Solar power in New Jersey explained

New Jersey has over 4,700 MW of installed solar power capacity as of January 2024, which provides more than 7% of the state's electricity consumption.[1] The's state's growth of solar power is aided by a renewable portfolio standard that requires that 22.5% of New Jersey's electricity come from renewable resources by 2021 and 50% by 2030, by incentives provided for generation of solar power, and by one of the most favorable net metering standards in the country, allowing customers of any size array to use net metering, although generation may not exceed annual demand. As of 2018, New Jersey has the sixth-largest installed solar capacity of all U.S. states and the largest installed solar capacity of the Northeastern States.[2]

New Jersey has historically been aggressive in installing solar power, at one point being the second largest solar state in the U.S. with 306.1 megawatts of installed solar power in 2011, which was a 131% increase over the 132.4 megawatts installed in 2010. In 2010, New Jersey became the second state, after California, to install over 100 MW in a single year.[3] The New Jersey Board of Public Utilities administers incentive programs that support the development of the state's solar industry. As of January 2024, over 194,000 solar photovoltaic systems have been installed, with 4,765 MW of capacity.[4] Net-metered projects make up 80% of the installed capacity, 191 grid-supply projects make up 17% of capacity, and 102 community solar projects are 3% of capacity.

New Jersey has 662 schools with 194 MW of solar power installed as of 2022, the second most after California.[5]

Incentives

The former New Jersey Clean Energy Program rebates on PV equipment have been discontinued.[6] [7]

The federal Residential Energy Efficient Property Credit (income tax credit on IRS Form 5695) for residential PV and solar thermal was extended in December 2015 to remain at 30% of system cost (parts and installation) for systems put into service by the end of 2019, then 26% until the end of 2020, and then 22% until the end of 2021. It applies to a taxpayer's principal and/or second residences, but not to a property that is rented out. There is no maximum cap on the credit, and the credit can be applied toward the Alternative Minimum Tax, and any excess credit (greater than that year's tax liability) can be rolled into the following year.[8] [9]

NJ law provides new solar power installations with exemptions from the 6.625% state sales tax, and from any increase in property assessment (local property tax increases), subject to certain registration requirements.[10] [11]

Renewable Portfolio Standard

See main article: Renewable Portfolio Standard. New Jersey's renewable portfolio standard (RPS) is one of the most aggressive in the United States and requires each electricity supplier/provider to provide 22.5% from renewable energy sources by 2021 and 50% by 2030. In addition, 2.12% must come from solar electricity, an amount estimated to be 1,500 megawatts (MW).[12] Solar Renewable Energy Certificates (SRECs) must be purchased by electricity suppliers to meet the state targets or else they face a fine known as a Solar Alternative Compliance Payment (SACP) that was $272/MWh in 2022.[13] As New Jersey was approaching the minimum requirements, the requirements were accelerated on July 23, 2012, changing the shape of the compliance curve from slowly increasing at first to rapidly increasing at first.[12]

Solar Renewable Energy Certificates

See main article: Solar renewable energy certificate. In 2004, New Jersey adopted a program promoting the use of Solar Renewable Energy Certificates (SRECs) to meet the solar energy carve-out of the state RPS. In the 2011 Energy Year, 306,000 SRECs (or MWhs of solar electricity) must be purchased by electricity suppliers in the state in order to meet the state solar requirement. That requirement grows to over 5 million in 2026.[14]

An SREC program is an alternative to the feed-in tariff model popular in Europe. The key difference between the two models is the market-based mechanism that drives the value of the SRECs, and therefore the value of the subsidy for solar. In a feed-in tariff model, the government sets the value for the electricity produced by a solar facility. If the level is too high, too much solar power is built and the program is more costly. If the feed-in tariff is set too low, not enough solar power is built and the program is ineffective.

The SREC program allows for the creation of a certificate with every megawatt-hour (MWh) of electricity produced. The certificate represents the solar aspect of the electricity that is produced and can be unbundled and sold separately from the electricity itself. Electricity companies, known as load-serving entities, are required by state RPS laws to procure a certain amount of their electricity from solar. Since it is often more costly for them to build solar farms themselves, the load-serving entities will purchase SRECs from solar generators and use the SRECs to comply with the state laws. With an SREC market, the value of an SREC is determined by supply and demand, subject to certain limitations. If solar is slow to develop, SREC values will remain high, encouraging the development of solar. If too much solar is added, SREC values will decrease, which in turn lowers the attractiveness of the investment. SRECs in New Jersey have traded as high as $680 per MWh. In comparison, the average sale price for the electricity itself ranges from $50 per MWh to $180 per MWh. The value created from the benefits of selling SRECs dwarf the value created by the actual electricity produced in today's market. This means that SRECs play a major role in the return on investment for solar in New Jersey. In 2012 the program was modified in the "solar rescue bill" to increase the value of the SRECs, which have declined in value by 92% but cap them at no more than $325.[15]

The SREC program closed to new registrations in April 2020.[16] A total of 3,335 MW was installed under the SREC program.

The Transition Incentive Program was open to new registrations between October 2019 and August 27, 2021. This program provided fixed incentives called TRECs with different values for different project types. There was no limit to the number of projects that could apply.[17] As of January 2024, 987 MW of projects have been completed under the TI Program.

The Successor Solar Incentive Program opened its Administratively Determined Incentive component on August 28, 2021. This program provides fixes incentives called SREC-IIs to up to 450 MW of small net-metered projects and community solar each year.[18] As of January 2024, 442 MW of projects have been completed under the ADI Program.

The Competitive Solar Incentive component will begin in 2023 and provide SREC-IIs priced as part of a competitive solicitation to 300 MW of grid-supply and large net-metered projects each year.[19] [20]

Net metering

See main article: Net metering.

In 2008, New Jersey and Colorado were the only two states to allow unlimited net metering customers, up to 2 megawatts for each customer. In 2010 the limit was removed, and in 2012 connection may be to a 69 kV or lower line voltage, raising the previous requirements. New Jersey is one of three states which have no limit on an individual project's size, although generation may not exceed annual demand, and the Board of Public Utilities originally had the option of limiting participation to 2.5% of peak demand,[21] but the cap was raised to 2.9% in August 2015, which was seen as a temporary fix that would cover three years.[22] In 2018, the legislature increased the net metering cap to 5.8% of retail sales.[23]

Landfill solar

New Jersey's subsection (t) program, established in the Solar Act of 2012, has allowed for the redevelopment of numerous landfill and brownfield sites into solar arrays.[24] The Mount Olive Solar Farm, located on a former Superfund site, is the largest solar project on a landfill in North America and was completed in November 2022.[25] [26] As of April 2023, there are 37 projects with 290 MW of capacity built on closed and repurposed landfills and brownfields. Seventeen projects with 187 MW are on Superfund sites, the most of any state.[27]

Solar 4 All project

In 2009, Public Service Enterprise Group, the largest utility company in New Jersey, announced plans to install solar panels on 200,000 utility poles in its service area, the largest such project in the world.[28] [29] In addition to the 38 MW of pole-mounted power,[30] PSEG's Solar 4 All project built at least 34 solar projects with 152 MW.[31] [32] [33]

Generation

Utility-scale solar generation in New Jersey (GWh)[34] [35]
YearTotal% of NJ total% of US solarJanFebMarAprMayJunJulAugSepOctNovDec
200911 0 0 1 1 1 1 1 2 2 1 1 0
201021 <0.1%1.7%0 1 1 2 3 3 3 3 2 1 1 1
201169 0.1%7%1 3 4 6 7 9 8 8 6 7 4 6
2012305 0.5%7%17 21 26 32 27 33 32 31 28 21 22 15
2013 438 0.7%4.8%22 23 35 49 44 46 44 3843 41 31 22
2014 514 0.75%2.9%22 31 43 53 52 56 59 58 49 36 33 22
2015 628 0.8%2.5%34 38 49 63 71 60 67 72 61 53 38 22
2016 835 1.08%2.3%51 45 73 82 74 94 90 88 66 67 61 44
2017 924 1.22%1.74%34 63 81 85 91 108 106 107 91 58 60 40
2018 992 1.72%1.94%57 54 89 89 104 117 124 110 74 69 54 51
2019 1,16563 75 106 101 110 126 142 127 111 80 76 48
2020 1,59283 98 121 148 172 169 186 162 136 126 104 87
2021 1,20389 93 142 164 185 179 173 178

Beginning with the 2014 data year, the Energy Information Administration has estimated distributed solar photovoltaic generation and distributed solar photovoltaic capacity. These non-utility scale estimates project that New Jersey generated the following additional solar energy:

title=Electric Power Monthly (February 2019 with data for December 2018) - Table 6.2.B. Net Summer Capacity using Primarily Renewable Sources retrieved 2019 3 19[36]
title=Electric Power Monthly (February 2019 with data for December 2018) - Table 1.17.B. Net Generation from Solar Photovoltaic retrieved 2019 3 19YearSummer capacity (MW)Generation (GWh)
20141,106 -20151,026.4 1,435 -20161,058.2 1,385 -20171,285.6 1,660
20181,490.9 1,927-

Facilities

New Jersey also has the Americas' largest floating solar array, an 8.9 MW project at New Jersey American Water's treatment plant in Millburn that was completed in 2022.[37] [38] The 4.4 MW system in Sayreville was the largest in the country when it was built in 2020.[39] A 3.3 MW project at a sand company puts the state's installed floating solar capacity at 16.6 MW, greater than the rest of North America combined.[40]

See also

External links

Notes and References

  1. Web site: . 2022 . New Jersey Solar . December 1, 2022 . www.seia.org.
  2. Web site: Solar Industry Research Data . . 30 November 2018.
  3. http://www.solar-new-jersey.org/2011/04/01/secondary-us-markets-for-solar-power-are-continuing-to-grow/ Secondary U.S. Markets For Solar Power Are Continuing to Grow
  4. Web site: Solar Activity Reports NJ OCE Web Site . 2022-12-01 . njcleanenergy.com.
  5. Web site: NJ.com . Amira Sweilem NJ Advance Media for . 2023-02-15 . N.J. schools rank 2nd in nation for solar power. See if your district has added panels. . 2023-03-23 . nj . en.
  6. http://www.njcleanenergy.com/renewable-energy/programs/renewable-energy-incentive-program/renewable-energy-incentive-program-cust Renewable Energy Incentive Program: Customer Sited Incentives
  7. Web site: Renewable Energy. State of NJ. April 29, 2016. "solar projects are no longer eligible for rebates"
  8. Web site: Residential Renewable Energy Tax Credit. Energy.gov. US Department of Energy. April 29, 2016.
  9. Web site: Federal Income Tax Credits for Energy Efficiency. EnergyStar.gov. US EPA. December 21, 2016.
  10. Web site: Solar Energy Sales Tax Exemption. DSIRE. NC Clean Energy Technology Center. April 29, 2016.
  11. Web site: Property Tax Exemption for Renewable Energy Systems. DSIRE. NC Clean Energy Technology Center. April 29, 2016.
  12. Web site: New Jersey Passes Legislation to Stabilize Its Solar Market - SEIA. 30 September 2018. SEIA.
  13. Web site: Solar Market Frequently Asked Questions (FAQs) NJ OCE Web Site . 2023-03-23 . njcleanenergy.com.
  14. Web site: SREC Markets - New Jersey . 30 September 2018 . SRECTrade.
  15. News: Forand . Rebecca . N.J. solar market struggling from oversaturation . South Jersey Times . December 18, 2012 . 2012-12-18 .
  16. Web site: SREC Registration Program NJ OCE Web Site . 2022-12-01 . njcleanenergy.com.
  17. Web site: Transition Incentive Program NJ OCE Web Site . 2022-12-01 . njcleanenergy.com.
  18. Web site: Administratively Determined Incentive (ADI) Program NJ OCE Web Site . 2022-12-01 . njcleanenergy.com.
  19. Web site: Competitive Solar Incentive (CSI) Program NJ OCE Web Site . 2022-12-01 . njcleanenergy.com.
  20. Web site: New Jersey launches competitive solar incentive program, aiming for 300 MW annually through 2026 . 2022-12-13 . Utility Dive . en-US.
  21. http://www.dsireusa.org/incentives/incentive.cfm?Incentive_Code=NJ03R&re=1&ee=0 New Jersey - Net Metering
  22. News: Johnson. Tom. August 11, 2015. Bill Could Mean More Money to Small Businesses, Residents with Solar Panels. NJ Spotlight. April 29, 2016.
  23. Web site: 2018-05-31 . Unpacking New Jersey’s Much-Needed New Clean Energy Legislation . 2022-12-01 . Solar Industry . en-US.
  24. Web site: September 2023 . RE-Powering America's Land Initiative: Profiles of State Programs . EPA . 24-41.
  25. News: Op-Ed: We’ll see no more solar power developments on landfills unless lawmakers act fast . NJ Spotlight News .
  26. Web site: Misbrener . Kelsey . 2021-08-17 . CEP Renewables kicks off construction on largest landfill solar project in North America . 2022-12-01 . Solar Power World . en-US.
  27. Web site: US EPA . OLEM . 2015-03-25 . RE-Powering Tracking Matrix . 2023-07-21 . www.epa.gov . en.
  28. News: January 19, 2011. PSE&G plans $773M for solar panels on 200K utility poles. The Star-Ledger. February 10, 2009.
  29. Web site: January 19, 2011. PSE&G To Install 105 Pole Mounted Solar Panels in the Borough of Magnolia. Borough of Magnolia. March 6, 2010.
  30. News: New Jersey Utility Plans Major Solar Project. The New York Times. Ken. Belson. 30 September 2018. 2009-02-10.
  31. Web site: Solar 4 All® Fact Sheet . PSE&G.
  32. News: Sroka-Holzmann. Pamela. January 19, 2011. PSE&G installing solar panels in Hillsborough. . July 27, 2010.
  33. Web site: PSE&G’s Largest Solar Farm Placed In-Service . 2023-06-13 . nj.pseg.com.
  34. "Electric Power Monthly-Data Browser 6/17"http://www.eia.gov/electricity/monthly retrieved 2019-3-19
  35. "Electricity Data Browser" https://www.eia.gov/electricity/data/browser/ retrieved 2019-3-24
  36. “Electric Power Monthly”http://www.eia.gov/electricity/monthly/epm_table_grapher.cfm?t=epmt_1_17_b
  37. Web site: Cooper . Melissa Rose . June 12, 2023 . Short Hills reservoir has nation’s largest floating solar array . NJ Spotlight News.
  38. Web site: Engel . John . 2022-05-03 . New Jersey floating solar project aims to be nation's largest . 2023-02-16 . Renewable Energy World . en-US.
  39. Web site: Ludt . Billy . 2020-01-29 . The country’s largest floating solar system keeps water clean . 2023-02-16 . Solar Power World . en-US.
  40. Web site: Regulators Boost Incentive for New Jersey Floating Solar Project RTO Insider . 2023-03-28 . www.rtoinsider.com . en.