New Jersey BPU Issues March 4, 2026 Orders on Energy Storage, Competitive Solar Incentive Programs and Community Solar Programs

Key Takeaways  

On March 4, 2026, the BPU issued five orders advancing energy storage and solar deployment in New Jersey (the "State"). These orders responded to existing legislation, including the Clean Energy Act of 2018, and directives from Governor Sherrill to accelerate clean energy deployment and increase access to distributed renewable resources.

The orders cover:

1. The 2025 Garden State Energy Storage Program's ("GSESP") Tranche 1 solicitation results, which announced winning bids for Tranche 1, annual incentive awarded, adjustments made in selection process and program governance for winners; 
2. GSESP Tranche 2 solicitation launch, which announced megawatts ("MW") size of solicitation target, bid and selection schedule, and selection criteria; 
3. Third CSI Solicitation results, which announced winning bids and incentives awarded; 
4. Fourth CSI Solicitation launch, which announced MW size solicitation target, bid and selection schedule and changes to program; and 
5. Energy Year 2026 Community Solar Energy Program MW block allocations.

Collectively, these actions expand storage and solar capacity, adjust program structures to enhance competition and participation, and maintain protections and incentives for developers and subscribers.

Summary of Changes to the NJ Community Solar Program

Effective March 6, 2026, the New Jersey Board of Public Utilities ("BPU") expanded and updated the Community Solar Energy Program ("CSEP"):

• Capacity Expansion: The BPU increased total CSEP allocation to 3,000 MW with rolling registration until fully subscribed or December 31, 2029, and reserved 300 MW for landfill and brownfield projects.
• Simplified Rules: The BPU removed tiebreakers and streamlined the application process for both new and rollover projects.
• Incentives & Subscriber Protections: The BPU set the community solar incentive at $60 per MWh and required minimum bill credit discounts of 20 percent for all subscribers except low and moderate income ("LMI") subscribers, which received a required minimum bill credit discounts of 25 percent.
• Implications for Projects: Existing projects retain prior awards, while prospective projects gain opportunities from increased capacity, simplified enrollment, and eligibility for storage paired or larger scale projects.

These changes accelerate deployment, expand access, and promote cost effective, reliable community solar in New Jersey.

Order on the Outcome of the 2025 Garden State Energy Storage Program Solicitation, Docket No. QO22080540 (3-4-26-8A)

LINK TO ORDER: 

https://publicaccess.bpu.state.nj.us/DocumentHandler.ashx?document_id=1414628

In this Order dated March 4, 2026, effective March 4, 2026, the BPU awarded incentives to three winning energy storage projects with a combined capacity of 355 MW in the GSESP Phase 1, Tranche 1 solicitation. Eligible participants included transmission-scale energy storage projects (i.e., projects that have an installed capacity of at least 5 MW), solar-plus-storage projects ineligible for the BPU's Successor Solar Incentive ("SuSI") incentives with storage of 5 MW or greater, and storage additions to existing Class I renewable projects (provided the storage did not receive other direct incentives).

The BPU evaluated ten bids totaling around 543 MW, and selected projects in ascending price-per-unit order until the minimum 350 MW target was met. An additional small project was selected using a three factor test.

Award recipients are subject to governance measures ensuring timely operation and availability. First-year incentive payments are reduced for delays in achieving the commercial operation date ("COD"). If a project is available less than 7,900 hours per year, annual payments are proportionally reduced. Failure to achieve COD within 36 months may result in award revocation, though the BPU may waive this penalty for good cause in writing.

Order Launching Phase 1, Tranche 2 of the Garden State Energy Storage Program, Docket No. QO25120634 (3-4-26-8B)

LINK TO ORDER:  

https://publicaccess.bpu.state.nj.us/DocumentHandler.ashx?document_id=1414943 

In this Order dated March 4, 2026, effective March 11, 2026 (the "Tranche 2 Order"), the BPU launched Tranche 2 of Phase 1 of the GSESP. Tranche 2 is open to stand-alone storage projects and solar-plus storage projects ineligible for SuSI incentives. Systems must have 5 MW AC capacity or greater and either be PJM interconnected or qualified to provide energy, capacity, or ancillary services in PJM. Storage additions to existing or new Class I renewable projects may participate if they do not receive other direct storage incentives.

The competitive, fixed-incentive structure from Tranche 1 continues with fixed incentives paid over 15 years. The BPU set a 645 MW solicitation target to contribute toward the 1,000 MW total transmission-scale goal, consistent with the Clean Energy Act of 2018 and Governor Sherrill's March 6, 2026 directive¹.

Applicants must complete pre-qualification and final bid submission requirements, including technical, interconnection, and financial documentation. The Tranche 2 Order provides definitive guidance on pre-qualification and final application requirements, community benefits, application fees, and participation criteria. Pre-qualification submissions by June 10, 2026 are guaranteed a review for deficiencies, with correction opportunities prior to the final bid deadline of August 7, 2026. Preliminary documentation may demonstrate project maturity, and responses to questions will be posted publicly. Projects with unresolved deficiencies at the bid deadline may be disqualified.

Incentives are primarily awarded based on bid price per expected average accredited capacity, but the BPU retains discretion to consider community benefits (such as brownfield redevelopment or advantages to overburdened communities) and project maturity, including advanced interconnection milestones or an earlier COD. Applicants on brownfield sites must submit an attestation of compliance with NJDEP Contaminated Site Remediation & Redevelopment program requirements. Selection generally follows lowest cost, price ranked order until the 645 MW Tranche 2 target is met. The BPU may reject bids exceeding the incentive benchmark or not producing net capacity savings, but may award higher priced projects when justified in the public interest. Recipients of Tranche 2 incentives are ineligible for future performance incentives.

The solicitation schedule provides that draft application instructions will be posted in April 2026, publication of application instructions, eligibility requirements and pre-qualification will open May 20, 2026, submission of pre-qualification materials by June 10, 2026 will receive a guaranteed review and opportunity for correction, questions are due July 1, 2026, final bids are due August 7, 2026, and Board decision will occur by October 28, 2026. Applicants may submit new bids and pre-qualification information until the final deadline; however, only submissions by June 10, 2026 are guaranteed a deficiency review and opportunity for correction. After the final bid deadline, no changes to bids or pre-qualification information will be accepted. 

Developers may submit preliminary documentation demonstrating project maturity and eligibility, which BPU Staff or the BPU Program Administrator will review and allow for corrections before final bid submission. Questions submitted by developers will be answered on a rolling basis and posted publicly. Final applications with unresolved deficiencies at the bid deadline may be disqualified. The Tranche 2 Order outlines obligations for chosen applicants, including completion of a GSESP registration, submission of a Definitive Report to the BPU, adjustments for poor performance, and reporting requirements.

Order on the Outcome of the Third Solicitation in the CSI Program, Docket No. QO21101186 (3-4-26-8C)

LINK TO ORDER: 

https://publicaccess.bpu.state.nj.us/DocumentHandler.ashx?document_id=1414944

In this Order dated March 4, 2026, effective March 11, 2026 (the "Third Solicitation Order"), the BPU announced the results of the third solicitation (the "Third Solicitation") under the Competitive Solar Incentive ("CSI") Program.

Following a competitive solicitation in which 22 projects prequalified and submitted bids, the BPU awarded SREC-II incentives to three solar generation projects totaling approximately 24.12 MW of capacity. The BPU also noted that no bids were submitted for Tranche 5 (energy storage paired with grid supply solar generation).

The BPU evaluated bids based solely on the SREC-II price ($/MWh) submitted by each project and, consistent with applicable regulations, declined to award additional capacity where bid prices exceeded confidential price caps, finding that doing so would not be in the best interest of ratepayers.

For the third solicitation, grid supply projects in Tranches 1 through 3 were competitively ranked together. No low price offers were selected for Tranche 1, while one project each in Tranches 2 and 3 was selected based on the lowest bid price. Tranche 4, consisting of net-metered projects, was evaluated separately, and one project was awarded under the BPU's discretion to exceed confidential price caps by up to 10 percent, marking the first CSI project selected in this tranche. The BPU declined to make additional awards or fill the allocated solicitation capacity, concluding that higher-priced bids would exceed price caps and increase costs to ratepayers.

The BPU directed all award recipients to submit an initial registration package within 30 days of the effective date of the Order. Tranches 2 and 4 projects will receive a notice of conditional registration, while Tranche 3 projects on contaminated sites or landfills must submit a Contaminated Site and Landfill Eligibility Verification Form and the NJDEP Permit Readiness Checklist. For Tranche 3 projects, conditional registration is subject to NJDEP site review and will not be complete until the BPU issues a separate Order of conditional certification confirming eligibility.

Recognizing federal supply chain impacts and historically high-grid demand, the BPU waived N.J.A.C. 14:8-11.5(g)(3) to allow conditionally registered projects up to 48 months to achieve commercial operation. Additionally, the BPU waived N.J.A.C. 14:8-11.5(d)(2)(i), allowing executed contracts to be submitted as part of quarterly milestone reporting rather than within one year of conditional registration.

All projects must comply with N.J.A.C. 14:8-12.8, governing siting rules for Grid Supply and Large Net-Metered Solar Facilities. Upon achieving commercial operation and submitting a post construction certification package demonstrating compliance, the BPU Staff will issue a New Jersey State Certification Number, enabling SREC-II (Successor Solar Incentive Renewable Energy Certificates) creation for a 15-year qualification life. The administrative fee for award recipients in this solicitation is $0.

The BPU emphasized that reducing the cost of solar incentives over time remains a key policy goal. As additional projects come online through the CSI Program, the BPU intends to reduce incentive levels in future solicitations, with the eventual objective of phasing out incentives where feasible, in order to minimize costs to ratepayers while maintaining a competitive and robust solar market in the State.

Establishing the Fourth Solicitation of the CSI Program, Docket No. QO21101186 (3-4-26-8D)

LINK TO ORDER: 

https://publicaccess.bpu.state.nj.us/DocumentHandler.ashx?document_id=1415018

In this Order dated March 4, 2026, effective March 11, 2026 (the "Fourth Solicitation Order"), the BPU established the fourth solicitation (the "Fourth Solicitation") of the CSI Program, and set the program structure, application process, and timeline for the next round of SREC-II awards. The BPU determined that launching the Fourth Solicitation immediately following the Third Solicitation awards would maintain a consistent pipeline of solar development and support the State's clean energy goals.

The Fourth Solicitation introduced several structural modifications compared to the Third Solicitation. Most notably, the BPU created a new competitive tranche (Tranche 1A) for grid supply solar projects 20 MW or greater, with prequalification requirements aligned with Tranche 1 but with a separate tranche capacity allocation. The BPU determined that this approach would improve competition among similarly sized projects and allow independent evaluation of large scale proposals.

The BPU adopted administrative adjustments to facilitate participation. Developers that submitted substantially similar projects in the Third Solicitation but were not awarded may participate without paying a bid fee, provided the project footprint substantially overlaps with the prior submission. Eligibility for paired energy storage is expanded to include large net-metered projects, including Tranche 4 net-metered non-residential projects greater than 5 MW, which may compete in Tranche 5 for an SREC-II adder under the Board waiver of N.J.A.C. 14:8-11.10(f). The pre-qualification process opened on March 11, 2026, and final bids are due by April 24, 2026.

Additionally, Tranche 2 projects may now be sited on industrial or commercial complexes, extractive mining land, or floating solar sites to enhance competition. Tranche 4 net-metered non-residential projects exceeding 5 MW are eligible for SREC-II paired storage adders in Tranche 5 under the same waiver. The BPU approved a total solicitation target of 300 MW of solar generation and 160 MWh of paired energy storage across Tranches 1, 1A, 2, 3, and 4, with capacity allocations as recommended by the BPU Staff. Confidential tranche specific price caps were approved to manage costs and protect ratepayers.

For purposes of the bid fee waiver, projects are considered "substantially similar" if their footprint substantially overlaps with a prior submission, allowing the $1,000 per MW participation fee to be waived. The BPU emphasized that reducing incentive levels over time, encouraging competition, and relying on price based evaluation will protect ratepayers while supporting continued solar deployment.

Compared to the Third Solicitation Order, which resulted in awards for three projects totaling approximately 24.12 MW, the Fourth Solicitation Order focused on structural adjustments to increase competition, particularly for larger grid supply projects and projects incorporating storage. The BPU determined that these changes will improve cost effectiveness, expand participation opportunities, and support continued solar deployment in the State.
 

Order Setting Community Solar Energy Program Megawatt Blocks for Energy Year 2026, Docket No. QO22030153 (4-23-25-8E)

LINK TO ORDER: 

https://publicaccess.bpu.state.nj.us/DocumentHandler.ashx?document_id=1415019  

In this Order dated March 4, 2026, effective March 6, 2026, the BPU established the MW block allocations for Energy Year 2026, setting a total of 3,000 MW of community solar capacity and determined that this expansion will increase subscriber access and accelerate in-state solar deployment.

The BPU allocated the 3,000 MW among the major utilities as follows: PSE&G (1,555 MW), JCP&L (778 MW), Atlantic City Electric (324 MW), and Rockland Electric (45 MW), with an additional 300 MW reserved for landfill or brownfield projects regardless of electric distribution company ("EDC") service territory.

New registrations for the community solar program will be accepted on a first come, first served basis, with capacity blocks rolling over to successive energy years until fully subscribed or December 31, 2029, whichever occurs first. To promote participation and avoid adverse customer impacts, the BPU waived N.J.A.C. 14:8-9.3(c)(1) and (2), eliminating the initial registration period.

All newly registered community solar projects must provide guaranteed bill credit discounts of at least 25% for LMI subscribers and 20% for all other subscribers. Because sufficient capacity is expected, the BPU also waived the tiebreaker provision (N.J.A.C. 14:8-9.3(c)(4)), finding that a competitive discount is unnecessary where projects are unlikely to exceed allocated capacity.

To align with legislative intent and protect ratepayers from unnecessary costs, the BPU waived N.J.A.C. 14:8-9.5(f), which would otherwise allow EDCs to register unsubscribed capacity in subsequent energy years.

The Three Year Review of the Administratively Determined Incentive ("ADI") Program provides a mechanism to assess program targets, adjust incentives, and provide market visibility. As part of this review, the BPU Staff conducted a public stakeholder process on CSEP and ADI implementation, including potential incentive adjustments. In light of higher electricity rates and the increased value of bill credits, the BPU reduced the community solar incentive by $20 per MWh (from $80 to $60 per MWh) for registrations received on or after March 6, 2026. Staff will continue to reevaluate incentive levels and eligibility parameters as federal Investment Tax Credit phase outs and other market changes occur.

The BPU emphasized its ongoing support for community solar, particularly small scale projects on preferred site types, and encouraged development on landfills to repurpose underutilized sites. Program flexibility, including waivers and rollover capacity, is intended to maximize consumer participation and benefits while ensuring the program operates efficiently.

Conclusion

The BPU's March 4 orders advance the State's clean energy goals, including deployment of 2,000 MW of energy storage by 2030 and significant expansion of community solar access, while fostering competitive, efficient, and accessible renewable energy programs.

Dan R. Skowronski is transaction counsel at Saul Ewing LLP with broad experience in energy and utility matters. Pamela S. Goodwin is a transactional partner at Saul Ewing LLP, with broad experience in energy, oil and gas, solid waste, agriculture and environmental permitting. Krystal R. Bordoni-Cowley is an associate in Saul Ewing LLP's real estate practice focusing on all aspects of transactional real estate law, including energy and oil and gas. Contact them at dan.skowronski@saul.com, pamela.goodwin@saul.com, and krystal.bordoni-cowley@saul.com.

1. As background, it might be of interest that a BPU Staff analysis of PJM data indicated that as of January 27, 2026, twenty-seven New Jersey projects had interconnection approval, which included twelve standalone energy storage projects with a collective capacity of 955 MW, twelve standalone solar projects with a collective capacity of 210 MW, two solar-plus storage projects with a collective capacity of 108 MW, and a single 51 MW uprate to an existing gas-fired power plant.