The number of solar, wind and other clean energy projects is rising across the state, but weaknesses in existing utility grid connections could crimp New Jersey’s ability to utilize renewable, or green power. And a tussle between a South Jersey power company and the New Jersey Board of Public Utilities illustrates some of the bottlenecks.

In February — as part of his Energy Master Plan to get the Garden State on a 100% “clean energy” footing by 2050 — Gov. Phil Murphy issued Executive Order No. 221, which established the Office of Climate Action and the Green Economy. Then at the end of June, as NJBIZ previously reported, the New Jersey Board of Public Utilities announced approval for what could be the nation’s largest offshore wind project: two separate applications for a combined 2,658 megawatts of offshore wind generation off the coast of Atlantic City.

While some renewable energy proponents like Lyle Rawlings — president and CEO of Advanced Solar Products Inc. and president of the Mid-Atlantic Solar Energy Industries Association, a trade organization — applaud the moves, they’re also concerned that the state is planning to accelerate the construction of solar and wind projects while “serious” connectivity issues are already beginning to slow or stop progress.

“The problem is that although new, green wind-and-solar generation sources are being created, some of the existing utility grids cannot handle the added capacity, so a portion of the green power is being wasted,” Rawlings said. “This challenge was highlighted in a filing that Atlantic City Electric (ACE) made with the NJBPU.” ACE provides energy service to some 560,000 customers in southern New Jersey.

In that Dec. 9, 2020 filing — where ACE requested rate hikes totaling about $71.8 million including sales and use tax — the utility noted that “the installation of DER [distributed energy resources, or smaller-scale units of renewable and other local generators that connect to the existing grid] places additional burdens on the company’s distribution system that must be addressed to maintain high levels of system reliability. Currently, the prevalence of DER has resulted in ACE closing a number of feeders and substation transformers to the installation of new DER projects. In order to alleviate this constraint…the company has proposed a program to upgrade a limited number of feeders and substation transformers that are presently closed to additional DER, and to capture the costs of this initiative in a regulatory asset to be recovered in the company’s next base rate case.”

Preparing for renewable power sources

“We have an application process to add new generation services to our system,” Jersey Central Power & Light President James Fakult told NJBIZ. “Each application is thoroughly reviewed to determine the most efficient way to accommodate the interconnection safely onto our system. In some cases, infrastructure upgrades and charges are required – developers understand this, and this is consistent with NJ regulations for connecting generation to the utility system. As we sit today, this is largely a question of solar generation, as the wind generation farms are still several years away.”

Although some circuits are currently “full,” Fakult noted that, “If a developer still wants to pursue a substantial interconnection on a ‘full’ circuit, we do offer a special study — for a fee — to ensure their project will not degrade reliability for existing customers in the area.” He said developers can pay for necessary upgrades to the system to support additional solar- or other-generation; but added that, “The BPU, JCP&L and other utilities will continue to work together on how all these factors will be addressed in the future.”

For its part, in June PSEG announced an accelerated “three-pronged 2030 climate vision that extends across its business,” featuring “Net-zero emissions for PSEG operations, including PSE&G’s utility operations; 100% greenhouse gas-, carbon-free power generation; and significant contributions to regional economy-wide decarbonization.”

According to PSEG President and CEO Ralph Izzo “PSEG’s climate vision for 2030 exemplifies the strategy we intend to pursue over the next decade – driving out harmful greenhouse gas emissions where they occur.”

Atlantic City Electric is also taking steps, observed spokesman Jake Sneeden. “We support the growth of solar energy and are working to create new opportunities for solar in areas where the grid no longer has the available capacity to accommodate more solar installations,” he said. “We continue to invest in and adopt new grid modeling tools and grid automation technologies as they become available, which allow us to optimize the system and make us better able to accommodate increasing amounts of solar.”

Besides working with the BPU on options for upgrading the grid to accommodate more solar-generated power, Sneeden said that ACE also continues to “work with offshore wind developers, the state and other stakeholders to support the transmission and delivery of this clean energy source and help New Jersey become a leader in offshore wind.”

ACE originally proposed to spend “up to $10 million over two years to complete needed upgrades to enable additional solar facilities to be installed on the identified facilities. But the company has “agreed to remove this proposal from the rate review and are working with the BPU staff and interested stakeholders outside of the regulatory rate review to identify the most efficient and fair path forward to expand capacity on sections of the local energy grid to create new opportunities for solar,” Jake Sneeden, ACE’s regional communications manager, told NJBIZ. “To accommodate the significant growth of solar, physical upgrades to the local energy grid to create capacity for substation transformers and key power lines will be required. We continue to assess our system’s needs as they evolve and are working to prioritize needed upgrades.”

Addressing the issue

The BPU is also looking at the big picture. During a mid-May meeting, the agency voted unanimously to award a contract for consulting services to “update New Jersey’s interconnection rules to reflect national best practices and better enable the state to achieve its clean energy goals.”

That was good news to Rawlings, who said “for some time now I, along with others, have been urging the state BPU to address this [interconnectivity issue]. I’m glad to see Atlantic City Electric’s case bring the issue to center stage, and I’m also glad to see that the BPU appears to taking a step in the right direction by agreeing to hire a consultant to offer advice on the interconnection issue.”

Rawlings said that one option is to start small, with pilot programs “to get early experience and quickly get an idea of how they work. It’s good that the BPU is studying the issue, but remember, we’ve only got another nine years to go to meet Gov. Murphy’s goal of achieving 50% renewable energy by 2030.”

New Jersey is not an outlier when it comes to challenges like this, noted Scott Weiner, a former president of the state BPU and commissioner of the state Department of Environmental Protection and Energy, since rebranded as the Department of Environmental Protection. “The old grid served for more than 100 years, but we’ve effectively reached a point where new technology needs to be integrated into the grid itself and at the points of interconnection,” he said. “The problem is that states get bottlenecked when patches and fixes are bolted onto the old grid, instead of investing and developing a new grid.”

He noted, though, that the BPU and the state “should be commended for moving ahead with a holistic look to see how to best align policies. Some may say this should have been done sooner, but at least it is being done.”