NEW YORK - Six New York State electric utilities and three of the nation's leading solar development companies have formed a "Solar Progress Partnership" to encourage more solar development across the state, while ensuring that adequate funding is available to maintain a reliable and resilient grid.
The Partnership includes Central Hudson Gas & Electric Corp., Consolidated Edison Company of New York, Inc., New York State Electric & Gas Corp., Niagara Mohawk Power Corp. d/b/a National Grid, Orange and Rockland Utilities, Inc., and Rochester Gas and Electric; and the solar companies SolarCity, Inc., SunEdison, Inc., and SunPower Corp.
In a filing this week with the New York State Public Service Commission (NYSPC) (Solar Progress Partnership Comments), the Partnership proposed a transition from the current compensation model for solar net metering to one that continues to support the development of clean solar power in New York, while addressing customer cost-sharing issues that have evolved with the rise of solar projects.
Net metering allows solar users to receive credit for excess power back to the grid at retail rates, helping them produce clean, renewable power and lower their utility bills. For those without adequate rooftops, solar power has also become available through so-called "community solar" or "remote net metering" arrangements, where solar power is purchased from solar developers or building owners who construct solar installations on available parcels of land or warehouse rooftops.
With all of these scenarios, electric grids are being used to transmit the solar power from the installations to the grid and back to their customers, with the revenue requirement for maintaining the grid being shifted more and more to non-solar customers.
The Solar Progress Partnership's filing recommends collecting a payment from solar developers for community and remote solar projects connected to the grid, while preserving utility bill savings for their customers. Solar developers would gain greater certainty over their ability to connect customers to their projects. Electric utilities would have the financial resources needed to maintain a reliable grid, essential to the widespread success of solar, and solar resources can be better targeted to areas of the grid that need them.
The proposal also recommends a transition plan for net-metered customers with rooftop solar panels. The proposal would generally continue the current formula until January 1, 2020, with options for a transition to a new formula that more accurately compensates customers for the value of the electricity they send to the grid.
The Partnership proposal was a result of productive dialogue facilitated by the Advanced Energy Economy Institute (https://www.aee.net/aeei ) on the future of solar development in New York State.
John McAvoy, chairman and CEO of Con Edison, Inc. (NYSE: ED) (includes Con Edison of New York and Orange & Rockland Utilities), said: "We're working together to keep our state's solar market vibrant while enabling us to maintain the robust power grid that solar energy requires, and in a way that is fair to all customers. Utilities and solar companies have found common ground to enhance our environment, the economy and electric reliability."
Lyndon Rive, CEO of SolarCity (NASDAQ: SCTY), said: "The deep institutional knowledge of these six utilities, and the creative approach they are taking to the evolution of electricity, is inspiring. Leaders like these will lay the foundation for the grid of the future."
Michael L. Mosher, president and CEO of Central Hudson, said: "As customer-sited solar installations continue to grow, it is important to ensure all customers benefit equally from the production and use of this clean energy source. This proposal ensures that the economic, social and environmental benefits of solar energy continue to thrive in New York."
Tom Werner, president and CEO of SunPower (NASDAQ: SPWR), said: "We are in the midst of one of the greatest energy transformations in history. This joint proposal for the people of New York is another strong example of how we can work collaboratively with utilities to ensure every household, business and community have access to the cleanest possible forms of energy."
Mark Lynch, president and CEO of NYSEG and RG&E, said: "This is an important first step toward a solar energy policy for New York. The Solar Progress Partnership offers the framework to update the net energy metering mechanism with a more sustainable, equitable policy to support the growth of solar and other distributed energy resources."
Fred Zalcman, managing director of External Affairs for SunEdison (NYSE: SUNE), said: "This joint proposal encourages the continued growth of New York's solar industry. By taking into account the value that solar brings to the grid while attending to ratepayer interests, we've arrived at a common sense solution that is good for all. We hope this sets a good example for other states to follow."