Noah: Steve thanks for taking time to talk about renewable energy in New Jersey. To start off, tell me a little bit about yourself.
Steve: Thanks Noah. I am CEO of American Clean Energy, a New Jersey based developer of distributed solar generation for commercial, industrial, and public sector customers in the Northeast market. Before joining American Clean Energy, I was President, CEO, and Chairman of the Board at Jersey Central Power and Light Company, which is the second largest utility in New Jersey. Most recently I was elected to the Board of Directors for Solar Electric Power Association (SEPA).
Noah: Congratulations on being elected to SEPA’s Board of Directors. Being the experienced industry leader you are, tell me a little bit about the state of solar in New Jersey.
Steve: New Jersey has become a national leader in solar PV. In fact the state is currently ranked 3rd in the country for solar PV capacity, hovering around 1GW which is well ahead of the solar RPS thanks in part to the rapid development that occurred during the ITC cash grant period of market development.
Noah: Although the New Jersey market is one of the top markets in the country, it’s been volatile at times. Why is that?
Steve: The oversupply of solar generation relative to the solar set aside obviously had a marked effect on solar REC prices. The good news is that the market responded as predicted by dramatically reducing price which had a deleterious effect on those developers who were relying on high SREC markets to get projects financed.
Noah: What’s your forecast for the market going forward?
Steve: I believe that the market has wrung out most of those uneconomic projects. I think going forward we will see a return to development of DG solar generation which provides the most benefit to consumers and achieves the original intent of the NJ RPS solar set aside. In addition, the recent court decision adverse to LCAPP- the state’s attempt to bypass the PJM capacity market-will, combined with stable SREC prices, cause moderate but sustainable solar DG development over the next 6 years of the RPS development period.
Noah: How are other types of renewables doing in New Jersey?
Steve: Well, the state relies on the Basic Generation Service auction for most of its electric energy supply, which is provided by generation capacity in the PJM market and that includes in-state natural gas and nuclear as well as Midwestern coal for its energy production. New Jersey has 9MW of wind power in the state, 13MW of hydropower, and 254 MW of biomass and municipal waste to power. It’s important to note that the state has a carve-out for offshore wind, but there have been many setbacks in the development process. And it’s worth noting that in recent years the state has been using funds from its Clean Energy Program to close budget gaps. That has certainly had a dampening impact on the renewable energy market.
Noah: Thanks for your in-depth analysis, Steve. And best of luck to you.
Steve: Thanks, Noah.