Solar Power Firms Say NJ Changed the Rules

MT. HOLLY, N.J. (CN) - New Jersey cost 11 solar power grid supply investors more than $43 million by passing legislation subjecting their already approved projects to new regulations, the companies claim in court.

The New Jersey Solar Grid Supply Association and 10 others, many of them solar farms, sued New Jersey and the state Board of Public Utilities, alleging constitutional violations, in Burlington County Court.

"Beginning in 2001, the defendants promoted policies requiring companies that supply energy to New Jersey rate payers to reduce their carbon emissions primarily through the greater use of renewable energy sources for their power (i.e., solar and wind power)," the plaintiffs say. (Parentheses in complaint.)

"As part of this policy, the defendants actively attracted and aggressively courted, invited, incentivized, and welcomed the plaintiffs to invest in the planning, development, financing and construction of Solar Grid Supply Projects in New Jersey.

"The plaintiffs collectively spent over $43 million to plan and develop the Solar Grid Supply Projects that the defendants said that they wanted and needed to satisfy the goals set forth in the Energy Master Plan of 2008 and the subsequent Renewable Portfolio Standard ('RPS') established as a goal by the Board."

With passage of the state's Solar Energy Advancement and Fair Competition Act of 2009, the plaintiffs' projects were eligible to generate solar renewable energy certificates.

"These SRECs are official acknowledgements that a particular solar array has generated a set amount of energy from its solar panels. In general, for each megawatt hour (1,000 kilowatt hours) of solar energy produced, one (1) SREC is issued, and the owner of the solar installation can sell that SREC to any power supplier and service provider to assist that company in satisfying its obligation under the law requiring it to generate a portion of its energy sales from alternative energy sources." (Parentheses in complaint.)

When the state realized that value of solar renewable energy certificates was dwindling, the Legislature passed Senate Bill 1925 (the Solar Act), and amended the Electric Discount and Energy Competition Act, to inflate the solar renewable energy certificates market by regulating Solar Grid Supply Projects.

Gov. Chris Christie signed the new rules into law on July 23, 2012.

"The Solar Act established standards and requirements for a specific sector of the state's solar industry, namely Solar Grid Supply Projects, where previously there had been none, and for the first time authorized the Board's review of plaintiffs' Solar Grid Supply Projects for eligibility to connect to the distribution system for the purpose of generating SRECs. No such action was taken for projects built of rooftops or adjacent buildings that use the solar energy directly ('Net Metered Solar Projects'), despite the fact that such projects represented and continue to represent a significant majority (exceeding 80%) of all solar installations in the state." (Parentheses in complaint.)

There was no grandfather clause, the investors say, which would exclude their projects from the Solar Act and its new laws and regulations.

So due to the new regulations, the investors can no longer finance and construct the projects in which they invested more than $43 million, the plaintiffs say.

They call the rules changes an unconstitutional taking, and want the state ordered to implement a grandfather clause, so they can proceed with their projects.

They are represented by William Hughes with Cooper Levenson April Niedelman & Wagenheim, in Atlantic City.

Plaintiffs include Effisolar New Jersey LLC, Lumberton 90 Solar LLC , Millennium Land Development LLC, North America Solar Corporation, Washington PV Generation LLC, Millennium Development Limited LLC, Pvone/Moncada LLC, North Park Solar LLC, Quakertown Farms and Pittsgrove Solar LLC.

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