BPU approves new strategy to increase use of solar power in NJ
By REBECCA SANTANA | Associated Press Writer

NEWARK, N.J. - The Garden State, already a national leader in solar energy, is expected to see the amount of energy garnered from the sun increase dramatically between now and 2020 under a program approved Wednesday by utilities regulators.

Under the framework unanimously approved by state Board of Public Utilities, the state will move away from a rebate system that has accounted for most of New Jersey's solar growth so far, and toward a market-based system that uses private financing to pay for solar installations.

"It is really the beginning of propelling the state forward, to the forefront of renewable energy," said Commissioner Joseph Fiordaliso. "I believe we are really traveling the right road."

But some critics have questioned whether the new method for growing the program will be too costly.

The state's solar program started in 2001 with six homeowners installing panels that capture the sun's rays and turn them into electricity. Since then the program has grown to over 2,300 installations in homes, businesses, churches and schools, and 100 solar-related companies have sprouted up.

As part of efforts to battle global warming and increase energy independence, New Jersey has committed itself to increasing the amount of solar energy it produces. By 2020, at least 2 percent of the state's energy must come from solar sources.

BPU officials say that sticking with a rebate-based system to achieve that goal would be too costly.

The framework approved Wednesday would encourage the installation of solar projects through the sale of credits, and eventually get the state out of the rebate business. Businesses, residential customers and schools will all be eligible to take part; municipalities would also be able to create large-scale systems that would service a whole town.

The program would cost ratepayers a maximum of about $6 billion over its lifetime, through 2036, said Michael Winka, who oversees the state's Clean Energy Program.

Whereas the rebates are currently financed through a fixed cost charged to ratepayers every year, in the future the cost will be folded into ratepayers' bills so they wouldn't see a specific charge.

In the beginning, ratepayers would be expected to see a drop in how much they're paying for solar installations, while in the peak years, when solar installations are expected to grow the most, the cost could be as high as $33.29 a year for the average residential ratepayer.

The board's vote was welcomed by environmental groups who see renewable energy sources such as solar as a way to wean people from fossil fuels, which are believed to contribute to global warming.

The vote was also welcomed by many in the solar industry who had seen their business slow down dramatically as the BPU figured out a framework for moving forward.

"Today is a day that will go down in history of New Jersey as a great day. ... It's going to really drive solar energy power mainstream," said Gaurav Naik, co-owner of GeoGenix, a Rumson-based solar energy installer.

However, Jeff Tittel, executive director of the New Jersey chapter of the Sierra Club, said he was distressed that the rebate program would be reduced, which he said would hurt homeowners. They had been able to recover 70 percent of a system's cost, he said.

And some in the business community fear the new approach will drive up New Jersey's already high electricity prices.

"Harnessing the sun can be expensive," said Commissioner Christine V. Bator, who voted for the program but had some concerns about the cost.

Those concerns led to the introduction of the $6 billion cap on the total cost to ratepayers included in the final version approved Wednesday.

The eventual cost of the program could be less, said BPU chief Jeanne Fox, since many in the solar industry estimate that the cost of the solar panels will go down significantly over the coming years.

The $6 billion figure must also be compared to the total amount that New Jerseyans are expected to pay for electricity during that same time, said Winka, who put that figure at about $600 billion.