Solar Debates Heat Up in New Jersey 0

New Jersey elections are over and spirited political discourse on solar is back in the public domain. The state’s four Electric Distribution Companies are pushing legislators to reject power plant subsidies, fearful new entrants will damage wholesale energy markets.

While this dynamic plays out, the Office of Clean Energy drafted a proposal to support residential and small business customers through an extension of utility sponsored programs. The intent is to stabilize the SREC market with the least market interference and risk to ratepayers. The programs would not start up until 2013, since the state’s SREC market is oversupplied.

“The best way to do that is to expand the EDC program because it provides built-in stability for the SREC market,” said Lyle Rawlings, vice president of the Mid-Atlantic Solar Energy Industries Association at a recent stakeholder meeting on the issue.

The EDC programs are attractive because they provide predictability. These solar systems are installed at lower costs, opposed to systems relying on spot market SREC prices.

The Board of Public Utilities has not taken a formal position on the proposal, but lobbying efforts are under way to support it. This action would clear up investor ambiguity regarding the governor’s public comments: Solar development on brownfields, landfills and large commercial warehouses offer the best societal benefits.

Besides utility programs, an option to accelerate the amount of SRECs energy suppliers need to purchase is on the table. A working group appointed by the BPU is in favor of this. The caveat—the risk cannot be passed onto ratepayers. There is an outlier concern, addressed by the Division of Rate Counsel, that acceleration and extended utility programs can lead to rate spikes.

“If we are increasing the program,” said Michael Winka, director of the Office of Clean Energy, “then the ratepayer has to come out with some cost savings.”

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