On May 21, the New Jersey Board of Public Utilities (BPU) announced in a meeting that they intend to break precedent and alter the percentage of load that state utilities must offset with Class 1 RECs in 2026.
Under New Jersey’s current Renewable Portfolio Standard, the percentage for Class I RECs in the state is mandated to rise from 35% in 2025 to 38% in 2026. At the BPU meeting yesterday, it was stated that the percentage will instead remain at 35% for 2026. In the same meeting, the BPU also stated that they will investigate the rule-making procedures for energy years 2027 through 2031.
The BPU cited PJM’s lagging supply of new build RPS-eligible assets coming online as the main reason for the decision. New supply has been hampered for years by interconnection queue backlog, and the sector has faced a number of new unwelcomed headwinds this year, including potential tariffs and curtailment of renewable energy tax credits under recent Congressional budget proposals.
An official order from the BPU is expected to be announced next week, though it remains unclear if the BPU has the legal authority to change the RPS percentage for existing legislation that was originally ratified by the state legislature.
PJM Tri-Qualified RECs, the bellwether REC product for the PJM region, have experienced a notable price decrease since the BPU’s announcement. As of this afternoon, 2026 PJM Tri-Qualified prices are 5% lower than yesterday’s close, and are now down 32% since the start of the year.
With 2026 pricing currently around $26.50 / REC, the market continues to inch closer towards a critical support level – the 2025 Alternative Compliance Payment (ACP) rate for both Maryland and Delaware ($25.00 / MWh). Karbone is tracking whether pricing will stabilize around this support level.
Through scenario modelling, Karbone’s pricing methodology cuts through near term uncertainty to forecast PJM Tri-Qualified REC prices out to 2050.
