A long-debated bill aimed at spurring grid-scale solar projects in New Jersey won approval from legislators Tuesday, but that vote heightened doubts whether the state will achieve its ambitious clean-energy targets.
After a couple of hours of heated debate, the Senate Environment and Energy Committee approved the legislation (S-2605) in a 3-0 vote, despite solar developers, conservationists and consumer advocates all finding flaws in the bill, some asking for lawmakers to hold the bill.
Grid-scale projects are viewed as critical to the Murphy administration’s goal of having solar provide one-third of the state’s electricity by mid-century. The projects are widely considered the most cost-effective way to produce solar power from systems at the least cost to ratepayers by virtue of economies of scale.
‘Real hard time finding a consensus’
Sen. Bob Smith (D-Middlesex), the chairman of the committee and sponsor of the bill, seemed deflated by the response at the hearing. “I don’t think it’s such a bad bill,’’ Smith said after mulling one alternative: “Maybe, there’s no bill. I’m having a real hard time finding a consensus here.’’
It is not for a lack of trying. Smith’s committee first released a different version of the bill in August, but pulled it back from the Senate Budget Committee to address concerns raised by the solar sector. Smith said he recognized the revised bill taken up on Tuesday did not make everyone happy, but thought it was generally viewed as an improvement on the original. That proved to be not the case.
The issues generating controversy mirror concerns that have been raised with the New Jersey Board of Public Utilities in a separate proceeding to restructure how the state promotes and finances new solar power installations. Little consensus has emerged.
Install more solar, keep costs down?
The central issue is how to lower the cost of solar to utility customers, who this year are expected to pay at least $750 million — and maybe as much as $1.2 billion, according to the Division of Rate Counsel — to subsidize solar and how to ramp up the pace of solar installations, but at the same time decreasing what customers have to pay.
So far, that answer has proved to be elusive.
Solar developers contend that the new incentives for them to install many solar projects are too low, making it unlikely the administration will meet the increased solar targets at those levels of incentives. Some clean-energy advocates argue solar costs are more expensive in New Jersey than in other states, suggesting the way to lower customer bills is to rely on cheaper out-of-state solar projects.
Perhaps the biggest conflicts concern where these utility-scale grid supply projects ought to be located, with much of the controversy focused on whether these types of projects would go on prime farmland. Ed Wegryn of the New Jersey Farm Bureau said his organization believed Smith’s bill struck a “pretty good balance.’’
Tom Gilbert of the New Jersey Conservation Foundation questioned whether too much prime farmland would be left to be developed as solar farms under the latest version of the bill.
Landfills and brownfields
Other solar developers interested in building grid-supply solar projects on landfills and brownfields had different concerns. They suggested those projects would not advance if they had to be involved in competitive solicitations for incentives. Because those sites need to be cleaned up, the developers often need more certainty about whether their projects will be awarded incentives.
In written testimony, Rate Counsel Director Stefanie Brand opposed the bill; she argued it essentially guts a rate cap included in a 2018 law that aimed to protect ratepayers from runaway prices that customers were paying to subsidize solar over the past couple of decades.
“What this bill does is essentially eliminate that cap and dispense with the goal of making this a competitive industry,’’ Brand said.
At the end of the day, the solar developers, clean-energy advocates and regulators seem unable to agree on how to move solar forward to meet the administration’s aggressive goals, said Jeff Tittel, the former director of the New Jersey Sierra Club who spoke at the hearing as a private citizen.