New York VDER Order Is An Important First Step For Solar


In March, the state of New York reached a milestone. The first phase of the Value of Distributed Energy Resources (VDER) order was approved by the New York Public Service Commission (PSC), setting the state on a path toward a modern system with clean energy and customer participation at its core.

There were several reasons to celebrate this progress, especially in the near term, but there were also a few areas of concern.

On the bright side, New York’s smaller rooftop solar customers can now rest assured that net metering will remain in place. This order allows residential and small commercial rooftop customers to be fully and fairly compensated for years to come for the valuable clean energy they deliver daily to the grid.

Additionally, large commercial customers already connected to the grid and certain community solar projects that have progressed toward completion will be grandfathered onto the current rates. These types of actions are the steps this industry needs to be successful because they provide regulatory certainty and strong market fundamentals.

We were also pleased to see a directive in the order for the New York State Energy Research and Development Authority and the New York Green Bank to further invest in solar growth and expanded access. This will help secure affordable financing so the benefits of clean energy can be felt throughout the entire state, including in underserved communities, which will still need additional measures.

And with ambitious goals such as Gov. Andrew Cuomo’s NY-Sun goal of 3 GW by 2023 and the state’s overall clean energy standard goal of 50% renewables by 2030, improvements like these are essential.

All of this to say – there is still room for improvement. Although the order begins the process of identifying the economic and social benefits that distributed resources, like solar, provide to the state and the grid (an important goal of New York’s Reforming the Energy Vision process), it doesn’t establish a fair compensation rate that reflects the full and actual value for new community solar development – or for municipal and larger commercial solar projects. For instance, the new rate significantly undervalues the way distributed solar reduces the need for costly grid upgrades.

We fear this will hinder solar access for low-income customers, along with upstate residents and businesses, as it will be hard for many New Yorkers to access the benefits of solar if they can’t install it on their own roofs.

And though rooftop solar is a great option for many, some of New York’s energy consumers – including low-income families, renters, and homes or businesses with a shaded roof – face physical or financial barriers to going solar through the rooftop model. A successful program should enable customers to cost-effectively take part in a shared solar energy project.

So, although we applaud the PSC for its collaborative process and the Cuomo administration for its commitment to building a robust solar industry, which today supports more than 8,100 New York jobs, there is still work to do.

The phrase may be “in a New York minute,” but we’re hoping state leaders take some time with this one to make sure this program is implemented in a way that expands clean energy access and its benefits to all New Yorkers, and we’re looking forward to working together to make that vision a reality.

Author’s note: Sean Gallagher is vice president of state affairs at the Solar Energy Industries Association.

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