Solar Industry In NJ May Be On Way To Bust Part Of Cycle

Mar 13, 2017

Nationwide employment in the solar industry increased 25 percent last year, but solar employment in New Jersey fell 15 percent. There are still plenty of projects underway in the Garden State, but a slowdown may be on the way.

You can see solar panels on many rooftops, utility poles, and in fields in New Jersey.

There are 66,000 solar installations in the state that generate 2 gigawatts of electricity.

And more are being put up.

Workers install solar panels at project being constructed at Delaware Valley Regional High School in Frenchtown.
Credit Phil Gregory

A solar field being constructed behind the Delaware Valley Regional High School in Frenchtown is expected to provide 80 percent of the school energy needs and save the district more than 800-thousand dollars over the next 15 years.

Like many solar projects, it’s a leasing arrangement where a company pays for the installation and then sells the power the panels generate to the school, municipality, or homeowner for less than they’d pay a utility company for electricity.

Some homeowners or local governments fund the installation themselves.

Solar panel array in the parking lot of the Brick Township Municipal Building
Credit Phil Gregory

Brick Township Mayor John Ducey says the solar panels that were erected in the parking lot and put on the roof of the municipal building several years ago are now saving the town about $5,000 a year.

“It saves us actually have to go out and purchase our power from another source. So a third of it is actually generated right here at town hall and it doesn’t have to come out of taxpayers’ pockets.”

Another solar project in Brick is used by the federal Environmental Protection Agency as a case study in how contaminated sites can be put to productive use.

Solar field at capped Superfund landfill site in Brick Township
Credit Phil Gregory

Assistant Township planner Tara Paxton says a 7 megawatt solar field located where a former 42-acre landfill was capped has been producing electricity since 2014.

“Considering it was a Superfund site and the potential environmental impacts with the plume that’s in the water table could have had on the rest of the community, we needed to do something. Rather than just having it sit there and having it be a capped landfill, it’s at least doing something for the future of the township.”

The incentive for solar developers in New Jersey is something called SREC’s, solar renewable energy credits, a tradeable commodity whose value is determined by supply and demand.

Lyle Rawlings
Credit Phil Gregory

Lyle Rawlings, is the president of Advanced Solar Products and leads the Mid Atlantic Solar Energy Industries Association. He says that incentive system causes a boom and bust cycle for the industry that may be headed for another collapse.

“The demand is set by legislature on a year by year basis so that sets how much you can set how much you can build without crashing this community market. Last year we built more than the legislature provided for so we’ve put ourselves on the brink of another bust cycle.”

Senate Environment Committee chairman Bob Smith says legislation passed by the Senate and awaiting action by the Assembly would extend the requirements for utilities in the state to purchase the solar renewable energy credits.

“It advances whatever SREC are left and moves them up to the next 2 or 3 years so that we maintain the same level.  I think that by June 30th we will or won’t have a bill and the solar market may be may not be back into boom and bust.”

Smith says New Jersey will study different ways of stimulating solar development.

Rawlings says a tariff system used in other states sets a fixed price for the electricity produced by the solar panels.

Environment New Jersey Doug O’Malley says more solar development won’t just help employment and the state’s economy. It’ll also reduce air pollution.

“You know solar isn’t just kind of a nice gee whiz thing on our homes. It can be the way the that we’re going to reduce carbon pollution in the state so that we will not have extreme weather events like Hurricane Sandy becoming more and more common here in New Jersey.”

Only about 4 percent of New Jersey’s electricity is now produced by the solar industry. Clean energy advocates want 80 percent to come from solar and other renewable energy sources by the year 2050.