Solar power in New Jersey

Solar power in New Jersey has been aided by a Renewable Portfolio Standard which requires that 22.5% of New Jersey's electricity come from renewable resources by 2021, and by one of the most favorable net metering standards in the country, along with Arizona, allowing unlimited customers of any size array to use net metering, although generation may not exceed annual demand. Best practices recommend limiting net metering only to the size of the customer’s service entrance capacity (i.e. no limit).

New Jersey is second in the nation in the total number of homes and businesses which have solar panels installed. As of May 31, 2013, 22,014 solar photovoltaic systems have been installed, totaling over 1,078 MW. New Jersey is 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. Many of the homes, schools and businesses which have installed solar panels can be monitored online on the internet. Prominent solar contractors in New Jersey include Gehrlicher Solar America Corp., Trinity Solar, GeoPeak Energy and Amberjack Solar.

Net metering

New Jersey is one of five states to receive an A in a comparison of the 38 states plus Washington D.C. which have net metering. Five received an F. 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, although generation may not exceed annual demand, and the Bureau of Public Utilities has the option of limiting participation to 2.5% of peak demand.


The New Jersey Clean Energy Program provides a rebate of $1.75/watt for residential systems less than 10 kW with an energy audit, or $1.55/watt without an energy audit. Non-residential photovoltaic systems up to 50,000 watts receive a rebate of $1.00/watt. An additional $0.25/watt for each is available for systems partially manufactured or assembled in state, such as inverters or solar PV modules. The rebate had, prior to February 2, 2009, been $3.50/watt. During 2009 and 2010 the 30% Federal tax credit becomes a 30% grant for systems completed or started during those two years and completed before 2017, and beginning in 2009, has no limit either for commercial or residential systems. Prior to 2009 residential credits were capped at $2,000.

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. In addition, 2.12% must come from solar electricity, an amount estimated to be 1,500 megawatts (MW). 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 $0.691/kWh in 2010. 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.

By the end of June 2012, 831,601 kW of solar had been installed and an additional 590,285 kW was planned. By the end of December 2012, 955,620.4 kW had been installed by 19,328 homes and businesses, and an additional 698,046.3 kW was approved, in 4,407 projects. By the end of May 2013, 1,078,410.9 kW had been installed in 22,014 projects. An additional 4,609 projects have been approved, totaling 677,058.7 kW.

Solar Renewable Energy Certificates

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.

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. The goal of an SREC market is to find the SREC price that effectively represents the difference between the cost of producing other electricity and the cost of producing solar electricity. As the cost of solar electricity comes down, so will the value needed for SRECs. 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. 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.

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. The Solar 4 All project intends to increase the capacity for renewable energy in New Jersey by 120 MW and is expected to be completed in 2013. In addition to 40 MW of pole mounted power, PSEG is building four solar farms in Edison, Hamilton, Linden, and Trenton. 40 MW is expected to come from customer installed projects. As of August 2012, the 40 MW of solar farms are 90% complete.

Comparative capacity


In March 2015 Six Flags Great Adventure announced its plans to clear more than 18,000 trees to build a 90-acre solar farm with 21.9 megawatts capable of meeting virtually all of the theme park's electrical needs. Solar facilities are concentrated in the Central Jersey. As of June 2014 the largest solar farms and photovoltaic arrays by megawatts in the state were:

See also

  • List of power stations in New Jersey
  • Renewable energy
  • Wind power in New Jersey


External links

  • New Jersey's Clean Energy Program
  • New Jersey Board of Public Utilities
  • New Jersey Incentives/Policies for Renewables & Efficiency

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