New York's Value of Distributed Energy Resources—Rate Design FAQ
FREQUENTLY ASKED QUESTIONS
Q. What’s happening with net metering for residential and small commercial projects in New York State?
The Value of Distributed Energy Resources Case (VDER) at the New York Public Service Commission (PSC) is subdivided into two working groups: 1) value stack—addressing compensation for larger distributed projects and community solar installations, and 2) rate design—addressing compensation for residential and small commercial systems. Stakeholders are awaiting a whitepaper from the New York Department of Public Service (DPS) Staff regarding proposed rate designs for residential and commercial customers.
Q. Will all residential and smaller commercial distributed solar projects be moved to the Value Stack starting in January 2020?
No. Nothing in the March 2017 VDER Order establishing Phase One NEM transitions residential or commercial projects to the value stack starting in January 2020. According to the VDER Order, “New mass market, onsite projects will be eligible for Phase One NEM until the earlier of January 1, 2020 or a subsequent Commission order addressing such projects in this proceeding” (at 14).
Q. Will the utilities continue to offer Phase One net metering after January 2020?
Throughout the stakeholder discussions, DPS Staff have said Phase One NEM will be extended to accommodate for the delays in the case.
However, many of the effective utility tariffs mirror the above language. They say Phase One NEM will be available until the earlier of January 1, 2020 or a subsequent Commission order addressing rate design. So minor adjustments should be made to these tariffs. DPS Staff is working to update the current tariffs.
Q. What’s under consideration for new rate designs?
In spring of 2019, a consultant to the DPS proposed the idea of establishing a limited suite of multiple “bridge rate” options as a gradual shift away from net energy metering while New York utilities consider technology changes necessary to implement alternate rates.
One of the proposed bridge rate options is an additional charge called a “Customer Benefit Charge” (CBC), which was proposed to recover costs associated with the state’s public benefit programs (energy efficiency programs, low income programs, etc.) and could no longer be offset by bill credits from solar production. Other proposed bridge rate options including a value stack–based approach and a time of use (TOU) rate that would charge customers based on the cost to serve them throughout the day and year.
Q. How large could a Customer Benefit Charge be?
The main issue for solar firms is the size of this charge. The consultant has proposed a charge that would be approximately $1/kW-month. Solar stakeholders in the case have recommended that the charge only include the costs associated with the Utility Low Income program (~$0.15/kW-month). And because these costs are undefined in future years, the solar industry proposed a cap of $0.50/kW-month for the charge.
Q. When are any new rates designs likely to become effective?
Given the lengthy delays in this case to date—the DPS was supposed to make its recommendations to the PSC at the end of 2018—at the absolute earliest, it is unlikely any new rate designs will be effective before Q4 2020.
Q. Who are the parties in the case representing the solar industry?
The Clean Energy Parties are a coalition of industry, environmental, and nongovernmental advocates encouraging the greater use of distributed energy resources that includes: ACENY, CCSA, NRDC, NYSEIA, PACE, SEIA, and Vote Solar.
Q. Where can I find the filings in the case and what is the case and matter number?
The VDER Case number is 15-E-0751 and to date many filings have also been submitted in matter number 17-01277.
FOR MORE INFORMATION
Senior Director of State Affairs, SEIA
Executive Director, NYSEIA