"Our proposed initiative highlights our intention to be a leader here in New Jersey in finding ways to improve the environment," says Ralph Izzo, chairman and CEO of Public Service Enterprise Group, PSE&G's parent company. "Climate change is a reality that needs to be addressed now. We are prepared to invest a substantial amount of capital, and we have developed an innovative regulatory approach to provide new avenues and incentives for investment in renewal energy."

If approved by BPU, the utility would provide loans to developers and businesses to cover approximately 40% to 50% of the cost of a solar installation project. The utility would be repaid the principal plus interest over 15 years, a considerably longer time frame than traditional lenders are willing to provide for solar installations.

The remaining project cost would be funded by a host customer or equity partner, such as a bank or investor, who would be eligible for a federal investment tax credit. PSE&G would be repaid in the form of credits called Solar Renewable Energy Certificates (SRECs), which have value in the energy marketplace. The solar systems themselves would be owned by the developer or host customer.