On Thursday, October 15th, the New York Public Service Commission (NY PSC) ruled to temporarily lift caps on the amount of net-metered solar energy that can be permitted on a utility system.
New York does not find itself in as dire of a situation as Massachusetts, where net metering caps have been hit in the state’s largest utility territory (National Grid). Nevertheless, a July filing by Orange and Rockland Utilities (ORU) prompted the movement by the NY PSC to avoid such a situation. The lift of net metering caps will apply to all six of New York’s investor-owned utilities, and will become effective on November 6th following the filing of tariff revisions implementing this ruling by each utility by October 30th.
The July filing from very small municipal utility ORU requested to suspend net metering for solar installations after they noticed their pool of interconnection applications exceeded their limit of 6% or 62MW.
The proposal by ORU would have implemented a “buy-all, sell-all” approach to interconnection and metering where a customer with a solar installation would buy all of their electricity at the retail rate and sell all of the system’s generation output at a wholesale rate. The NY PSC found this approach inadequate for addressing the needs of the flourishing solar industry in New York.
In addition, rather than increasing the caps to an artificially set level as they have done in the past, the NY PSC decided the temporary lift the cap to an undetermined level would provide a more adequate solution until the Commission could better understand the value of distributed energy resources under New York’s Reforming the Energy Vision (REV) initiative, slated for the end of 2016.
This apparently reflects the thinking of several Commissions and utility consultants that retail net metering is a sort of “rough justice” that approximates the value of net metering to the system. After all, an elaborate ratemaking process has already occurred to establish the value and cost of an electron at the meter. If there is no inherent subsidy in net metering, there is less rationale for a cap. This argument is further reinforced in New York, where large demand and capacity charges tend to offset the percentage of the bill that is offset by any netting.
What About Megawatt Block?
With the net metering barrier now out of the way, it remains to be seen how successful New York developers can be under the NYSERDA Megawatt Block incentive program, which Sol Systems still believes is set at inadequate incentive levels.
As promised earlier this year, NY-Sun held a Stakeholder Meeting on Monday, October 26th to discuss the progress of and updates on the MW Block Commercial and Industrial (C&I) incentives. This meeting provided participants an opportunity to share information on program activity, regulatory developments, and market conditions.
Although falling short of our goal to receive a commitment to increasing the incentive levels from NY-Sun, Sol Systems felt the meeting was productive for continuing to relay our strong message – one we have found we share with most solar industry companies across the state. Our team will continue to provide input to NY-Sun and NYSERDA on how we believe the program should be changed to allow for a more successful and burgeoning C&I market in New York. Stay tuned…
This article has been published here by the PVBUZZ team from the original article written by Anna Noucas for publication on SolSystems.
Sol Systems is a solar energy finance and investment firm. The company has facilitated financing for 333MW of solar projects on behalf of Fortune 100 corporations, insurance companies, utilities, banks, family offices, and individuals. Sol Systems provides secure, sustainable investment opportunities to investor clients, and sophisticated project financing solutions to developers. The company’s tailored financial services range from tax structured investments and project acquisition, to debt financing and SREC portfolio management. Inc. Magazine named Sol Systems on its annual Inc. 500 list of the nation’s fastest-growing private companies for a second consecutive year, ranking it No. 6 in the nation’s top solar companies in 2014.