New Jersey recently enacted the Residential Development Solar Energy Systems Act (the "Act"),[1] which will require residential developers to provide information on solar energy systems to prospective buyers. The Act will have a significant impact on the planning, advertising, and construction of New Jersey's residential developments, and development professionals will be faced with new challenges that should be addressed early in the development process.

The Act applies to all residential developments consisting of 25 or more dwelling units intended for owner occupancy.[2] Residential developers must offer to install, or provide for the installation of, a solar energy system for each unit.[3] Developers must provide this option to potential buyers whenever installation of such a system is "technically feasible," as determined by the Commissioner of Community Affairs (the "Commissioner") and the Board of Public Utilities (the "Board").[4]

Developer Advertising

Residential developers will now be required to disclose in all advertising:

  1. That the buyer may have a solar energy system installed in any unit,
  1. The costs involved in installing a solar energy system that will be charged to the buyer,
  1. Information about the potential environmental and economic benefits associated with solar energy systems, and
  1. Information on any credits, rebates, or other incentives that may be available for the installation of solar energy systems.[5]

If the prospective buyer accepts the developer's offer to install a solar energy system, then the developer must install, or arrange for the installation of, the system before completion of the construction of that unit.[6]

Homeowner Associations

If a solar energy system is installed, and the unit is within a development that a homeowner or other owner or member association will be responsible for maintaining, repairing, or replacing the roof, and the association incurs additional costs resulting from the solar energy system, the association may:

  1. Collect the additional costs from the owner of the unit,
  1. Access the unit to maintain, repair, or replace the solar energy system or roof, and
  1. Record an instrument with the county clerk to give current and prospective owners notice of potential responsibility for additional costs associated with maintaining the solar energy system and/or roof.[7]

Installation Standards for Solar Energy Systems

The Act requires that the Commissioner and the Board adopt standards for the technical sufficiency of solar energy systems installed pursuant to the Act. The standards must provide the installed solar energy system:

  1. Is installed in conformance with manufacturer's specifications,
  1. Complies with electrical, building, and energy codes,
  1. Has a warranty of 10 years or more, and
  1. Has devices to monitor system performance and output of electricity.[8]

Further, the Commissioner and the Board must publish materials designed to show developers how to incorporate solar energy systems during construction, and provide developers with information on applicable credits, rebates, and other available incentives for the installation of the systems.[9]

Legislative Goals for the Act

The Act aims to create a sustainable energy future for New Jersey, decrease pollution and greenhouse gas emissions, counteract global warming, reduce dependence on foreign energy sources, and benefit the state's economy by creating jobs in the manufacture, design, repair, and marketing of renewable energy products.[10] The Act is part of the state's Energy Master Plan.[11]

The Act will apply to any unit for which a construction permit is obtained 90 or more days after the Department of Community Affairs adopts technical sufficiency standards.[12]