New York VDER Order Is An Important First Step
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 into 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.
That said, 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. – Sean Gallagher
Sean Gallagher is vice president of state affairs at the Solar Energy Industries Association.
Ohio House Passes Repeal Of Renewables Mandate
Here we go again: Only a few months after Gov. John Kasich, R-Ohio, vetoed a similar bill, Ohio lawmakers have advanced new legislation to repeal the state’s renewable energy mandate.
In June 2014, Ohio became the first U.S. state to roll back its clean energy mandates after passing a law that implemented a two-year “freeze” on the state’s Alternative Energy Portfolio Standard. Last year, the Ohio legislature passed a bill that would have effectively extended the freeze by turning the requirements for utilities to purchase renewables and invest in energy efficiency into voluntary goals, with no compliance obligations, through 2019. However, Kasich vetoed the bill last December, thus reinstating the utility mandates on Jan. 1.
Seemingly determined, though, the legislature has redoubled its efforts to do away with the standards. In a 65-31 vote at the end of March, the Ohio House of Representatives passed H.B.114, a bill that again aims to repeal the renewable energy mandates and instead make them optional goals. H.B.114, which also targets state energy-efficiency requirements, has gone to the Ohio Senate for consideration.
In a blog post, the House Republican Caucus refers to H.B.114 as a “pro-business bill” that “encourages economic growth [and a] free-market system.” Bill sponsor Ohio State Rep. Louis W. Blessing III, R-Colerain, says he is “pleased” with the bill’s passage and is looking forward to “more spirited discussion as it heads to the Senate.”
In a separate blog, House Democratic Leader Fred Strahorn, D-Dayton, speaks out against the bill, saying, “If Ohio’s economy is on the ‘verge of a recession,’ as the governor has claimed, rolling back state renewable energy standards will threaten future job growth and could harm consumers, workers and the environment.”
National business group Advanced Energy Economy (AEE) claims H.B.114 is objectively worse than H.B.554, the bill vetoed by Kasich last year. According to AEE, H.B.114 would deprive the state of $10 billion in advanced energy market opportunities created by the reinstatement of the state’s standards on Jan. 1.
Oregon Solar Program Selects Winning Projects
Business Oregon, a state economic development agency, has approved 15 utility-scale solar energy projects to enroll in the new Solar Development Incentive program.
Created in the 2016 Oregon legislative session, the program encourages development of 2 MW to 10 MW solar photovoltaic projects in Oregon by providing an incentive per kilowatt-hour of electricity generated. The agency says the utility-scale solar sector is nascent in Oregon; therefore, developers face higher costs by being the first to take on such projects in the state.
According to Business Oregon, qualified projects in the program will receive a monthly payment of $0.005/kWh for up to five years. The program is capped at 150 MW worth of projects, but the 55 applications that Business Oregon received totaled 293 MW of solar energy capacity.
The 15 projects selected to date represent 116 MW of the total 150 MW capacity and are mostly located in central, southern and eastern Oregon. The agency says additional award announcements from the application pool are forthcoming, but because this is a one-time enrollment incentive program that closed in January, Business Oregon is no longer accepting applications.
To date, the awardees include the following: Coronal Energy, with two projects totaling 20 MW; Cypress Creek Renewables LLC, with three projects totaling 23 MW; ET Solar, with three projects totaling 28 MW; NextEra Energy, with one 5 MW project; Obsidian Renewables LLC, with two projects totaling 18 MW; Pine Gate Renewables, with two projects totaling 11.9 MW; SolarCity, with one 8 MW project; and Sunthurst, with one 2 MW project.
Utah Sounds Death Knell For Solar Incentive
Utah Gov. Gary R. Herbert has signed into law a bill that will fully phase out the state’s residential solar tax credit.
Utah homeowners can currently claim a $2,000 income tax credit for installing rooftop solar, but the new law will drop the incentive to $1,600 in 2018 and decrease the available amount by an additional $400 each year, until the solar tax credit is completely eliminated after 2021.
Bill sponsor Republican State Rep. Jeremy Peterson cited state budget concerns and argued Utah’s growing solar industry no longer needed the tax credits to thrive. In February, local solar advocates considered the phase-out a compromise and decided not to contest the bill, with Ryan Evans, president of the Utah Solar Energy Association, telling the Salt Lake Tribune, “Solar energy is becoming more and more affordable every year, and I think we can absorb this.”
Nonetheless, solar groups remain concerned about other policy issues that might hinder solar in Utah. In November, for example, utility Rocky Mountain Power (RMP) proposed controversial changes to the utility’s net energy metering (NEM) program for new rooftop solar customers. A group of solar companies denounced the plan, and the proposal is scheduled for regulatory review later this year. Solar Industry’s February 2017 issue featured an op-ed by an RMP representative, titled “In Defense Of NEM Changes.” In it, the author explained RMP’s reasoning and declared, “We are interested in working with the solar industry in finding a path forward that is fair to all customers.”