April 1. 2019

CSG Law Alert: New Jersey BPU Announces Opening of Application Window for Community Solar

On March 29, 2019 the New Jersey Board of Public Utilities (“BPU”) released the final Community Solar Energy Pilot Program Application Form (the “Application”) and announced the Application period opens on April 9, 2019 at 9:00 A.M. and closes on September 9, 2019 at 5:00 P.M. The form is substantially the same as the form released for comment in November 2018, however, there are some changes, including modifications to the scoring system.

It is important to note the following regarding the Application:

1. Original signatures are required on all forms, and the certifications must be notarized. One original and three copies of the complete Application must be submitted to the BPU by hand or mail no later than 5:00 P.M. on September 9, 2019. In addition, an electronic copy of the complete Application must be submitted to two separate e-mail addresses contained in the Application.

2. Projects that have begun operation and/or have been approved by the BPU for connection to the distribution system prior to February 19, 2019 are not eligible.

3. Projects may not be larger than 5 megawatts (“MW”) and the applicant must have site control at the time of application. An option to purchase or option to lease will qualify as site control.

4. If the project is not located on a rooftop or parking lot the applicant must have met with the New Jersey Department of Environmental Protection’s (“NJDEP”) Office of Permit Coordination and Environmental Review (“PCER”) to determine what permits may be required and to identify other potential issues. Applicants are expected to have completed the NJDEP Permit Readiness Checklist and submitted such checklist to NJDEP PCER prior to submitting the Application.

5. An applicant may be a project developer, project owner, project operator, property owner, contractor, installer, land speculator or agent thereof.

6. Only Applications that are administratively complete by the close of the application period will be considered. Applications may be amended and resubmitted during the application period without penalty.

7. Projects must score a minimum of 30 points to qualify. Projects that score 30 points or higher will be presented to the BPU for participation in order, starting with the highest score and proceeding until the 75 MW cap is reached. At least 40% of the program capacity (at least 30 MW) must be allocated to LMI projects. The projects will be scored as follows:

            I. Low and Moderate Income (“LMI”) Inclusion – 30 points. A project is considered an LMI project if a minimum of 51% of the capacity is assigned to LMI subscribers.

            II. Siting – 20 points. Higher preference for landfills, Brownfields, areas of historic fill, rooftops, parking lots and parking decks. Medium preference will be given to canopies over impervious surface (i.e. walkway) and areas in need of redevelopment. Preserved land, wetlands, forested area and farmland is not preferred. Up to 5 bonus points are available for landscaping, land enhancement, pollination support, storm water management and soil conservation.

            III. Product Offering – 15 points. Higher preference for guaranteed savings of greater than 10% and flexible terms (e.g. no cancellation fee and a short term contract). Medium preference for guaranteed savings greater than 5%. Projects with no guaranteed savings are not preferred.

            IV. Community and Environmental Justice Engagement – 10 points. Higher preference for partnerships with municipalities, local community organizations and affordable housing providers. Medium preference for a letter of support from the municipality, if the project owner is a government and/or public or quasi-public entity or if the owner is an affordable housing developer.

            V. Subscribers – 10 points. Higher preference if more than 51% of the capacity is assigned to residential subscribers.

            VI. Other Benefits – 10 points. Higher preference for projects that provide local jobs and projects which demonstrate co-benefits (e.g. paired with storage, a micro-grid, energy audit or energy efficiency measures).

            VII. Geographic Limit – 5 points. Higher preference if subscribers are limited to the municipality in which the project is located or adjacent municipalities. Medium preference if subscribers are limited to the county in which the project is located or the adjacent county.

        8. Approved projects are expected to begin construction within 6 months of their approval by the BPU and are expected to become fully operational within 12 months of their approval. Extensions may be granted by the BPU in its discretion.

        9. Information requested in the application includes:

            I. Estimated number of subscribers and breakdown between residential, industrial and commercial subscribers.

            II. Whether the project is using an anchor subscriber.

            III. Cost estimates, including net installed cost, cost of customer acquisition, annual customer churn rate and annual operating expenses. Substantiating evidence must be attached in the form of charts and/or spreadsheet models.

10. Applicants are expected to provide a good faith description of the product offerings as they are known at the time the application is filed. If the project is approved the applicant must notify the BPU and receive approval for any modification or addition to the product offerings.

In addition, the BPU clarified via order that community solar projects will apply for interconnection through the Electric Distribution Companies (EDCs) following normal interconnection procedures.