Pay for Performance Program

June 09, 2023

Summary

NOTE: Applications for the programs must be submitted before June 30, 2017 in order to be eligible for FY 2017 incentives.

The New Jersey Clean Energy Program (NJCEP) offers the Pay for Performance incentive program for comprehensive energy efficiency for whole-building improvements. The incentives are categorized into Existing Buildings and New construction. The program is available to all commercial and industrial buildings. The program is administered by the NJ Board of Public Utilities.

Eligibility

The program is funded by the State Societal Benefits Charge (SBC), hence it is only available to non-residential retail electric and/or gas service customers of the following New Jersey utilities that collect the SBC: Atlantic City Electric, Jersey Central Power & Light, Rockland Electric Company, New Jersey Natural Gas, Elizabethtown Gas, PSE&G, and South Jersey Gas. Customers that purchase only natural gas from a participating utility are only eligible to receive incentives for natural gas measures.

In order to qualify for the Existing Buildings program, commercial and industrial buildings must have a peak demand of kilowatt (kW) of at least 200 kW in any of the most recent last months, multifamily buildings can have a peak demand of 100 kW.

New commercial, industrial and multifamily buildings must have 50,000 sq ft or more of gross heated/conditioned space and must have targeted 15% energy reduction in order to qualify for the New Commercial Buildings program. Market Manger has the discretion of approving the projects that are less than 10% below the requirement.

Hospitals, public college and universities, non-profits, affordable multifamily housing, and local governmental entities are exempt the 100 kW and 50,000 sq ft requirement.

Program Description

The program requires participants to use an approved Program Partner (see website for a list of approved partners) in order to receive incentives. The Program Partners are qualified energy efficiency technicians who work directly with the program participant to recommend and install energy efficient measures in the buildings.

Rather than offering specific rebate levels for specific equipment types, the Pay for Performance program calculates the performance incentive (Payments II and III below) as a variable $/kWh, $/therm, or $/sq. ft. incentive based on projected energy savings. Three separate payments exist based on the achievement of program milestones (described below). Incentive amounts are arrived at differently for existing buildings and new construction projects

The incentives are offed in three phases upon completion of each of the program milestones, i) approval of an Energy Reduction Plan, ii) installation of all recommended measures per plan, and iii) completion of post-construction benchmarking report.

Program Overview

Implementing Sector:	State
Category:	Financial Incentive
State:	New Jersey
Incentive Type:	Rebate Program
Web Site:	https://www.njcleanenergy.com/commercial-industrial/programs/pay-performance/new-construction/new-construction
Administrator:	New Jersey Board of Public Utilities, Office of Clean Energy
Start Date:
Eligible Renewable/Other Technologies:	Lighting Chillers Furnaces Boilers Air conditioners Energy Mgmt. Systems/Building Controls Motors Comprehensive Measures/Whole Building
Incentive Amount:	Awarded based on completion of three program milestones See Program Guide for full details. Existing Buildings Incentive 1: Energy Reduction Plan $7,500-$50,000, $0.15/sq ft, not to exceed 50% of facilities annual energy expenditure; Incentive 2: Installation of Recommended Measures 25% of the total project cost; Base incentive 15% savings: $0.09/kWh saved, $0.90/Therm saved For each % over 15%: $0.005/KWh saved, $0.05/Therm saved Maximum Incentive: $0.11/kWh saved, $1.25/Therm saved Incentive 3: Post-Construction Benchmarking Report Incentive cap is 25% of total project cost Enhanced incentives are equal to an additional 100% of the incentives #2 and #3 listed above. The incentives are subject to a cap of 80% of the Applicant’s cost for the project allocated between Incentive #2 and #3: Incentive 2: Installation of Recommended Measures Electric Savings Additional Incentive: $0.09-$0.11/per projected kWh saved Gas Savings Additional Incentive: $0.90-$1.25/per projected Therm saved Incentive 3: Post-Construction Benchmarking Report Electric Savings Additional Incentive: $0.09-$0.11/per projected kWh saved Gas Savings Additional Incentive: $0.90-$1.25/per projected Therm saved New Construction Minimum Cost Reduction 15% - Multifamily 5% - All Other Incentive 1: Proposed Energy Reduction Plan $0.10/sq ft for ERP +0 -1.9% above $0.12/sq ft for ERP +2 – 4.9% above $0.14/sq ft for ERP +5% or greater Maximum: $50,000.00 Pre-Design Bonus: $0.04/sq ft Maximum Bonus : $20,000.00 Incentive 2: Installation and Commissioning of Measures +0 – 1.9%: $1.00/sq ft +2 – 4.9% : $1.20/sq ft +5% or greater: $1.40/sq ft Incentive 3 : Building Performance Flat: $0.40/sq ft Commercial and Multifamily Incentive 1: Proposed Energy Reduction Plan $0.08/sq ft for ERP +0 -1.9% above $0.10/sq ft for ERP +2 – 4.9% above $0.12/sq ft for ERP +5% or greater Maximum: $50,000 Pre-Design Bonus: $0.04/sq ft Maximum Bonus $20,000 Incentive 2: Installation and Commissioning of Measures +0 – 1.9%: $0.80/sq ft +2 – 4.9%: $1.00/sq ft +5% or greater: $1.20/sq ft Incentive 3 : Building Performance Flat: $0.35/sq ft
Maximum Incentive:	Incentives are capped at the lesser of the following: o Incentives #1, #2, and #3 combined will not exceed $2 million per project, assuming both electric and natural gas measures are recommended and implemented. Should only electric measures, or only gas measures, be recommended and implemented then the total of Incentive #1, #2, and #3 combined shall not exceed $1 million per project. The latter applies to electric-only facilities as well. o $4 million per entity per program fiscal year based on date of Proposed ERP approval.
Eligible System Size:	Existing Buildings: Peak demand greater than 200 kW in any last 12 months for commercial and industrial facilities, and 100 kW for multifamily facilities New Construction: Greater than 50,000 sq feet
Installation Requirements:	Must be installed by approved Program Partner Existing building: Must achieve a minimum 15% source energy reduction target New construction: Must have an energy cost reduction of 15% from ASHRAE 90.1-2013.

Contact

Name:	New Jersey Clean Energy Program - Pay For Performance
Organization:	c/o TRC Energy Services
Address:	900 Route 9 North, Suite 104 Woodbridge NJ 07095
Phone:	(732) 855-0033
Email:	P4P@NJCleanEnergy.com

This information is sourced from DSIRE; the most comprehensive source of information on incentives and policies that support renewables and energy efficiency in the United States. Established in 1995, DSIRE is operated by the N.C. Clean Energy Technology Center at N.C. State University.