N.J. Admin. Code § 14:8-2.3

Current through Register Vol. 56, No. 21, November 4, 2024

Section 14:8-2.3 - Amount of renewable energy required

(a) Each supplier/provider, as defined at N.J.A.C. 14:8-1.2, that sells electricity to retail customers in New Jersey, shall ensure that the electricity it sells each energy year in New Jersey includes at least the minimum amount of qualified renewable energy required for that energy year, as specified in this section. Requirements for class I, class II, SRECs, and TRECs are set forth in Table A below:

Table A

What Percentage of Energy Supplied Must Be Solar, Class I, or Class II Renewable

Energy Year	TRECs	SRECs	Class I	Class II	Total
June 1, 2018 - May 31, 2019	0%	4.30%	14.175%	2.50%	20.975%
June 1, 2018 - May 31, 2019*	0%	3.29%*	14.175%*	2.50%*	19.965%*
June 1, 2019 - Dec. 31, 2019	0%	4.90%	16.029%	2.50%	18.529%
June 1, 2019 - Dec. 31, 2019*	0%	3.38%*	16.029%*	2.50%*	21.909%*
January 1, 2020 - May 31, 2020	0%	4.90%	21.0%	2.50%	23.50%
January 1, 2020 - May 31, 2020*	0%	3.38%*	21.0%*	2.50%*	26.88%*
June 1, 2020 - May 31, 2021	based on retail sales	5.10%	21.0%	2.50%	23.50%
June 1, 2020 - May 31, 2021*	based on retail sales	3.47%*	21.0%	2.50%	26.97%
June 1, 2021 - May 31, 2022	based on retail sales	5.10%	21.0%	2.50%	23.50%
June 1, 2022 - May 31, 2023	based on retail sales	5.10%	22.0%	2.50%	24.50%
June 1, 2023 - May 31, 2024	based on retail sales	4.90%	27.0%	2.50%	29.50%
June 1, 2024 - May 31, 2025	based on retail sales	4.80%	35.0%	2.50%	37.50%
June 1, 2025 - May 31, 2026	based on retail sales	4.50%	38.0%	2.50%	40.50%
June 1, 2026 - May 31, 2027	based on retail sales	4.35%	41.0%	2.50%	43.50%
June 1, 2027 - May 31, 2028	based on retail sales	3.74%	44.0%	2.50%	46.50%
June 1, 2028 - May 31, 2029	based on retail sales	3.07%	47.0%	2.50%	49.50%
June 1, 2029 - May 31, 2030	based on retail sales	2.21%	50.0%	2.50%	52.50%
June 1, 2030 - May 31, 2031	based on retail sales	1.58%	50.0%	2.50%	52.50%
June 1, 2031 - May 31, 2032	based on retail sales	1.40%	50.0%	2.50%	52.50%
June 1, 2032 - May 31, 2033	based on retail sales **	1.10%	50.0%	2.50%	52.50%

(*BGS Providers with existing contracts)

**The TREC Obligation expressed as a percentage of retail sales in a given energy year will not be known until each energy year when the volume of retail sales subject to the RPS has been determined. Allocation of the Statewide obligation to individual TPS/BGS providers will follow the method set forth at (r) and (t) below.

(b) Each supplier/provider that sells electricity to retail customers in New Jersey shall ensure that the electricity it sells each reporting year in New Jersey includes at least the minimum percentage of SRECs and TRECs required for that energy year as set by the Board. The Board, in consultation with the NJDEP, EDCs, Rate Counsel, the solar energy industry, and relevant stakeholders, shall periodically consider increasing the renewable energy portfolio standards beyond the minimum amounts set forth in this chapter, taking into account the cost impacts and public benefits of such increases including, but not limited to:

1. Reductions in air pollution, water pollution, land disturbance and greenhouse gas emissions;

2. Reductions in peak demand for electricity and natural gas and the overall impact on the costs to electricity and natural gas customers;

3. Increases in renewable energy development, manufacturing, investment and job creation opportunities in New Jersey; and

4. Reductions in State and national dependence on fossil fuels.

(c) Each supplier/provider's SREC obligation shall be calculated in accordance with the requirements of P.L. 2018, c. 17. A supplier/provider shall meet the requirements for SRECs through:

1. Retirement of SRECs through a renewable energy trading program approved by the Board in consultation with the NJDEP; or

2. Submittal of one or more SACPs.

(d) Beginning in EY20, SREC obligations and TREC obligations are a component of class I renewable energy requirements, and satisfaction of SREC and TREC obligations shall be counted toward class I renewable energy requirements.

(e) A supplier/provider may meet the class I and class II renewable energy requirements in Table A above by retiring RECs in accordance with N.J.A.C. 14:8-2.8. Alternatively, a supplier/provider may comply with the class I and class II requirements of this subchapter by submitting the appropriate number of ACPs, in accordance with N.J.A.C. 14:8-2.10.

(f) Only RECs based upon class II renewable energy, as defined at N.J.A.C. 14:8-1.2, shall be used to meet the class II renewable energy requirements.

(g) The following shall apply to the type of energy, and type of documentation, used for compliance with each of the requirements in this subchapter:

1. SRECs may be used to meet any requirement for solar electric generation or class I renewable energy;

2. Class I RECs may be used to meet class I renewable energy requirements, but shall not be used to meet solar electric generation requirements or class II renewable energy requirements; and

3. Class II RECs shall be used only to meet class II renewable energy requirements and shall not be used to meet solar electric generation requirements or class I renewable energy requirements.

(h) A supplier/provider shall not demonstrate compliance with this subchapter using direct supply of any type of renewable energy.

(i) (Reserved)

(j) The same renewable energy shall not be used for more than one of the following:

1. Creation of an SREC under N.J.A.C. 14:8-2.9;

2. Creation of a REC under N.J.A.C. 14:8-2.8 or 2.9;

3. Creation of a REC, or of any other type of attribute or credit, under authority other than N.J.A.C. 14:8-2.9, such as another state's renewable energy standards or any voluntary clean electricity market or voluntary clean electricity program; or

4. Creation of a TREC under N.J.A.C. 14:8-10.

(k) (Reserved)

(l) Each megawatt-hour (MWh) of retail electricity supplied in New Jersey by a TPS/BGS provider subject to this subchapter carries with it an accompanying SREC obligation. For any electricity supplied by a TPS, such TPS shall calculate its SREC obligation by multiplying its total retail sales by the applicable percentage requirement in Table A above. For Energy Year 2019, 2020, or 2021, each BGS provider shall calculate its SREC obligation as set forth in (m) or (n) below. Subsection (m) allocates the SREC obligation of BGS providers with electricity supply contracts that were effective prior to date of enactment of P.L. 2018, c. 17. Subsection (n) below allocates the Table A Statewide SREC obligation among all BGS providers that are subject to this subchapter. All BGS provider SREC obligations, taken together, must equal the Statewide SREC obligation set forth in Table A above for Energy Year 2019, 2020, or 2021.

(m) Notwithstanding any other provision of this section, if a BGS provider has, prior to May 23, 2018, executed a BGS contract to provide retail electricity, the SREC obligation resulting from the electricity supplied under that contract shall be determined using the provisions of this subchapter that were in effect at the time the contract was executed. For the purpose of this section, the electricity supply covered by these contracts shall be called "exempt electricity," and electricity supply not covered by such a contract shall be called "non-exempt electricity."

(n) All contracts subject to exemption under (m) above will expire on or before May 31, 2021. Therefore, for EY 2019, 2020, or 2021, the SREC obligation that attaches to exempt electricity supply must be calculated separately from the SREC obligation for non-exempt electricity supply, in accordance with the applicable provisions of (o) and (p) below. If a BGS provider's energy portfolio includes both exempt and non-exempt electricity supply, the SREC obligation for each shall be calculated separately and summed to determine that BGS provider's total SREC obligation for the energy year.

(o) For any exempt electricity supplied, a provider shall calculate its SREC obligation as follows:

1. Determine the MWhs of exempt electricity the provider supplied during the energy year;

2. Determine the SREC electric generation percentage requirement in effect when the BGS contract subject to (m) above was executed; and

3. Multiply (o)1 by (o)2 above.

(p) For any non-exempt electricity supplied during EY 2020, 2021, 2022, or 2023, a BGS provider shall calculate its SREC obligation as follows:

1. Determine the provider's contemporaneous SREC obligation for non-exempt electricity by multiplying their total non-exempt retail electricity sales in MWh during the energy year by the applicable percentage requirement in Table A above.

2. Determine the provider's share of the banked obligations from the increased SREC requirements avoided by exempt retail electricity in the previous energy year or previous two energy years, as follows:

i. Determine the market share of the non-exempt electricity supplied Statewide during the applicable energy year, as follows:

(1) Consult the Board's NJCEP website to determine the number of MWhs of non-exempt electricity supplied Statewide during the energy year by all BGS providers subject to this subchapter;

(2) Determine the number of MWhs of non-exempt electricity the BGS provider supplied during the energy year; and

(3) Divide (p)2i(2) above by (p)2i(1) above to obtain a fraction, representing the provider's non-exempt electricity market share for the applicable energy year.

3. Determine the total deferred SREC obligation incurred from exempt electricity supply during the previous energy year(s) as follows:

i. Consult Table A above to determine the total Statewide SREC obligation for all electricity supplied during the energy year and the percentage requirement for exempt supply.

ii. Consult the Board's NJCEP website to obtain the deferred SREC obligation for the exempt electricity that was supplied during the previous energy year or previous two energy years, as applicable.

iii. The total amount of increased SREC obligation avoided by exempt electricity supply in an energy year shall be allocated to the following two energy years.

4. Multiply the BGS provider's non-exempt market share from (p)2i above by the total deferred SREC obligation from (p)3 above. The result is the provider's SREC obligation for the deferred exempt electricity based on the share of non-exempt electricity that it supplied during the energy year.

5. Add the BGS provider's contemporaneous SREC obligations in MWh resulting from (p)1 above to the banked share resulting from calculated (p)4 above in MWh above to arrive at the total RPS SREC obligation.

(q) For electricity supplied during EY 2024 or later, a BGS provider shall calculate its SREC obligation by multiplying its total retail sales by the applicable percentage required in Table A above.

(r) Each megawatt-hour (MWh) of retail electricity supplied in New Jersey by a TPS/BGS provider subject to this subchapter carries with it an accompanying TREC obligation. For any electricity supplied by a TPS/BGS provider, such supplier/provider shall calculate its TREC obligation based upon the total number of TRECs procured by the TREC Administrator within the applicable Energy Year and the market share of retail electricity sold by the supplier/provider within the Energy Year.

(s) All TRECs shall be created by GATS and procured by a TREC Administrator under contract with the State's electric distribution companies.

(t) During the true-up period following each Energy Year, Board staff shall calculate the market share of total Statewide retail electricity sold by each TPS/BGS provider. The TREC Administrator will allocate a proportionate percentage of the total TRECs procured during the Energy Year to each TPS/BGS Provider. Each TREC allocated by the TREC Administrator shall be retired by, or on behalf of, the TPS/BGS Provider.

N.J. Admin. Code § 14:8-2.3

Amended by 49 N.J.R. 809(a), effective 4/17/2017

Amended by 51 N.J.R. 1058(a), effective 6/17/2019

Amended by 51 N.J.R. 1470(a), effective 9/16/2019

Amended by 52 N.J.R. 1850(a), effective 10/5/2020