Long Island Power Authority - PV Rebate Program

Summary

Note: As of August 30, 2013, LIPA has suspended the Solar Pioneer Residential Program. However, the utility plans to reopen the program on September 23 with $5 million pledged by New York State. See the web site above for more information. The summary below describes the program as it was in effect before the residential program was suspended.   

LIPA offers its customers rebates for grid-connected photovoltaic (PV) systems as part of the Solar Pioneer and Solar Entrepreneur programs. Residential PV systems up to 25 kW and non-residential PV systems up to 2 MW (the limits of LIPA's net metering policy) are eligible for an incentive based on expected system performance, ranging from base level of $1.45 - $2.25 per watt (CEC-AC) depending on the customer sector. The incentive amount is also adjusted for shading, array orientations, and other factors affecting performance based on a calculation of a "Design Factor" (%) that compares the system in question to an optimal reference system. The program has historically only been available for customer-owned systems, rendering third-party owned systems ineligible for incentives. However, the program rules have recently been changed to allow residential systems installed under third-party ownership arrangements (i.e., power purchase agreements or leases) to qualify for incentives.

Systems should generally be sized so as not to exceed annual electricity consumption. Rebate amounts will be limited to the amount dictated by a system sized to produce no more than 105% of on-site electricity consumption during the prior 12 months. LIPA's rebates are designed to reflect the current PV costs. The rebate may not exceed the lesser of 50% of installed system costs for residential and business-owned systems, 65% for municipal and non-profit systems, or the incentive value as determined by the rebate schedule. The installed costs are defined as the PV system cost to the customer minus any government grants or subsidies.

The most recently published rebate levels offered by the program are as follows:

• Residential (general customer-owned): $1.86/watt CEC-AC up to the lesser of 50% of installed costs or $18,600
• Residential (third-party owned): $1.72/watt CEC-AC up to the lesser of 50% of installed costs or $17,200
• Residential (non-profit owned): $2.25/watt CEC-AC up to the lesser of 65% of installed costs or $22,500
• Commercial: $1.45/watt CEC-AC up to the lesser of 50% of installed costs or $145,000
• Gov't, Schools, Nonprofits: $2.25/watt CEC-AC up to the lesser of 65% of installed costs or $225,000

Schools, not for profit, and government facilities receive higher rebates to help compensate for tax incentives available to residential and commercial customers. For the additional incentive, proof of non profit (501(c)3) or equivalent status is required and tax credits/depreciation cannot be applied for the PV installation. All equipment must meet the minimum technical, warranty, and installation requirements established by LIPA. The program has a $100 non-refundable application fee.

History
LIPA launched the Solar Pioneer Program in 2000 as part of the utility's five-year Clean Energy Initiative -- a $32 million commitment to developing clean energy alternatives. In May 2003, LIPA announced that it would extend its Clean Energy Initiative for another five years and increase funding levels by $5 million per year, to an annual investment of $37 million and a total investment of $185 million. Under the Efficiency Long Island Program (which replaces the Clean Energy Initiative) budgets have exceeded this investment level, with total efficiency and renewables budget of $120 million for 2013.

In recent years the solar rebate program has been expanded with the addition of rebates for large commercial systems. The large commercial program is called the Solar Entrepreneur program. With the addition of the Solar Entrepreneur program, the overall program budget has increased dramatically, to more than $28 million in 2013. LIPA has reportedly issued rebates for more than 3,300 PV systems over the 10-year life of the program. Past reports indicate an average PV system size of approximately 5.9 kW.