NY-Sun Commercial and Industrial Incentive Program

Summary

New York State Energy Research and Development Authority (NYSERDA) through NY-Sun Commercial/Industrial Incentive Program (PON 3082) provides incentives for installation of non-residential new grid connected solar photovoltaic (PV) systems that are greater than 200 kW. Incentives for systems smaller than 200 kW systems are offered through the NY- Residential  and Small Commercial incentive program. Incentives are awarded on a first-come, first serve basis, until the funds are fully committed. Applications are being accepted through December 29, 2023. 

Eligibility

Incentives are provided to new customer-sited PV systems, greater than 200 kW per electric meter, that are grid connected and displace utility provided electricity. The program is funded primarily by the Renewable Portfolio Standard (RPS) customer charge that are billed to the customers of investor owned utilities in the State. The funding in limited amount is also provided through the statewide Regional Greenhouse Gas Initiative (RGGI) funds. After the RGGI funds are exhausted, only RPS/SBC paying customers of investor owned utilities will be eligible for the program. Such utilities include Central Hudson Gas and Electric, Con Edison, National Grid, NYSEG/RG&E, and Orange & Rockland. 

PV projects receiving any other NYSERDA awards are not eligible to receive incentive under this program. 

Program Description

The program offers incentive based on the performance of the PV system over the first 3 years of the system’s annual energy production. The program also offers additional incentives for: i) installations in utility identified strategic locations, ii) for systems that integrate energy storage, and iii) for projects that include comprehensive energy efficiency. 

 MW Blocks

Incentives are based on the Megawatt (MW) Block design that allocates specific incremental MW targets to specific regions of the state. Each target has a specific incentive level. As the MW target on the specific block fully subscribed, another subsequent target is specified with unique incentive amount. Incentive amounts are designed to decrease in time as each of the MW targets are met. Once all the MW blocks in a region are fully subscribed, an incentive is no longer offered in that region. The MW block design is based on historical demand, market penetration, installed cost per watt, and helps to provide equity on a regional basis. Real time incentive price for each of the MW blocks can be viewed here. 

There are two regional MW blocks established i) region served by Con Ed, and ii) the rest of the state (ROS) except PSEG-LI. Remote net metered projects in ROS that receive monetary crediting from a non-demand host meter receive the "Monetary" incentive, all other projects in ROS receive "Volumetric" incentive. 

Incentive Amount

The Base Incentive for the PV systems are calculated based on 3 years of estimated annual energy production using 13.4% capacity factor (CF) for fixed systems, 16% CF for single-axis tracking, or 17.5% CF for dual-axis tracking. 

Total estimated annual energy production is calculated by the formula:

             PV system Estimated Annual Energy Production (kWh) = PV system DC rating (kW) x 8760 (h) x Capacity Factor. 

Base Incentive is calculated by multiplying estimated annual energy production calculated above by its corresponding MW block incentive rate (in $/kWh), given by the formula

             Base Incentive ($) = PV system Estimated Annual Energy Production (kWh) x MW Block Incentive ($/kWh) x 3 years

The base incentive calculated above, with additional eligible incentives (described section below) add up to "Not to Exceed" (NTE). NTE value is calculated based on projected kWh production of the system. Total incentive payment for the system cannot exceed this value.

Incentives are distributed to the contractor in for four separate installments:

•  25% of the NTE value (0.25x NTE) , after the system is commercially operational.
•  The remaining 75% provided on three installment payment  (25% each year) based on yearly performance calculated by the formula (0.75 x Metered Yearly Energy Production (kWh) x PBI ($/kWh))

For example a 1MW system, would have total Annual Energy Production of 1,174MWh with a 13.4% capacity factor. Base incentive can be calculated by multiplying the total Annual Energy Production by 3 years and the Performance Based Incentive corresponding to the MW block. The Base incentive with volumetric PBI on Block I (0.114$/kWh) would amount to 1,174MWh x 3 x 0.114 = $401,453.28. This is the total NTE or maximum incentive that the project will receive (excluding additional incentives described below). One fourth of the amount ($100,363) will be paid after commercial operation. The rest of the amount will be paid after each year for three years based on the output of the facility (which will approximately amount to $100,363 each year for next three years. 

The excel based incentive calculator (MWBlock Estimator) available at the NY-Sun website can be used to calculate incentives for the PV system. 

Additional Incentives

An additional incentive of $50,000 is awarded to applicants who invest in energy storage and/or energy efficiency. Energy efficiency investments must reduce energy use intensity (kBtu/sq.ft/year) at the customer’s site by a minimum of 15% relative to the baseline energy use intensity of the customer. The program also offers separate additional $50,000 for investment in integrated PV/energy storage that provide minimum of 250 kW of monthly peak demand reduction at the electric customer's site. 

Contractor Requirements 

Incentives are provided directly to the participating contractors, which are transferred to the customer to reduce the cost of the system. Interested parties with appropriate credentials can apply through the NY-Sun program website to register as a participating contractor. Participating contractors are responsible for installing the system, and submitting all required PV incentive application to NYSERDA.