New Jersey – Net Metering

New Jersey – Net Metering

Incentive Type: Net Metering

Eligible Renewable/Other Technologies: Solar Thermal Electric, Photovoltaics, Landfill Gas, Wind, Biomass, Geothermal Electric, Anaerobic Digestion, Tidal Energy, Wave Energy, Fuel Cells using Renewable Fuels

Applicable Sectors: Commercial, Industrial, Residential

Limit on System Size: 2 MW

Limit on Overall Enrollment: No limit

Treatment of Net Excess: Several options exist according to customer preference. Generally, NEG will be credited to customer’s next bill at retail rate with next excess purchased by the utility at the avoided cost rate at the end of an annualized period.

Utilities Involved: Electric distribution companies (does not apply to municipal utilities or electric co-ops)

Interconnection Standards for Net Metering?

Yes

Authority 1: N.J. Stat. § 48:3-87
Date Enacted: 1999 (subsequently amended)
Effective Date: 1999
Authority 2: N.J.A.C. 14:4-9
Date Enacted: 9/13/2004
Effective Date: 10/4/2004

Website: http://www.njcleanenergy.com

Summary:  
Note: In September 2007 the New Jersey Board of Public Utilities (BPU) approved an order regarding a redesign of the state solar-energy program. As a result, the New Jersey Office of Clean Energy (OCE) has been directed to develop modified interconnection, net metering and renewable portfolio standard (RPS) rules consistent with the program transition. Click here to view the proposed rules.  

New Jersey’s net-metering rules and interconnection standards apply to all residential, commercial, and industrial customers of the state’s investor-owned utilities (and certain competitive municipal utilities and electric cooperatives). Eligible systems include those that generate electricity using solar, wind, geothermal, wave, tidal, landfill gas or sustainable biomass resources, including fuel cells (all “Class I” technologies under the state RPS). The maximum individual system capacity is two megawatts (MW). There is no firm aggregate limit* on net metering. Many supporters of distributed generation believe that New Jersey has the best standards for net metering in the United States.  

A single metering arrangement is preferred. Customer-generators have several compensation options for net excess generation (NEG), listed below: 1. Customer-generator receives month-to-month credit for NEG at the full retail rate and is compensated for remaining NEG at the avoided-cost of wholesale power at the end of an annualized period.  

2. Customer-generator is compensated for all NEG on a real-time basis according to the PJM power pool real-time locational marginal pricing rate, adjusted for losses by the respective zone in the PJM.  

3. Customer generator may enter into a bilateral agreement with their electric supplier or service provider for the sale and purchase of NEG. Real-time crediting is permitted, subject to the applicable PJM rules.

The latter two options were added by S.B. 2936 enacted in January 2008 and effective July 11, 2008. This legislation also: (1) extends net metering to industrial and large commercial customers; (2) extends net metering to all systems that generate electricity using “Class I” renewable-energy resources; and (3) permits utilities to recover the costs of “any new net meters, upgraded net meters, system reinforcements or upgrades, and interconnection costs” through either their regulated rates or from net-metered customers. These changes are not yet reflected in the administrative rules.  

Customers eligible for net metering retain ownership of all renewable-energy credits (RECs) associated with the electricity they generate. Customers with photovoltaic (PV) systems may apply to the New Jersey Board of Public Utilities (BPU) to participate in New Jersey’s Solar Renewable Energy Certificates (S-RECs) program, which tracks and verifies solar certificates, and allows the certificates to be sold on-line to electric suppliers to meet suppliers’ solar renewable portfolio standard (RPS) requirements.  

*S.B. 2936 amended this portion of the law by removing a potential financial impact cap of $2 million and by increasing the aggregate capacity trigger to 2.5% (formerly 0.1%) of statewide peak load. As before, the BPU retains discretionary authority over capping net metering if this trigger is met.

Contact:  
Benjamin Scott Hunter
New Jersey Board of Public Utilities
Renewable Energy Program Administrator, Office of Clean Energy
44 South Clinton Avenue
P.O. Box 350
Trenton, NJ 08625-0350
Phone: (609) 777-3300 
Fax: (609) 777-3330
E-Mail: benjamin.hunter@bpu.state.nj.us
Web site: http://www.bpu.state.nj.us

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