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RPS New Jersey
(Last updated July 1st, 2004)
RENEWABLE PORTFOLIO STANDARDS—STATE
SUMMARY
I. POLICY
II. ADMINISTRATION
III. FINANCING
IV. CRITICAL ELEMENTS
V. POLICY/PROGRAM ASSESSMENT
VI. PUBLIC OUTREACH AND
EDUCATION
I. POLICY
Date Enacted
February 1999
Effective Date
September 1, 2001
Time Period
Renewable percent increases from September 1, 2001 through January
1, 2012, then holds steady with no defined program end.
Extensions to Time Period
not applicable
Applicable Laws, Orders, and Regulations
Electric Discount and Energy Competition Act
P.L. 1999, CHAPTER 23
N.J.S.A. 48:3-87
http://www.bpu.state.nj.us/wwwroot/energy/Dereglaw.pdf
Subchapter 8, N.J.A.C. 14:4-8
Interim Renewable Energy Portfolio Standards
http://www.bpu.state.nj.us/wwwroot/energy/portfoliostands.pdf
Description
This RPS incorporates two tiers of renewables, Class I and Class
II. The total renewable generation requirement begins at 3.0%
on 2001 and ramps up to 6.5% in 2012 and beyond. Class II renewables
comprise 2.5% of the portfolio for all years, while Class I
renewables increase from 0.5% to 4.0% over the first ten years
of the program. The policy is currently subject to interim Renewable
Energy Portfolio Standards, which are intended to be in effect
for 18 months from the commencement of the program.
Program Name
Renewable Energy Portfolio Standard
Standard
Year
|
% Generation from Class I Sources
|
% Generation from Class I or II Sources
|
Total % Generation from Eligible Sources
|
| 2001* |
0.5% |
2.5% |
3.0%
|
| 2002 |
0.5% |
2.5% |
3.0%
|
| 2003 |
0.75% |
2.5% |
3.25%
|
| 2004 |
0.75% |
2.5% |
3.25%
|
| 2005 |
0.75% |
2.5% |
3.25%
|
| 2006 |
1.0% |
2.5% |
3.5%
|
| 2007 |
1.5% |
2.5% |
4.0%
|
| 2008 |
2.0% |
2.5% |
4.5%
|
| 2009 |
2.5% |
2.5% |
5.0%
|
| 2010 |
3.0% |
2.5% |
5.5%
|
| 2011 |
3.5% |
2.5% |
6.0%
|
| 2012 and beyond |
4.0%
|
2.5%
|
6.5%
|
*(September 1, 2001 - December 31, 2001)
Eligibility Date
No eligibility date is specified in the interim standards,
implying that both existing and new sources are eligible under
the RPS.
Generation Limit
Only hydroelectric facilities that have a maximum design capacity
of 30 megawatts or less shall qualify as Class II renewable
energy sources. Aggregate generation from small renewable
energy resources, 100 kilowatts of capacity or less, may be
used to meet renewable portfolio requirements.
Fuels/Technologies
"Class I Renewable Energy" means electric energy produced
from:
·
Solar technologies
·
Photovoltaic technologies
·
Wind energy
·
Fuel cells (hydrogen or hydrogen-rich fuel for fuel cells
can be obtained from hydrocarbon-based fuel sources that include,
but are not limited to, natural gas, methanol, landfill and
digester gas, and biomass gas.
·
Geothermal technologies
·
Wave or tidal action
·
Electric energy produced from biomass, either by the burning
of captured methane gas derived from biomass or the direct
firing of biomass, provided that the biomass is cultivated
and harvested in a sustainable manner. Here biomass is defined
as "...any organic matter that is available on a renewable
or recurring basis (excluding old-growth timber), including
dedicated energy crops and trees, agricultural food and feed
crop residues, aquatic plants, wood and wood residues, animal
wastes, and other waste materials." Biomass includes:
(A) Gas from the anaerobic digestion of food waste and sewage
sludge;
(B) Gas from the anaerobic digestion of other biomass fuels,
including bioenergy crops and agricultural waste;
(C) Bioenergy crops;
(D) Any of the following types of wood, provided that the
wood is clean and untreated and cultivated and harvested in
a sustainable manner in accordance with a management plan
approved by the environmental agency in the state in which
the wood is grown:
I. Wood produced at a biomass energy plantation;
II. Wood from the thinning or trimming of trees and/or from
a forest floor, except wood from old growth forests;
III. Ground wood, produced through the grinding or shredding
of pallets and other scrap wood (and the removal of nails
and any other metal) at a recycling facility that is classified
as a Class B recycling facility by the New Jersey Department
of Environmental Protection’s Bureau of Landfill and Recycling
Management or an equivalent recycling facility approved by
the state environmental agency in which the facility is located;
or
IV. Wood shavings and scrap from a lumberyard or a paper mill.
Co-firing of biomass with non-renewable fuels is allowed,
with generation credited on a pro-rated output basis.
The legislation specifically excludes:
(A) Treated, painted or chemically coated wood;
(B) Municipal solid waste;
(C) Tires;
(D) Sewage sludge;
(E) Wood waste, including demolition waste and construction
waste, for which there is no documentation that demonstrates
that the wood was grown and harvested in accordance with a
management plan approved by the environmental agency of the
state in which the wood is grown;
(F) Wood from an old growth forest, including wood from the
forest floor; and
(G) Wood from the harvesting of a standing forest, except
for a forest that is part of a bioenergy plantation.
"Class II Renewable Energy" means electric energy produced
at a:
·
Resource recovery facility
·
Hydro power facility, 30 MW or less only
Provided that such facilities are located where retail competition
is permitted and provided further that the Commissioner of
Environmental Protection has determined that such facility
meets the highest environmental standards and minimizes any
impacts to the environment and local communities.
II. ADMINISTRATION
Administering Entities
New Jersey Board of Public Utilities
The New Jersey Department of Environmental Protection (NJDEP)
is responsible for assessing biomass facility compliance with
sustainability criteria.
Type of Entity
State
Administrative Contacts
New Jersey Board of Public Utilities
44 South Clinton Avenue (7th Floor)
Trenton, NJ 08625
Phone: (609) 777-3314
Fax: (609) 777-3336
Website: http://www.bpu.state.nj.us
III. FINANCING
Funding Level
There is no explicit funding level for the RPS. However, the
interim standards allow electricity generated from Class I
renewable energy projects funded by the societal benefits
charge (SBC) to qualify as Class I renewable energy that can
be used to meet the renewable energy portfolio standards percentage
requirements.
Funding Source
Included in rate base
Cost Cap
None specified. The legislation stipulates that the cost of
renewable energy to be recovered from the ratepayers must
be reasonable and prudent.
Charge
Not broken out on a mil/kWh basis.
IV. CRITICAL ELEMENTS
Trading
An electric power supplier or basic generation service provider
may satisfy the RPS requirements by participating in a renewable
energy trading program at such time as a program is developed
and ordered or adopted by the Board, in consultation with
the NJDEP. An electric power supplier or basic generation
service provider is advised to keep all documentation pertinent
to any energy from Class I and Class II renewable sources
in excess of the renewable energy portfolio standards’ requirement
for any given year. Should the renewable energy trading program
allow for inter-temporal trading or trading between years,
full documentation shall be required to confirm the existence
of such excess renewable energy in the electric power supplier's
or basic generation service provider's electric energy portfolio.
Green Pricing
As long as green attributes (green tags) remain bundled with
the kWh produced, energy sold under green pricing is eligible
under the RPS.
Certification
Should a renewable energy trading system be implemented, legislation
creating renewable energy tradable credits will be promulgated.
Out-of-State
An electric power supplier or basic generation service provider
may rely on energy produced by an out-of-state resource recovery
facility as Class II renewable energy, provided the NJDEP
determines that the highest environmental standards for the
resource recovery facility are meet. Further, the energy must
be generated at a facility in a jurisdiction where retail
competition exists.
Self-generation
Aggregate generation from small renewable energy resources,
100 kilowatts of capacity or less, may be used to meet renewable
portfolio requirements, provided that the generators or customer-generators
or their agents document the level of generation, as recorded
by appropriate metering and power sales, on an annual basis.
Any renewable energy from small on-site generation not scheduled
through the PJM ISO or NY ISO, including on-site small wind
or solar photovoltaic generation sources using net metering
to record electricity generated from the customer's side of
the meter and meeting New Jersey's Interim Net Metering, Safety
and Power Quality Standards for Wind and Solar Photovoltaic
Systems, may be used to meet these renewable energy portfolio
requirements, subject to provisions detailed in the legislation.
Flexibility
Class I and Class II renewable portfolio percentage requirements
cannot be fulfilled by ascribing a portion of spot market
purchases as renewable energy. This is due to concerns that
allowing suppliers to rely on a percentage of the spot market
average to discharge their renewable energy requirement could
result in counting the renewable energy in more than one supplier’s
energy portfolio.
V. POLICY/PROGRAM ASSESSMENT
Reporting Requirement
By March 1st of each year, beginning March 1, 2002, each electric
power supplier and basic generation service provider shall
file an annual report with the Board of Public Utilities,
demonstrating that the electric power supplier's or basic
generation service provider's electric energy portfolio met
the percentage requirements for Class I and Class II renewable
energy contained in N.J.A.C. 14:4-8.3 for the preceding calendar
year (January through December).
If the annual March report demonstrates noncompliance for
the preceding calendar year, the electric power supplier or
basic generation service provider shall then file quarterly
reports beginning in June of that year and in each subsequent
calendar year in March, June, September, and December. The
electric power supplier or basic generation service provider
shall continue to submit quarterly reports until such time
that the supplier or provider of electricity has met the Class
I and Class II renewable energy portfolio requirements for
one full calendar year.
Any party determined by the Board, after notice and hearing,
to have violated any provision of these interim standards
relating to the renewable energy portfolio standards’ requirements
may be subject to any one or more of the following penalties:
i. Suspension or revocation of the electric power supplier's
license;
ii. Financial penalties;
iii. Disallowance of recovery of costs in rates; and
iv. Prohibition on accepting new customers.
Assessing Entity
Board of Public Utilities
Report Date
April 24, 2003
Report Name
The Renewable Energy Task Force released a new report in April.
The New Jersey Public Utility Commission has been advised
of the task force's recommendations and will propose new public
utility regulations to the state legislature.
http://www.state.nj.us/bpu/renewEnergy/renEnergyReport.pdf
Status
The majority of electricity suppliers in New Jersey have met
their RPS requirment. For those suppliers who have not met
their requirement, they have an additional year to make up
their renewable energy deficit.
As it stands now, New Jersey has an interim RPS requirement.
However, the Public Utility Commission and the state legislature
are in the process of revising these requirements.
Governor McGreevey Accepted recommendations from his appointed
Renewable Energy Task Force to increase the initial RPS targets
specified by legislation. The following noteworthy items are
from the April 24, 2003 press release:
- increase 2008 target from 2%
to 4%
- extend legislation to 2020 with
a 20% target
- establish two pro-renewable energy
voluntary programs for utility customers
- suggested options for programs
specifically promoting solar energy
Cost Information
To date, there is no public information on the cost of renewable
contracts. However, included in the Renewable Energy Task Force's
report was a recommendation for a new tracking certificate-based
program. This tracking system would have the effect of requiring
all retail suppliers to disclose the renewable attributes of
the power along with some of the costing information.
Assessment Contact
New Jersey Board of Public Utilities
44 South Clinton Avenue (7th Floor)
Trenton, NJ 08625
Phone: (609) 777-3314
Fax: (609) 777-3336
VI. PUBLIC OUTREACH AND EDUCATION
Press Release
http://www.bpu.state.nj.us/wwwroot/communication/communications.htm
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