Earlier today, SRECTrade hosted a webinar for New Jersey Transition Incentive (TI) Program stakeholders. The webinar presented an overview of the TI Program, which features fixed-price, factorized Transition Renewable Energy Credits (TRECs), and also outlined SRECTrade’s services and onboarding process.
For access to the presentation slides, please click HERE. To view a recording of the webinar, please click the image below.
April 6, 2020 EDIT: The BPU ordered the following earlier today:
On Tuesday, March 31st, the New Jersey Board of Public Utilities (BPU) announced that it forecasts that 5.1% of state electricity sales will be supplied by operational solar projects around or before May 2020. It is therefore expected that the current SREC program (“Legacy Program”) could close to new applications as soon as April 30th.
In order to qualify for the current SREC Program, solar projects 1) need to obtain a Permission to Operate (PTO) by the SREC program closure date (estimated April 30th) and 2) submit their final-as-built application within 90 days from receiving PTO.
Solar systems that receive PTO after the SREC market closure date will be eligible for the new Transition Incentive program (“TREC Program”). Many details regarding the 15-year, fixed-price TREC Program structure have been finalized, including a flat pricing schedule of $152.00 per SREC. However, many important details surrounding the implementation and administration of the TREC Program Administrator have not been finalized yet. As a result, it is expected that TREC approvals and payments will not be made for several months after the program opens.
SRECTrade will continue to monitor the Legacy Program’s closure and the development of both the TREC Program and the eventual Successor Incentive program.
TweetOn Tuesday, January 21st, New Jersey Governor Phil Murphy signed Assembly Bill 6088 (AB-6088) / Senate Bill 4275 (SB-4275) into law in a victory for New Jersey “Transition Incentive” program stakeholders. A New Jersey Board of Public Utilities (BPU) order last month established that the Transition Incentive program’s structure will feature a factorized, fixed-price, 15-year Transition Renewable Energy Certificate (TREC), but did not finalize the pricing schedule that will be used throughout the program.
SB-4275 helps address a “kink year” component in one of the pricing schedule options by allowing the BPU to increase costs to electricity customers in energy years (EY) 2022-2024, such that the average cost to electricity customers from EY2019-2024 does not exceed a 9% cost cap during EY2019-2021 and a 7% cost cap for EY2022-2024. This cost cap flexibility allows the BPU to set higher TREC prices in the near term while still remaining below the legislated cost cap. Prior to this legislation adding flexibility, the BPU had proposed drastically lower TREC pricing during the first three “kink years” of the program, followed by higher pricing in later years.
For example, the two pricing schedules that the BPU had considered are: 1) a flat 15-year price of $152 and 2) a lower price of $65 for the first three years followed by a higher price of $189 for the last twelve years. The BPU still has not finalized some key aspects of the TREC program, including the final price levels. SRECTrade will continue to monitor the development of the Transition Incentive program and provide updates.
TweetOn Friday, December 6th, the New Jersey Board of Public Utilities (BPU) issued an order approving a new SREC program to aid in the transition from the current SREC program to the yet-to-be-determined “Successor Incentive” program. This “Transition Incentive” program will feature a factorized, fixed-price, 15-year Transition Renewable Energy Certificate (TREC). All projects that submitted complete SREC Registration Program (SRP) applications after October 29, 2018, but do not reach commercial operation at the time the BPU determines the 5.1% target has been reached, will qualify for TRECs.
The BPU will hold a cost-cap proceeding in early 2020 to finalize the annual value of the fixed-price TREC. Specifically, the BPU will evaluate two pricing scenarios: 1) a flat 15-year price of $152 and 2) a lower price of $65 for the first three years followed by a higher price of $189 for the last twelve years.
The different TREC project types and factorizations are displayed below:
TRECs will have a useful life of two energy years, including the energy year in which they were generated. If a TREC is not issued or sold during its two-year useful life, it will become an NJ Class I REC. The order further clarifies that Transition Incentive projects will be eligible to generate NJ Class I RECs after their 15-year TREC Qualification Life.
The BPU order also directs electric distribution companies to procure a TREC Administrator. Although the exact mechanics for how TRECs will be transacted are still being determined, the TREC Administrator will ultimately purchase all generated TRECs and allocate them to load-serving entities for compliance based on their market share of retail sales.
SRECTrade will continue to monitor the development of the final TREC levels and the Successor Incentive program.
TweetEarlier today, the New Jersey Board of Public Utilities (BPU) issued an order to clarify that all SREC applications submitted after October 29, 2018 will only receive 10 years of SREC eligibility.
This order means that all New Jersey Office of Clean Energy SREC Registration Program (SRP) applications submitted after 11:59pm ET today will be subject to 10 years of SREC eligibility instead of 15 years.
Please also note that applications received by the BPU for conditional certification pursuant to Subsection T prior to today’s deadline that fulfill all conditions established by the BPU shall receive 15-year SREC eligibility.
Since the May 23rd passage of Assembly Bill 3723 (AB-3723) and Senate Bill 2314 (SB-2314) to increase the state’s Renewable Portfolio Standard (RPS) requirements, there had been some confusion regarding when the effective date took place for the new 10-year eligibility period. Today’s NJ BPU order clarifies that confusion.
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