs, whether paid upon issuance or over the life of the transition bonds, including, but not limited to, credit enhancements, service charges, overcollateralization, interest rate cap, swap or collar, yield maintenance, maturity guarantee or other hedging agreements, equity investments, operating costs and other related fees, costs and charges, or to assign, sell or otherwise transfer bondable transition property;

“Bondable stranded costs rate order” means one or more irrevocable written orders issued by the board pursuant to P.L.1999, c.23 (C.48:3-49 et al.) which determines the amount of bondable stranded costs and the initial amount of transition bond charges authorized to be imposed to recover such bondable stranded costs, including the costs to be financed from the proceeds of the transition bonds, as well as on-going costs associated with servicing and credit enhancing the transition bonds, and provides the electric public utility specific authority to issue or cause to be issued, directly or indirectly, transition bonds through a financing entity and related matters as provided in P.L.1999, c.23 (C.48:3-49 et al.), which order shall become effective immediately upon the written consent of the related electric public utility to such order as provided in P.L.1999, c.23 (C.48:3-49 et al.);

“Bondable transition property” means the property consisting of the irrevocable right to charge, collect and receive, and be paid from collections of, transition bond charges in the amount necessary to provide for the full recovery of bondable stranded costs which are determined to be recoverable in a bondable stranded costs rate order, all rights of the related electric public utility under such bondable stranded costs rate order including, without limitation, all rights to obtain periodic adjustments of the related transition bond charges pursuant to subsection b. of section 15 of P.L.1999, c.23 (C.48:3-64), and all revenues, collections, payments, money and proceeds arising under, or with respect to, all of the foregoing;

“British thermal unit” or “Btu” means the amount of heat required to increase the temperature of one pound of water by one degree Fahrenheit;

“Broker” means a duly licensed electric power supplier that assumes the contractual and legal responsibility for the sale of electric generation service, transmission or other services to end-use retail customers, but does not take title to any of the power sold, or a duly licensed gas supplier that assumes the contractual and legal obligation to provide gas supply service to end-use retail customers, but does not take title to the gas;

“Brownfield” means any former or current commercial or industrial site that is currently vacant or underutilized and on which there has been, or there is suspected to have been, a discharge of contaminant, as included in the “Brownfields Redevelopment Task Force” inventory, developed pursuant to section 5 of P.L.1997, c.278 (C.58:10B-23);

“Buydown” means an arrangement or arrangements involving the buyer and seller in a given power purchase contract and, in some cases third parties, for consideration to be given by the buyer in order to effectuate a reduction in the pricing, or the restructuring of other terms to reduce the overall cost of the power contract, for the remaining succeeding period of the purchased power arrangement or arrangements;

“Buyout” means an arrangement or arrangements involving the buyer and seller in a given power purchase contract and, in some cases third parties, for consideration to be given by the buyer in order to effectuate a termination of such power purchase contract;

“Class I renewable energy” means electric energy produced from solar technologies, photovoltaic technologies, wind energy, fuel cells, geothermal technologies, wave or tidal action, small scale hydropower facilities with a capacity of three megawatts or less and put into service after the effective date of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), and methane gas from landfills or a biomass facility, provided that the biomass is cultivated and harvested in a sustainable manner;

“Class II renewable energy” means electric energy produced at a [resource recovery facility or] hydropower facility with a capacity of greater than three megawatts or a resource recovery facility, provided that such facility is located where retail competition is permitted and provided further that the Commissioner of Environmental Protection has determined that such facility meets the highest environmental standards and minimizes any impacts to the environment and local communities;

“Co-generation” means the sequential production of electricity and steam or other forms of useful energy used for industrial or commercial heating and cooling purposes;

“Combined cycle power facility” means a generation facility that combines two or more thermodynamic cycles, by producing electric power via the combustion of fuel and then routing the resulting waste heat by-product to a conventional boiler or to a heat recovery steam generator for use by a steam turbine to produce electric power, thereby increasing the overall efficiency of the generating facility;

“Combined heat and power facility” or “co-generation facility” means a generation facility which produces electric energy[,] and steam[,] or other forms of useful energy such as heat, which are used for industrial or commercial heating or cooling purposes.  A combined heat and power facility or co-generation facility shall not be considered a public utility;

“Competitive service” means any service offered by an electric public utility or a gas public utility that the board determines to be competitive pursuant to section 8 or section 10 of P.L.1999, c.23 (C.48:3-56 or C.48:3-58) or that is not regulated by the board;

“Commercial and industrial energy pricing class customer” or “CIEP class customer” means that group of non-residential customers with high peak demand, as determined by periodic board order, which either is eligible or which would be eligible, as determined by periodic board order, to receive funds from the Retail Margin Fund established pursuant to section 9 of P.L.1999, c.23 (C.48:3-57) and for which basic generation service is hourly-priced;

“Comprehensive resource analysis” means an analysis including, but not limited to, an assessment of existing market barriers to the implementation of energy efficiency and renewable technologies that are not or cannot be delivered to customers through a competitive marketplace;

Connected to the distribution system” means, for a solar electric power generation facility, (1) connected to a net metering customer’s side of a meter, regardless of the voltage at which that customer connects to the electric grid, or (2) directly connected to the electric grid at 69 kilovolts or less, regardless of how an electric public utility classifies that portion of its electric grid, except that notwithstanding that it meets the criterion set forth in paragraph (1) or (2) hereof, a solar electric power generation facility that is neither net metered nor an on-site generation facility shall not be considered “connected to the distribution system” unless it shall have been designated as such by the board pursuant to subsections q. through s. of section 38 of P.L.1999, c.23 (C.48:3-87).  Any solar electric power generation facility, other than that of a net metering customer on the customer’s side of the meter, connected above 69 kilovolts, shall not be considered connected to the distribution system;

“Customer” means any person that is an end user and is connected to any part of the transmission and distribution system within an electric public utility’s service territory or a gas public utility’s service territory within this State;

“Customer account service” means metering, billing, or such other administrative activity associated with maintaining a customer account;

“Delivery year” or “DY” means the 12-month period from June 1st through May 31st, numbered according to the calendar year in which it ends;

“Demand side management” means the management of customer demand for energy service through the implementation of cost-effective energy efficiency technologies, including, but not limited to, installed conservation, load management and energy efficiency measures on and in the residential, commercial, industrial, institutional and governmental premises and facilities in this State;

“Electric generation service” means the provision of retail electric energy and capacity which is generated off-site from the location at which the consumption of such electric energy and capacity is metered for retail billing purposes, including agreements and arrangements related thereto;

“Electric power generator” means an entity that proposes to construct, own, lease or operate, or currently owns, leases or operates, an electric power production facility that will sell or does sell at least 90 percent of its output, either directly or through a marketer, to a customer or customers located at sites that are not on or contiguous to the site on which the facility will be located or is located.  The designation of an entity as an electric power generator for the purposes of P.L.1999, c.23 (C.48:3-49 et al.) shall not, in and of itself, affect the entity’s status as an exempt wholesale generator under the Public Utility Holding Company Act of 1935, 15 U.S.C. s.79 et seq., or its successor;

“Electric power supplier” means a person or entity that is duly licensed pursuant to the provisions of P.L.1999, c.23 (C.48:3-49 et al.) to offer and to assume the contractual and legal responsibility to provide electric generation service to retail customers, and includes load serving entities, marketers and brokers that offer or provide electric generation service to retail customers. The term excludes an electric public utility that provides electric generation service only as a basic generation service pursuant to section 9 of P.L.1999, c.23 (C.48:3-57);

“Electric public utility” means a public utility, as that term is defined in R.S.48:2-13, that transmits and distributes electricity to end users within this State;

“Electric related service” means a service that is directly related to the consumption of electricity by an end user, including, but not limited to, the installation of demand side management measures at the end user’s premises, the maintenance, repair or replacement of appliances, lighting, motors or other energy-consuming devices at the end user’s premises, and the provision of energy consumption measurement and billing services;

“Electronic signature” means an electronic sound, symbol or process, attached to, or logically associated with, a contract or other record, and executed or adopted by a person with the intent to sign the record;

“Eligible generator” means a developer of a base load or mid-merit electric power generation facility including, but not limited to, an on-site generation facility that qualifies as a capacity resource under PJM criteria and that commences construction after the effective date of P.L.2011, c.9 (C.48:3-98.2 et al.);

“Energy agent” means a person that is duly registered pursuant to the provisions of P.L.1999, c.23 (C.48:3-49 et al.), that arranges the sale of retail electricity or electric related services or retail gas supply or gas related services between government aggregators or private aggregators and electric power suppliers or gas suppliers, but does not take title to the electric or gas sold;

“Energy consumer” means a business or residential consumer of electric generation service or gas supply service located within the territorial jurisdiction of a government aggregator;

“Energy efficiency portfolio standard” means a requirement to procure a specified amount of energy efficiency or demand side management resources as a means of managing and reducing energy usage and demand by customers;

“Energy year” or “EY” means the 12-month period from June 1st through May 31st, numbered according to the calendar year in which it ends;

“Farmland” means land actively devoted to agricultural or horticultural use that is valued, assessed, and taxed pursuant to the “Farmland Assessment Act of 1964,” P.L.1964, c.48 (C.54:4-23.1 et seq.);

“Federal Energy Regulatory Commission” or “FERC” means the federal agency established pursuant to 42 U.S.C. s.7171 et seq. to regulate the interstate transmission of electricity, natural gas, and oil;

“Financing entity” means an electric public utility, a special purpose entity, or any other assignee of bondable transition property, which issues transition bonds.  Except as specifically provided in P.L.1999, c.23 (C.48:3-49 et al.), a financing entity which is not itself an electric public utility shall not be subject to the public utility requirements of Title 48 or any rules or regulations adopted pursuant thereto;

“Gas public utility” means a public utility, as that term is defined in R.S.48:2-13, that distributes gas to end users within this State;

“Gas related service” means a service that is directly related to the consumption of gas by an end user, including, but not limited to, the installation of demand side management measures at the end user’s premises, the maintenance, repair or replacement of appliances or other energy-consuming devices at the end user’s premises, and the provision of energy consumption measurement and billing services;

“Gas supplier” means a person that is duly licensed pursuant to the provisions of P.L.1999, c.23 (C.48:3-49 et al.) to offer and assume the contractual and legal obligation to provide gas supply service to retail customers, and includes, but is not limited to, marketers and brokers.  A non-public utility affiliate of a public utility holding company may be a gas supplier, but a gas public utility or any subsidiary of a gas utility is not a gas supplier.  In the event that a gas public utility is not part of a holding company legal structure, a related competitive business segment of that gas public utility may be a gas supplier, provided that related competitive business segment is structurally separated from the gas public utility, and provided that the interactions between the gas public utility and the related competitive business segment are subject to the affiliate relations standards adopted by the board pursuant to subsection k. of section 10 of P.L.1999, c.23 (C.48:3-58);

“Gas supply service” means the provision to customers of the retail commodity of gas, but does not include any regulated distribution service;

“Government aggregator” means any government entity subject to the requirements of the “Local Public Contracts Law,” P.L.1971, c.198 (C.40A:11-1 et seq.), the “Public School Contracts Law,” N.J.S.18A:18A-1 et seq., or the “County College Contracts Law,” P.L.1982, c.189 (C.18A:64A-25.1 et seq.), that enters into a written contract with a licensed electric power supplier or a licensed gas supplier for: (1) the provision of electric generation service, electric related service, gas supply service, or gas related service for its own use or the use of other government aggregators; or (2) if a municipal or county government, the provision of electric generation service or gas supply service on behalf of business or residential customers within its territorial jurisdiction;

“Government energy aggregation program” means a program and procedure pursuant to which a government aggregator enters into a written contract for the provision of electric generation service or gas supply service on behalf of business or residential customers within its territorial jurisdiction;

“Governmental entity” means any federal, state, municipal, local or other governmental department, commission, board, agency, court, authority or instrumentality having competent jurisdiction;

“Greenhouse gas emissions portfolio standard” means a requirement that addresses or limits the amount of carbon dioxide emissions indirectly resulting from the use of electricity as applied to any electric power suppliers and basic generation service providers of electricity;

“Incremental auction” means an auction conducted by PJM, as part of PJM’s reliability pricing model, prior to the start of the delivery year to secure electric capacity as necessary to satisfy the capacity requirements for that delivery year, that is not otherwise provided for in the base residual auction;

“Leakage” means an increase in greenhouse gas emissions related to generation sources located outside of the State that are not subject to a state, interstate or regional greenhouse gas emissions cap or standard that applies to generation sources located within the State;

“Locational deliverability area” or “LDA” means one or more of the zones within the PJM region which are used to evaluate area transmission constraints and reliability issues including electric public utility company zones, sub-zones, and combinations of zones;

“Long-term capacity agreement pilot program” or “LCAPP” means a pilot program established by the board that includes participation by eligible generators, to seek offers for financially-settled standard offer capacity agreements with eligible generators pursuant to the provisions of P.L.2011, c.9 (C.48:3-98.2 et al.);

“Market transition charge” means a charge imposed pursuant to section 13 of P.L.1999, c.23 (C.48:3-61) by an electric public utility, at a level determined by the board, on the electric public utility customers for a limited duration transition period to recover stranded costs created as a result of the introduction of electric power supply competition pursuant to the provisions of P.L.1999, c.23 (C.48:3-49 et al.);

“Marketer” means a duly licensed electric power supplier that takes title to electric energy and capacity, transmission and other services from electric power generators and other wholesale suppliers and then assumes the contractual and legal obligation to provide electric generation service, and may include transmission and other services, to an end-use retail customer or customers, or a duly licensed gas supplier that takes title to gas and then assumes the contractual and legal obligation to provide gas supply service to an end-use customer or customers;

“Mid-merit electric power generation facility” means a generation facility that operates at a capacity factor between baseload generation facilities and peaker generation facilities;

“Net metering” means the process of measuring the difference between (1) the quantity of electric power supplied by a basic generation service provider or an electric power supplier to a customer owning or leasing a generating facility that produces Class I renewable energy, and (2) the quantity of electric power generated by that facility which is used to offset part or all of the customer-generator’s requirements for electric power;

“Net metering aggregation” means the combination of readings from, and billing for, all net metering of the electric power consumption of a customer, provided that such customer is a school district, a county or any agency, authority, or other entity thereof,  or a municipality, or any agency, authority, or other entity thereof, which owns or leases properties and which operates a Class I renewable energy generation system or systems on one or more of those properties, provided that such properties are located within the service territory of a single electric public utility.  Net metering aggregation may be completed through physical or virtual net metering aggregation;

“Net proceeds” means proceeds less transaction and other related costs as determined by the board;

“Net revenues” means revenues less related expenses, including applicable taxes, as determined by the board;

“Offshore wind energy” means electric energy produced by a qualified offshore wind project;

“Offshore wind renewable energy certificate” or “OREC” means a certificate, issued by the board or its designee, representing the environmental attributes of one megawatt hour of electric generation from a qualified offshore wind project;

“Off-site end use thermal energy services customer” means an end use customer that purchases thermal energy services from an on-site generation facility, combined heat and power facility, or co-generation facility, and that is located on property that is separated from the property on which the on-site generation facility, combined heat and power facility, or co-generation facility is located by more than one easement, public thoroughfare, or transportation or utility-owned right-of-way;

“On-site generation facility” means a generation facility, including, but not limited to, a generation facility that produces Class I or Class II renewable energy, and equipment and services appurtenant to electric sales by such facility to the end use customer located on the property or on property contiguous to the property on which the end user is located.  An on-site generation facility shall not be considered a public utility.  The property of the end use customer and the property on which the on-site generation facility is located shall be considered contiguous if they are geographically located next to each other, but may be otherwise separated by an easement, public thoroughfare, transportation or utility-owned right-of-way, or if the end use customer is purchasing thermal energy services produced by the on-site generation facility, for use for heating or cooling, or both, regardless of whether the customer is located on property that is separated from the property on which the on-site generation facility is located by more than one easement, public thoroughfare, or transportation or utility-owned right-of-way;

“Person” means an individual, partnership, corporation, association, trust, limited liability company, governmental entity or other legal entity;

“Physical net metering aggregation” means the physical rewiring of all instruments for net metering of the electric power consumption of a single customer that is a school district, a county or any agency, authority, or other entity thereof,  or a municipality, or any agency, authority, or other entity thereof, to provide a single point of contact for net metering of that customer’s consumption;

“PJM Interconnection, L.L.C.” or “PJM” means the privately-held, limited liability corporation that is a FERC-approved Regional Transmission Organization, or its successor, that manages the regional, high-voltage electricity grid serving all or parts of 13 states including New Jersey and the District of Columbia, operates the regional competitive wholesale electric market, manages the regional transmission planning process, and establishes systems and rules to ensure that the regional and in-State energy markets operate fairly and efficiently;

“Private aggregator” means a non-government aggregator that is a duly-organized business or non-profit organization authorized to do business in this State that enters into a contract with a duly licensed electric power supplier for the purchase of electric energy and capacity, or with a duly licensed gas supplier for the purchase of gas supply service, on behalf of multiple end-use customers by combining the loads of those customers;

“Properly closed sanitary landfill facility” means a sanitary landfill facility at which all activities associated with the design, purchase, or construction of all measures required by the Department of Environmental Protection, pursuant to law, in order to prevent, minimize, or monitor pollution or health hazards resulting from a sanitary landfill facility subsequent to the termination of operations at any portion thereof, including, but not necessarily limited to, the costs of placement of earthen or vegetative cover, and the installation of methane gas vents or monitors and leachate monitoring wells or collection systems at the site of any sanitary landfill facility;

“Public utility holding company” means: (1) any company that, directly or indirectly, owns, controls, or holds with power to vote, ten percent or more of the outstanding voting securities of an electric public utility or a gas public utility or of a company which is a public utility holding company by virtue of this definition, unless the Securities and Exchange Commission, or its successor, by order declares such company not to be a public utility holding company under the Public Utility Holding Company Act of 1935, 15 U.S.C. s.79 et seq., or its successor; or (2) any person that the Securities and Exchange Commission, or its successor, determines, after notice and opportunity for hearing, directly or indirectly, to exercise, either alone or pursuant to an arrangement or understanding with one or more other persons, such a controlling influence over the management or policies of an electric public utility or a gas public utility or public utility holding company as to make it necessary or appropriate in the public interest or for the protection of investors or consumers that such person be subject to the obligations, duties, and liabilities imposed in the Public Utility Holding Company Act of 1935 or its successor;

“Qualified offshore wind project” means a wind turbine electricity generation facility in the Atlantic Ocean and connected to the electric transmission system in this State, and includes the associated transmission-related interconnection facilities and equipment, and approved by the board pursuant to section 3 of P.L.2010, c.57 (C.48:3-87.1);

“Registration program” means an administrative process developed by the board that requires all owners of solar electric power generation facilities connected to the distribution system that intend to generate SRECs, to file with the board documents detailing the size, location, interconnection plan, land use, and other project information as required by the board;

“Regulatory asset” means an asset recorded on the books of an electric public utility or gas public utility pursuant to the Statement of Financial Accounting Standards, No. 71, entitled “Accounting for the Effects of Certain Types of Regulation,” or any successor standard and as deemed recoverable by the board;

“Related competitive business segment of an electric public utility or gas public utility” means any business venture of an electric public utility or gas public utility including, but not limited to, functionally separate business units, joint ventures, and partnerships, that offers to provide or provides competitive services;

“Related competitive business segment of a public utility holding company” means any business venture of a public utility holding company, including, but not limited to, functionally separate business units, joint ventures, and partnerships and subsidiaries, that offers to provide or provides competitive services, but does not include any related competitive business segments of an electric public utility or gas public utility;

“Reliability pricing model” or “RPM” means PJM’s capacity-market model, and its successors, that secures capacity on behalf of electric load serving entities to satisfy load obligations not satisfied through the output of electric generation facilities owned by those entities, or otherwise secured by those entities through bilateral contracts;

“Renewable energy certificate” or “REC” means a certificate representing the environmental benefits or attributes of one megawatt-hour of generation from a generating facility that produces Class I or Class II renewable energy, but shall not include a solar renewable energy certificate or an offshore wind renewable energy certificate;

“Resource clearing price” or “RCP” means the clearing price established for the applicable locational deliverability area by the base residual auction or incremental auction, as determined by the optimization algorithm for each auction, conducted by PJM as part of PJM’s reliability pricing model;

“Resource recovery facility” means a solid waste facility constructed and operated for the incineration of solid waste for energy production and the recovery of metals and other materials for reuse, which the Department of Environmental Protection has determined to be in compliance with current environmental standards, including, but not limited to, all applicable requirements of the federal “Clean Air Act” (42 U.S.C. s.7401 et seq.);

“Restructuring related costs” means reasonably incurred costs directly related to the restructuring of the electric power industry, including the closure, sale, functional separation and divestiture of generation and other competitive utility assets by a public utility, or the provision of competitive services as such costs are determined by the board, and which are not stranded costs as defined in P.L.1999, c.23 (C.48:3-49 et al.) but may include, but not be limited to, investments in management information systems, and which shall include expenses related to employees affected by restructuring which result in efficiencies and which result in benefits to ratepayers, such as training or retraining at the level equivalent to one year’s training at a vocational or technical school or county community college, the provision of severance pay of two weeks of base pay for each year of full-time employment, and a maximum of 24 months’ continued health care coverage.  Except as to expenses related to employees affected by restructuring, “restructuring related costs” shall not include going forward costs;

“Retail choice” means the ability of retail customers to shop for electric generation or gas supply service from electric power or gas suppliers, or opt to receive basic generation service or basic gas service, and the ability of an electric power or gas supplier to offer electric generation service or gas supply service to retail customers, consistent with the provisions of P.L.1999, c.23 (C.48:3-49 et al.);

“Retail margin” means an amount, reflecting differences in prices that electric power suppliers and electric public utilities may charge in providing electric generation service and basic generation service, respectively, to retail customers, excluding residential customers, which the board may authorize to be charged to categories of basic generation service customers of electric public utilities in this State, other than residential customers, under the board’s continuing regulation of basic generation service pursuant to sections 3 and 9 of P.L.1999, c.23 (C.48:3-51 and 48:3-57), for the purpose of promoting a competitive retail market for the supply of electricity;

“Sanitary landfill facility” shall have the same meaning as provided in section 3 of P.L.1970, c.39 (C.13:1E-3);

“School district” means a local or regional school district established pursuant to chapter 8 or chapter 13 of Title 18A of the New Jersey Statutes, a county special services school district established pursuant to article 8 of chapter 46 of Title 18A of the New Jersey Statutes, a county vocational school district established pursuant to article 3 of chapter 54 of Title 18A of the New Jersey Statutes, and a district under full State intervention pursuant to P.L.1987, c.399 (C.18A:7A-34 et al.);

“Shopping credit” means an amount deducted from the bill of an electric public utility customer to reflect the fact that such customer has switched to an electric power supplier and no longer takes basic generation service from the electric public utility;

“Small scale hydropower facility” means a facility located within this State that is connected to the distribution system, and that meets the requirements of, and has been certified by, a nationally recognized low-impact hydropower organization that has established low-impact hydropower certification criteria applicable to: (1) river flows; (2) water quality; (3) fish passage and protection; (4) watershed protection; (5) threatened and endangered species protection; (6) cultural resource protection; (7) recreation; and (8) facilities recommended for removal;

“Social program” means a program implemented with board approval to provide assistance to a group of disadvantaged customers, to provide protection to consumers, or to accomplish a particular societal goal, and includes, but is not limited to, the winter moratorium program, utility practices concerning “bad debt” customers, low income assistance, deferred payment plans, weatherization programs, and late payment and deposit policies, but does not include any demand side management program or any environmental requirements or controls;

“Societal benefits charge” means a charge imposed by an electric public utility, at a level determined by the board, pursuant to, and in accordance with, section 12 of P.L.1999, c.23 (C.48:3-60);

“Solar alternative compliance payment” or “SACP” means a payment of a certain dollar amount per megawatt hour (MWh) which an electric power supplier or provider may submit to the board in order to comply with the solar electric generation requirements under section 38 of P.L.1999, c.23 (C.48:3-87);

“Solar renewable energy certificate” or “SREC” means a certificate issued by the board or its designee, representing one megawatt hour (MWh) of solar energy that is generated by a facility connected to the distribution system in this State and has value based upon, and driven by, the energy market;

“Standard offer capacity agreement” or “SOCA” means a financially-settled transaction agreement, approved by board order, that provides for eligible generators to receive payments from the electric public utilities for a defined amount of electric capacity for a term to be determined by the board but not to exceed 15 years, and for such payments to be a fully non-bypassable charge, with such an order, once issued, being irrevocable;

“Standard offer capacity price” or “SOCP” means the capacity price that is fixed for the term of the SOCA and which is the price to be received by eligible generators under a board-approved SOCA;

“Stranded cost” means the amount by which the net cost of an electric public utility’s electric generating assets or electric power purchase commitments, as determined by the board consistent with the provisions of P.L.1999, c.23 (C.48:3-49 et al.), exceeds the market value of those assets or contractual commitments in a competitive supply marketplace and the costs of buydowns or buyouts of power purchase contracts;

“Stranded costs recovery order” means each order issued by the board in accordance with subsection c. of section 13 of P.L.1999, c.23 (C.48:3-61) which sets forth the amount of stranded costs, if any, the board has determined an electric public utility is eligible to recover and collect in accordance with the standards set forth in section 13 of P.L.1999, c.23 (C.48:3-61) and the recovery mechanisms therefor;

“Thermal efficiency” means the useful electric energy output of a facility, plus the useful thermal energy output of the facility, expressed as a percentage of the total energy input to the facility;

“Transition bond charge” means a charge, expressed as an amount per kilowatt hour, that is authorized by and imposed on electric public utility ratepayers pursuant to a bondable stranded costs rate order, as modified at any time pursuant to the provisions of P.L.1999, c.23 (C.48:3-49 et al.);

“Transition bonds” means bonds, notes, certificates of participation or beneficial interest or other evidences of indebtedness or ownership issued pursuant to an indenture, contract or other agreement of an electric public utility or a financing entity, the proceeds of which are used, directly or indirectly, to recover, finance or refinance bondable stranded costs and which are, directly or indirectly, secured by or payable from bondable transition property.  References in P.L.1999, c.23 (C.48:3-49 et al.) to principal, interest, and acquisition or redemption premium with respect to transition bonds which are issued in the form of certificates of participation or beneficial interest or other evidences of ownership shall refer to the comparable payments on such securities;

“Transition period” means the period from August 1, 1999 through July 31, 2003;

“Transmission and distribution system” means, with respect to an electric public utility, any facility or equipment that is used for the transmission, distribution or delivery of electricity to the customers of the electric public utility including, but not limited to, the land, structures, meters, lines, switches and all other appurtenances thereof and thereto, owned or controlled by the electric public utility within this State; [and]

“Universal service” means any service approved by the board with the purpose of assisting low-income residential customers in obtaining or retaining electric generation or delivery service; and

“Virtual net metering aggregation” means the combination of readings from instruments for, and billing for, all net metering of the electric power consumption of a single customer which is a school district, a county or any agency, authority, or other entity thereof,  or a municipality, or any agency, authority, or other entity thereof, which owns or leases properties and which operates a generating facility on those properties that produces Class I renewable energy by means of the electric public utility’s billing process, rather than through physical rewiring of the customer’s property to provide a single point of contact, provided that such properties are located three miles within the boundaries of each other and within the service territory of a single electric public utility. A customer engaged in virtual net metering shall not be considered a public utility.

(cf: P.L.2011, c.9, s.2)

 

2.    Section 38 of P.L.1999, c.23 (C.48:3-87) is amended to read as follows:

38. a. The board shall require an electric power supplier or basic generation service provider to disclose on a customer’s bill or on customer contracts or marketing materials, a uniform, common set of information about the environmental characteristics of the energy purchased by the customer, including, but not limited to:

(1)   Its fuel mix, including categories for oil, gas, nuclear, coal, solar, hydroelectric, wind and biomass, or a regional average determined by the board;

(2)   Its emissions, in pounds per megawatt hour, of sulfur dioxide, carbon dioxide, oxides of nitrogen, and any other pollutant that the board may determine to pose an environmental or health hazard, or an emissions default to be determined by the board; and

(3)   Any discrete emission reduction retired pursuant to rules and regulations adopted pursuant to P.L.1995, c.188.

b.    Notwithstanding any provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, in consultation with the Department of Environmental Protection, after notice and opportunity for public comment and public hearing, interim standards to implement this disclosure requirement, including, but not limited to:

(1)   A methodology for disclosure of emissions based on output pounds per megawatt hour;

(2)   Benchmarks for all suppliers and basic generation service providers to use in disclosing emissions that will enable consumers to perform a meaningful comparison with a supplier’s or basic generation service provider’s emission levels; and

(3)   A uniform emissions disclosure format that is graphic in nature and easily understandable by consumers.  The board shall periodically review the disclosure requirements to determine if revisions to the environmental disclosure system as implemented are necessary.

Such standards shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the “Administrative Procedure Act.”

c. (1) The board may adopt, in consultation with the Department of Environmental Protection, after notice and opportunity for public comment, an emissions portfolio standard applicable to all electric power suppliers and basic generation service providers, upon a finding that:

(a)   The standard is necessary as part of a plan to enable the State to meet federal Clean Air Act or State ambient air quality standards; and

(b)   Actions at the regional or federal level cannot reasonably be expected to achieve the compliance with the federal standards.

(2)   By July 1, 2009, the board shall adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), a greenhouse gas emissions portfolio standard to mitigate leakage or another regulatory mechanism to mitigate leakage applicable to all electric power suppliers and basic generation service providers that provide electricity to customers within the State.  The greenhouse gas emissions portfolio standard or any other regulatory mechanism to mitigate leakage shall:

(a)   Allow a transition period, either before or after the effective date of the regulation to mitigate leakage, for a basic generation service provider or electric power supplier to either meet the emissions portfolio standard or other regulatory mechanism to mitigate leakage, or to transfer any customer to a basic generation service provider or electric power supplier that meets the emissions portfolio standard or other regulatory mechanism to mitigate leakage.  If the transition period allowed pursuant to this subparagraph occurs after the implementation of an emissions portfolio standard or other regulatory mechanism to mitigate leakage, the transition period shall be no longer than three years; and

(b)   Exempt the provision of basic generation service pursuant to a basic generation service purchase and sale agreement effective prior to the date of the regulation.

Unless the Attorney General or the Attorney General’s designee determines that a greenhouse gas emissions portfolio standard would unconstitutionally burden interstate commerce or would be preempted by federal law, the adoption by the board of an electric energy efficiency portfolio standard pursuant to subsection g. of this section, a gas energy efficiency portfolio standard pursuant to subsection h. of this section, or any other enhanced energy efficiency policies to mitigate leakage shall not be considered sufficient to fulfill the requirement of this subsection for the adoption of a greenhouse gas emissions portfolio standard or any other regulatory mechanism to mitigate leakage.

d.    Notwithstanding any provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, after notice, provision of the opportunity for comment, and public hearing, renewable energy portfolio standards that shall require:

(1)   that two and one-half percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from Class I or Class II renewable energy sources;

(2)   beginning on January 1, 2001, that one-half of one percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from Class I renewable energy sources.  The board shall increase the required percentage for Class I renewable energy sources so that by January 1, 2006, one percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider shall be from Class I renewable energy sources and shall additionally increase the required percentage for Class I renewable energy sources by one-half of one percent each year until January 1, 2012, when four percent of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider shall be from Class I renewable energy sources.

An electric power supplier or basic generation service provider may satisfy the requirements of this subsection by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection;

(3)   that the board establish a multi-year schedule, applicable to each electric power supplier or basic generation service provider in this State, beginning with the one-year period commencing on June 1, 2010, and continuing for each subsequent one-year period up to and including, the one-year period commencing on [June 1, 2025] June 1, 2028, that requires [suppliers or providers to purchase at least] the following number or percentage, as the case may be, of kilowatt-hours sold in this State by each electric power supplier and each basic generation service provider to be from solar electric power generators connected to the distribution system in this State:

EY 2011             306 Gigawatthours (Gwhrs)

EY 2012             442 Gwhrs

EY 2013             596 Gwhrs

EY 2014             [772 Gwhrs1.832%

EY 2015             [965 Gwhrs2.145%

EY 2016          [1,150 Gwhrs2.446%

EY 2017          [1,357 Gwhrs2.519%

EY 2018          [1,591 Gwhrs2.851%

EY 2019          [1,858 Gwhrs3.111%

EY 2020          [2,164 Gwhrs3.233%

EY 2021          [2,518 Gwhrs3.320%

EY 2022          [2,928 Gwhrs3.383%

EY 2023          [3,433 Gwhrs3.434%

EY 2024          [3,989 Gwhrs3.483%

EY 2025          [4,610 Gwhrs3.532%

EY 2026          [5,316 Gwhrs] 3.579%

EY 2027          3.625%

EY 2028, 3.730%, and for every energy year thereafter, at least [5,316 Gwhrs] 3.730% per energy year to reflect an increasing number of kilowatt-hours to be purchased by suppliers or providers from solar electric power generators connected to the distribution system in this State, and to establish a framework within which, of the electricity that the generators sell in this State, suppliers and providers shall [purchase] each obtain at least [2,518 Gwhrs] 3.320% in the energy year 2021 and [5,316 Gwhrs] 3.730% in the energy year [2026] 2028 from solar electric power generators connected to the distribution system in this State, provided, however, that

[the number of solar kilowatt-hours required to be purchased by each supplier or provider, when expressed as a percentage of the total number of solar kilowatt-hours purchased in this State, shall be equivalent to each supplier's or provider's proportionate share of the total number of kilowatt-hours sold in this State by all suppliers and providers.] :

(a) The board shall determine an appropriate period of no less than 120 days following the end of an energy year prior to which a provider or supplier must demonstrate compliance for that energy year with the annual renewable portfolio standard;

(b)  No more than 24 months following the date of enactment of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), the board shall complete a proceeding to investigate approaches to mitigate solar development volatility and prepare and submit, pursuant to section 2 of P.L.1991, c.164 (C.52:14-19.1), a report to the Legislature, detailing its findings and recommendations.  As part of the proceeding, the board shall evaluate other techniques used nationally and internationally;

(c) The solar renewable portfolio standards requirements in this paragraph shall exempt those existing supply contracts which are effective prior to the date of enactment of P.L.     , c.     (C.     ) (pending before the Legislature as this bill) from any increase beyond the number of SRECs that exceeds the number mandated by the solar renewable portfolio standards requirements that were in effect on the date that the providers executed their existing supply contracts.  This limited exemption for providers’ existing supply contracts shall not be construed to lower the Statewide solar  sourcing requirements set forth in this paragraph.  Such incremental new requirements shall be distributed over the electric power suppliers and providers not subject to the existing supply contract exemption until such time as existing supply contracts expire and all suppliers are subject to the new requirement in a manner that is competitively neutral among all providers and suppliers, such that non-exempt providers are assigned the requirements that would have otherwise been assigned to the exempt providers.

(d) The solar renewable portfolio standards requirements in this paragraph [(3) of this subsection] shall automatically increase by 20% for the remainder of the schedule in the event that the following two conditions are met:  [(a)] (i) the number of SRECs generated meets or exceeds the requirement for three consecutive reporting years, starting with energy year [2013] 2014; and [(b)] (ii) the [average]SREC price for [all] SRECs purchased by entities with renewable energy portfolio standards obligations [has decreased] in each of the same three consecutive reporting years is less than the current SREC price in the year prior to the three consecutive reporting years; and

(e) The board shall exempt providers’ [existing] supply contracts that are [: (a)] effective prior to  the date of [P.L.2009, c.289; or (b) effective prior to any future increase in the solar renewable portfolio standard beyond the multi-year schedule established in paragraph (3) of this subsectionany such increase.  This exemption shall apply to the number of SRECs that exceeds the number mandated by the solar renewable portfolio standards requirements that were in effect on the date that the suppliers or providers executed their existing supply contracts.  This limited exemption for providers’ existing supply contracts shall not be construed to lower the Statewide solar [purchase] sourcing requirements set forth in this paragraph [(3) of this subsection].  Such incremental new requirements shall be distributed over the electric power suppliers and providers not subject to the existing supply contract exemption until such time as existing supply contracts expire and all suppliers are subject to the new requirement in a manner that is competitively neutral among all suppliers and providers, such that non-exempt providers are assigned the requirements that would have otherwise been assigned to the exempt providers.

An electric power supplier or basic generation service provider may satisfy the requirements of this subsection by participating in a renewable energy trading program approved by the board in consultation with the Department of Environmental Protection, or compliance with the requirements of this subsection may be demonstrated to the board by suppliers or providers through the purchase of SRECs.

The renewable energy portfolio standards adopted by the board pursuant to paragraphs (1) and (2) of this subsection shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the “Administrative Procedure Act.”

The renewable energy portfolio standards adopted by the board pursuant to this paragraph [(3) of this subsection] shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 30 months after such filing, and shall, thereafter, be amended, adopted or readopted by the board in accordance with the “Administrative Procedure Act”; and

(4)   within 180 days after the date of enactment of P.L.2010, c.57 (C.48:3-87.1 et al.), that the board establish an offshore wind renewable energy certificate program to require that a percentage of the kilowatt hours sold in this State by each electric power supplier and each basic generation service provider be from offshore wind energy in order to support at least 1,100 megawatts of generation from qualified offshore wind projects.

The percentage established by the board pursuant to this paragraph shall serve as an offset to the renewable energy portfolio standard established pursuant to paragraphs (1) and (2) of this subsection and shall reduce the corresponding Class I renewable energy requirement.

The percentage established by the board pursuant to this paragraph shall reflect the projected OREC production of each qualified offshore wind project, approved by the board pursuant to section 3 of P.L.2010, c.57 (C.48:3-87.1), for twenty years from the commercial operation start date of the qualified offshore wind project which production projection and OREC purchase requirement, once approved by the board, shall not be subject to reduction.

An electric power supplier or basic generation service provider shall comply with the OREC program established pursuant to this paragraph through the purchase of offshore wind renewable energy certificates at a price and for the time period required by the board.  In the event there are insufficient offshore wind renewable energy certificates available, the electric power supplier or basic generation service provider shall pay an offshore wind alternative compliance payment established by the board.  Any offshore wind alternative compliance payments collected shall be refunded directly to the ratepayers by the electric public utilities.

The rules established by the board pursuant to this paragraph shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.).

e.     Notwithstanding any provisions of the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the board shall initiate a proceeding and shall adopt, after notice, provision of the opportunity for comment, and public hearing:

(1)   net metering standards for electric power suppliers and basic generation service providers.  The standards shall require electric power suppliers and basic generation service providers to offer net metering at non-discriminatory rates to industrial, large commercial, residential and small commercial customers, as those customers are classified or defined by the board, that generate electricity, on the customer’s side of the meter, using a Class I renewable energy source, for the net amount of electricity supplied by the electric power supplier or basic generation service provider over an annualized period.  Systems of any sized capacity, as measured in watts, are eligible for net metering [.  If], provided, however, that the system shall not be sized in excess of the generation capacity necessary to serve the annualized energy needs of (a) on-site load, inclusive of load associated with a customer-generator receiving physical net metering aggregation service, or (b) load associated with a customer-generator receiving virtual net metering aggregation service.  For a customer-generator eligible for virtual net metering aggregation service, the customer-generator may designate other of its net metering instruments to be credited with the kilowatt-hour production from any physical net metering aggregation service, including net annual excess, if any.  For physical net metering aggregation and virtual net metering aggregation, if the amount of electricity generated by the customer-generator, plus any kilowatt hour credits held over from the previous billing periods, exceeds the electricity supplied by the electric power supplier or basic generation service provider, then the electric power supplier or basic generation service provider, as the case may be, shall credit the customer-generator for the excess kilowatt hours until the end of the annualized period at which point the customer-generator will be compensated for any remaining credits or, if the customer-generator chooses, credit the customer-generator on a real-time basis, at the electric power supplier’s or basic generation service provider’s avoided cost of wholesale power or the PJM electric power pool’s real-time locational marginal pricing rate, adjusted for losses, for the respective zone in the PJM electric power pool.  Alternatively, the customer-generator may execute a bilateral agreement with an electric power supplier or basic generation service provider for the sale and purchase of the customer-generator’s excess generation.  The customer-generator may be credited on a real-time basis, so long as the customer-generator follows applicable rules prescribed by the PJM electric power pool for its capacity requirements for the net amount of electricity supplied by the electric power supplier or basic generation service provider.  The board may authorize an electric power supplier or basic generation service provider to cease offering net metering whenever the total rated generating capacity owned and operated by net metering customer-generators Statewide equals 2.5 percent of the State’s peak electricity demand;

(2)   safety and power quality interconnection standards for Class I renewable energy source systems used by a customer-generator that shall be eligible for net metering.

Such standards or rules shall take into consideration the goals of the New Jersey Energy Master Plan, applicable industry standards, and the standards of other states and the Institute of Electrical and Electronic Engineers.  The board shall allow electric public utilities to recover the costs of any new net meters, upgraded net meters, system reinforcements or upgrades, and interconnection costs through either their regulated rates or from the net metering customer-generator; and

(3)   credit or other incentive rules for generators using Class I renewable energy generation systems that connect to New Jersey’s electric public utilities’ distribution system but who do not net meter.

Such rules shall require the board or its designee to issue a credit or other incentive to those generators that do not use a net meter but otherwise generate electricity derived from a Class I renewable energy source and to issue an enhanced credit or other incentive, including, but not limited to, a solar renewable energy credit, to those generators that generate electricity derived from solar technologies.

Such standards or rules shall be effective as regulations immediately upon filing with the Office of Administrative Law and shall be effective for a period not to exceed 18 months, and may, thereafter, be amended, adopted or readopted by the board in accordance with the provisions of the “Administrative Procedure Act.”

f.     The board may assess, by written order and after notice and opportunity for comment, a separate fee to cover the cost of implementing and overseeing an emission disclosure system or emission portfolio standard, which fee shall be assessed based on an electric power supplier’s or basic generation service provider’s share of the retail electricity supply market.  The board shall not impose a fee for the cost of implementing and overseeing a greenhouse gas emissions portfolio standard adopted pursuant to paragraph (2) of subsection c. of this section, the electric energy efficiency portfolio standard adopted pursuant to subsection g. of this section, or the gas energy efficiency portfolio standard adopted pursuant to subsection h. of this section.

g.     The board may adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), an electric energy efficiency portfolio standard that may require each electric public utility to implement energy efficiency measures that reduce electricity usage in the State by 2020 to a level that is 20 percent below the usage projected by the board in the absence of such a standard.  Nothing in this section shall be construed to prevent an electric public utility from meeting the requirements of this section by contracting with another entity for the performance of the requirements.

h.     The board may adopt, pursuant to the “Administrative Procedure Act,” P.L.1968, c.410 (C.52:14B-1 et seq.), a gas energy efficiency portfolio standard that may require each gas public utility to implement energy efficiency measures that reduce natural gas usage for heating in the State by 2020 to a level that is 20 percent below the usage projected by the board in the absence of such a standard.  Nothing in this section shall be construed to prevent a gas public utility from meeting the requirements of this section by contracting with another entity for the performance of the requirements.

i.      After the board establishes a schedule of solar kilowatt-hour sale or purchase requirements pursuant to paragraph (3) of subsection d. of this section, the board may initiate subsequent proceedings and adopt, after appropriate notice and opportunity for public comment and public hearing, increased minimum solar kilowatt-hour sale or purchase requirements, provided that the board shall not reduce previously established minimum solar kilowatt-hour sale or purchase requirements, or otherwise impose constraints that reduce the requirements by any means.

j.     The board shall determine an appropriate level of solar alternative compliance payment, and [establish a 15-year solar alternative compliance payment schedule, that permits] permit each supplier or provider to submit an SACP to comply with the solar electric generation requirements of paragraph (3) of subsection d. of this section.  The value of the SACP for each Energy Year, for Energy Years 2014 through 2028 per megawatt hour from solar electric generation required pursuant to this section, shall be:

EY 2014          $350

EY 2015          $343

EY 2016          $336

EY 2017          $329

EY 2018          $322

EY 2019          $315

EY 2020          $308

EY 2021          $301

EY 2022          $294

EY 2023          $287

EY 2024          $280

EY 2025          $273

EY 2026          $266

EY 2027         $259

EY 2028         $252

The [board may initiate subsequent proceedings and adopt, after appropriate notice and opportunity for public comment and public hearing, an increase in solar alternative compliance payments, provided that the] board shall not reduce previously established levels of solar alternative compliance payments, nor shall the board provide relief from the obligation of payment of the SACP by the electric power suppliers or basic generation service providers in any form.  Any SACP payments collected shall be refunded directly to the ratepayers by the electric public utilities.

k.    The board may allow electric public utilities to offer long-term contracts through a competitive process, direct electric public utility investment and other means of financing, including but not limited to loans, for the purchase of SRECs and the resale of SRECs to suppliers or providers or others, provided that after such contracts have been approved by the board, the board’s approvals shall not be modified by subsequent board orders.

l.      The board shall implement its responsibilities under the provisions of this section in such a manner as to:

(1)   place greater reliance on competitive markets, with the explicit goal of encouraging and ensuring the emergence of new entrants that can foster innovations and price competition;

(2)   maintain adequate regulatory authority over non-competitive public utility services;

(3)   consider alternative forms of regulation in order to address changes in the technology and structure of electric public utilities;

(4)   promote energy efficiency and Class I renewable energy market development, taking into consideration environmental benefits and market barriers;

(5)   make energy services more affordable for low and moderate income customers;

(6)   attempt to transform the renewable energy market into one that can move forward without subsidies from the State or public utilities;

(7)   achieve the goals put forth under the renewable energy portfolio standards;

(8)   promote the lowest cost to ratepayers; and

(9)   allow all market segments to participate.

m.    The board shall ensure the availability of financial incentives under its jurisdiction, including, but not limited to, long-term contracts, loans, SRECs, or other financial support, to ensure market diversity, competition, and appropriate coverage across all ratepayer segments, including, but not limited to, residential, commercial, industrial, non-profit, farms, schools, and public entity customers.

n.     For projects which are owned, or directly invested in, by a public utility pursuant to section 13 of P.L.2007, c.340 (C.48:3-98.1), the board shall determine the number of SRECs with which such projects shall be credited; and in determining such number the board shall ensure that the market for SRECs does not detrimentally affect the development of non-utility solar projects and shall consider how its determination may impact the ratepayers.

o.    The board, in consultation with the Department of Environmental Protection, electric public utilities, the Division of Rate Counsel in, but not of, the Department of the Treasury, affected members of the solar energy industry, and relevant stakeholders, shall periodically consider increasing the renewable energy portfolio standards beyond the minimum amounts set forth in subsection d. of this section, taking into account the cost impacts and public benefits of such increases including, but not limited to:

(1)   reductions in air pollution, water pollution, land disturbance, and greenhouse gas emissions;

(2)   reductions in peak demand for electricity and natural gas, and the overall impact on the costs to customers of electricity and natural gas;

(3)   increases in renewable energy development, manufacturing, investment, and job creation opportunities in this State; and

(4)   reductions in State and national dependence on the use of fossil fuels.

p.    Class I RECs and ORECS shall be eligible for use in renewable energy portfolio standards compliance in the energy year in which they are generated, and for the following two energy years.  SRECs [and ORECs] shall be eligible for use in renewable energy portfolio standards compliance in the energy year in which they are generated, and for the following [two] four energy years.

q.  (1) During the energy years of 2014, 2015, and 2016, a solar electric generation facility project which is not net metered, not an on-site generation facility, or not certified as being located on a brownfield or a properly closed sanitary landfill facility, as provided pursuant to subsection t. of this section, shall be considered “connected to the distribution system” if (a) the facility files a notice with the board indicating its intent to qualify under this subsection; and (b) the capacity of the facility, when added to the capacity of other facilities that have been approved for connection prior to the facility’s filing under this subsection, does not exceed 100 megawatts in the aggregate for each year.  The board shall act within 180 days of its receipt of a completed application for designation of a solar power electric generation facility as “connected to the distribution system,” to either approve, conditionally approve, or disapprove the application.  Filings made pursuant to this subsection shall include a notice escrow of $40,000 per megawatt of the proposed capacity of the facility.  The notice escrow shall be reimbursed to the facility in full upon the facility entering commercial operation, or shall be forfeited to the State if the facility is determined to be “connected to the distribution system” pursuant to this paragraph but does not enter commercial operation pursuant to paragraph (2) of this subsection.

(2) If the proposed solar power electric generation facility does not commence commercial operations within two years following the date of the designation by the board pursuant to this subsection, the designation of the facility as “connected to the distribution system” shall be deemed to be null and void, and the facility shall thereafter be considered not “connected to the distribution system.”

r. (1) For solar power electric generation facility projects proposed in addition to those approved pursuant to subsection q. of this section and for all projects proposed in each energy year following energy year 2016, a proposed solar power electric generation facility that is neither net metered nor an on-site generation facility, may be considered “connected to the distribution system” only upon designation as such by the board, after notice to the public and opportunity for public comment or hearing.  A proposed solar power electric generation facility seeking board designation as “connected to the distribution system” shall submit an application to the board that includes for the proposed facility: the nameplate capacity; the estimated energy and number of SRECs to be produced and sold per year; the estimated annual rate impact on ratepayers; the estimated capacity of the generator as defined by PJM for sale in the PJM capacity market; the point of interconnection; the total acreage and location; the current land use designation of the property; the type of solar technology to be used; and other such information as the board shall require.

(2) The board shall approve the designation of the proposed solar power electric generation facility as “connected to the distribution system” if the board determines that:

(a) the SRECs forecasted to be produced by the facility do not have a detrimental impact on the SREC market or on the appropriate development of solar power in the State;

(b) the loss of tillable acreage that would result from the approval of the designation of the proposed facility, together with the tillable acreage of all other facilities approved pursuant to this subsection, would cumulatively constitute a loss of less than one percent of the total tillable acres of farmland in the State on the date of enactment of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), pursuant to information provided by the New Jersey Department of Agriculture; and

(c) the impact of the designation on electric rates and economic development is beneficial.

(3) The board shall act within 180 days of its receipt of a completed application for designation of a solar power electric generation facility as “connected to the distribution system,” to either approve, conditionally approve, or disapprove the application.  If the proposed solar power electric generation facility does not commence commercial operations within two years following the date of the designation by the board pursuant to this subsection, the designation of the facility as “connected to the distribution system” shall be deemed to be null and void, and the facility shall thereafter be considered not “connected to the distribution system.”

s. Notwithstanding the foregoing provisions of this section, a solar power electric generation facility located on farmland, and not heretofore approved pursuant to subsection q. of this section, shall not be considered “connected to the distribution system” unless the facility has been approved as such by the board and (a) PJM issued a System Impact Study for the facility prior to March 31, 2011; (b) the facility files a notice with the board within 60 days of the effective date of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), indicating its intent to qualify under this subsection.

t. No more than 180 days after the date of enactment of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), the board shall, in consultation with the Department of Environmental Protection and the New Jersey Economic Development Authority, and, after notice and opportunity for public comment and public hearing, complete a proceeding to establish a program to provide SRECs to owners of solar power electric generation facility projects certified by the board as being located on a brownfield or a properly closed sanitary landfill facility.  Projects certified under this subsection shall (1) be considered “connected to the distribution system” and shall not require such designation by the board and (2) shall not be subject to board review required pursuant to subsections q. and r. of this section.  For projects certified under this subsection, the board shall credit additional incentives to be determined by the board for each megawatt hour (MWh) of solar energy that is generated by the project.  The issuance of S