Public Service Electric & Gas is scaling back plans to build grid-connected solar systems on brownfields and old garbage dumps under a tentative agreement reached with regulators and other parties.
The settlement will allow the state’s largest utility to develop 33 megawatts of arrays with a projected investment of approximately $80 million, sharply lower than what PSE&G originally proposed in May, when it sought approval to spend $275 million and build 100 megawatts of solar facilities on landfills and brownfields in its service territory.
The proposed settlement, which still needs to be approved by the state Board of Public Utilities, was reached with the agency’s staff, Division of Rate Counsel, and other parties after months on negotiations.
The policy of using former garbage dumps and abandoned but contaminated brownfields as sites for solar farms is backed by the Christie administration as a way of steering such projects away from undeveloped open spaces and farmland.
But some consumer advocates, including the Rate Counsel, had concerns about allowing a regulated utility to pass the costs of developing the solar facilities on to utility customers.
In the end, Rate Counsel signed the tentative settlement after it was scaled back. “We got it down so low; it’s a pretty small program now,’’ explained Rate Counsel director Stefanie Brand.
PSE&G has been the biggest advocate of putting solar systems on idle land — even given higher costs and more complex projects due to landfill topography and possible contamination.
Under a previous program approved by the state, PSE&G will have completed the installation of nine solar farms on brownfields with a capacity of 53 megawatts, enough to power about 8,500 homes annually.
Courtney McCormick, vice president of renewables and energy solutions for PSE&G, said the utility expected its proposal might be scaled down in its negotiations with the state.
“We continue to believe there’s a lot more to be done,’’ she said. “To date, we’ve not seen a lot of private developers step up to do this in any meaningful way.’’
McCormick noted converting the old dumps and brownfields to solar farms is “really hard to do,’’ primarily because of environmental, permitting, and negotiating issues with the owners of the properties.
Some solar developers feared the magnitude of the PSE&G proposal, worried it would crowd out other projects by acquiring a big share of the solar credits owners of solar arrays use to make their projects financially feasible.
To address that concern, the tentative settlement would limit the utility to installing no more than 15 megawatts of grid-connected solar systems a year in the state.
Others, however, back utility-sized grid-supply projects since they tend to be cheaper to build than solar panels on residential properties, which also rely on ratepayer-subsidized solar credits.
The Legislature is currently considering a bill that would accelerate the state’s reliance on solar power to provide electricity to residents and businesses, a step many solar proponents say is needed to keep the sector thriving in New Jersey.