WOODLAND PARK, N.J. (AP) -- A major overhaul of the state's energy industry was blocked last week because Governor Christie had concerns about how much solar power the proposal demands utilities produce, officials familiar with the bill said.
The overhaul could help Passaic County to decide whether to restart a solar project that was tabled last year, after it failed to attract bidders, The Record of Woodland Park reported.
The bill, which passed committee but failed to come to a vote before the end of the legislative term, would more than double the solar output from utilities by 2014. It has been touted as a boost to a promising industry but criticized as a bust for ratepayers, who would shoulder much of the cost until solar became self-sustaining.
Christie blocked the measure late Thursday with his own proposal, which would trim the solar production mandate and remove a clause that exempts current solar projects from a level of oversight otherwise required for new projects, according to state Assemblyman Upendra Chivukula, D-Somerset, who said he discussed the changes with the governor's office.
"The Governor's Energy Master Plan touts energy efficiency, and yet his proposed amendments would have gutted that aspect of the bill," Chivukula, chairman of the utilities committee that sent the legislation to the floor, said in an email. "The measure would have helped advance some interesting projects that are in the pipeline that may now never get off the ground."
Christie's office issued a brief statement, arguing that his recommendations were consistent with the master plan.
"We proposed what we believed were a reasonable set of alternatives to the original bill to balance the interests of the ratepayer, the continued success and viability of solar energy in New Jersey and the protection of open space, agricultural and forest lands," the statement said. "This is a complex issue, with a lot of stakeholders, and it will no doubt be revisited."
Solar backers say the industry will collapse without legislative action, costing New Jersey thousands of jobs. Though solar builders want to keep aggressive expansion in the bill, they are ready to strike a deal with the governor, said Lyle Rawlings, president of Mid-Atlantic Solar Energy Industries Association.
But if the Legislature passes a bill with production requirements lower than what the industry asked for, Rawlings said he wants limits on solar construction put in the new bill. That would limit the supply of solar power and thus maintain the value of Solar Renewable Energy Credits, which are tradable credits that the state awards to producers.
"We are ready to compromise," Rawlings said. "But if the compromise isn't enough to avert a crash, the industry will have to be put on a diet."
Rawlings also said taxpayers may be at risk. Public solar projects, such as a plan being considered by Passaic County, use revenue from SRECs to pay back money borrowed by local governments to finance the projects. Rawlings, who is CEO of Advanced Solar Products, said that with SRECs trading at $200 apiece, some of the projects he's installed for school districts and municipalities are not generating enough money to pay back the bonds.
"Unquestionably, any entity that bought a system with a bond is in danger of being underwater," Rawlings said. "And one way or another, that's going to have to be made up through higher property taxes."
Also at issue is whether solar facilities that already produce power should be subject to a Board of Public Utilities review, as required for new projects under the bill. Such reviews would help ensure that projects would not harm the SREC market or electric rates and affect no more than 2 percent of tillable farmland.
The bill would exempt existing facilities from the review. According to Chivukula's office, Christie was concerned that extra leeway on current projects would limit the growth of new ones.
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