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Last Updated December 2, 2016

Program Overview


Financial Incentive


New Jersey

Incentive Type:

Rebate Program


New Jersey Board of Public Utilities, Office of Clean Energy

Start Date:


Expiration Date:


Web Site:

Applicable Sectors:

Commercial, Industrial, Local Government, Nonprofit, Schools, State Government, Federal Government, Institutional

Eligible Renewable/Other Technologies:

Comprehensive Measures/Whole Building


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.


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

For Existing Buildings

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 as provided below. 

• Incentive #1 - Submittal of complete energy reduction plan prepared by an approved program partner - Contingent on moving forward, incentives will be between $5,000 and $50,000 based on approximately $.10 per square foot, not to exceed 50% of the facility's annual energy expense.

• Incentive #2 - Installation of recommended measures- Incentives are based on the projected level of electricity and natural gas savings resulting from the installation of comprehensive energy-efficiency measures.

• Incentive #3 - Completion of Post-Construction Benchmarking Report - A completed report verifying energy reductions based on one year of post-implementation results. Incentives for electricity and natural gas savings will be paid based on actual savings, provided that the minimum performance threshold of 15% savings has been achieved.

Maximum incentives are capped at 50% of lesser of the total estimated or actual project costs and up to $1 million per gas and electric account (limited to $2 million per project). There is an also an annual cap of $4 million per entity.

For New Construction or Substantial Renovations

Similar to Existing Buildings program, New Construction program also includes incentives based project milestones.  

Incentive #1 - Submittal and approval of the proposed energy reduction plan prepared by an approved program partner, detailing the proposed building design and its energy cost savings compared to code compliant baseline. Incentives range from $0.08-$0.16 per square foot up to $60,000 and are contingent on moving forward with construction.

• Incentive #2 - Submittal and approval of a as-built energy reduction plan and commissioning report confirming energy efficiency are installed and performing as expected. Incentives range from $0.80-$1.40 per square foot up to 75% of the projects incremental cost.

• Incentive #3 - Submittal of building performance report demonstrating building has achieved ENERGY STAR Certification. Incentives range from $0.35-$0.40 per square foot up to 25% of project's incremental costs

Program participants may not receive incentives for improvements made prior to their enrollment in the program. Incentives are capped at $1 million per electric and gas account per year and $4 million per entity per year. Please see the program website or contact the program administrator for additional information on how this program works.