New Jersey Seeks Feedback this Week on Town Center Microgrid Funding

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New Jersey regulators seek feedback by Dec. 13, 2019 on the second phase of the town center microgrid program, which will allot $4 million for project design.

Two years ago, in the program’s first phase, the Board of Public Utilities distributed $2 million to 13 town center microgrids for feasibility studies. Those microgrids will be eligible for the second round of funding.

The board seeks comment on funding criteria for the second phase as well as on issues being raised that could hamper development of the microgrids. 

town center microgrid

Atlantic City has proposed a 19.2 MW town center microgrid that would serve casinos, a medical center and other buildings. Photo by ESB Professional/Shutterstock.com

One stumbling block involves the ability of microgrids to cross utility rights of way. The board asks for comment on a New Jersey League of Municipalities assertion that municipalities can construct and operate microgrids in their own right of ways. This interpretation would ease restriction on microgrid development.

Another issue clouding the town center microgrid program involves the ability of the projects to form public-private partnerships to fund their construction. The board did not raise that issue in its request for comments, but it is playing out before the state legislature. A bill under consideration (A4535/S2958) would allow the public private partnerships.

Town center microgrid ranking

The town center microgrid program takes the projects only through feasibility and design; after that they would need to seek private funds and possibly other state incentives.

For the second round of funding, the board proposes such criteria as:

  • Use of renewable energy and energy storage in the microgrid
  • Coordination with the local electric utility
  • Commitment to cost sharing 

The board will choose winners based on a competitive ranking process. Highest points (up to 20 each) go to the project’s narrative and its “clean and green” attributes, which include its use of  renewable energy and energy storage, electric vehicle charging and its reduction in greenhouse gases and peak demand. Four other categories receive up to 15 points each: social (including service to shelters or critical facilities); financial, technology and cost contribution to the project by the applicant.

The number of awards given will be based on the rankings and available funds.

Want to learn more about town center microgrids? Join us at Microgrid 2020, June 2-3 in Philadelphia. Register now for the early bird discount.

New solar incentives

Separately, the board made another move last week that could influence microgrids and other clean energy projects seeking solar incentive funds.

The board approved a new transitional solar incentive program for use as it moves away from the state’s current incentives — solar renewable energy certificates (SRECs) — to a yet-to-be determined successor incentive.

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Called ‘transition renewable energy certificates, or TRECs, the new program offers fixed-price incentives over 15 years. The board plans to hold a cost-cap proceeding in early 2020 to determine the annual value of the TREC. At issue is whether there is  sufficient headroom for a flat 15-year TREC price of $152, or if the board should maintain a lower price of $65 for the first three years and $189 for the remaining 12 years. 

The state is phasing out the SREC under a requirement in its 2018 Clean Energy Act that the program close when 5.1% of the electricity sold in New Jersey comes from solar or by June 2021, whichever comes first. State lawmakers decided to phase out SRECs after critics raised concerns the program had become too costly and was creating market inefficiencies as solar prices fell.

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Elisa Wood About Elisa Wood

Elisa Wood is the chief editor of MicrogridKnowledge.com. She has been writing about energy for more than two decades for top industry publications. Her work also has been picked up by CNN, the New York Times, Reuters, the Wall Street Journal Online and the Washington Post.

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