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CHIVUKULA MEASURE TO INCENTIVIZE COMBINED HEAT & POWER ADVANCED BY ASSEMBLY PANEL
Legislation Would Set Up Alternative Energy Portfolio Standard & Certificate Program
(TRENTON) Legislation sponsored by Assembly Utilities Chairman Upendra J. Chivukula to incentivize the development of combined heat & power (CHP) by setting up an alternative energy portfolio standard and certificate program, was advanced today by an Assembly panel.
The Assembly Utilities panel voted in favor of the measure (A-1384) intended to power up the state's development of cleaner and more efficient power plants.
Chivukula's measure would require that power suppliers purchase a certain amount of the electricity they supply to customers each year from CHP plants. Under the bill, a minimum of five percent of New Jersey’s electricity would have to come from CHP facilities by the twelfth year of the program.
Combined Heat & Power plants produce electricity and heat simultaneously, a technology that can deliver big savings on utility bills for facilities that use a lot of thermal energy.
"Combined heat and power plants that can fuel efficiency up to 80 percent by capturing and recycling heat manufactured in the generation of electricity, need to be incentivized to power up our state's source of cleaner and more efficient energy," Chivukula (D-Somerset\Middlesex) said.
"Unlike solar or wind which are intermittent, CHP provides 24x7 power to the grid and in the case of hurricanes like Sandy, can operate like a micro grid and continue to provide power during emergencies. As we upscale to renewable, it is necessary to have generation reserves to keep the PJM grid balanced," Chivukula added.
New Jersey is part of the PJM (Pennsylvania, Jersey and Maryland) Interconnection, the world's largest competitive wholesale market headquartered in Valley Forge, Pennsylvania, which coordinates the movement of electricity in all or parts of 13 states and in the District of Columbia. Seven hundred companies are members of the Regional Transmission Organization (RTO) which serves 54 million customers across 56,350 miles of transmission lines and has 167,000 megawatts of generating capacity.
The state's Energy Master Plan calls for 1,500 megawatts of CHP by 2020, a target not likely to be met without financial incentives. Under Chivukula's measure, CHP plants would be granted financial credits for the power they produce, which would have to be purchased by power suppliers. If enough credits are not available, the suppliers would be required to make a compliance payment to the State.
The measure would direct the Board of Public Utilities (BPU) to establish regulations directing each electric power supplier and each basic generation service provider to obtain a certain percentage of the kilowatt hours sold in this State from qualified alternative energy generating facilities. The legislation would also set up an alternative energy portfolio standard and certificate program that would reward developers of combined heat and power facilities with incentives similar to the ones currently in place for New Jersey's solar industry.
The measure has the support of CHP advocates, who say it is necessary to provide developers with incentives to build new plants.
The growth of new CHP power plants in New Jersey has been stunted by the diversion of funds set aside by lawmakers to promote their development. The Christie administration appropriated $164 million of these funds to help plug a hole in the state budget.
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