Small Scale CHP and Fuel Cell Incentive Program (New Jersey)

From Open Energy Information


Last modified on December 17, 2014.

Financial Incentive Program

Place New Jersey

Name Small Scale CHP and Fuel Cell Incentive Program
Incentive Type State Grant Program
Applicable Sector Commercial, Industrial, Nonprofit, Schools, Local Government, State Government, Fed. Government, Multi-Family Residential, Agricultural, Institutional
Eligible Technologies CHP/Cogeneration, Fuel Cells, CHP/Cogeneration, Microturbines
Active Incentive Yes
Implementing Sector State/Territory
Energy Category Renewable Energy Incentive Programs, Energy Efficiency Incentive Programs
Amount Varies by system type and size

Equipment Requirements Equipment must be new, commercially available, and permanently installed; electric-only generation must achieve a minimum 45% electric efficiency; systems with waste heat utilization must achieve a minimum 60% annual system efficiency; systems must have a 10 year all-inclusive warranty or 10 year service contract

Funding Source New Jersey Societal Benefits Charge (public benefits fund)
Installation Requirements Must be stationary; installed on the customer side of the meter; designed to serve no more than 100% of on-site electric load

Maximum Incentive Limits (% of cost) vary by system type, but the following limits also exist:

NJCEP Incentive: 1 million
Pay for Performance Bonus Incentive: 250,000
Utility Match: 1 million
Overall Maximum: 2.25 million

Program Budget $20 million (2012)

Program Administrator TRC Solutions

References DSIREDatabase of State Incentives for Renewables and Efficiency[1]


The New Jersey Clean Energy Program (NJCEP) offers incentives for several types of small combined heat and power (CHP) and fuel cell systems that have a generating capacity of 1 MW or less and are located behind the meter of an existing electric or natural gas customer that pays the Societal Benefits Charge (SBC). This includes customers of the states investor-owned electric and natural gas utilities, but does not include customers of municipal utilities. A variety of equipment and installation requirements exist for determining eligibility (see details above and on the program web site), but in addition to these limitations the program guidance specifically notes that the following types of systems are not eligible for incentives: renewable source-fueled systems; portable and emergency backup power systems; used, refurbished, temporary, pilot, or demonstration equipment; systems that use diesel fuel, other types of oil or coal for continuous operation. However, systems that use Class I renewable fuels (as defined under the New Jersey RPS) are eligible under the separate Renewable Energy Incentive Program (REIP). The New Jersey Economic Development Authority (EDA) administers New Jersey's Large CHP and Fuel Cell Program, which offers incentives for systems sized greater than 1 megawatt (MW). The EDA also offers low-interest financing for the small CHP program through the Energy Efficiency Revolving Loan Fund.

Projects the meet the minimum program requirements are evaluated for funding based on a variety of criteria, such as system efficiency, environmental performance, and other metrics (i.e., the program is not a first-come, first-served rebate program). The incentive available to an individual project is determined by the project type and size. Maximum incentives in reference to a percentage (%) of project cost also vary by project type. The following table summarizes the basic incentive terms (see the program web site for further details):


Incentive Contact

Contact Name New Jersey Clean Energy Program - CHP and Fuel Cell Program
Department c/o TRC Energy Services
Address 900 Route 9 North, Suite 104
Place Woodbridge, New Jersey
Zip/Postal Code 07095
Phone (866) 657-6278


  • Incentive and policy data are reviewed and approved by the N.C. Solar Center's DSIRE project staff.[1]


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