The BPU issued this new program to help New Jersey accomplish the renewable energy goals of the state’s Solar Act of 2021.

The New Jersey Board of Public Utilities (BPU) established a Successor Solar Incentive (SuSI) Program that provides incentives to developers of solar generation projects. The program limits the number of solar incentives available to developers each year, so interested developers should move quickly. In addition to the annual limits, the value of the available incentives will be reduced over time, giving an advantage to early movers. The SuSI Program opened for new registrants on August 28, 2021.

The BPU issued this new program to help New Jersey accomplish the renewable energy goals of the state’s Solar Act of 2021, including development of 17 gigawatts (GW) of solar power by 2035 and 32 GW by 2050. The SuSI Program replaced (1) the SREC Registration Program (SRP), which ended as required by law when the amount of solar generation reached 5.1 percent of the electric load in the state of New Jersey, and (2) the Transition Incentive Program (TI). Due to the success of solar development in New Jersey and the reduction of the cost of building solar over the years, the SuSI Program lowered the amount of the available incentives per megawatt-hour (MWH) as compared to earlier programs.

The SuSI Program comprises two separate subprograms, the applicability of each depending on the size and characteristics of the proposed solar facility: (1) the Administratively Determined Incentive (ADI) Program for community solar and net-metered facilities less than 5 megawatts (MW) in size, and (2) the Competitive Solar Incentive (CSI) Program for projects larger than 5 MW. The value of the incentives for both the ADI and the CSI Programs will be based on the value of one MWH of solar electricity produced by a qualifying facility, which is set administratively for the ADI Program and via a competitive process in the CSI Program.

Administratively Determined Incentive Program

In addition to incentives available to community solar projects and net-metered projects (either residential or nonresidential less than 5 MW in size), certain grid facilities may also receive incentives under the ADI Program during an interim period. The chart below provides a summary of the incentives, organized by market segment.

ADI Incentives (NJ-SREC-II) per Market Segment

* “Public entity” is defined as a customer that is a state entity, school district, county, county agency, county authority, municipality, municipal agency or New Jersey public college or university.

** Subsection (t) grid solar facilities are defined as solar facilities certified as being located on brownfield, historic fill or properly closed landfills.

The ADI Program has cumulative total capacity limits for each type of market segment, summarized in the table below. New registration will be accepted on a first-come, first-served basis until the megawatt block for each market segment is fully subscribed, at which point the BPU will stop accepting new registration until the next year. There will not be any waiting list for projects. Instead, once these capacity limits are reached, developers will have to wait until the next year to register. Therefore, anyone considering developing solar generation in New Jersey under the ADI Program should register as soon as possible to receive the maximum value of incentives for the project.

ADI Capacity Blocks by Market Segment

Competitive Solar Incentive Program

The CSI Program will provide competitively set incentive values for grid supply projects (i.e., those selling into the wholesale markets) and net-metered, non-residential projects greater than 5 MW. The BPU staff and other stakeholders are currently working on the design of the CSI Program with the goal of holding the first solicitation by early-to-mid 2022. Additional information will be available when the BPU has finalized the design of the program.

For More Information

If you have questions about this Alert, please contact Amauri G. Costa, Phyllis J. Kessler, W. Patrick Dinnin, any of the attorneys in our Energy Group or the attorney in the firm with whom you are regularly in contact.

Disclaimer: This Alert has been prepared and published for informational purposes only and is not offered, nor should be construed, as legal advice. For more information, please see the firm's full disclaimer.