This week’s column is on an important piece of legislation that will ensure that residential and small-business solar continues to grow with the full support of state policy. As always, thanks to my science and environment intern Arcadia Lee for research and drafting this article. Thank you to NJ Spotlight and NJ.com for their continued coverage of these important issues to the state of New Jersey. Cross-posted at BlueJersey.com
You or maybe a neighbor in town has installed solar, and you've seen or heard about how the power company's meter "runs backward" when the solar panels are powering the home. That means that the homeowner is receiving a retail rate for the power they are generating, making the payback for solar much quicker for the homeowner. The technical term for this is "Net Metering."
Net metering is the system that allows people who generate their own electricity using solar panels to feed excess energy back into the grid, sometimes referred to as “nega-watt” energy. Net metering encourages residential and commercial solar growth and may allow a utility company to avoid costly investments in new transmission and distribution of grid electricity.
Under the current New Jersey law, utilities do not have to offer net metering when generating capacity by net-metered customers equals 2.5% of the state’s peak demand for electricity, and as NJ Spotlight reports, a threshold we are already above. But on August 10th, the governor signed legislation (A-3838/S-2420) sponsored by Assemblymen John F. McKeon, Tim Eustace, Reed Gusciora and myself. The new law expands the state’s net-metering capacity threshold to 2.9% of total annual kilowatt-hours sold in state. More importantly, this means that the crucial pro-consumer pro-environment and pro-renewable energy job policy of net metering will continue unabated as solar continues its growth in the Garden State.
The passing of this legislation is particularly important due to President Obama’s Clean Power Plan. The Clean Power Plan uses authorities allowed by the Clean Air Act and in June 2014, the EPA developed new regulations with a goal of reducing carbon dioxide emissions by 30% by 2030, from our 2005 levels. Opponents to the rule are fearful that the transition will be too expensive and grid operators are fearful that added costs and sudden changes may harm reliability. By raising the net metering cap, less pressure is placed on utility companies to meet these ambitious reduction targets.
I will continue pushing for legislation that raises net metering caps to increase the amount of small-scale solar development in New Jersey because it benefits our economy and our environment. At a time when many states are putting up new barriers for solar growth or are cutting back on policies like net metering, it is vital we continue to lead in this important economic growth area for our state. This is especially so, when there have been so few environmental "wins" legislatively under Governor Christie.
For more articles discussing our legislation's passage see the links below: