State regulators are giving solar installers more time to show that their arrays qualify for Solar Renewable Energy Certificates (SRECs), if they have not formally completed their applications by the end of April because of the COVID-19 pandemic.
The Board of Public Utilities previously set an April 30 deadline for solar operators to submit their applications for the valuable certificates because that’s when the state is due to meet a requirement for 5.1% of its retail electricity to come from solar power, a target set by the state’s Clean Energy Act of 2018.
The law required that new registrations for the certificates be ended whenever the state met the 5.1% target. The BPU later determined that New Jersey would hit the target by May 1, and so set April 30 as the time when the program would terminate.
But the board said Monday that the pandemic-related shutdowns had made it impossible for some solar companies to obtain the final inspections needed to complete their applications. So it is allowing more time for those who have both completed their mechanical work and meet a list of other requirements.
“The inability for solar developers to arrange for final inspections in the face of the steps that have been taken to curb the spread of the Coronavirus and safeguard human health should not, in the Board’s view, prevent mechanically complete projects from receiving SRECs,” it wrote in an order issued after a board meeting.
It gave more time to companies whose installations would have received a “Permission to Operate” certificate by April 30 if they hadn’t been prevented from doing so by the virus. It did not specify how much more time would be allowed.
The other conditions include providing an affidavit that failure to obtain an operating certificate by the deadline was because of the pandemic, and evidence that a good-faith attempt was made to arrange an inspection with local code officials.
Program to boost solar power
SRECs are purchased by utilities, which are required by states such as New Jersey to meet a renewable portfolio standard that a certain portion of the state’s electricity come from solar resources. They are purchased from commercial owners of solar arrays or groups of residents that have installed solar panels on their houses.
New Jersey’s SREC program was started in 2004; since then, some 118,000 residential solar systems have been installed, according to the BPU.
New Jersey’s renewable portfolio standard, which officials say is one of the most aggressive in the nation, requires utilities to generate 22.5% of their power from qualified renewable sources including solar by 2021. That figure includes the power represented by the SRECs a utility holds.
Lyle Rawlings, president of the Mid-Atlantic Solar & Storage Industries Association (MSSIA), a trade and advocacy group in New Jersey, Pennsylvania and Delaware, said solar developers in New Jersey have been scrambling to qualify for the certificates since the BPU moved up the deadline — signifying the closure date for the SREC program — to April 30.
“Everybody was rushing to get done, a lot of people got done, and then they accelerated it to the point where a lot of people could not get through the gate,” he said in an interview. “But even those who did get finished were then caught by the COVID crisis, and couldn’t get inspection.”
Under the circumstances, the board’s order giving more time for companies to obtain SRECs was a welcome move, Rawlings said.
“What the board did yesterday was much appreciated,” he said. “It showed sensitivity to this bind that people are in, and it shows that they care about this industry.”
Replacement to be named later
With the SREC program ending this week, the BPU has been studying what to replace it with, as required by law. The board hired a consultant to propose a substitute, which is expected to be published in early May, along with a BPU staff recommendation on the new program, said Scott Hunter, the BPU’s manager of the Office of Clean Energy, during a webinar on Tuesday.
Until the new incentive program is finalized, the BPU will be providing “Transition Renewable Energy Certificates” to projects that no longer qualify for SRECs.
The transition program is designed to be a “bridge” between the SREC system and the as-yet undetermined successor incentive, said Ariane Benrey, a program administrator at the BPU, during the webinar.
She invited contributions from the solar industry and the public on finalization of the new program. “If you would like to be involved in the stakeholder process or the successor incentive program, we highly encourage you to do so,” she said.