Sunny Outlook for NJ’s Solar Sector, Which Continues to Add Capacity

One possible shadow on horizon: changes to the way state promotes this form of reusable energy

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With the state contemplating an overhaul of its solar program, New Jersey continues to see robust growth in the sector, experiencing significant installations in new capacity.

In the second quarter, New Jersey added 78 megawatts of capacity, the eighth among states, according to a report by GTM Research and the Solar Energy Industries Association. New Jersey currently ranks fifth among states for installed solar capacity.

The solar market added 2.4 gigawatts of new solar capacity nationwide in the second quarter, its best second quarter ever, and racked up an 8 percent year-over gain, according to the report.

In New Jersey, a state that has witnessed boom-and-bust cycles in the solar market, the growth here underscores the vitality of a sector that provides thousands of jobs and helps slash energy bills for homeowners and businesses, albeit with subsidies from all ratepayers.

“It’s significant progress,’’ noted David Gahl, director of state affairs for the Northeast for the association, citing the fact that more than 2 gigawatts of solar systems have been installed in the state since it started incentives to encourage their use.

Despite the growth, some solar firms are pushing the Legislature to revamp its system of promoting solar under a bill yet to be taken up by either house.

The legislation, introduced this past summer as lawmakers broke for recess, would initiate significant changes in how the state encourages installation of solar, gradually phasing out existing financial incentives given to owners of solar panels.

Perhaps as significant, the bill aims to provide leeway to a new administration to figure out how it wants to incentivize new solar installations without having the sector collapse as it did several years ago.

“Probably, the next governor is going to be dealing with this problem,’’ said Fred DeSanti, a lobbyist who helped draft the pending bill in concert with other key players in the solar field.

While many issues remain to be worked out, there is no disagreement on keeping New Jersey among the leaders in solar installations. Indeed, another bill pending in the Legislature aims to have 80 percent of the state’s electricity come from renewable energy by 2050. Solar is expected to be a crucial component in achieving that goal.

The solar association is projecting growth will continue to occur in the rest of 2017. It forecasts 359 megawatts of new solar capacity will be added in New Jersey during the calendar year, with more than half installed in the residential sector, Gahl said.

“There’s more growth opportunity in the residential area,’’ he said. While there is a structural problem in mandates for solar falling off beginning next year, the industry recognizes that there is confidence legislators will address the problem before it begins to impact installations, Gahl said.

Nationwide, the sector continues to prosper. Through the first half of 2017, 22 percent of all new electric capacity brought online in the United States has come from solar, ranking second over that time period to natural gas.

“This report shows once again that solar is on the rise and will continue to add to its share of electricity generation,’’ said Abigail Hoss Hopper, SEIA’s president and CEO.