12B — January 31 - February 13, 2014 — Owners, Developers & Managers — Mid Atlantic Real Estate Journal
www.marejournal.com O wners , D evelopers & M anagers By Ken Sheehan, Genova Burns Giantomasi Webster Retrofitting clean and green technology with the State’s help
Mid Atlantic R EAL E STATE J OURNAL is published to serve all companies and individuals in the commercial real estate industry. Whether you are a company looking for space or seeking to dispose of or acquire, build or design property, look to the Mid Atlantic Real Estate Journal first! Call 1-800-584-1062/781-871-5298
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here may not be any such thing as a free lunch, but there is no shame in try-
and retrofit buildings. Under State law, N.J.S.A. 48:3- 60, all gas and electric public utilities in the State collect an SBC or “societal benefits charge.” This SBC is designed to allow for the recovery of the costs associ- ated with a number of State pro- grams, including social programs, nuclear decommissioning, energy efficiency and renewable energy, remediation and financial assis- tance to low-income customers. The SBC is collected on the retail sale of electricity and natural gas from any of the State’s public utility companies, and, according to the 2011 New Jersey Energy Master Plan, consisted of 3.6% of
an average bill. Each and every customer of a public utility in the State has been paying into this fund with every energy bill they pay. Cus- tomers are unable to be relieved from the obligation to pay, but they can minimize the impact in one of two ways – pay less or take back more. Under the recently enacted SBC Credit Program, commercial and industrial ratepayers may take a credit against the SBC for energy efficient products and services they purchase. In essence, rather than paying the State, and then having the State in turn provide an incentive or rebate, the SBC Credit Program cuts out the mid- dleman. Under this program, com- mercial and industrial customers receive a credit of 50% of the total project costs, capped at 50% of the total SBC yearly payments. While the products and services must be eligible for incentives under the existing Clean Energy Program, this process allows the customer to immediately reduce their energy costs through both the credit and through the installation of energy efficient products and services. In addition, traditional rebate and incentive programs continue to operate in the State. Under the Smart Start Buildings program, rebates are available for both new and retrofit projects, and cover major equipment such as chillers, water heaters, lighting control, and refrigeration. These rebates range from $10 for lamps to $1,000 per freezer units, up to $450 per ton for gas absorption chillers. The equipment must be pre-approved, and the State is currently offering increased incentives for Hurricane Sandy repairs. Under the Pay For Performance program, large energy users who can develop and implement a plan to reduce energy savings at least 15% in a renovation or come in 15% under the standard code for new construction are eligible for a tiered incentive structure that is directly related to the value of energy saved. Likewise, the Direct Install program is designed for smaller customers but uses pre- qualified contractors who perform a “turnkey” program, with incen- tives of 70% of the retrofit costs, capped at $125,000. Additional details are avail- able at the BPU’s website: www. njcleanenergy.com/ - but the im- portant concept to remember is that since you’ve already paid for it, why not get the benefits? Ken Sheehan is director of the Energy & Utility Law Group at Genova Burns. n
ing to get your “fair share.” The New Jer- sey Board of Public Utili- ties (“BPU”) may be taking with one hand, but they have deve l oped a
Ken Sheehan
number of programs that give back with the other, and owners and de- velopers of commercial, industrial, and multi-family dwellings should make sure to take full advantage of a number of programs for new
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