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New Jersey Solar TREC Program

February 27, 2020 By In News No Comments

The NJ Board of Public Utilities (BPU) announced the approval of the Transition Incentive Program which will provide some certainty to solar projects until a successor program is announced. The current SREC (Solar Renewable Energy Credits) program will expire once 5.1% of the NJ megawatt hours are supplied by qualified solar generation. Once the capacity of the SREC program is reached, projects already accepted into the program, but not yet built, will qualify for the TREC (Transitional Renewable Energy Credits). In a February 7, 2020 report to stakeholders, the BPU estimated that the TI program would begin around June 2020.

What does this mean for businesses considering solar?

There are three classes of programs for companies that are generating solar.

  1. SRECs – Projects that reach their commercial operation date before the program hits the 5.1% goal is reached. Businesses that qualified for SRECs will continue to generated SRECs throughout their qualified life.
  2. TRECs – Projects that complete the registration before the program reaches capacity but do not reach their commercial operation date prior to the program hitting capacity will qualify for TRECs. Customer’s taking advantage of the TREC program will continue to receive the value for 15 years.
  3. Successor Program – A program not yet announced, solar facilities that do not complete registration prior to capacity being reached are at risk.

TREC Value

TRECs are valued based on a pre-determined, fixed-rate schedule. This varies from the SREC program which is traded based on market value. The first three years of the TREC program sets prices at $65. Starting in year 4, values will jump up to $189 for the remainder of the 15-year qualifying life.

A system producing around 450,000 kWh a year would generate over $1 million in TRECs over the 15 year period – about twice the value of the system.

When will the program reach capacity?

The BPU has published an estimated timeline of June 2020. However, they have made it explicitly clear that it is only an estimate that could be reached before or after. Genie Solar is advising customers who want to take advantage of the TREC program to enter into their agreement no later than April 15th in order to ensure that the application for the program can be completed and submitted in adequate time. This may shift forward or backward depending on how the capacity progresses.

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Genie Energy Ltd., (NYSE: GNE, GNEPRA) is a global energy solutions company. We supply customers in the US and Europe with electricity, including electricity generated from renewable resources and with natural gas. Through Genie Solar Energy and Prism Solar, we design, construct and install commercial solar energy solutions. We provide commercial and industrial clients with energy brokerage and consultative services through our Diversegy brand.

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Convinced to go solar by the New Jersey incentives, PCS Wireless looked at several solar companies to provide the best overall value. Genie Solar was able to design a unique system to offset the largest portion of their electricity usage. Additionally, we combine it with an exclusive financial product which minimized the cash out of pocket and maximized the return on investment. The 494 kW system was constructed in minimal time, with no impact on the businesses operations.
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A premier provider of water treatment in the New York and New Jersey area, Tower wanted to go solar to save money and generate clean energy. Upon reviewing the financial benefits available in New Jersey with the SREC program and the federal Investment Tax Credit, they wanted to safe harbor the project in 2019 and construct in 2020. Buying American Made panels was an important component of the project, and by utilizing their white roof, Genie Solar was able to leverage Prism Solar’s bifacial panels to minimize the square footage needed and maximize the electricity generated. Genie Solar helped them achieve all of their goals in an efficient manner with a 44.6 kW system.
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