New Jersey’s Clean Energy Program Rutgers University Wind Symposium September 25, 2009.

New Jersey’s Clean Energy Program

Rutgers University

Wind Symposium

September 25, 2009

• REIP Overview

• Current Installations vs. RPS

• EPBB Overview

• Wind EPBB applications

• EPBB Calculator

• Project considerations

• Cost benefit analysis models

Presentation Overview

Agenda

Energy Master Plan Goals

1. To provide New Jersey with secure, safe and reasonably priced energy supplies and services.

2. To encourage and maintain economic growth prospects for the State.

3. To promote the achievement of Federal and State environmental requirements and objective in a low cost manner. (Environmental protection and impact)

REIP Overview

2006 2020

Conventional Generation

MW

Hs

of

En

erg

y D

em

an

d

80,000

100,000

Expected Growth, Business as Usual and Existing Levels of Energy Efficiency

80,000

62,000


REIP Overview


2006 2020


Energy Efficiency

MW

Hs

of

En

erg

y D

em

an

d

80,000

100,000


Goal with 20% Efficiency 80,000

62,000


REIP Overview

Conventional GenerationConventional Generation

Energy Efficiency

2006 2020


Renewables

Energy Efficiency

MW

Hs

of

En

erg

y D

em

an

d

80,000

100,000


Goal with 20% Efficiency 80,000

62,000

Goal with 30% Class I Renewables, 2.5% Class II Renewables


REIP Overview

New Jersey Wind Market

• The required wind resource (>11mph) is along the shore and highlands.

• Best example of installed project is at ACUA, similar interest building among at other coastal municipalities

• Small wind projects have run into home rule issues; first model ordinance adopted by Ocean Gate.

• 2009 REIP has dedicated $7.5M to small wind projects.

• REIP supports Behind the Meter (BTM) projects• Rule changes required to support Group Net

Metering and Community Wind• Offshore wind evaluation is underway (summary on

NJCEP and NJDEP websites)

REIP Overview

NJ Class I Renewable Energy

• Solar technologies, photovoltaic technologies, wind energy, fuel cells powered by renewable fuels, geothermal technologies, wave or tidal action,

• and/or methane gas from landfills or a biomass facility, provided that the biomass is cultivated and harvested in a sustainable manner.

• Types of class I renewable energy that qualify for use in meeting the requirements of this subchapter are set forth at N.J.A.C. 14:8-2.5.

Electric energy produced from:

REIP Overview

Renewable Energy Certificates (RECs)

• One REC certificate given per MWh of solar electricity produced

• Certificates traded on the open market

• RECs ultimately are purchased by the power generators (Load Serving Entities - LSE) to offset their requirement to produce Clean Energy

• Class 1 REC value significantly less than Solar REC

REIP Overview

Net-Metering and Interconnection Standards

Interconnection• State regulations that permit small generators (< 2MWs) to be installed behind the

meter.• These generators cannot be sized to over produce based on current site

consumption.• Mandates that utilities connect them to the grid.

Net-Metering• State regulations that allow interconnected generators to offset their electric

consumption with an on-site resource.• Allows production of electricity beyond site consumption to be sold to the grid and

be compensated at the wholesale price of energy.

REIP Overview

New Jersey ProfileToday• 94 MW PV solar

• 4100 installs • 4.2 MW Biomass• 7.6 MW Wind• 1.1 MW Fuel Cells

Tomorrow• 1,600 MW Solar• 3,000 MW Offshore

Wind• 200 MW Onshore Wind• 900 MW Biomass

Government Activism Energy Master Plan NJ RPS BPU commitment Renewable Resources• Wind:

• Shore, highlands• Sustained winds of 11 mph

• Solar: • Output ~1200 kWh AC

• Biomass• Includes LFG, WWT, wood

residue, food waste and aggregation of resources

Current installations vs. the RPS

New Jersey Wind Resources

EPBB Overview

Output as a Function of Wind Speed

EPBB Overview

2,709kWh

6,136kWh

60’ 80’ 100’

9,338kWh

(a) 10kw system; source Mick Sagrillo; “Incremental Tower Costs vs Incremental Energy”

Output as a Function of Tower Height

EPBB Overview

30-percent tax credit for both residential and commercial renewable energy installations. Small wind is eligible up to 100 kW.

Eliminates the prohibition on utilities from benefiting from the credit;

Allows Alternative Minimum Tax (AMT) filers to take the credit

Calculated net of state rebate

Note that projects greater than 100 kW are eligible for the Production Tax Credit at $0.021 per kWh for ten years.

Investment Tax Credit

EPBB Overview

• EPBB Incentive levels

• This is different than the previous wind incentive level which was calculated on the capacity of the system.

• Factors included in calculating annual input– Location specific wind speed– Hub Height– Obstructions within 500 feet

Wind Incentives - EPBB

Annual Estimated Production Incentive Level

1-16,000 kWh $3.20 / Annual kWh

16,000-750,000 kWh $0.50 / Annual kWh

EPBB Calculations

Renewable Energy Incentive Program - EPBB

• Wind Program Incentive is calculated based upon Expected Performance Based Buy-down (EPBB).

– Expected performance based on output• Specific turbine• Specific site

• How does the EPBB work?– Performance calculator calculates output for a given location

• Input parameters– Wind speed at 50m– System hub height– Turbine power curve

• The EPBB is designed to produce higher rebates for project which maximize power production

• More closely calibrates with goals defined in the Renewable Portfolio Standard (RPS) and the Energy Master Plan (EMP).

EPBB Calculations


• Obtaining locals average annual wind speed• Wind maps for no charge are available at:

• http://firstlook.3tiergroup.com/• http://www.awstruewind.com/maps/united-states.cfm/region/466

88• http://eosweb.larc.nasa.gov

• Additionally a wind resource site assessment may be performed even though the average wind speed can be determined from the wind maps

• Site assessments are performed by;1. Certified site assessor evaluates topography and site characteristics

to give a more accurate evaluation2. Engineering firm performs detailed site assessments including wind

speed analysis based on anemometer readings

EPBB Calculations

http://firstlook.3tiergroup.com/

http://www.awstruewind.com/maps/united-states.cfm/region/46688

http://www.awstruewind.com/maps/united-states.cfm/region/46688

http://eosweb.larc.nasa.gov/

• Wind turbine equipment currently accepted by the program:

• If a wind turbine is not presently accepted by the program the following information must be provided

– Power curve based on one year of actual energy production data– Engineering certification form the manufacturer based on the power curve from an

independent third party• To apply to the program applicant must complete a pre-application for guidance purposes


– ARE – Entegrity Wind Systems

– Bergey – Energie

– EWP – Eoltec

– Enertech – Northern Power Systems

– Fuhrlander – Proven

– GAIA Wind– NextGen– WTIC

– Endurance– South West Wind Power– Wind Energy Solutions

EPBB Calculations

Turbine Availability vs. Turbine Size

Ava

ila

bil

ity

1kW 10kW 50kW 100kW 500kW 700kW 1.5MW 2.0MW 3.5MW

Larger turbines, MW size turbines, have a two year wait

Project Considerations

Small Wind Turbine Height Comparison


Building PermitZoning NJDEP Evaluations Engineering and Pre Construction Permit

• Determine Wind Resource and direction

• Site specific evaluation (project owner)

Wind Generating Facility: Pre Construction and Permitting Process

Wind ResourceEvaluation

• Engineering- design and seals required

• Equipment Selection— Turbine— Tower— Inverter

• Pre-Construction Permit (owner)— Site Evaluation— Facility— Equipment

• Turbines— Some turbines

have up to a two year lead time

• Facility Pre-Construction Permit process (NJDEP CAFRA review if applicable)

• NJDEP is working to streamline the permitting process

• Engineering drawings

• Site Map• Ownership• NJDEP

certifications• Local Land Use

Permit— Seals & Stamps

• Restrictions and variances

• Building Permit• Electrical


• Local • land-use• building• electrical

• State (DEP):• CAFRA/Waterfront• Pinelands• Highlands• Well Drilling

• Federal• FAA• Bird and Wildlife• DOD

Model Wind OrdinancesAdopted by 8 NJ Communities

NJDEP Fast Track Proposal

Small Wind Permitting


Model Ordinance

• The Model ordinance passed by Ocean Gate was designed to allow the development of wind projects in their community.

• It acknowledges the NJ BPU Renewable Portfolio Standard• Their current zoning regulations to not inhibit the installation of wind projects there

were unintentional barriers to developing wind projects• The Model Ordinance standardizes and streamlines the requirements for permitting

wind turbine projects• The ordinance is designed to preserve and protect public health and safety without

significantly increasing the cost or decreasing the efficiency of a wind project.• The ordinance addresses the following issues:

• Standards• Setbacks• Access

• Permit requirements• Abandonment• Administration and enforcement


Renewable Energy Value Drivers

REIP Subsidy

Federal Investment Tax Credit

Accelerated Depreciation Tax Impact

Energy Value

REC Value

Capital Cost of System

Overhead & Maintenance

Other???

Cost Benefit Analysis Models

Project type comparison

Compare three different project types• Residential• Commercial• MunicipalBased on the following• 20 kW turbine• 12 MPH wind Speed at 50m• 120 foot hub height



Residential Installed Cost $90,000

Estimated Annual Output 17,596 kWh

Current electric rate $0.15 per kWh

Estimated Annual Energy Savings

$2,639.40

Rebate $51,200

Federal ITC $11,640

MACRS Depreciation No

REC Value $51 per year

O&M (Annual contract) $600

Approximate payback period

10 years


Commercial Installed Cost $90,000

Estimated Annual Output

17,596 kWh



$2111.52

Rebate $51,705.50

Federal ITC $25,500

MACRS Depreciation Yes




5 years


Municipal Installed Cost $100,000

Estimated Annual Output

17,596 kWh



$2,111.52

Rebate $51,705.50

Federal ITC None

MACRS Depreciation No




20 years

If you have any questions about this presentation or New Jersey’s Clean Energy Programs, please feel free to contact:

Mark Loeser [email protected]

Phone 732-218-4430

mailto:[email protected]

New Jersey’s Clean Energy Program Rutgers University Wind Symposium September 25, 2009.

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Transcript of New Jersey’s Clean Energy Program Rutgers University Wind Symposium September 25, 2009.