New Jersey

In New Jersey Community Choice is called Government Energy Aggregation (GEA). For the last ten years New Jersey has also had very effective policies for encouraging the installation of solar photovoltaic systems. By April, 2017, more than 73,000 solar photovoltaic (PV) facilities were installed around the state on residentail and business rooftops, with solar capacity exceeding 1,630 megawatts from distributed generation and 495 megawatts from utility-scale generation. In 2016, solar power supplied 74% of New Jersey’s renewable electricity generation from both utility and distributed (customer-sited, small-scale) sources. Nearly two-thirds of that solar electricity came from distributed solar panels.

HISTORY

Community Choice in the Garden State came into being in 1999 as part of the electricity deregulation movement. It was followed by a more specific Government Energy Aggregation Act in 2003, but an opt-in requirement and cost cap stymied the growth of GEAs. Subsequent legislation removed these barriers and the first GEA programs launched in 2012.

New Jersey’s experiment with an opt-in aggregation demonstrated that CCAs really need to be designed as opt-out programs in order to succeed. Only with the automatic enrollment of all customers, except those who opt out, can a CCA reach the critical mass necessary to attract suppliers and succeed as a business.

New aggregation programs are initiated by majority vote of the municipality’s elected body and must be approved by the Board of Public Utilities.

New Jersey now allows the automatic enrollment of residential customers, but it still requires commercial and municipal accounts to opt-in during a specified period.

In 2012, Plumstead Township was the first community to initiate GEA in New Jersey. Other early adopters were Toms River, Montgomery and Monroe Townships.

As of February, 2023, only one CCA program is active in New Jersey, whereas at least 131 communities have enabled CCA local law and actively aim to continue or start a CCA program. CCA represents approximately less than 1% of the NJ population, while 4 million households are eligible for CCA in the state.

CURRENT AND EMERGING ISSUES

In 2023, New Jersey CCA communities are unable to compete with the Price To Compare (“PTC”) rates. The Board of Public Utilities requires CCA rates to be lower than the PTC rate, unless the CCA rate includes more than 24.5% of renewable energy source (a.k.a. the NJ minimum renewable energy requirement for 2022 and 2023).

While this requirement may be protective of customers, state regulators have unfortunately established a formula to calculate a PTC that is inadequate with the CCA market. In New Jersey, the PTC formula equals the average standard rate from the past three energy auctions (there is one energy auction per year). Therefore, as of 2023, CCA standard rates must be lower than the PTC rate, which is an average of the utility's standard rates of 2021, 2022, and 2023. CCAs cannot compete with this PTC rate since the 2021 utility rates were much lower at the time and yet still considered in the current PTC formula. The current PTC rate is artificially low as the 2021 rates are dragging the numbers down.

Many NJ communities are waiting for the hedges to roll off in the next years for competitors to join the market again and start CCA programs.

FAST FACTS

New Jersey’s ranks fifth among US states in installed solar photovoltaic capacity.
In the spring of 2019, the state launched its Community Solar Pilot program. After a successful 2 year run, the state is designing a permanent program.
The Solar Act of 2021 states that the new Successor Solar Incentive Program should aim to provide incentives for at least 150 MW of community solar facilities per year.

RENEWABLES PORTFOLIO STANDARD

In the state's 2020 Energy Master Plan, Executive Order 28 established a goal of 50% renewable energy by 2030 and 100% clean energy by 2050. Executive Order 307 increased previous offshore wind targets to 11,000 MW by 2040.

In Q1 of 2023, the Governor signed an executive order setting a goal for the state to reach 100% clean energy by 2035. In January, 2023, the Governor also announced the beginning of efforts to develop the new 2024 Energy Master Plan.

LEGISLATION (PARTIAL LIST)

Assembly Bill 2165 (2003) Government Energy Aggregation Act of 2003 (c. 24, “GEA Act”), authorized municipalities and/or counties to establish GEA programs after passing an ordinance or a resolution.
The provisions governing the formation and conduct of GEA programs can be found at N.J.S.A. 48:3-92 – N.J.S.A. 48:3-95. (N.J.S.A. stands for New Jersey Statutes Annotated).
The Board of Public Utilities’ rules for GEA programs can be found in N.J.A.C. 14:4-6, Government Energy Aggregation Programs. (N.J.A.C. stands for New Jersey Administrative Code).
New Jersey Clean Energy Act (2018)

LATEST PRESS

Haverhill Residents Not Receiving Discounted Electric Rate Have Another Chance to Enroll. whav.net, January 16, 2023

N.J. shakes up offshore wind industry with historic $1B plan. politicopro.com, October 27, 2022

Old Bridge voters to decide fate of clean energy program. mycentraljersey.com, October 26, 2022

Mayor Kramer Promotes 'Two Environmentally Friendly Energy Programs.

tapinto.net/towns/franklin-township, October 3, 2022

As SOMA Returns to PSE&G for Electricity, Town Leaders Work to Find Cheaper Options. Village Green NJ, September 12, 2022

Morris Township Moves To Lower Energy Costs by Exploring Energy Aggregation & Natural Gas. Morristown Minute, September 4, 2022

South Orange & Maplewood Electric Bills Likely to Rise as Towns Return to PSE&G as Supplier. The Village Green, August 29, 2022

New pilot program will help residents save money and protect the environment. Essex News Daily, March 13, 2022

Petitions to Create Renewable Energy Program Accepted in Cherry Hill. Food and Water Watch, November 19, 2021

Chester Township: Stats On HAEC Residential Energy Aggregation Program. patch.com, September 6, 2021

Woodbridge Forms Energy Cooperative, With 100% Renewable Goal. patch.com, September 1, 2021

City prepares for green energy provider. The Link News, August 29, 2021

Teaneck Residents Submit Petitions for 100% Renewable Energy Program. Food & Water Watch, July 16, 2021

Denville Township Council Votes to Join the Morris Energy Cooperative. Tap Into Denville, April 26, 2021.

Glen Rockers Can Opt Up to 100% Renewable Energy Supplier by March 7. Tapinto.net, March 5, 2021

Sustainable Essex Alliance to enter second round of program. Essex News Daily, February 26, 2021

GEA LINKS

ACES – Alliance for Competitive Energy Services (Purchases electricity and natural gas for 430 NJ school districts. It is the largest GEA in the state.)

Sustainable Essex Alliance (serving the towns of Maplewood, South Orange, Verona, Livingston, Glen Ridge, Montclair, and Glen Rock)

Piscataway Community Energy Aggregation (serving the town of Piscataway)

Hunterdon Area Energy Cooperative (30,000 residential customers of JCP&L and 20,000 residential customers of PSE&G)

Food & Water Action (working in 15 municipalities to enact 100% renewable GEA programs)

MAEC (Morris Area Energy Cooperative, GEA serving 12 municipalities)

NJ AGG (website to assist in the Energy Aggregation programs approved by the NJ Board of Public Utilities and the Rate Payer Advocate)

Gable Associates (consultant)

NEW JERSEY