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SEIA’s Proposal to Fix Key Aspect of New York’s Solar Tariff Gains Momentum

Monday, Nov 26 2018

Dave Gahl

A federal government report from last Friday is the latest in a wide body of scientific studies that lay bare the growing economic impacts of climate change. States are key to this battle, and New York’s Governor Andrew Cuomo has consistently been a leader. He has introduced ambitious plans to meet 50 percent of the state’s electricity needs with clean energy by 2030.

But for clean energy to grow, regulators must properly value it. This includes valuing its environmental benefits. SEIA is proposing a fix to New York’s main solar policy — the Value of Distributed Energy Resources (VDER) tariff — that would do just that, and last week, we gained a key ally.

Assemblyman Steve Englebright, the chair of the Environmental Conservation Committee and long-time backer of clean energy from Long Island, urged the New York State Public Service Commission (PSC) to make improvements to the way the environmental component, or “e-value”, is calculated.

Citing the recent United Nations Intergovernmental Panel on Climate Change report from last month showing that we need to take “unprecedented actions” to avoid climate change’s worst impacts, the Assemblyman sent a letter to the PSC, asking it to “speed up the transition to carbon free sources of electricity.”

SEIA is leading a coalition of clean energy groups, environmental organizations and academic institutions in the VDER case. In October, we filed a petition to make technical corrections to the way the e-value is derived.

The current VDER calculation of avoided carbon pollution undervalues clean energy resources. We asked the PSC to give credit for DER carbon reductions for the full 25-year term of the VDER tariff. The tariff currently excludes carbon credits for the last five years of the tariff. In addition, the social cost of carbon values should not be discounted twice, and should simply be averaged on a kWh basis.

Together, these proposed corrections increase the value of clean energy resources by more than $5 per MWh, a marginal price for ratepayers, and one that will result in major clean energy gains.

To encourage more clean energy, New York should more accurately calculate the many values these resources bring to the electric grid. We thank the Assemblyman for his support and look forward to the PSC’s resolution on this key issue soon.

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