After months of input and review from our fellow stakeholders – industry, customers and supporters alike – Vote Solar and the Solar Energy Industries Association (SEIA) recently submitted our vision for the future of solar in New York. Many other parties filed proposals as well, notably a collection of New York utilities and leading solar companies. Together, the proposals represent an excellent start to a process that will deliver important benefits to New York.
The rise in solar installations in the state and around the country has encouraged state regulators to take a look at how to compensate consumers for the local, clean energy they sell into the electric grid. Dozens of states are wrestling with this question with various degrees of reliance on rhetoric versus fact. Against this complicated and dynamic landscape, New York gives us a particularly strong example of what ‘good’ looks like in this brave new energy world.
New York’s Public Service Commission, led by Chair Audrey Zibleman, started a stakeholder-driven process to examine net metering and the value of distributed energy resources, including solar. The process also will consider the evolution of regulation and policy. With space for real discussion among diverse stakeholders and a clear commitment to an outcome that keeps New Yorkers going solar, Vote Solar and SEIA are excited to take part.
SEIA and Vote Solar built our proposal around a well-supported set of principles that uphold the fairness and simplicity of net metering, while offering an evolution of compensation to meet customer needs. We believe the commission should do the following:
1. Protect the Customer’s Rights: All energy customers should have a right to determine the amount of energy they purchase from the utilities – whether that means producing and consuming their own solar power or reducing their consumption through efficiency or conservation. Our proposal allows New Yorkers to continue to use their own solar in their homes or businesses, and to reduce the amount of retail rate energy they are purchasing from the utilities as a result.
2. Get the Value of Distributed Energy Resources Right: Distributed energy resources offer many cost-saving benefits to the electric utility system and, by extension, to all customers. The value of that distributed generation should be properly quantified, and customers should be adequately compensated for exporting that valuable power to the grid. Critically, this should include accounting for the long-term value of distributed solar to the system. Our proposal articulates many of the important benefits that solar and distributed energy resources, like solar, provide to New York’s electric grid, economy and environment that should be recognized in the customer’s compensation.
3. Keep It Simple, Gradual and Predictable: Customers and businesses must be able to make educated investment choices with knowledge of the economic factors that will affect their investment, and with sufficient certainty to secure loans or other financing to make a solar investment. This call for simplicity and certainty extends to compensation. Our proposal uses a combination of fixed and dynamic analysis to provide accurate information while maintaining the kind of predictability that is so critical for consumers, developers and a functioning market.
4. Protect Existing Customers: Building on the need for predictability, the commission should preserve project economics and protect customer and investor expectations for financial commitments already made. Our proposal protects solar customers with assurance that they will be grandfathered for the useful life of their system and creates a concrete definition of how the policies that apply to their projects can and cannot change over time.
5. Be Transparent and Thorough: As we have learned (sometimes the hard way) from other states, the process is just as important as the product when it comes to deciding the future of solar. That process should be transparent and ensure that stakeholders have an opportunity to provide meaningful input. All of this should be undertaken in close coordination with related regulatory proceedings and clean energy programs so that they are additive and do not undermine each other.
This commonsense set of principles and our resulting recommendations have support from many stakeholders, including the New York Solar Energy Industries Association and the Coalition for Community Solar Access. As this process begins, we are ready to dig further into a well-informed discussion with the commission and fellow parties about the future of solar in New York.
Dave Gahl is director of Northeast state affairs for SEIA, and Sean Garren is the Northeast regional manager for Vote Solar. SEIA, Vote Solar and other industry leaders will host a webinar on the future of net metering in New York on May 3 at 4 p.m. ET. More information on the event is available here.