A 4529

P.L.
2026, CHAPTER 2, approved March 24, 2026
Assembly, No. 4529
An Act concerning the procurement of transmission-scale energy
storage and amending P.L.2025, c.136.
���� Be It Enacted by the Senate and General Assembly of the State of New
Jersey:
���� 1.��� Section 2 of P.L.2025, c.136 (C.48:3-121.3) is
amended to read as follows:�
���� 2.��� a.� (1) The Board of Public Utilities shall
establish a program to procure and provide incentive awards for the development
of transmission-scale energy storage systems with a reasonable likelihood of
successful and timely completion.� The board shall solicit applications for the
program established pursuant to this section in an initial Tranche 1 and in
Tranche 2, pursuant to paragraph (2) of this subsection.� The board may place
an eligible project that does not receive an incentive award for Tranche 1 or
Tranche 2 on a waiting list and consider the eligible project for an incentive
award during a subsequent tranche.
���� (2)�� By no later than [June 30] December 31, 2026, the
board shall approve incentive awards for eligible projects totaling at least
1,000 MW AC in installed capacity.� However, at least 350 MW AC of the 1,000 MW
AC procurement goal shall be approved in incentive awards for eligible projects
in Tranche 1 by no later than December 31, 2025.� If the board is unable to
procure all 1,000 MW AC in installed capacity in Tranche 1, the board shall
approve incentive awards for eligible projects in Tranche 2, provided that all
incentive awards in Tranche 2 are awarded by no later than [June 30] December
31, 2026.
���� b.��� To qualify for an incentive award in Tranche 1 or
Tranche 2 pursuant to this section, a transmission-scale energy storage system
shall:�
���� (1)�� not participate in any other energy storage
program, except for the GSESP, to the extent that the energy storage program
established pursuant to P.L.2025, c.136 (C.48:3-121.2 et al.) is incorporated
into the GSESP;
���� (2)�� have an anticipated commercial operations date of
no later than December 31, 2030, unless the board permits an exception;
���� (3)�� meet the following project maturity requirements,
as applicable:�
���� (a)�� a transmission-scale energy storage system
applying for an incentive award in Tranche 1 shall have entered the PJM
interconnection process and, at the time of application, have a fully executed
Generation Interconnection Agreement or Interconnection Service Agreement
through PJM, have a completed Surplus Interconnection Study through PJM, or
have notified PJM of intent to transfer existing Capacity Interconnection
Rights associated with a deactivating generation station;
���� (b)�� a transmission-scale energy storage system
applying for an incentive award in Tranche 2 shall have entered the PJM
interconnection process and, at the time of application [,] : have
a fully executed Generation Interconnection Agreement or Interconnection
Service Agreement through PJM [,] ; have
a completed Surplus Interconnection Study through PJM [,] ; have
been studied by PJM in a Phase I System Impact Study [and have paid a Decision Point I
Readiness Deposit to PJM,]
or be in the process of undergoing a Phase I System Impact Study through PJM;
or have notified PJM of intent to transfer existing Capacity Interconnection
Rights associated with a deactivating generation station; and
���� (c)�� if a transmission-scale energy storage system applying
for an incentive award in Tranche 1 fulfils the project maturity
requirements established pursuant to subparagraph (a) [or
subparagraph (b)]
of this paragraph by completing a Surplus Interconnection Study or by notifying
PJM of intent to transfer existing Capacity Interconnection Rights associated
with a deactivating generation station, then the transmission-scale energy
storage system shall also have obtained the associated Capacity Interconnection
Rights through PJM; and
���� (4)�� meet any other eligibility criteria the board may
establish through board order or rulemaking.
���� c.���� Any application for an incentive award issued in
Tranche 1 or Tranche 2 pursuant to this section shall include:�
���� (1)�� evidence reasonably satisfactory to the board of
site control;
���� (2)�� evidence reasonably satisfactory to the board
that an applicant has or will obtain all required permits, which evidence shall
include an execution plan to obtain all required permits;
���� (3)�� evidence reasonably satisfactory to the board
that the applicant has submitted all interconnection applications and initial
application fees necessary to obtain permission from the appropriate electric
public utility or grid operator to operate the transmission-scale energy
storage system;
���� (4)�� evidence reasonably satisfactory to the board of
the applicant�s financial means to construct the transmission-scale energy
storage system and ability to obtain revenues through electricity markets or
non-ratepayer funding, including, but not limited to, energy arbitrage,
ancillary services, and capacity revenues in PJM;
���� (5)�� evidence reasonably satisfactory to the board of
the status of the transmission-scale energy storage system in the PJM
interconnection process;
���� (6)�� assurances reasonably satisfactory to the board
that the transmission-scale energy storage system will adhere to any safety
requirements, standards, or measures that the board deems appropriate as well
as to any nationally recognized minimum safety requirements, including, but not
limited to, appropriate laboratory testing, and will comply with all
manufacturers� installation requirements, applicable laws, regulations, codes,
licensing, and permit requirements;
���� (7)�� a statement describing the transmission-scale
energy storage system�s alignment with State and regional transmission and
resource adequacy planning goals and demonstrating the transmission-scale
energy storage system�s coordination with PJM and the appropriate electric
public utility;
���� (8)�� an application fee as set by the board; and
���� (9)�� any other information required by the board.
���� d.��� The board shall review Tranche 1 and Tranche 2
applications consistently with the requirements of this section.� At its
discretion, the board may instruct an applicant on curing minor defects in a
Tranche 1 or Tranche 2 application.� The board shall evaluate each application
based on the bid prices of the requested incentive awards.� The board may
appropriately compare bid prices, at the board�s discretion, based on the
measure of a transmission-scale energy storage system�s installed capacity,
energy storage capacity, or expected accredited capacity.� The board may also
consider other factors such as:�
���� (1)�� project maturity and likelihood of success;
���� (2)�� whether the project has completed non-ministerial
permits;
���� (3)�� whether the project is proposed by an applicant
with experience in energy storage development, construction, and finance; and
���� (4)�� whether the project promotes redevelopment,
community benefits, brownfield redevelopment, or existing or former fossil fuel
plant replacement or provides demonstrated benefits to environmental justice in
communities where a transmission-scale energy storage system is proposed to be
located.
���� e.���� Any board order issued pursuant to P.L.2025,
c.136 (C.48:3-121.2 et al.) shall be binding and enforceable.� Any such board
order shall:�
���� (1)�� define the eligible project receiving an
incentive award and the eligible project�s installed capacity;
���� (2)�� define the incentive award, including a payment
schedule for the 15-year award period of the incentive award, which term shall
commence no earlier than the commercial operations date of an eligible project
and during which term an eligible project shall receive an annual incentive
award on each anniversary of the first payment date;
���� (3)�� determine the amount of funding to be allocated
for payment of the incentive award beginning in the fiscal year in which the
eligible project commences commercial operations;
���� (4)�� include a participation fee as the board may
require from the developer;
���� (5)�� require, for an eligible project awarded an
incentive award, a pre-development security not to exceed $100,000 per megawatt
and not to exceed in total $10,000,000;
���� (6)�� outline the conditions under which the board may,
in the event of a developer�s failure to operate an eligible project by the
deadline stated in the board order or to meet deadlines included in the board
order, revoke an incentive award or retain some or all of the pre-development
security;
���� (7)�� provide that receipt of an incentive award for an
eligible project shall be contingent on achievement of baseline performance
requirements, including, but not limited to, availability for dispatch in a
minimum number of hours per year, as determined by the board.� The board may
use the PJM Equivalent Forced Outage Rate or another metric determined
appropriate by the board to measure energy storage availability.� The board
order shall require that the developer report data for the purpose of this
paragraph at regular intervals and shall provide for a reduction of an
incentive award in proportion to the number of hours of required availability
that is unmet by the eligible project; and
���� (8)�� require a developer to provide additional
information to the board during the term of the incentive award, as the board
may reasonably require.� The board may set additional requirements at its
discretion, including, but not limited to, a requirement that the developer
report major development and construction milestones to the board, maintain
financial security throughout the term of the incentive award, or any other
requirement the board determines necessary to ensure continued progress and
operational viability of an eligible project.
���� f.���� The board may amend an order issuing an
incentive award pursuant to this section solely to change the funding source of
the incentive award.� Any incentive award for an eligible project and the
conditions for receiving funding pursuant to this section shall remain
effective for the full duration of the award period specified in the board
order issuing the incentive award, notwithstanding any change to the funding
source of the incentive award.
���� g.��� (1) Notwithstanding the provisions of the
�Administrative Procedure Act,� P.L.1968, c.410 (C.52:14B-1 et seq.), or any
other law or rule to the contrary, the board shall permit applications for
Tranche 1 without regard to the publication status of the rules and regulations
to be issued pursuant to P.L.2025, c.136 (C.48:3-121.2 et al.), by no later
than September 30, 2025.�
���� (2)�� The board shall accept Tranche 1 applications for
a maximum of 60 days after the beginning of the formal application period for
Tranche 1.� Within 60 days following the closure of the Tranche 1 application
period, the board shall:�
���� (a)�� evaluate projects in accordance with this
section, any rules or regulations proposed pursuant to P.L.2025, c.136
(C.48:3-121.2 et al.), and any application requirements and eligibility
criteria approved pursuant to this subsection; and
���� (b)�� select eligible projects to receive an award.
���� h.��� An incentive award shall be conditioned upon a
developer�s compliance with the board order determining the incentive award and
with any conditions the board shall reasonably require.
(cf:� P.L.2025, c.136, s.2)
���� 2.��� This act shall take effect immediately.
STATEMENT
���� This bill would extend the deadline for the Board of
Public Utilities (BPU) to approve Tranche 1 and Tranche 2 incentive awards for
eligible transmission-scale energy storage systems under the energy storage
program established by N.J.S.A.48:3-121.2 et al. (program).� Under current law,
the BPU is required to approve incentive awards for eligible projects totaling
at least 1,000 megawatts in installed capacity by June 30, 2026.� This bill
extends that solicitation deadline to December 31, 2026.� The bill also
modifies certain project maturity requirements in order to expand the amount of
projects eligible to receive incentive awards under Tranche 2 of the program.
���� Modifies certain requirements for transmission-scale
energy storage procurement under BPU incentive program.