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Regulators preparing to offer verdict on solar showdown

BPU expected to act on PSE&G's scaled-back investment strategy

PSE&G's latest solar proposal is smaller than the $883 million plan announced last year.-(PSE&G)

The Board of Public Utilities is expected to decide this week whether to let the state’s largest utility proceed with a major solar investment program.

The program, which is set for a May 29 hearing, has the potential to create hundreds of jobs and boost the state’s green-energy portfolio, but it’s also raising concerns about costs, and whether the program is even necessary.

Public Service Electric & Gas wants to spend $446 million on solar in two different programs. A $199 million expansion of the utility’s Solar Loan program would finance some 97.5 megawatts of commercial and residential solar, while a $247 million Solar 4 All extension would put 42 megawatts of solar on landfills and brownfields, and fund three 1-megawatt pilot projects.

The proposal represents a scaled-back version of an $883 million plan PSE&G first announced in July. The company has since been in negotiations with regulators, resulting in the April 30 announcement of the smaller program. The BPU will decide whether to ratify that settlement at Wednesday’s meeting.

Terry Moran, director of solar market strategy and development at PSE&G, said the programs have good track records. He said the solar loan program has been very well received by customers, and has helped promote solar development.

The Solar 4 All extension would bolster the state’s energy goals, he said.

“Number one, we believe that it satisfies the state’s energy master plan objectives,” he said. “In the energy master plan, there’s a reference to landfills and brownfields being a good application for solar.”

Moran said the plan also calls for the state to move away from putting solar on farmland and other green spaces.

However, the proposal also comes before the board at a time when the regulator is deciding how much it wants utilities to spend on infrastructure hardening in the wake of Hurricane Sandy. The largest such proposal, by far, is PSE&G’s $3.9 billion Energy Strong proposal, which has drawn both criticism and praise.

Stefanie Brand, director of the state’s Division of Rate Counsel, said now isn’t the time for a massive solar program.

“The solar industry is struggling a little bit, and it’s struggling because we have more than we need to meet our renewable portfolio standard,” she said.

The renewable portfolio standard, or RPS, is a state mandate that requires power suppliers here to incorporate a certain amount of renewable energy in their portfolios. One way companies can meet that standard is by purchasing SRECs — solar renewable energy certificates — which are credits earned by the owners of solar installations. Those credits can be sold for cash on the open market or through long-term contracts.

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