New Jersey Solar Rebate

Renewable Energy-Related Legislation and Loan programs in New Jersey

New Jersey Board of Public Utilities (NJBPU), a regulatory authority responsible for adequate and safe utility services for New Jersey residents made extensive revisions in New Jersey's renewable portfolio standard (RPS), in April 2006, which is considered as one of the most hard line standard in US. According to this RPS every supplier/provider in New Jersey needs to include 20% qualified renewable energy sources by 2021 in the electricity it sells. After the revision the requirement of "Class I" and "Class II" renewable energy sources was increased by a significant amount and the same happened with solar electricity also. It is estimated that New Jersey will need 2.12% which is equal to 1,600 megawatts (MW) solar electricity by the year of 2021.

Clean energy attributes of the electricity generated from a solar system is characterized by Solar Renewable Energy Certificate (SREC) which is a tradable certificate. After generating 1 MWh solar electricity, a solar system gets SREC which can be sold irrespective of the power. Main aim of this SREC program is to provide means of clean and emission free solar power to the individuals and businesses.

New Jersey Board of Public Utilities is responsible for all the administrative tasks related to SRECs. SREC program tracks solar production from every generator installed in the State and also issues SRECs. According to New Jersey's Renewable Portfolio Standard (RPS) every electric supplier is required to purchase SRECs annually. It was launched in June 2004. Market availability and the price of Solar Alternative Compliance Payment (SACP) mainly determine the price of SRECs. SACP plays a role of cap value to SREC if electric suppliers fail to meet the standards of RPS and consequently obtaining enough SRECs.

Since the commencement of SREC program in March 2004, there have been ambiguities in accreditation of SRECs. So there was an extension in the right to generate RPS compliant SREC in January 2008 under SB 2936. Non-net metered solar systems were permitted to secure a SREC. Once a supplier gets a SREC, he is liable to generate SRECs for 15 years being a part of the grid.

Monthly SREC generation for solar systems having capacity less than 10 kW, are calculated through an annual engineering estimation method. After obtaining a SREC, any supplier can offer a sale and all the SRECs are transferred to the qualified buyers. From June 2009, suppliers will have 2 years for trade purposes meaning an SREC can be used only for the year it was issued and the next year. Whereas SRECs issued before June 20009 can only be used for the year they were issued. In June 2009, there was an announcement of eight year schedule for the SACP and NJBPU is responsible to the SACP review each year. New Jersey Office of Clean Energy (OCE) has estimated the weighted average price of an SREC to be $467 per MWh which is much lower than SACP for a given year.

According to "Property Tax Exemption for Renewable Energy Systems" enacted in October 2008 industrial, commercial and residential renewable energy systems from local property taxes. Various renewable energy systems like solar PV, fuel cells. Sustainable biomass, hydroelectric, geothermal electric etc are eligible for this exemption. Moreover systems generating electricity from solar power like solar hot water are also eligible to apply for. First of all, the system owner has to go through a new assessment of their properties by a local assessor which will exclude the cost of the renewable energy systems. After one year he gets the certification, he will liable to avail an exemption. The New Jersey Division of Taxation and Department of Treasury are responsible for all the rules and regulation implementing this exemption. And the requirements needed by the system to meet the standards are developed by New Jersey Board of Public Utilities (BPU) and the Commissioner of Community Affairs.

All solar energy devices or systems which are designed for heating or cooling, or mechanical or electric power by collecting and transferring solar energy like solar water heater, solar thermal heater, passive solar space heater, photovoltaic, solar thermal process heater are eligible for the exemption from tax imposed under Sales and Use Tax Act of New Jersey State Government. The exemption is nearly 7% and all taxpayers including residential, commercial, public customers are liable to get.

The New Jersey Economic Development Authority (EDA) has developed The Edison Innovation Clean Energy Manufacturing Fund (CEMF) to assist manufacturing of energy efficient and Class I renewable energy products. The main aim of this program is to dominate the traditional sources of electric generation. Various grants (Tranche I) and loans (Tranche II) are funded to businesses running in New Jersey. The fund will be provided for both trends together or separately only for tranche II, but tranche I applicant must apply for tranche II also. Maximum amount that can be funded under this program is $3.3 million per project. Funding is available only in commercial and industrial sectors and can be used for project assessment and design, and project construction and operation. An amount up to $300,000 can be availed under project assessment and design grant, but it should not exceed 10% of the total CEMF requested. Under project construction and operation zero-interest loan the applicant can secure and amount up to $3.3 million and he has to commence the repayment from the fourth year of the approval of the loan. Various renewable Class I energy are eligible to avail this grant, like - solar, photovoltaic, fuel cells, tidal, harvested biomass etc.

There is a Home Performance with Energy Star Program available for all New Jersey homeowners to improve their houses' energy efficiency. This program is administered by New Jersey Board of Public Utilities (NJ BPU) and includes air sealing, installation of better insulation, HVAC improvements, radon and smoke improvements etc. the homeowner must get the work done by a BPI-certified contractor to be eligible for incentive. Mainly three types of incentives are provided for the followings - home energy assessment, air sealing improvements and installation of energy efficiency measure. This project has a budget of $12.5 million for the year of 2009.

Under New Jersey's Public service Electric and Gas (PSE&G) customers in all classes can get loans for photovoltaic systems. An amount covering 40%-60% of the actual cost of the system can be availed. Residential customers can secure this loan on a 10 year term and at an interest of 6.5%, whereas non-residential customers will get it at 15 years term with 11.11% interest.

Rebate programs

COOLAdvantage Program
This rebate is offered by the N.J. Clean Energy Program to improve the efficiency of renewable energy systems which mainly include heat pumps and electric air conditioners. This program is intended to improve the sale of the system and also the installation techniques. Eligible systems' energy efficiency is measured with the help of their EER, SEER or HSPF ratings. The rebate amount is to be shared in between the contractor and the customer. An amount of $100-$150 can be availed through this rebate based on the system's efficiency.

ENERGY STAR Homes Program
This program is a result of a joint venture by New Jersey utilities and the New Jersey Board of Public Utilities. A rating is provided to the building on a 100 points scale and to be considered for this program it should secure at least 85 points. Tough home owners from any part of New Jersey is eligible to get a Energy Star rating, but only home which are in the New Jersey Smart Growth areas can avail the incentives. Incentives are split into mainly three tiers - Tier I, II and III. An amount up to $2,900 can be availed for Tier I and for other ones there is no specific amount.

Energy Star Product Rebates
Under this State Rebate Program, the New Jersey Office of Clean Energy (OCE) provides incentives to the customers of Jersey Central Power & Light; PSE&G Electric, Atlantic City Electric and Rockland Electric Company for certain energy efficient home appliances like Dehumidifiers, Air conditioners, Lighting and Clothes Washers. Normally Air Conditioner Incentive is seasonal, but it is open for 2009. To be eligible for this incentive all the applying systems must be Energy Star Rated.

New Jersey Comfort Partners Program
Customers having an income of at max 225% of the federal poverty guidelines can apply for this incentive which is totally free of any charges. Energy education and counseling for usage is also provided. This program has an overall budget of $36 million for the year of 2009. The funding mainly comes from States System Benefit Charge (SBC).

New Jersey Customer-Sited Renewable Energy Rebates
This program developed by NJBPU provides funding in residential, commercial and industrial sectors. Various technologies including photovoltaic, biomass energy technology and small wind energy systems are eligible to apply for. From 2009, residential PV systems with 10 kW and non-residential PV systems with 50 kW are eligible for this program.

New Jersey SmartStart Buildings
This program run by New Jersey's gas and electric utilities and the NJBPU provides funding in almost every sector. It has a budget of $36,609,890 for the year of 2009. Financial incentives up to $500,000 per unit can be availed through this program. According to New Jersey Division of Taxation all industrial applicant must posses Tax Clearance Certificate to be considered for this program.