On June 9, 2021, Governor Murphy signed the Solar Act of 2021, L. 2121 c. 169), which directs the New Jersey Board of Public Utilities to establish a program to incent the development of 3,750 MW of solar by 2026.
Responsive thereto, the Board issued an order Order on July 28 launching its Successor Solar Incentive (“SuSI”) Program, effective August 28, 2021. Projects meeting the SuSI Program requirements will receive a solar renewable incentive credit (“SREC-II”) for each MWh of production registered through the PJM-EIS Generation Attribute Tracking System (“GATS”). SREC-IIs will be purchased by a designated SREC-II Administrator who will allocate the SREC-IIs annual to third-party suppliers (TPS) and basic generation suppliers (BGS) on the basis of relative energy sales in order the TPS/BGS to meet their renewable portfolio standards (“RPS”) obligations
In connection with the SuSI Program, the Board issued a companion order closing the current Transition Incentive (“TI”) Program effective at the end of August 27, 2021. The Board will accept no new TI Program applications after that date with exceptions for community solar, and subsection (t) (i.e., brownfield and landfill redevelopment projects). Applicants filing subject to the deadline will have 7 days after any completeness deficiency notice to cure their applications to remain eligible for TRECs. Projects seeking to benefit from the current, administratively set values for transitional renewable energy credits (“TRECs”) thus have a looming deadline to submit their TI Program applications.
The SuSI Program has two main components – a Administratively Determined Incentive (“ADI”) Program and the Competitive Solicitation Incentive (“CSI”) Program. The ADI Program establishes a fixed value for each SREC-II generated from net-metered facilities that are less than 5MWdc. The fixed value ranges from $70/MWh for non-LMI community solar projects to $120/MWh for publicly owned non-residential on rooftop, carport, canopy and floating solar. Projects will receive the applicable fixed-value SREC-IIs for a Qualification Life of 15 years (thereafter the project may receive Class I RECs). The fixed values will be evaluated after the first year and reset as needed every three years to ensure program support and the State’s solar development objectives. Specific application requirements, processing and registration approval generally follow those implemented for the current TI Program. The ADI Program will be subject to annual MW caps of 150MW for net-metered residential and non-residential projects. Subsection (t) projects have a 75 MWdc cap until used up or until the CSI Program is initiated, whichever occurs first.
The CSI Program will issue SREC-IIs to grid supply projects and net metered non-residential projects greater than 5MWdc. The Board has directed its Staff to bring the final CSI Program proposal back to the Board by the end of the year and hold the first competitive solicitation in early-to-mid 2022.
Consistent with the current TI Program, the construction of any facility of 1MWdc or greater in size and eligible to receive SREC-IIs will be subject to the New Jersey Prevailing Wage Act (N.J.S.A. 34:11-56.25, et seq.).
Along with the Solar Act of 2021, Governor Murphy signed a bill directing the Board to develop a pilot program for dual-use solar facilities (also known as “agrivoltaics”) that locate solar on productive farmlands (L. 2021, c. 170, “Dual-Use Act”). The Board has signaled its intent to initiate a stakeholder proceeding this year to develop and implement the pilot program. The Board will design and implement the pilot program in cooperation with the Secretary of Agriculture and State Agricultural Development Committee (“SADC”) on the development of standards and practices regarding the agricultural or horticultural use of lands under the solar panels.
Please contact us if we may assist you in completing a pending TI Program application by August 27 or submitting an application for an SREC-II registration thereafter.