Before June 1, 2015 the New York Public Service Commission (PSC) credited solar generators for the kilowatt hour (kWh) of energy they fed onto the grid using a monetary valuation. Post June 1, 2015, the PSC shifted the valuation of net energy metering (NEM) credits from a monetary to a volumetric valuation and all current solar energy projects in New York are subject to this volumetric valuation.
Though solar is still a good investment for any New York organization to include in their energy management strategy, solar projects subject to a volumetric valuation are less lucrative than those qualified for the monetary valuation.
What’s the difference between monetary and volumetric NEM?
The difference between monetary and volumetric valuation comes down to one question — which utility meter is being used to value the net energy metering credits?
New York allows for “remote net energy metering,” where a solar site is built in a remote location and generated NEM credits are applied to a meter in another location. The $/kWh rate is established at the generation meter in the old monetary valuation program as opposed to the $/kWh rate being established at the off-taker’s meter where the energy is being “credited” to.
Monetary Valuation: The original NEM program placed a $/kWh value on each kWh generated at the non-demand meter where the solar array is hosted. The total monetary value of those energy credits was then applied to the energy bill associated with the demand meter of the off-taker. This has an even greater impact on the overall energy savings for the off-taker, because the applicable rate makes a kWh worth more at the generation meter than at the off-taker’s meter.
Volumetric Valuation: The shift to the current volumetric valuation assesses the value of the NEM credits at the lower $/kWh rate on the off-taker’s meter. Instead of applying a dollar credit to the off-taker’s energy bill, the sum of the kWhs generated by the solar installation is applied to the off-taker’s meter reducing their bill by the same number of kWhs generated. The value of those kWh is set by the rates associated with the off-taker’s meter, typically at a lower $/kWh, which in turn lowers the overall energy savings.
For example, if the solar array produces 100 kWhs of energy in a day, and the $/kWh value is higher under one program than another, wouldn’t you want to receive the higher credit for the 100kWhs produced?
The NY PSC ruled that entities that exhibited the intention to install solar before June 1, 2015 would be grandfathered into the monetary NEM program. Of the several qualifications for “exhibiting intention to install solar” was to submit an interconnection application to a utility for solar to be installed at a specific location. By virtue of submitting the interconnection application by June 1, 2015, a site is grandfathered, and the solar project built there is eligible for the monetary NEM program.
Borrego Solar currently has six grandfathered sites for solar in the National Grid Load Zone F territory. New York entities with operations in any of the counties listed below can receive monetary crediting by partnering with Borrego Solar to utilize one of these six grandfathered sites qualified for the monetary NEM credit program.
National Grid Load Zone F covers the following New York counties: