2010 mandatory new installer training - nj clean energy · 2010-08-27 · feb 2010 112,183 6,784...

1

New Jersey’s Clean Energy Program

2010 Mandatory NEW Installer Training

1. Electricity Fundamentals

2. Rebate Application Process

3 Payment and SREC Process

Presentation Overview

Training Objectives

3. Payment and SREC Process

4. Installation Standards

5. Inspection standards

6. Utility Finance programs

Electricity Fundamentals

Load(watts)

Duration(hr)

Usage(kwh)

Electric rate($/kwh)

Billed Amount($)Load

(kw)

60

Household Load Economics


1 .060 0.109 .01

1 1.00 0.109 .11

.060

1

1000

2

Representation of Conventional Electricity Production

Turbine/Generator

Wires(kw)


Customer

Heat Source

Boiler

Turbine/Generator

(kw hrs)

Electric Industry Value Chain


Customer

Electric Industry Value ChainElectricity Production

Heat Source Boiler Turbine/Generator Wires


Fuel OtherProduction Trading Transmission Distribution

Electric Industry Value Chain

GenerationLoad Serving Entities (LSEs)

Generation Companies (Gencos)

T&DEnergy Distribution Companies (EDCs)

Distribution Companies (Discos)

Transmission Companies (Transcos)

Retail/Energy ServicesEnergy Services Companies

(Escos)

(Function of Line Voltage)

Regulatory Jurisdiction

3


Value Chain Jurisdictions

FERC

National

Regulatory Entities


RTO / ISO

BPU

National

Regional

State of NJ

Office of the Governor

State of NJ“Energy Master Plan”

“OCE Programs”

Representation of Conventional Centralized Electricity Generation


Power Plant

Transmission

Distribution

Representation of Distributed Electricity Generation


Power Plant

Transmission

Distribution

New Jersey ProfileToday (6/30/2010)• 180.8 MW PV solar

• 6281 installs • 30.9 MW Biomass• 7.9 MW Wind• 1.5 MW Fuel Cells

Government ActivismEnergy Master Plan NJ RPSBPU commitment

Renewable Resources


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

Wind• 200 MW Onshore Wind• 900 MW Biomass

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

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New Jersey’s Renewable Portfolio Standard


U.S Renewable Portfolio Standard (RPS)

Currently there are 24 states plus the District of Columbia that have RPS policies in place.

In absence of Federal legislation states have required that certain percentages of their load be derived from

renewable or clean energy sources. These requirements are called Renewable Portfolio Standards.

Renewable Energy and Clean Energy Definitions

Renewable Generation

vs.

Clean Energy

WindSolarFuel CellsWave/TidalBiomassGeothermalH d

WindSolarFuel CellWave/TidalBiomassGeothermalH d


Hydro HydroNuclearClean Coal (IGCC) Coal TrailingsTire Burners

The definitions vary from state to state program to program

ConventionalGeneration

No Carbon Footprint

Addresses an existing environmental issue

RECs (Renewable Energy Credits) are a market mechanism to track and trade attributes of renewable energy

2 518

2,928

3,433

3,989

4,610

5,316

3,000.0

4,000.0

5,000.0

6,000.0

MkW

h

New Jersey’s RPS Requirement for Solar (GWhs) per A3520


306.0442.0

596.0772.0

965.01,150.0

1,357.01,591

1,858

2,164

2,518

-

1,000.0

2,000.0

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026

Y ear

M

5

NJ Class I Renewable Energy

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

d/ th f l dfill bi f ilit id d

Electric energy produced from:


• 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.

Solar Renewable Energy Certificates (SRECs)

• One SREC certificate given per MWh of solar electricity produced

(S)REC Value Driver


y p

• Certificates traded on the open market

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

• SRECs are generated for 15 years. After that they automatically convert to Class 1 RECs

(S)REC Production

The cumulative (S)REC production created during the course of a year is obtained from the program meter – cumulative production or may be estimated for smaller systems Each time a renewable energy electric system generates 1000kWh (1MWh) of electricity, an (S)REC is issued which can then be sold or traded separately from the power.


p y p• An (S)REC is a tradable certificate that represents all the clean energy

benefits of electricity generated from a renewable energy system. • (S)RECs must be traded, monetized, retired in a defined period

otherwise they expire. SRECs have a two energy year trading life (A3520 extends that to a three year trading life)

Calendar Year

Energy Year

2009 2010 2011 2012

2009 2010 2011 2012

$640

$660

$680

$700

$720

Wh

New Jersey Solar Market TransitionSACP/SREC Schedule

The SACP declines gradually over an eight year time horizon


$520

$540

$560

$580

$600

$620

2009 2010 2011 2012 2013 2014 2015 2016

Energy Year

$ M

W

SACP

The A3520 legislation that sets the SACP over a 15 year time horizon

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SREC Quantity Monthly Cumulative

Month YearActive kW

DCIssued in

MonthTraded in

MonthHigh

($/MWh)Low

($/MWh)

# of SRECs Traded

Weighted Avg Price ($/MWh)

May 2010 132,956 16,504 8,737 $ 700 $ 170 75,917 $578.80

Apr 2010 124,159 12,548 6,773 $ 700 $ 65 67,178 $573.77

Mar 2010 120,848 5,814 9,522 $ 700 $ 209 60,405 $568.66

Feb 2010 112,183 6,784 9,720 $ 685 $ 170 50,883 $552.69

RY10 SREC Prices

as of May 2010

Jan 2010 103,694 5,249 11,731 $ 675 $ 110 41,163 $533.15

Dec 2009 100,083 7,862 7,582 $ 700 $ 195 29,432 $566.91

Nov 2009 97,482 6,192 7,292 $ 688 $ 170 21,850 $559.45

Oct 2009 93,402 8,085 7,004 $ 680 $ 170 14,558 $549.84

Sept 2009 92,015 8,796 5,119 $ 700 $ 170 7,554 $524.90

Aug 2009 89,660 10,320 2,435 $ 685 $ 170 2,435 $492.18

Jul 2009 83,807 6,626 Due to low trade volume, the July trades are reported with the cumualtive pricing data starting in August.

Total 94,777 75,915

Net-Metering and Interconnection Standards

Interconnection• State regulations that permit small generators (< 2MW - AC) 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.


g

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.

New Jersey’s Energy Master Plan

d

80,000

100,000

Energy Master Plan Goals

2006 2020

Conventional Generation

MW

Hs

of

En

erg

y D

em

an

d

7

Energy Efficiency

d

80,000

100,000

Goal with 20% Efficiency 80,000



2006 2020


MW

Hs

of

En

erg

y D

em

an

d

Energy Efficiency

Renewables

Energy Efficiency

80,000

100,000

Goal with 20% Efficiency 80,000


Conventional GenerationConventional Generation

2006 2020


MW

Hs

of

En

erg

y D

em

an

d

52,000

Residential Electric Rate

Value Chain as a Function of the Residential Electric Rate



BGSBasic Generation Service

$ P

er

kW

h

Excess Depreciation

Sales Tax

TEFA

MTC Tax

NTC-NUG

STC

SBC

BGS

Distribution

Residential Electric

Rate

8

kW

h

Excess Depreciation

Sales Tax

TEFA

MTC Tax

NTC-NUG

Residential Electric

Rate

Electric Discount and Energy Competition Act, (EDECA) established requirements to advance energy efficiency and renewable energy in New Jersey through the societal benefits charge (SBC). EDECA f th d


Residential Electric Rate and the Residential Electric Bill

$ P

er STC

SBC

BGS

Distribution

SBC (Societal Benefits Charge) ~3%Social Programs

Nuclear Plant Decommissioning

MGP remediation (RAC)

Consumer Education Programs

Universal Service Fund

DSM and EE programs

EDECA further empowered the Board to initiate a proceeding and cause to be undertaken a comprehensive resource analysis of energy programs, currently referred to as the comprehensive energy efficiency (EE) and renewable energy (RE) resource analysis.

REIP ProgramsHome Performance Program

Review of OrganizationR l d R ibilitiRoles and Responsibilities

• Honeywell team members:

Honeywell Market Manager Team

Assumed responsibility for providing market manager services to renewable and residential energy efficiency programs in early 2007.

Team composition


• Honeywell team members:

• Conservation Services Group

• MaGrann Associates

• Vermont Energy Investment Corporation

Program offices and full time New Jersey based staff dedicated to the success of the Clean Energy Programs

New Jersey Clean Energy Program Management


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Contacts

Initial application processingTheresa Heller at [email protected]

Program questions and installer liaisonJoananne Bachmann at [email protected]


j @ g p

Program Inspections, training registrationand NJ Certification Numbers

Melissa Smith at [email protected]

Rebate Processing Cynthia Surman at [email protected]

Renewable Energy Committee Meetings: Second Tuesday of each month,

REC meeting held at CSG’s Iselin, New Jersey office. Discusses general

administration issues associated across all New Jersey renewable energy

programs.

Solar (Wind) Technical Working Group: Second Monday of each month to

Forums


Solar (Wind) Technical Working Group: Second Monday of each month to

discuss and review technical issues associated with the implementation of

the solar CORE and SREC pilot programs.

RE Listserve: Information in the registration email has a link and here it is

again http://mail.njcleanenergy.com/mailman/listinfo/Renewables The

Listserve give you the most up to date Program information on the Various

Stakeholder Processes

Economics and Business Model

Solar 101


Grid – Connected PV System

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Why is Solar so popular?

NJCEP Rebate

Capital Cost of System-Large initial investment

Cash Outflow

Cash Inflow

Federal Investment Tax Credit

Energy -Saving

SRECs Inbound cash flow based on the actual production of energy from the

system

O & M-Minimal maintenance

1 15 . 25 .

Year

Insert Residential Home

New Jersey Residential 7.5 kw Solar PVElectric System

Approximate Installed Cost: $50,000

NJCEP Rebate: $5,625

Electric annual cost savings:

$1,350/ yr

SRECs annual income $4,500

Out of Pocket Expense :$31,062

Total annual savings: $5,850

Federal Tax Credit: $13,313

Simple Payback Period: 5.3 yrs

New Jersey Commercial 1,000 kW Solar PV

Electric SystemApproximate Installed Cost: $5,000,000

NJCEP Rebate: $0

Annual electric cost savings / Net Metering:

$170,000/ yr

SRECs annual

Federal Tax Credit:

$1 500 000 SRECs annual income:

$625,000 / yr

Net Investment Expense:

$3,500,000

Total annual savings: $795,000

$1,500,000

Accelerated Depreciation:

5 years

Simple Payback Period on Cash Deal : 4.4 years

Return on Equity if Financed: up to 20%

Rebate Application Processes

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Installation standards

And

Inspection Protocols

• All applicants for grid-connected systems must submit an Interconnection Application to the appropriate utility company.

• Interconnection applications are subject to review by the utility company and must comply with all utility interconnection requirements.

Utility Interconnection

Installation Process

y y

• Interconnection applications should be submitted when applying for the REIP or SRP to ensure no costs are incurred for the interconnection

• A copy of the Interconnection Application must be provided to the REIP Program as a condition of final rebate processing.

1. Modules must be UL 1703 or equivalent listed and be properly installed as per manufacturers instructions

2. The maximum amount of sunlight available on a year-round basis must not be obstructed

Solar Electric Module Array Requirements

REIP Additional Installation Requirements


3. The system must adhere to a minimum design threshold using PVWATTS

• Systems must be 80% of default calculated by PVWATTS

• Performance < 80% but >= 70% will get a prorated rebate i.e. 75% will get 75/80 of the rebate or 93.75% of the full rebate

• Building integrated solar systems must be 40% of default calculated by PVWATTS

4. All modules installed in a series string must be installed in the same plane

1. The inverter must be properly installed as per manufacturers instructions.

2. The inverter must be certified as compliant with requirements of IEEE929 for small photovoltaic systems and with UL 1741.

Inverter and Controls


installation Process

3. The system must be equipped with on/off switch, operating mode indicator, operating status indicator AC/DC over current protection.

4. Warning labels must be posted on the control panels and junction boxes indicating that circuits are energized by an alternate power source and the DC Disconnect must also have the system information.

5. Operating instruction must be posted near the system.

6. Systems must have monitoring capability that is readily accessible to the owner and must monitor (meter or display) at minimum instantaneous and cumulative production.

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1. Areas where wiring passes through ceilings, walls, or other areas of the building must be properly restored, booted and sealed.

2. All interconnecting wires must be copper. (Some provisions may be made

Control Panel to Solar Electric Array Wire Runs



for aluminum wiring – this will require approval from utility engineering departments prior to acceptance.)

3. Thermal insulation in areas where wiring is installed must be replaced to “as found or better condition”. Access doors to these areas must be properly sealed and gasketed.

1. The battery storage system must be installed according to manufacturer’s instructions.

Batteries (If Applicable)


installation Process

2. Battery terminals must be adequately protected from accidental contact.

3. DC-rated over-current protection must be provided.

REIP Solar Electric Systems Externalities

.Installation requirements

Systems to be installed in accordance with:

• Manufacturers recommendations

• Program requirements

• National Electric Code

• Be consistent with final project documentation

Inspection Process

Be consistent with final project documentationWarranties

All inclusive warranty for at least 5 years from the date of installationMust cover all major components for:Break down Degradation in electrical output of more than 10% originally rated

outputWarranty may be provided by manufacturer for equipment in conjunction

with the installer for installation. Be aware how long the Mfg warranty is and know that you have the full five years of coverage.

Owner’s manual with warranty documentation must be provided to the customer.

Mounting Systems

Installation Standards

Square and Straight install.

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Mounting Systems


Straight Lines – Take Pride In Your Work

Mounting Systems


Systems Can Have Multiple Azimuth

Mounting Systems


Looks Don’t Matter, But Production Will

Mounting Systems


Hidden Install-Be Careful of Dissimilar Metals

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Mounting Systems


Good Layout-Notice The Shadow Line

Mounting Systems


Looks Don’t Matter If The Customer Doesn’t Care

Racks & Mounting


Racks & Mounting


15

INVERTERS


Clean Lines-But Open To The Public

INVERTERS


They Come In All Sizes500kW 5900 pounds

INVERTERS


COMBINERS


16

PROJECT OVERVIEW


PROJECT OVERVIEW


PROJECT OVERVIEW


PROJECT OVERVIEW


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PROJECT OVERVIEW


PROJECT OVERVIEW


PROJECT OVERVIEW


PROJECT OVERVIEW


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PROJECT OVERVIEW


SELF INSTALLS


SELF INSTALLS


SELF INSTALLS


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SELF INSTALLS


SELF INSTALLS


The Inspection Protocol

Inspection Process

RE Inspection Process -Quality Control

Quality Control serves as a check to ensure specific parameters of renewable energy installations have been achieved.

• Installer registration process

Inspection Process

• Installer registration process

• Inspection process

• Installation particular monitoring and evaluation

All RE systems require and inspection and must receive a PASS status

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RE Inspection Process -Quality Assurance

Inspection Process

Quality Assurance - define processes throughout program lifecycle to ensure quality standards

• Certification process• Inspection process • Monitoring and

evaluation process

QA Summary – A Three Pronged Approach

Quality Assurance Program

Registration Process Evaluation ProcessInspection & Monitoring

Process

Inspection Process

Process

• Administrative Training

• Registration as a Program Certified Trade Ally

• Demonstration of Performance

• Demonstrated Proficiency

• Submission Requirements:

– Photograph of RE system

– PVWatts analysis

– Shading analysis (Google Earth)

– Metering worksheet

– Final “As Built” Packet

• Reduce Inspection Ratio in aggregate from 100% to 50% (~70% on average for 2009)

• Monitor installer community for proficiency

QA Transition – Inspection Thresholds

Inspection Selection Criteria

Criteria for Inspection Selection

QA - Rebated Inspection Ratio 20-30%

QA Non rebated Inspection Ratio 20%

Inspection Process

QA - Non-rebated Inspection Ratio 20%

Inspection Ratio per Installer (> 3 inspections) 10% Minimum

Utility Project Inspection Ratio 100%

Self-Install Inspection Ratio 100%

QC Inspection Ratio 100%

REIP “As built” Packet

The following items are deemed as critical failures:

• Number of modules and total system size in W-dc

• Orientation in degree TRUE +/- 5 degrees

Inspection Process

• System tilt in degrees +/- 3 degrees

• System shading in percent +/- 3%

• System production from PVWATTS in kWh +/- 3%

• Either the installer or the program inspector has to reach the 80% performance standard to receive the full rebate and be within the tolerance specified

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Inspection Process Inspection Process

Inspection Process

REIP “As built” Packet– Shading Analysis

Submit a shading analysis for the installation. If there is no shading on the system an alternative to the shading analysis is available by submitting a satellite view of the location of the solar electric system and attest by

Inspection Process

signing Section E that no shading exists on the system at the time of installation.

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Shade Analysis is Critical to Solar System Performance

“Short of outright physical destruction, hard shadows are the worst possible thing you can do to a PV module output.”

- The Solar Living Source Book

Inspection Process

• Solar systems consist of series connections of modules called “strings”.

• Shading on just a small section of a (crystal silicon) module dramatically reduces the output of the module and even the entire string.

First Step in Proper Solar Design

• Initial Sales Visit– Perform preliminary shade analysis as basis for sales bid.– Discuss trimming of trees and relative merits of different site locations.

• Design/Install Time– Perform detailed shade analysis to determine optimal location and

Inspection Process

y porientation of panels.

– Shade analysis must be taken at the outside corner of each array i.e. three roofs, three arrays, three shade analysis

– Off-grid optimized for annual solar access.– On-grid optimized for peak rate periods.– Combine modules with similar shading together in single string.

Even a small degree of shadowing can seriously reduce productivity.

Shading Analysis - Installation Considerations

Inspection Process

To account for shading the program utilizes a number of tools.

• Satellite Imagery• Solar Pathfinder• Solmetric SunEye

Satellite Imagery on the Computer

Local Live also offer a “Birdseye View” which is very useful.

Shading Analysis - Tools of the Trade

Inspection Process

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Solar PathFinder:

Identifies shadowing problems by tracking the path of the sun.


Inspection Process


Inspection Process


Inspection Process


Inspection Process

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Quick and Accurate Shade Analysis -- The Solmetric SunEyeTM

Integrated handheld measurement device that

Inspection Process

accurately measures solar access and shading with the press of a button.

Simple to Use

Use built in compass and bubble level to orient SunEye level and toward

Inspection Process

level and toward magnetic south and level.

Press the button!

Annual Sunpath View

The SunEye automatically…– captures fish-eye image– superimposes correct

sunpaths based on latitude

– Accounts for magnetic

Inspection Process

gdeclination

– Detects shade-causing obstructions

– Accounts for panel tilt and azimuth

– Calculates solar access percentages

Monthly View

• View the solar access as monthly, seasonal, or annual data.

• Automatically calculates average solar access for

Inspection Process

solar access for multiple skyline readings.

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Summary -- Key SunEye Features

• Accurate, repeatable shading measurements of actual site.

• Easy to learn.• Easy to use.

I t t it lt

Inspection Process

• Instant on-site results.• Simple transfer of data to PC.• Powerful features for advanced

analysis.

Solar Access Annual

• Information needed for program performance qualification.

• Average of the annual solar access from the four corners.

Inspection Process

• PV watts using all defaults except system size (100%).

• PV watts with as built size, tilt, and orientation.

Ideal - Default PVWATTS

Inspection Process Inspection Process

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Ideal System Performance - PVWATTS

Inspection Process

As Built

Inspection Process

Derate changes permitted in PVWATTS

There are only THREE derates that are acceptable

Inspection Process

• Shading based on documentation submitted with As Built Technical Worksheets

• Module Efficiency

• Inverter Efficiency

Inspection Process

As Built

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Inspection Process

As Built

REIP Final Documentation – RE System Photograph

Representative photographs of the system ( ) d th i t ( )

Inspection Process

array(s) and the inverter(s) using

5” X 7” 300 DPI Photo

SREC Reporting Requirements

REIP Program

Non-Residential Rebated Residential Rebated Non-Rebated

< 10 kW > 10 kW < 10 kW > 10 kW < 10 kW > 10 kW

REC production REC production REC may be REC production REC production REC production

Inspection Process

REC production metered (ANSI C.12)

Accuracy standard of 5%



REC may be metered. Eligible to report based upon estimated performance.







Self reported to REC Administrator






REIP Final Documentation – Metering Worksheet

Inspection Process

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The REIP Program Inspection goals are:

• To ensure the best design and installation practices are followed in accordance with manufacturers recommendation (Including racking)

• To ensure that systems meet the minimum requirements of the REIP program

REIP Program Inspections

Inspection Process

program

• To verify consistency of installed systems with specifications provided to the REIP Program via rebate application forms and the As Built Technical Worksheet

• Systems installed conform with all Program Rules.

1. Verify that equipment qualifies for participation in the Program and is as specified on the inspection work order form.

2. Verify – Tilt, Orientation and Shading

3. If necessary analyze expected performance using PVWATTS and shading analysis tools

REIP Program Inspection Responsibilities

Inspection Process

analysis tools

4. Verify system operates properly

PLEASE NOTE:

• If there is inclement weather our inspectors may reschedule the inspection.

• It is the owners/installers responsibility to remove snow from the roof to make sure the system turns on. If the system does not operate upon our arrival the system will receive a FAIL.

1. REIP inspections shall typically be scheduled within 10 business days of receiving an inspection request. And will be scheduled within a two week period

2. Inspection will be scheduled with the property owner. The installer shall be notified of all inspections.

3 For installations greater than 10 kW or on inspections where special

REIP Inspection Guidelines

Inspection Process

3. For installations greater than 10 kW or on inspections where special equipment is required, the inspection will be scheduled with both the property owner and the installer.

4. The REIP program provides for the first inspection free of charge. Any further inspections will be subject to a fee of $200 per additional inspection to be subtracted from the total rebate amount.

5. Within 10 business days of performing the inspection a status of “pass” or “fail” will be assigned. Should deficiencies be found during the inspection and these deficiencies resolved within the 10 day window a second inspection will not be required.

1. Code Inspection complying to the provisions of the NEC by a state-licensed inspector is mandatory.

REIP Additional Inspection Requirements

Code Requirements

Inspection Process

2. Submittal of the local jurisdiction’s UCC certification shall be accepted as evidence of passing the local inspection.

3. Program inspectors will continue to review NEC requirements and will communicate egregious violations to the local inspector.

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Local Code Inspections

1. Local code inspectors perform inspections relevant to NEC requirements.

2. Local code inspections shall be scheduled after the REIP program inspection.

Inspection Process

As evidence of passing the local code inspection, the homeowner or the installer shall submit a copy of the local jurisdiction’s UCC certification to the REIP Program Manager for final rebate processing.

Registration as a Trade AllyIn order for a company to be listed as a registered installer the following criteria must be met:

• They must have passed three installations through the NJCEP for the relevant technology they are requesting the listing

Inspection Process

for the relevant technology they are requesting the listing

• The can legally conduct business in New Jersey

• They have met the minimum insurance requirements as defined by the Division of Consumer Affairs

• If performing residential installations a copy of the Home Improvement Contractors Registration is on file with the Market Manager. If you are an electrical Contractor licensed in NJ you are still required to supply the HIC

Utility Finance Programs

Approximately 40% - 60% of the total installed cost is loaned.

The Loan is paid back on a monthly basis with SRECs valued at a guaranteed price. We do all of the back-office SREC work.

The Solar Loan is unique because…


PSE&G

We offer a long term guaranteed floor price on SRECs, giving borrowers’ security and a chance to benefit from the upside of higher market prices

No other bank or broker offers this financing in combination with a floor price.

The loan period of 15 years for Non-Residential applicants and 10 years for Residential applicants is significantly longer than most traditional lenders allow for solar PV installations.

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Provides loans for residential and non-residential solar projects in PSE&G electric territory

PSE&G Solar Loan II Program


PSE&G

Total 51 MW available ~ $143 MM in loans available for solar

500 kw(dc) project size max

3 segments with capacity of:

Residential: 9 MW

Small Non-Res: 17 MW (< 150 kw DC)

Large Non-Res: 25 MW (> 150 and < 500 kw )

• Applications accepted First-Come-First-Served on a quarterly basis• 8 application periods over 2 years (calendar quarters) ending

12/31/2011– First quarter is now through 3/31/2010

• Entity caps set at 20% of segment capacity annually, unless undersubscribed

PSE&G Solar Loan II Program


PSE&G

undersubscribed• Res terms are 10 years @ 6.5%• Non-Res terms are 15 years @ 11.3092%• Administrative fee withheld at closing from loan amount• 6% for Res• 2.5% Small Non Res (up to & including 150 kw)• 1.5% Large Non Res > 150 up to = 500 kw• Application fee is $10.00 per installed kW (up to a maximum of

$2,500)

SREC Floor Price ScheduleYour floor price depends on when you submit your application:

SegmentDec 2009 -Jun 2010

Jul 2010 -Dec 2010

Jan 2011 -Jun 2011

Jul 2011 -Dec 2011


PSE&G

Locking in at the price shown above (e.g. if residential application is filed on March 1, 2010, customer locks in at $450 per SREC for the duration of the loan)

Eliminates SREC Risk for the Customer – the loan program takes it on

Residential 450 435 420 400

Non-Residential

410 395 380 360up to 150 kWDC

Non-Residential>150 - 500 kWDC 380 365 350 330

How much can the customer borrow? It all Depends on System Output

Non-Residential Customers can borrow:

Net present value of Net present value of• All SRECs solar system would

Residential Customers can borrow:


PSE&G

• All SRECs solar system would produce over 15 years

• 11.3092%• @ guaranteed Floor Price per

SREC

Equals ~40-60% of installed system total costGo to the Calculators on our website

• All SRECs solar system would produce over 10 years

• 6.5%• @ guaranteed Floor Price per

SREC

Equals ~40-60% of installed system total costGo to the Calculators on our website

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• Go to http://www pseg com/customer/solar/index jsp

Calculator Demonstration / Tour of our Website Tools, forms,

application for download


PSE&G

Go to http://www.pseg.com/customer/solar/index.jsp

• Click on “PSE&G Solar Loan Program” on left• Select Residential or Nonresidential on the left• Find the Calculator on the right

Application Submittal • Applicant with Developer’s assistance

Application Review• PSE&G reviews loan package, notifies applicant/developer of deficiencies if any• Credit and Interconnection Review Conducted

Loan Approval

Application process


PSE&G

Loan Approval• PSE&G issues a Commitment Letter• Borrower has 30 days to sign

Installation and Inspections• Developer builds system and drives BPU and Municipal inspections• Developer Coordinates meter installation with PSE&G• Developer drives SREC certification (and rebates)

Pre-Closing Due Diligence• Title report run, 1st lien status on equipment established by PSE&G• Insurance• Subordinations as required

Financial Closing

What is the cost to a non-residential customer?System Size: 500 kWSystem Cost: ($5.50/watt) $2,750,000Tax Credit (ITC 30%) -$825,000PSE&G could loan -$1,469,168 (use loan calculator)

$455,832 (customer out of pocket)

$


PSE&G

Electricity cost savings ($.15kWh) -$85,4101st year depreciation benefit* -$163,625*assumes federal taxable income, 35% tax rate

1st year Operating Exp. ($.3/w)* $15,000*includes O&M and insurance

End of Yr 1 Money out of Pocket $221,797Payback Period Less than 2 yearsWith Home Solar Loan, pay back approach is SMART

*Designed to pay itself off with SRECs generatedNote: The illustration is heavily driven by tax items including tax rates, availability of tax credits, depreciable tax basis and allowable tax depreciation expense for purposes of calculating taxable income. It further assumes that the equity owner has sufficient tax liability to utilize tax benefits. Each owner should consider their own specific tax situation.

What is the cost to a residential customer?

System Size: 7 kWSystem Cost: ($7.00/watt) $49,000Rebate ($0.75/watt) -$5,250System Cost (After Rebate) $43,750Tax Credit (ITC 30%) -$13,125 (30% X $43,750)System Cost (After ITC) $30,625PSE&G ld l ( t f d i f ) $25 281 ( l l l t )


PSE&G

PSE&G could loan (net of admin fee) -$25,281 (use loan calculator)5,344 Customer out of

pocket

Electricity cost savings -$ 797End of Yr 1 out of pocket $4,547Payback period ~ 5.5 years

With Home Solar Loan, pay back approach is SMART

*Designed to pay itself off with SRECs generated

32


For more information:www.pseg.com/slp

•Andres Salas (general) Mark Burke (general) David Saraceno (developers)•973-430-6057 609-709-9137 973-430-7931

PSE&G

973 430 6057 609 709 9137 973 430 7931 [email protected] [email protected] [email protected]

•Patty Siegel (credit) Patty Taylor (closings) Solar Hotline•973-430-6241 973-430-6132 973-430-8460•[email protected] [email protected] [email protected]

•Michele Gonzalez (non-res)•[email protected]

• The Program is designed to enable financing for new solar projects based on reasonable assurances regarding the price and potential revenues that could result from each project’s generation of SRECs

• The Program is not a loan programTh P i l f th h f SREC ACE JCP&L d

SREC-Based Financing Overview


ACE, JCP&L, RECO

• The Program is only for the purchase of SRECs. ACE, JCP&L and RECO will not purchase the energy or capacity from solar projects

• The Program is consistent with Stipulation and Orders– 10 to 15 year term purchase agreements– Anticipate three solicitations each year– Requires completion of Initial Application Process with State

Programs (either REIP or SRP)

500 kW or less*

Residential

Commercial

In ACE’s service territory

A portion (less than 500 kW) of a project that exceeds 500 kW in aggregate*

Has received or will receive b t f CORE i f 2001

Eligible Projects Projects That Are Not Eligible


General Project Requirements

ACE, JCP&L, RECO

y

In JCP&L’s service territory

In RECO’s service territory

Customer submits Proposal

Developer submits Proposal

Has cleared the Initial Application Process with State Programs (REIP or SRP) but has not requested interconnection before BPU approval of bids

rebate from CORE in force 2001-2008

Interconnected at transmission voltages

Does not agree to net metering arrangements with the EDC

Does not agree to install SREC meter at project’s expense

Does not agree to terms of SREC PSA

*DC rating

• The Program targets to procure more than 64 MW over three years, 19 MW for ACE, 42 MW for JCP&L, and 3.769 MW for RECO

• The planned quantities may or may not be awarded in a solicitation based on an assessment of the competitiveness of


MW Targets

ACE, JCP&L, RECO

solicitation based on an assessment of the competitiveness of pricing

33

1. Expression of Interest (EOI)

2 Pricing Proposal (Bids)


RFP participation is in three steps

ACE, JCP&L, RECO

2. Pricing Proposal (Bids)

3. Qualification Package

Visit our dedicated Web Site:www.NJEDCsolar.com

• The New Jersey Clean Energy Program (“NJCEP”) is working in cooperation with the SREC-Based Financing Program.

• In order to participate, an applicant must obtain a NJCEP Application Number through an initial application process.


NJCEP Initial Application Deadlines

ACE, JCP&L, RECO

Application Number through an initial application process. The number must then be included in the EOI.

• In order to guarantee the acquisition of an NJCEP Application Number for a project in time for this solicitation, the applicant must provide a complete package to the NJCEP.

• Information and links for both programs can be found on the following web page: www.njcleanenergy.com/renewable-energy/home/home


Register to Receive Email Announcements

ACE, JCP&L, RECO

Register to be on distribution list to receive updates about the program


RFP Documents Available on Our Web Site

ACE, JCP&L, RECO

Updated RFP Rules posted January 29, 2010

Useful 4-page overview

34

• Forty-four bids received (7,009.628 kW)• Thirty-nine awards made (6,521.798 kW)

( )


Results from the Second SolicitationBids received on December 11, 2009

ACE, JCP&L, RECO

• Five bids (487.830 kW) were rejected because pricing was found not to be competitive

• The average Net Present Value (“NPV”) of all accepted projects was $2,864.93/SREC (corresponding to an average SREC price of $405.15 for a ten-year project)

• The lowest NPV of all accepted projects was $1,926.53/SREC (corresponding to an average SREC price of $272.44 for a ten-year project)

SREC Based Financing ProgramSREC Based Financing ProgramOne Gateway Center, Suite 720, Newark,One Gateway Center, Suite 720, Newark,


Delivery Address and Contact Information

ACE, JCP&L, RECO

One Gateway Center, Suite 720, Newark, One Gateway Center, Suite 720, Newark, NJ 07102NJ 07102

Attn: NERA / Solicitation ManagerAttn: NERA / Solicitation ManagerPhone: (973) 297Phone: (973) 297--08800880

Email: [email protected]: [email protected]

Marketing and use of NJCEP Brand

• Installers CAN NOT use the NJCEP logo in any marketing advertising or

Marketing information

in any marketing, advertising or communications pieces.

• Only HPwES contractors that are a part of a formal co-op program can use the logo

Doing business in New Jersey

• Home Improvement Contractor registration for residential projects

• Must be legal entity recognized by the state to conduct business in the state

Doing Business in NJ

business in the state• Meet insurance requirements set by the state• Comply with all tax and licensing requirements for doing

business in the state.• Recommend reviewing all relevant Board Orders and

program Guidebook information on the NJCEP website

35

Contact Info:

Tammy Gray David Damiani

Larry Barth REIP Program [email protected]

Joananne BachmannREIP Account Manager

[email protected]

New Jersey’s Clean Energy Program75 Lincoln Highway

Suite 100Iselin, NJ 08830

www.NJCleanEnergy.com866-NJSMART

Senior Operations [email protected]

Program [email protected]