New York Is Doubling Down On Its Solar Subsidies


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Jason Hopkins Immigration and politics reporter
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New York is hoping to dramatically expand its renewables industry by handing out more incentives for community solar projects and reforming how solar owners are compensated.

State regulators have put forward a proposal to boost solar energy use among New York residents. In two separate reports, the New York State Department of Public Service laid out recommendations to increase community-distributed generation — a community solar program for people who are otherwise unable to install modules in their homes — and enhance compensation for Value of Distributed Energy Resources (VDER), a more technical system for paying solar panel owners for the energy they produce.

“Smarter, forward-thinking compensation for these projects will assure that these markets are developed in a robust, cost-effective and sustainable way,” said John Rhodes, the CEO of the Department of Public Service, in a statement. “Today’s reports recognize the necessity to refine and advance compensation policy for distributed energy in order to encourage investment in New York’s clean energy economy.”

New York has a burgeoning community solar presence. With 800 MW already in the pipeline, regulators now wish to more than double this number with another 1,000 MW.

Approved by Democratic Gov. Andrew Cuomo in 2015, community solar is meant to provide options for people who want to participate in distributed generation but are unable to install a panel in their residence. People who live in apartments, shady areas or rented homes can partake in a community solar program and receive compensation for energy the development sends back to the grid.

Regulators want to expand shared renewables into more New York communities by increasing incentives to those who participate.

“[T]he report recommends that existing market transition credits be enhanced and standardized across upstate utility territories in order to ensure that additional electric customers in these territories are afforded viable opportunities to meet their energy needs through participation in a [community solar] project,” reads a report from the New York Department of Public Service.

Such an ambitious goal is more than likely to increase energy costs for residents across the state, even ratepayers who are not involved in the solar programs.

Community distributed generation is considered a form of net metering, but on a community-wide scale. Most states in the U.S. conduct some form of net metering — where utilities credit solar panel owners for the energy they send back to the grid. However, this process has become increasingly controversial as it essentially forces non-solar customers to foot the bill. In order to compensate solar owners for their power at a retail rate, utilities typically charge other customers higher prices. (RELATED: Every State In New England Is Reconsidering Their Subsidies To Solar Power)

New York reformed its net metering program in March 2017 into a system that takes into account multiple factors — such as the time of day and value of energy in a particular area — that allow a more fair compensation to participants. This switch from net metering to a new system, known as the Value of Distributed Energy Resources (VDER), drew vehement opposition from solar companies who did not want to see their subsidies decrease.

New York regulators are, once again, looking to recalculate how solar energy is credited.

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