In early 2020, the NJ Board of Public Utilities implemented the Transition IncentiveProgram (TREC) as a bridge between the previous SREC Program and the yet to be implemented Solar Successor Program. The TREC program was designed to be temporary and indications are that it will close in summer 2021, and the NJ BPU recently released its Solar Successor Program Straw Proposal If you are thinking about going solar in NJ, there is still time to claim a highest incentive before the following changes go into effect
1. Up to 44% reduction of incentive value
The proposed incentive is up to 44% lower than currently available under the Transition Incentive Program. The TREC pays solar system owners up to $152/MWh ($0.152/kWh) for 15 years, with the best rates going to commercial roof and carport projects. Under the Proposed Successor Program, system owners would be paid just $85/MWh for 15 years.
What these changes mean for you if you miss the window to use the current incentive program for your solar project:
- If you want to buy a solar system (1 MW example): You would miss out on revenue of $1.1 million (~$80k per year)
- If you want to get a financed solar system (1 MW example): You would pay $40k per year for 15 years, instead of paying $0 for 15 years and collecting $350,000 up front
2. Application process and fees
Applying for the current TREC incentive is simple, allows for some flexibility for changes to the system size, and has no application fees. So if you’re considering solar for your NJ building(s), it’s straightforward to secure an incentive reservation with minimal expense and risk.
The proposed program would require more detailed application information and an application fee. This means that more feasibility and design work must be completed prior to applying for the incentive and increases the financial risk and lead times for project developers and customers.
3. System size and total program capacity is capped
Under the TREC program, system size is limited only by the customer’s electrical consumption and there is no statewide cap. You can get all the solar you need to offset up to 100% of your annual electrical consumption and collect the full incentive on all of it!
Under the Proposed Successor Program, projects will be limited to 5MW in capacity. Larger projects would need to apply under a competitive solicitation process, which will likely result in a much lower incentive.
The proposed program also establishes an annual statewide cap on the amount of solar that can qualify for incentives. This means the program could run out of money before you apply, causing your project to be delayed, or to get a lower incentive.
OnSwitch is following these changes closely and is helping our customers prepare TREC incentive applications in order to lock-in the current lucrative incentives. Once the changes go into effect, our SkyQuotes engine will automatically update quotes and savings to reflect the new program incentives.