Community Distributed Generation

Summary

Introduction

In July 2015 the NY Public Service Commission (PSC) issued an order that established a Community Net-metering in the State. The community net-metering allows multiple customers to subscribe to and receive credits for the electricity produced from off-site renewable generation facilities. This policy makes it possible for renters, low-income residents, and homeowners to receive credits for renewable energy who previously could not install a renewable generation facility in their homes. 

In general a community energy project requires a minimum of 10 members. In March 2017, the commission allowed a waiver for a minimum ten member requirement for community distributed generation projects that are located on the site of a property serving multiple residential or non-residential customers. No more than 40% of the generation may serve large demand-metered (25 kW or greater) subscribers. Each subscriber must be allocated at least 1 MWh/year (not exceeding their historic average annual consumption). The maximum size of the community energy system is limited to 2 MW. Any single entity, including facility developer, ESCO, municipal entity, business, non-profit, LLC, partnership, or other form of business or civic association can be the sponsor of the community energy facility. The sponsor will be responsible for building and operating the facility.

Implementation of the program is divided into two phases. First phase of the program will last till April 30, 2016, during which the community net metering will serve as an introductory phase. During this period, the projects will be limited to siting distributed generation in areas where it provides greatest locational benefits to the larger grid, and in areas that promote low-income customer participation. The second phase will begin on May 1st 2016 when the community net metering projects will be fully implemented throughout the other utility service territories. 

Credit

Compensation for energy created by distributed energy resources in New York is based on the Value Stack. The Value Stack compensates projects based on when and where they provide electricity to the grid, compensation is in the form of bill credits. The value of the credit is determined by several factors, including energy value (LBMP), capacity value (ICAP), environmental value (E), demand reduction value (DRV), and locational system relief value (LSRV). 

Incentives

Certain Community Distributed Generation projects may also have a market transition credit (MTC) or community credit (CC) which recognize the benefits that DERs provide to the grid and society. The CC incentive, the successor to the MTC, provides a $/kWh that is locked in for 25 years. The CC rate varies based on location and availability. 

The Community Adder incentive is offered for a limited number of MW projects that were developed in areas where the MTC and CC had already been fully allocated. Adder rates and availability are based on the project’s utility service territory. Projects in PSEG-Long Island service territory are not eligible for this adder. As of November 30, 2022, the Con Ed Community Adder Block 1 is temporarily suspended. As of February 28, 2022, the Upstate Community Adder Block 1 has been fully allocated. However, NY-SUN is conducting an analysis of all current market conditions and costs, as well as the impact of the IRA on community solar project economics. Updates on additional blocks and incentive rates will be announced after this analysis is complete.

LMI Provisions

The Inclusive Community Solar Adder (ICSA) is designed to support CDG solar projects serving low-to-moderate income (LMI) subscribers, affordable housing, and other facilities serving disadvantaged communities. The goal of this adder is to increase access to community solar and resulting electric bill savings for LMI households and to reduce operating costs for affordable housing and nonprofit entities serving disadvantaged communities. As of February 28, 2023, NYSERDA is revising the ICSA and is not accepting any applications.

The Solar for All program is a utility bill assistance program that benefits homeowners and renters who may not be able to access solar energy. Eligible subscribers include those who rent or own their own home, are a veteran receiving disability benefits, are on a fixed income, earn minimum wage, and/or participate in HEAP, SNAP, TANF, or other electric bill assistance programs.