ASSEMBLY, No. 3358

STATE OF NEW JERSEY

216th LEGISLATURE

 

INTRODUCED JUNE 9, 2014

 


 

Sponsored by:

Assemblyman  TROY SINGLETON

District 7 (Burlington)

Assemblyman  UPENDRA J. CHIVUKULA

District 17 (Middlesex and Somerset)

Assemblyman  WAYNE P. DEANGELO

District 14 (Mercer and Middlesex)

 

 

 

 

SYNOPSIS

     Establishes Class I renewable energy certificate multiplier program for certain energy production facilities fueled by methane.

 

CURRENT VERSION OF TEXT

     As introduced.

  


An Act concerning Class I renewable energy certificates, and supplementing Title 48 of the Revised Statutes.

 

     Be It Enacted by the Senate and General Assembly of the State of New Jersey:

 

     1.    The Legislature finds and declares that:

     a.    Many facilities in this State which produce electric energy from methane extracted from landfills have experienced unanticipated and continuing maintenance costs due to engine damage caused by siloxane compounds.

     b.    Siloxane compounds develop in landfills from common, silicon-based consumer products, such as hairspray and other aerosols. 

     c.    Siloxane compounds are corrosive to engines used in energy production facilities.

     d.    The engine corrosion caused by siloxane compounds causes facilities in this State to incur extraordinary maintenance costs in order to keep the engines compliant with emission requirements.

     e.    As a result of these costs, the future economic viability of facilities which produce electric energy from methane extracted from landfills is uncertain.

     f.     The State’s Energy Master Plan continues to support the production of electric energy from methane extracted from landfills as an important technology that advances clean energy goals.

     g.    It is in the interest of this State to continue the operation of facilities that produce electric energy from methane extracted from landfills to eliminate the negative greenhouse gas impacts of methane entering the atmosphere.

     h.    In order to keep the impacted facilities operational and to balance the interests of electric public utility ratepayers, the Legislature, therefore, determines that it is necessary to establish a Class I renewable energy certificate multiplier program to increase the number of Class I renewable energy certificates issued to facilities that produce electric energy from methane extracted from landfills, in order to offset the economic losses these facilities have incurred due to harmful siloxane compunds.

 

     2.    a.    Within 90 days after the effective date of P.L.    , c.    (C.        ) (pending before the Legislature as this bill), the board shall establish a Class I renewable energy certificate multiplier program for a facility in this State that produces electric energy from methane extracted from landfills as provided in subsection b. of this section.

     b.    The board shall issue Class I renewable energy certificates to a facility that has demonstrated to the board an economic loss in the previous energy year, as determined by the board, in an amount equal to the quotient of the facility’s economic loss in a previous energy year divided by the number of Class I renewable energy certificates generated by the facility in the previous energy year, divided by the current market price for a Class I renewable energy certificate, and multiplied by the number of Class I renewable energy certificates generated by the facility in the previous energy year. 

     c.    The board shall not consider a facility’s fines, penalties, or costs due to non-compliance with emissions requirements as an economic loss for the purposes of this section.

     d.    The board shall establish application standards and an annual application process for the Class I renewable energy certificate multiplier program, which shall include, but not be limited to, financial disclosure of all capital expenditures, debt service, return on equity, operating expenses, and other costs incurred.  The costs to administer the application process for the Class I renewable energy certificate multiplier program shall be borne by the applicant.

     e.    As used in this section:

     “Board,” “Class I renewable energy,” “energy year,” and “renewable energy certificate” shall have the same meaning as prescribed for those terms under section 3 of P.L.1999, c.23 (C.48:3-51).

 

     3. This act shall take effect immediately.

 

 

STATEMENT

 

     This bill establishes the Class I renewable energy certificate multiplier program for facilities in this State that produce Class I renewable electric energy from methane extracted from landfills, in order to allow these facilities to offset economic losses in a previous energy year.  Under the bill, a facility that demonstrates an economic loss in a previous energy year is to be eligible to receive Class I renewable energy certificates issued by the Board of Public Utilities (board).  The number of Class I renewable energy certificates the board issues to the facility is to equal the quotient of the facility’s economic loss in a previous energy year divided by the number of Class I renewable energy certificates generated by the facility in the previous energy year, divided by the current market price for a Class I renewable energy certificate, and multiplied by the number of Class I renewable energy certificates generated by the facility in the previous energy year.  The board is not to consider any fines, penalties, or costs due to non-compliance with emissions requirements as an economic loss.

     Under the bill, the board is to establish application standards and an annual application process for the Class I renewable energy certificate multiplier program, which is to include, but not be limited to, financial disclosure of all capital expenditures, debt service, return on equity, operating expenses, and other costs incurred.  The costs to administer the application process for the Class I renewable energy certificate multiplier program is to be borne by the applicant.