New York: Bringing Reason to the Net Metering Conversation

If you read our pages, you know that all across the country bedrock solar policies, especially net metering, are under attack. Net metering is one of the most important solar policies, because it allows solar customers to use their own solar power and to be compensated fairly for any extra clean electricity they send to their neighbors. In contrast the rhetoric, misinformation and big money of these anti-solar campaigns, New York is offering a decidedly different kind of net metering discussion.

As part of its Reforming the Energy Vision (REV) effort, the Empire State has started a fact-based, stakeholder-driven process at the Public Service Commission (PSC), to examine net metering and the value of distributed generation, including solar, in order to decide what the future of its consumer compensation program will look like. With space for real discussion and a clear commitment to an outcome that keeps New Yorkers going solar, this is one process that I am excited to engage in along with industry partners like the Solar Energy Industries Association (SEIA). The first step is to submit proposals for how to adapt or replace net metering and how to properly value distributed generation by April 18th.

Net metering is a valuable policy tool for supporting solar power, and its simplicity is hard to replace, but that does not mean that it is the only option for states that want to clear the way for a more participatory energy system. This is especially true for larger and more sophisticated solar projects and customers. That said, any option should most definitely adhere to our Guiding Principles for Distributed Solar Policy and Rate Design in mind. In particular, we will be focused on supporting the following three in our proposal for the New York process:

1. The right to self-consumption: Each customer should be able to choose: the amount of energy to purchase from the grid; the amount of energy to self-produce, for instance through solar, and consume; the amount of energy to save through efficiency measures; and the amount to reduce consumption through energy conservation. This means that customers should be able to reduce their demand through solar, and their rates should reflect that by netting their use over a certain period of time before any determination of the treatment of excess generation. In addition, the choice to employ technology such as distributed solar should not limit the customer’s available rate options.
2. Fair value: Customer-sited solar generation offers many benefits to the electric utility system and by extension to non-solar customers. The values and benefits should be quantified, and solar customers should be adequately compensated for the value their solar energy is delivering to all customers.
3. Simplicity, gradualism and predictability: Customers and businesses need to be able to make educated investment choices with knowledge of the economic factors that will affect their investment. As such, changes to tariffs or credit value calculations—including the assumptions used in the calculations—should not impact existing customers or projects; should be publicly available for at least six months before implementation; and should reflect customers’ ability to understand and respond to price signals.

We will keep you up to date on our progress, as well as on the other proposals and arguments being made in this PSC process, called the Locational Marginal Pricing plus Distribution (LMP+D) process. We are looking forward to digging into this important issue as part of a process and discussion that facilitates intelligent, well-informed discussion.