How Will New York Value Distributed Energy Resources Now?

March 10, 2017 - New York regulators issued an order Thursday that begins the process of phasing out net metering to instead value distributed energy resources based on a range of benefits they bring to the electric grid.

Part of New York’s larger Reforming the Energy Vision policy, the order is expected to help the state reach its goal of generating half of its electricity from renewable energy by 2030.

Issued by the Public Service Commission (PSC), the 274-page decision says that the state is attempting to move away from “legacy policies” that stand in the way of new energy technologies. (Case Number 15-E-0751)

“A failure to bring the electric system and industry fully into the modern world and to keep it apace with continuing developments could have disastrous consequences, including a failure to meet modern reliability needs and expectations, enormous and avoidable costs associated with the inefficient replacement of aging components, and unchecked emissions of greenhouse gasses and other pollutants,” the order said.

What specifically does the order change?
The state places a value on distributed energy resource by gradually moving away from use of net metering and toward ‘value stacked compensation tariffs.’ The new tariffs will consider the worth of energy, capacity, environmental, demand reduction and locational relief from distributed energy resources.

Net metering remains in place for existing solar energy systems, as well as certain new solar and distributed power systems that will be installed between now and January 1, 2020 for residential and small commercial customers.

The order also establishes compensation values, for the first time in New York, for energy storage systems when combined with certain types of distributed energy.

Utilities must submit work plans to develop location-based prices that reflect the full value of distributed energy resources. The commission hopes to begin applying the new tariffs to projects as early as this summer.

In addition, the commission took action to speed development of community solar, calling for the state to issue at least $28 million for incentives. By Elisa Wood

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