The New Jersey State’s Energy Master Plan (EMP) draft, released every three years, is a vision for the use, management, and development of energy in New Jersey over the next ten years and beyond. It was released by Governor Chris Christie on June 7, 2011, but comments on the EMP were accepted up until August 25th, with the Solar Alliance, a solar industry trade organization, filing comments just before the deadline.
The position taken by the Solar Alliance is that some of the costs and benefits have been misconstrued. In particular, the Solar Alliance commented that:
- The Draft EMP has severely inflated the present cost of solar.
- New Jersey’s solar costs have already been pushed far below those assumed in the Draft EMP by competitive SREC markets.
- As opposed to statements in the Draft EMP, the costs of the SREC program comprise only a tiny fraction of ratepayers’ monthly electric bills
- The Draft EMP acknowledges external benefits of other energy resources but does not account for external benefits of solar.
- Contrary to statements in the Draft EMP, the quantified benefits of solar far exceeds the cost of solar incentives.
Carrie Hullen Hitt, President of the The Solar Alliance summarized the organization’s position this way, “we believe the analysis has left out important economic and social benefits. As currently drafted, the EMP will restrict New Jersey solar businesses from creating jobs and deploying clean, reliable solar electricity.” Below are three key points that the Solar Alliance feels should be included in any interpretation or revision of the EMP:
- The Board of Public Utilities should quantify all value streams, from manufacturing to investment and financing to development and installation, associated with solar when attempting to calculate the net economic benefit of solar projects.
- The EMP should use updated, universally recognized cost estimates of solar technology instead of out-of-date, inaccurate ones.
- The EMP should reassess its calculation of the cost of the SREC Program to ratepayers. The Solar Alliance estimates that the cost of the program is equivalent to $.09 per kW-hr.
The EMP is responsible for assessing the impact of, and recommending adjustments to, New Jersey’s Renewable Portfolio Standard (RPS) Program. The RPS is the program that created the NJ SREC market. While it remains to be seen if the EMP will be revised in the light of these comments, recent shifts in the SREC markets have since led to a new paradigm. At the time that the EMP was released SRECs were typically trading at 95% of the SACP. As of this writing, SRECs are trading at around 25% of the SACP. This alone prompts a revisit to the calculation regarding the cost of solar on utility prices as the calculations were based on the assumption that SRECs are priced at 75% of the SACP.