Bill Text: NJ A4089 | 2022-2023 | Regular Session | Introduced
Bill Title: Extends deadlines, under certain circumstances, for completion and commercial operation of certain solar electric power generation facilities.
Spectrum: Strong Partisan Bill (Democrat 10-1)
Status: (Passed) 2023-09-12 - Approved P.L.2023, c.158. [A4089 Detail]
Download: New_Jersey-2022-A4089-Introduced.html
Sponsored by:
Assemblyman WAYNE P. DEANGELO
District 14 (Mercer and Middlesex)
SYNOPSIS
Extends certain deadlines for completion and commercial operation of solar electric power generation facilities under certain circumstances.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning certain deadlines for completion and commercial operation of solar electric power generation facilities under certain circumstances and supplementing P.L.1999, c.23 (C.48:3-49 et al.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. a. Notwithstanding the provisions of P.L.1999, c.23 (C.48:3-49 et al.), P.L.2021, c.169 (C.48:3-114 et al.), or any other law, rule, regulation, or order to the contrary, a qualified solar electric power generation facility that, due to a delay attributable to a tolling event, fails, or is projected to fail, to achieve project completion or commercial operation by the deadline date established by law, rule, regulation, board order, incentive program registration acceptance letter, or other approval or authorization for that facility, shall receive an automatic extension of the project completion or commercial operation deadline date established for that facility.
The extension granted pursuant to this section shall be for a period coextensive with the duration of the delay associated with the applicable tolling event. The automatic extension shall protect the qualified solar electric power generation facility from forfeiting the following:
(1) designation as "connected to the distribution system";
(2) eligibility to continue to participate in the applicable solar incentive program for which application was made and conditional approval was granted;
(3) eligibility to receive the financial incentives provided by the solar incentive program for which application was made and conditional approval was granted; and
(4) any other benefit or incentive available to a qualified solar electric power generation facility conditionally approved to participate in the solar incentive program.
b. (1) To be eligible to receive the automatic extension provided by this section, the project sponsor of a qualified solar electric power generation facility shall certify in writing to the board of the occurrence of a tolling event. The certification shall describe the tolling event and the nature and anticipated duration of the delay associated with the event.
(2) Within 45 days after receipt of a certification from a project sponsor of the occurrence of a tolling event pursuant to paragraph (1) of this subsection, the board shall issue an unconditional order approving an automatic extension of the project deadline date or commercial operation deadline date established for the facility, whether established by law, rule, regulation, board order, incentive program registration acceptance letter, or other approval or authorization for that facility.
The order shall be issued by the board on a non-discretionary basis, and no factual investigation or hearing by the board shall be conducted. The order shall acknowledge receipt of certification of the tolling event, extend the previously established project completion or commercial operation deadline date for the facility by an amount of time coextensive with the duration of the tolling event, and provide such other and further relief as the board may deem appropriate. The board order shall be effective as of the date of the certification of the tolling event.
c. A project sponsor shall have a continuing obligation to apprise the board, on at least a quarterly basis, regarding the nature and extent of the tolling event and its anticipated duration, which requirement may be satisfied by including such information in the quarterly milestone reporting form required to be submitted to the board for the qualified solar electric power generation facility.
d. The project sponsor of a qualified solar electric power generation facility that is granted relief under this section due to the occurrence of a tolling event shall use commercially reasonable efforts to timely satisfy the remaining requirements of the applicable solar incentive program that are within the project sponsor's control and whose performance has not been delayed by the tolling event.
e. Upon conclusion of the tolling event, the project sponsor shall timely resume and complete development of those aspects of the facility that were delayed by the tolling event. The project sponsor shall complete the facility and commence commercial operation within the longer of: (1) six months following the conclusion of the tolling event; or (2) the time remaining under the terms of the original conditional approval authorized prior to the occurrence of the tolling event.
f. As used in this section:
"Project sponsor" means a municipality, business entity, person, property owner, developer, redeveloper, or other interest that is the party pursuing the development and implementation of a qualified solar electric power generation facility under a solar incentive program administered by the board.
"Qualified solar electric power generation facility" or "facility" means a solar electric power generation facility for which a project sponsor has submitted an application for conditional approval to participate in a solar incentive program, and includes a facility that has received conditional approval from the board to participate in the solar incentive program for which application was made.
"Solar incentive program" means a program administered by the board which awards SRECs, transition renewable energy certificates, SREC-IIs, or other solar renewable energy certificates capable of counting towards the renewable energy portfolio standard of an electric power supplier or basic generation service provider pursuant to section 38 of P.L.1999, c.23 (C.48:3-87).
"Tolling event" means the action or inaction of a third party, or occurrence or circumstance that delays the timely completion or commercial operation of a qualified solar electric power generation facility, that is not within the reasonable control of the project sponsor of the qualified solar electric power generation facility, and shall be limited solely to the failure of an electric public utility or PJM Interconnection, L.L.C. to approve an application for interconnection with the utility distribution system or interstate transmission system, or to negotiate, execute, and deliver any other engineering or other studies, agreements, or approvals required by the electric public utility or PJM Interconnection, L.L.C. as a prerequisite to project interconnection or commercial operation, within such time period as would allow a project sponsor to achieve commercial operation of a qualified solar electric power generation facility pursuant to an award, authorization, or conditional approval under a solar incentive program.
"Transition renewable energy certificate" means the same as the term is defined in in section 2 of P.L.2021, c.201 (C.34:1B-375).
2. This act shall take effect immediately.
STATEMENT
This bill provides that certain deadlines for the completion or commercial operation of a solar electric power generation facility (facility) may be extended under certain circumstances.
Specifically, the bill would automatically extend the project completion or commercial operation deadline dates established for a solar electric power generation when a facility fails, or is projected to fail, to achieve project completion or commercial operation by the deadline date established by law, rule, regulation, board order, incentive program registration acceptance letter, or other approval or authorization for that facility, when the delay is due to a tolling event as defined by the bill. To receive the extension provided by the bill, a project sponsor would be required to certify in writing to the Board of Public Utilities (board) describing the tolling event and the nature and anticipated duration of the delay associated with the event. Within 45 days after receipt of this certification, the bill would require the board to issue an unconditional order approving an automatic extension of the project deadline date or commercial operation deadline date established for that facility. The order would be issued by the board on a non-discretionary basis, and no factual investigation or hearing by the board would be conducted. The order would extend the previously established project completion or commercial operation deadline date for the facility by an amount of time coextensive with the duration of the tolling event, and may provide such other and further relief as the board may deem appropriate.
Under the bill, a project sponsor would have a continuing obligation to apprise the board, on at least a quarterly basis, regarding the nature and extent of the tolling event and its anticipated duration. Upon conclusion of the tolling event, the project sponsor would be required to complete the facility and commence commercial operation within the longer of: (1) six months following the conclusion of the tolling event; or (2) the time remaining under the terms of the original conditional approval authorized prior to the occurrence of the tolling event.
The bill defines "tolling event" as "the action or inaction of a third party, or occurrence or circumstance that delays the timely completion or commercial operation of a qualified solar electric power generation facility, that is not within the reasonable control of the project sponsor of the qualified solar electric power generation facility, and shall be limited solely to the failure of an electric public utility or PJM Interconnection, L.L.C. (PJM) to approve an application for interconnection with the utility distribution system or interstate transmission system, or to negotiate, execute, and deliver any other engineering or other studies, agreements, or approvals required by the electric public utility or PJM as a prerequisite to project interconnection or commercial operation, within such time period as would allow a project sponsor to achieve commercial operation of a qualified solar electric power generation facility pursuant to an award, authorization, or conditional approval under a solar incentive program."
In the current solar energy development environment, certain regulatory and market barriers have emerged which, if left unaddressed, could provide significant disincentives to solar expansion and threaten the State's ability to achieve its clean energy goals. In particular, delays associated with the interconnection of solar electric power generation facilities with the electric public utility distribution grid and the PJM interstate transmission grid, and securing related project development, interconnection, and construction agreements from the electric public utilities and PJM have, with increasing regularity, impeded the timely development of solar electric power generation facility projects.
Interconnection applications to an electric public utility and PJM typically involve the performance of detailed and lengthy engineering studies which, when completed, may result in a project sponsor being required to assume responsibility for system upgrades determined to be necessary to accommodate the additional load associated with the solar electric power generation facility. Each of these approvals must be obtained for solar energy projects to be deemed complete and authorized to commence commercial operation. The recent announcement by PJM regarding the imposition of a multi-year moratorium on the processing of interconnection applications underscores that this is a special circumstance that requires relief in a manner similar to the relaxation of certain programmatic and rule requirements in response to the COVID-19 pandemic.
In addition, solar electric power generation facility project financing and development remains dependent upon the availability of the financial incentives made available through the clean energy programs administered by the board. As currently structured, a solar electric power generation facility is conditionally approved for participation in the board's solar financial incentive programs and to receive an award of incentives, with the approval contingent upon compliance with all program requirements, including the timely completion and commercial operation of the facility by a deadline date designated by the board. If a conditionally approved facility is not completed and in commercial operation by the designated deadline date, the facility is deemed ineligible to further participate in the solar incentive program applied for and the incentive is rescinded. The loss of incentives significantly detracts from the feasibility of proposed solar energy projects, rendering many more risky and less attractive to lenders, and increases the likelihood of project abandonment.
Given the increasing frequency and duration of delays associated with the interconnection of solar electric power generation facilities, it is appropriate for the State to safeguard against the potential loss of viable solar electric power generation facility projects. In the current environment, solar electric power generation facility projects may become ineligible to participate in the solar incentive program for which they applied and to receive the solar incentives applied for due to a failure to achieve timely project completion and commercial operation solely because of unforeseeable delays caused by third parties or unforeseen circumstances beyond a project sponsor's control. It is in the interests of the State to afford project sponsors automatic extensions of project completion and commercial operation deadline dates to preserve eligibility to participate in the solar incentive programs for which they were conditionally approved and to receive the incentives offered by those programs in circumstances where project interconnection-related delays are attributable to third parties or circumstances over which the project sponsors are unable to exercise control. While project sponsors shall remain responsible for their failure to comply with deadline dates and other program requirements where the failure is attributable to the actions or inaction of the sponsors, under this bill, they would not be held responsible for failures to comply with requirements as a result of circumstances they cannot control.
