This action recognizes the municipality for buying electricity from a renewable source. 

Municipalities are able to buy electricity on the open market that is then delivered through their usual utility supply channel. Municipal officials can specify the amount of green content in their electricity mix, either by buying directly from a green energy supplier, or (more commonly) participating in a buying pool that includes renewable power. 

By purchasing renewable electricity in this way, the municipality can often reduce its energy costs while also reducing its greenhouse gas emissions, become less vulnerable to fossil fuel costs, and help create demand for more sustainable sources of energy. 

To accomplish this action, the municipality must purchase electricity with at least 5% renewable energy above and beyond the NJ Renewable Portfolio Standard (RPS) in force at the time the energy contract is executed. 

Why is it important? 

Increasing the adoption of renewable energy is a key strategy for developing a more sustainable approach to energy generation and use. Buying renewable energy in this way is possible because the energy markets in New Jersey have been deregulated. As a result, any municipality can purchase energy from a third-party supplier of its choice, rather than the default supplier provided through the utility. 

All the benefits associated with renewable energy, including greenhouse gas reduction, reduced dependence on fossil fuels and associated cost volatility, local job creation, and reduced pollution and other environmental and public health impacts are all realized – while simultaneously reducing a municipality’s energy costs.

It should be noted that purchasing energy through an aggregation contract is a well-established practice in New Jersey. Many New Jersey municipalities already buy their electricity in that way. This action takes that process one step further, and captures the same cost reduction benefit for the procurement of renewable energy.