The sun has yet to set on a complicated and much debated bill aimed at promoting community-wide solar power projects.
The legislation (A-915) came up again yesterday in the Assembly Telecommunications and Utilities Committee, which is quite familiar with it. On three earlier occasions, the committee approved a different version of the bill. The Senate also has passed its own version of the bill with bipartisan support. But the Assembly panel held the bill, saying it still needs more amendments.
Once touted by solar energy advocates and industry officials as helping New Jersey achieve very aggressive solar energy targets, the bill has undergone so many changes that virtually the only people backing it now are its legislative sponsors and fellow lawmakers. Yet the fact that it is still being debated testifies to the support enjoyed by the solar industry in the legislature.
Blocking Small Solar Firms
Critics argue the bill strays far from its original intent to allow community-wide solar projects, a strategy embraced by virtually everyone, but one that sparked disputes over how to get there. They also say the legislation sets up an overly complex mechanism, which would make it virtually impossible for small solar firms to participate, raising concerns New Jersey’s diverse solar energy sector would be dominated by powerful nationals and utilities.
Perhaps more importantly, the legislation would give discounts to people living in all-electric homes, a subsidy opponents argue is unnecessary given other financial aid programs designed to encourage solar. The debate over subsidies for renewable energy has emerged as one of the key issues confronting the Christie administration as it reassesses the state’s aggressive clean-energy goals.
Under the bill, residential customers would be allowed to join together in a cooperative and sign up with a solar developer to sell the power from their solar panels into the PJM grid, the regional power system serving most of the eastern seaboard. The legislation then sets up a complicated system for paying customers for the power their systems generate, one which involves the utility, PJM and members of the cooperative.
The bill also would afford even bigger discounts on their electric bills for customers of all-electric homes, a provision the Division of Rate Counsel opposes because it would have ratepayers subsidizing their energy bills.
The discounts afforded customers who banded together to form community solar projects would total $460 million, according to Joseph Sullivan, ombudsman for the state Board of Utilities. Those costs would be spread out among all other utility customers in the form of a surcharge on customers’ bills called a societal benefit charge, he said.
“We think they are significant,’’ Sullivan said. “We do not support things that add costs to the ratepayers.’’ In addition, there is an equity issue, he added, since 65 percent of the energy consumed in New Jersey is used by businesses, which would wind up paying a heavier burden of the costs of the state’s clean-energy programs.
Sen. Robert Smith (D- Middlesex), the Senate sponsor, disputed Sullivan’s projected costs and also noted those expenses would be spread out over many years among all ratepayers. He said he expects there to be agreement on the bill shortly, with discussions now focusing on how big the community solar projects should be.
“We are providing rate relief to the people who really need it: senior citizens who live in all-electric homes,’’ he said. “We’re also providing alternative energy to homes which because of location could not install solar themselves.’’
Assemblyman Upendra Chivukula (D-Middlesex), the sponsor of the Assembly version of the bill, also defended the measure. “Most of the bill is very good, but we have to figure out what is right amount of subsidization.’’
One-time advocates of the bill argue otherwise.
“They need to kill this bill and start from scratch and come up with a bill that will work for everyone in the industry, including the small guys,’’ said Jeff Tittel, executive director of the New Jersey Sierra Club. “This bill hurts solar in New Jersey and only helps the utilities.’’