What renewable energy incentive programs are available to New Jersey businesses?
Recent Regulations and Resources
1. Federal Energy Investment Tax Credit
A 30% federal tax credit is available for investments in qualified renewable energy technologies. This credit can be used to offset both regular and alternative minimum tax (AMT). A five-year accelerated depreciation allowance is also available under this tax credit program.
2.Solar Renewable Energy Certificates (SREC)
Each time a solar installation generates 1,000 kilowatt-hours (kWh) of electricity, an SREC is earned. Solar project owners report the energy production to the SREC Tracking System. This reporting allows SREC’s to be placed in the customer's electronic account. SRECs can then be sold on the SREC Tracking System, providing revenue for the first 10 or 15 years of the project's Qualification Life pending interpretation of Legislation.
Electricity suppliers, the primary purchasers of SRECs, are required to pay a Solar Alternative Compliance Payment (SACP) if they do not meet the requirements of New Jersey’s Solar RPS. One way they can meet the RPS requirements is by purchasing SRECs. As SRECs are traded in a competitive market, the price may vary significantly. The actual price of an SREC during a trading period can and will fluctuate depending on supply and demand. See recent SREC trading prices.
3. Assistance for Offshore Wind Developers
With help from a multi-agency team (BPU, EDA, DEP and others), the State of New Jersey offers turbine manufacturers and wind farm developers access to a wide array of tools and resources critical to the success of the wind power industry including: Offshore Wind Feasibility Studies; Wind Simulations; NJ Resource Maps. The BPU also offers a rebate program for those who develop and Offshore Wind Meteorological Towers.
Information on the NJEDA’s support for offshore wind and the New Jersey Wind Port is available at https://www.njeda.com/offshorewind/.
4. Offshore Wind Renewable Energy Certificate (OREC)
The OREC system is under development, but all load-serving entities that supply Basic Generation Service to Electric Distribution Companies (EDCs) and third party suppliers of retail electricity will be required to obtain a certain number of Offshore Renewable Energy Certificates (ORECs), based on their percentage of retail sales in NJ. The number of ORECs required to be obtained by suppliers will increase over time as new offshore wind facilities are installed.