Governor Signs Solar Program Fix Bill

Today, Governor Murphy signed S4275 (Smith) into law. The bill allows BPU to increase cost to customers of Class I renewable energy requirement for energy years 2022 through 2024, under certain conditions.

“This new law will temporarily stop the solar market from crashing, but we need to do more. This will raise the cost cap, which lets more sunlight in and allows the solar program to move forward. Our concern is that this is a stopgap instead of a real solution. We have said from the beginning that the cost cap would hurt the solar industry and cause it to crash. This legislation is just a short-term fix that averages the cost cap out over five years to extend the program. Under this bill we can only get to 200 Megawatts per year instead of the 500 MW that we need to reach our clean energy goals,” said Jeff Tittel, Director of the New Jersey Sierra Club. “We should be completely getting rid of the cap. We don’t have caps on energy from coal, nuclear, oil, or gas. Having a cap on solar hurts renewable energy and favors fossil fuels.”

The bill would allow the BPU to increase the cost cap on Class I renewable energy requirements if the total energy costs during energy years 2019 through 2021 is less than 9%. Since the solar program went into effect about 10 years ago, solar has become 29 percent more efficient and gone down in price by 25 percent.

“We are glad that Murphy signed this bill because it will help extend the solar program, but we need a real fix. Having a cost cap on solar will only allow for a modest solar program. This law raises the cost cap and averages it out over five years. If the costs exceed the limit the BPU is still required to set aside the Renewable Portfolio Standard for that year. You also have to factor in legacy SRECs as well as transition SRECs. Our concern is that even with this change in the law it will not allow us to have a robust solar program,” said Jeff Tittel, Director of the New Jersey Sierra Club. “We need to remove the cost cap, but we also need to come up with a new solar program that is more cost effective and works for all of New Jersey. This includes looking at other funding mechanisms and regulations to push for solar programs to get done.”