RESA Says Earlier Start to Higher N.J. RPS Would Create Competitive Advantage for BGS Suppliers

Any increase in the New Jersey solar RPS requirement should come into effect in Energy Year (EY) 2016 so as to not perpetuate the current competitive disadvantage imposed on competitive retail electric suppliers with respect to solar RPS compliance, the Retail Energy Supply Association said in comments on an Office of Clean Energy Staff straw proposal.

RESA noted that the Solar Energy Advancement and Fair Competition Act (SEAFCA) provides that existing Basic Generation Service (BGS) provider contracts, but not existing retail supply contracts, are exempt from any increases in the RPS.

"The fundamental unfairness of this scheme is obvious: a Board-imposed increase in the solar RPS would force retail suppliers and their customers to pay additional, unfair costs, while BGS providers and their customers would have no such obligation. Shopping customers have already been forced to pay tens of millions of dollars more than their fair share of the solar RPS due to the inequitable distribution of solar RPS requirements by SEAFCA," RESA said.

The straw proposal would avoid any further disparate treatment, by recommending that any, "additional capacity of the extended EDC SREC programs will be reflected in the solar RPS regulatory amendments that will be effective in EY 2016." Using a start-date sufficiently in the future (at least three years) would ensure that the BGS contracts in place at that time would reflect the higher RPS, by allowing the existing, exempt BGS contracts to roll off prior to any new RPS requirement.

While the Staff straw proposal would not implement any change in the RPS until 2016, RESA noted that some working group members have advocated immediately advancing the RPS, or staggering the increase so that partial increases occur before EY 2016.

Such actions would only impose, "further economic harm upon the customers of retail suppliers under SEAFCA," RESA said.

"Perpetuating a regime wherein retail suppliers and their customers are forced to bear a disproportionately larger share of changes to New Jersey's solar RPS requirements is unfair. Therefore, OCE Staff should preserve its recommendation that no increase should be introduced prior to EY 2016," RESA said.