LEGISLATIVE FISCAL ESTIMATE
[Second Reprint]
SENATE, No. 2185
STATE OF NEW JERSEY
220th LEGISLATURE
DATED: AUGUST 4, 2023
SUMMARY
Synopsis: Establishes incentive program for installation of energy storage
systems.
Type of Impact: Annual State expenditure increase.
Agencies Affected: Board of Public Utilities.
Office of Legislative Services Estimate
Three-Year Duration of
Fiscal Impact Pilot Program Year 4 and Thereafter
Annual State Expenditure Increase At least $60 million Indeterminate
 The Office of Legislative Services (OLS) determines that there would be an annual State
expenditure increase of at least $60 million during the three-year duration of the pilot program,
as required by the bill.
 The OLS notes that the bill directs the Board of Public Utilities to adopt rules and regulations
within three years in order to establish a permanent program to incentivize the installation of
new energy storage systems in the State. The bill gives the board discretion to determine the
amounts to be allocated for these incentives. As such, cost increases for the ongoing program
are indeterminate.
BILL DESCRIPTION
This bill would require the Board of Public Utilities to develop a program to provide monetary
incentives to persons who install new energy storage systems in the State. The pilot program
would continue until the board adopts rules and regulations, within three years after the effective
date of the bill, to establish a permanent program pursuant to the bill. After the expiration of the
pilot program, the board would determine the appropriate amount to allocate for the incentives.
The bill would establish certain requirements for the program, including parameters for the
types of energy storage projects that would be eligible for the program. The program would be
Office of Legislative Services Legislative Budget and Finance Office
State House Annex Phone (609) 847-3105
P.O. Box 068 Fax (609) 777-2442
Trenton, New Jersey 08625 www.njleg.state.nj.us
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available to smaller energy storage systems that are owned by customers of electric utilities and
sited in the customer's residence or business, as well as larger energy storage systems that are
connected directly to the grid.
The incentives would consist of an upfront incentive and a performance incentive. The upfront
incentive would consist of a one-time payment made by the board's clean energy program, which
is funded by the societal benefits charge imposed pursuant to P.L.1999, c.23. The bill specifies
that at least $60 million per year of funds collected from the societal benefits charge would be
allocated for upfront incentives for the three-year duration of the pilot program. The performance
incentive would be a recurring payment made by the relevant electric utility, to compensate the
owner of the energy storage system for services to the grid made by the system, including reducing
peak demand and supplying power during outages.
FISCAL ANALYSIS
EXECUTIVE BRANCH
None received.
OFFICE OF LEGISLATIVE SERVICES
The OLS determines that there would be a State expenditure increase of at least $60 million
annually during the pilot program. The bill specifies that at least $60 million per year of funds
collected from the societal benefits charge would be allocated for upfront incentives for the three-
year duration of the pilot program.
The OLS notes that the bill directs the Board of Public Utilities to adopt rules and regulations
within three years in order to establish a permanent program to incentivize the installation of new
energy storage systems in the State. The bill gives the board discretion to determine the amounts
to be allocated for these incentives. As such, cost increases for the ongoing program are
indeterminate.
Section: Environment, Agriculture, Energy, and Natural Resources
Analyst: Neha Patel
Senior Fiscal Analyst
Approved: Thomas Koenig
Legislative Budget and Finance Officer
This legislative fiscal estimate has been produced by the Office of Legislative Services due to the
failure of the Executive Branch to respond to our request for a fiscal note.
This fiscal estimate has been prepared pursuant to P.L.1980, c.67 (C.52:13B-6 et seq.).