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Bills to accelerate NJ solar target head to Assembly

A pair of bills that would accelerate the state's solartarget passed a New Jersey Assembly committee despite concerns among somelawmakers and a state ratepayer advocate about potential costs to ratepayers.

A.B. 3918 and its companion bill S.B. 2276 on Oct. 6 passedout of the New Jersey Assembly Telecommunications and Utilities Committee by a6-2 vote. Republican committee members — Assemblyman Brian Rumpf andAssemblywoman Gail Phoebus — voted against the bills.

Electric suppliers would be required to supply 4.1% of theirpower sales with solar by energy year 2021, which runs from June 1, 2020, toMay 31, 2021, under the bills. Under current law, the state reaches that targetby energy year 2027. The earlier target would increase through 2021 and alignwith federal tax incentives.

Republican members of the committee said their down vote wasbecause of the potential costs passed on to consumers from meeting the targetearlier. "Electricity rates are already at high," and the bills "speedup" the cost of the mandates that are passed to consumers, LouCrescitelli, chief of staff to Phoebus, said in an interview.

"I believe that New Jersey already offers enoughincentives for the solar industry," Rumpf said, and offering any morewould be an "additional burden" that other ratepayers should not haveto bear.

The state's Division of Rate Counsel, an independent stateagency backing consumers, also raised concerns about potential costs and risksto ratepayers. Rate Counsel Director Stefanie Brand said in a to legislators thatshifting the solar targets earlier would increase ratepayer exposure by $276million.

"[B]illions of dollars of ratepayer money have been earmarkedto help get the industry up and running, and we ask that legislators keep thisin mind," Brand said. Referring to concerns that the solar industry mightfall off a "cliff" in 2017, she added that "analogies to ChickenLittle are hard to avoid."

Brand said in the letter that while solar prices have beendropping, New Jersey pays some of the highest prices for solar renewable energycredits in the country. New Jersey SREC prices are around $250/MWh for thecurrent compliance year, while similar SRECs in Maryland and Delaware arebetween $25/MWh to $80/MWh, the letter noted.

Any acceleration of the solar renewable energy credits,Brand said, should be accompanied by reductions in the solar alternativecompliance payment, or ACP, which acts as a limit to SREC prices.

The ACP began at $339/MWh in 2014. In the bills, it drops to$239/MWh by 2021. "If we reduce the solar ACP by $50 per year, we willstill be higher than other states, but at least ratepayer exposure will bereduced," Brand said.

The bills' passage out of the committee was supported bydevelopers such as KDC Solar LLCand installer Trinity Solaralong with conservation groups including the New Jersey League of ConservationVoters and the New Jersey chapter of the Sierra Club.

S.B. 2276, passedthe state Senate on June 27. The Assembly committee's passage now sends thebills to the General Assembly.

The bills also create a 25-member Solar Energy StudyCommission to study whether to extend the state's solar target to 2031 from2028. The commission would also evaluate whether the state's solar market,which allows solar power to generate tradable SRECs creates long-termincentives for solar development.

Republicans are not necessarily opposed to the creation ofthe Solar Energy Study Commission, Crescitelli said, but added that there mayhave been more bipartisan support had the language on the commission separatedas a stand-alone bill.