Public Service Electric and Gas Company (PSE&G) has received approval from state regulators to begin offering $105 million in loans to help finance the installation of solar systems on homes, businesses and municipal buildings throughout its electric service area.
Initially, the program will only be available to non-residential customers. PSE&G needs approval from the New Jersey Department of Banking and Insurance to provide direct loans to residential customers. There are also plans to review residential loan documents with a group of stakeholders before the program is offered to residential customers.
PSE&G says the program will support the development of 30 MW of solar power, designed to fulfill about 50 percent of the RPS requirements in PSE&G's service area for the energy years 2009 and 2010.
Some of the major components of the program include:
- PSE&G's solar program will be open to all of its electric customers, including low-income, residential, commercial, industrial and municipal/governmental. The solar panels would be owned by the developer or the host customer.
- Applications will be available for two years and accepted on a first-come, first-served basis until 30 MW of projects have been developed.
- PSE&G would provide loans to developers or customers to cover approximately 40% to 60% of the cost of a solar installation project, depending on the projected output of the solar energy system and the cost of the system. The borrower would repay the principal, plus interest, over 10 years for residential customers and over 15 years for all other borrowers.
- The remaining project cost would be funded by the owner of the solar installation. The owner may have access to funds from banks and investors. In addition, the owner may be eligible for a federal investment tax credit.
- Owners of solar energy systems would be able to repay the loan with solar renewable energy certificates (SRECs).
- PSE&G's electric customers will pay for the cost of the solar program through the Solar Pilot Recovery Charge (SPRC), which will be included in the delivery part of their monthly bills. PSE&G will sell the SRECs it receives for loan repayments in an auction and credit the proceeds from the sale to customers through the SPRC, which will offset a portion of the program costs.
Those interested in learning more about PSE&G's program can visit www.pseg.com/solarloan, send an email to solarloan@pseg.com or call (973) 430-8460.
