Contributed by Matthew A. Karmel
The New Jersey Board of Public Utilities has provided guidance to developers seeking a waiver of solar siting restrictions for facilities greater than 5 MW. In the two orders issued on December 7, 2022, the Board granted a waiver of solar siting restrictions for one project but denied a waiver of solar siting restrictions for other projects. As developers continue to organize projects greater than 5 MW in size in New Jersey, these guidelines and decisions will become critical as land can be scarce, and exciting sites are sometimes located in initially prohibited locations.
As an initial matter, New Jersey’s solar incentive program for facilities greater than 5MW in size has had difficulties getting started. The program, known as the Competitive Solar Incentive or CSI Program, is a competitive program with a variable incentive periodic application cycle. Notably, the New Jersey Board of Public did not award incentives to a single project in the first application cycle because the projects exceeded the Board’s pre-established pricing indicators.
As the second application cycle nears its end on February 29, 2024, at least one developer has gotten news that its project can be considered as part of this cycle despite an initial siting restriction. By way of background, New Jersey’s solar siting rules apply to all grid supply and net-metered solar facilities greater than 5 MW in size. Pursuant to these siting rules as clarified by the New Jersey Board of Public Utilities, unless authorized through a petition filed with the Board, facilities may not be sited on:
- Land preserved under the Green Acres Program, a New Jersey program that provides funding for the creation of open space
- Certain areas within the Pinelands area
- Lands within the Highlands preservation area
- Certain forested lands defined by the Board
- Certain freshwater or coastal wetlands defined by the Board
- Certain prime agricultural soils and soils of Statewide importance defined by the Board
As noted, to site a solar facility greater than 5 MW in size, a developer must file a petition with the Board of Public Utilities in accordance with the process outlined by the Board for waivers of these siting restrictions, and the petition must be granted before the facility can apply for consideration as part of the CSI Program. In other words, to be considered for the application cycle ending on February 29, 2024, developers need to file a petition and receive a waiver before that date. Otherwise, they will be deferred until the next application cycle.
Further compounding this timing issue, the Board generally acts on petitions only at regularly scheduled meetings, and there are one to two meetings per month throughout the year. The Board decided the two petitions noted in this article within 6-7 months of the filing of the petition. This is somewhat accelerated as compared to other pending petitions before the New Jersey Board of Public Utilities involving the solar industry, but the Board has enacted a process to further expedite petitions for waiver of siting restrictions if the facility is to be located on previously existing impervious surfaces. As noted, waivers must be obtained before a project will be considered as part of the CSI Program. The siting restrictions also apply regardless of whether an incentive is sought, so all facilities larger than 5 MW must comply with the restrictions.
As to the specific projects considered by the Board recently, as noted above the Board denied the request for a waiver for one project located in the Highlands preservation area and granted the waiver for another project located in the Pinelands preservation area. While the facts are nuanced and demonstrate the complexity of siting decisions, the Board appears to have been heavily influenced by local government and agency opinions on the project.
The Board also continued its strong support for solar development on landfills and questioned the benefits of floating solar arrays, and it seems likely that other factors associated with the location (such as whether it is a landfill) will be influential in waiving siting restrictions. This is consistent with prior Board orders in which the Board has embraced broad policy goals as it makes site-specific determinations. Going forward, developers should carefully evaluate these decisions with their advisors to determine whether a specific project is likely to be approved despite siting restrictions, as the process of seeking a waiver is just one step in an already lengthy development process.
About the author
Matthew Karmel is the Chair of the Environmental and Sustainability Law Group at Offit Kurman P.A. Matthew represents solar developers as well as other businesses helping to make the world a better and more sustainable place. His particular focus and experience have garnered wide recognition, including from NJBiz, which included Matthew on its 2022 “Law Power 50” list highlighting the most influential attorneys in New Jersey, and from Waste360, which included him on its 2022 “40 under 40” list recognizing professionals driving the future of the waste and recycling industry.