New York is ready to soak up the sun, but the city’s ability to hit its solar energy targets may be in jeopardy.
Tens of thousands of dollars in incentives from the state that help make city-friendly “community sun” developments financially feasible are about a month from sunset for new projects. And it threatens clean energy projects on the verge of the city – along with the local jobs and energy savings that come with them, say representatives of the solar industry.
The solar industry claims that Governor Kathy Hochul’s recently expanded targets for solar development – from six gigawatts in 2025 to 10 in 2030, enough to power nearly 1.7 million homes – will not necessarily help the five boroughs unless the credit is replenished.
With community solar, tenants buy solar-generated electricity that is not necessarily collected where they live, as they have nothing to say about whether or not to put panels on their apartment blocks. Energy experts see community sun as a way for lower-income New Yorkers who cannot afford the high cost of installation to participate in the transition to clean energy.
Community solar is particularly suitable for the city, where two thirds of the residents are tenants. Density and strict fire codes mean that there is room for everything from solar panels on the roof to large clear energy projects in utility value.
Meanwhile, community solar plants are growing — such projects represented 75% of applications to non-private solar companies by 2020, according to the city.
“The community’s solar cells are really getting started and there’s a lot of room for growth,” said Susanne DesRoches, Deputy Director of Infrastructure and Energy at the Mayor’s Office of Sustainability and Office of Resistance.
“We feel like we are just at the beginning of something that can be expanded and multiplied throughout the city,” she added. “We just need to have the right programs and the right incentives in place to be able to do that.”
‘Important incentive mechanism’
In April 2019, the State Public Service Commission approved the Community Credit, which provides subsidies for energy generated from community solar projects in the Con Ed area, which includes New York City and Westchester.
The program covers 350 megawatts of community solar projects in total – that comes to about $ 68 million annually, according to the State Department of Public Service. The projects can collect the credit for 25 years.
Con Ed estimates that around 9,000 customers receive 28 megawatts of power from 250 shared solar panels in its service area, and more are coming online.
But there are only five megawatts worth of community credit left for new solar projects to reserve – enough to support projects for just about a month more, according to an estimate by Shyam Mehta, the outgoing CEO of the New York Solar Energy Industries Association.
He called the honor the “most important incentive mechanism” for promoting community sun in the city, where residents have access to about a tenth of the solar-powered community projects in the rest of the state.
“Virtually developers have stopped the development of new community solar projects in New York City because they do not know if there is going to be any future incentive support,” Mehta said. “Without this incentive support, the economy in the sun of society just is not penetrating right now in New York City.”
Without the credit, the value of solar cells will be halved, warn developers. They say that it is already difficult to develop solar in the cities: Unlike large areas in the catchment area, the city’s solar projects tend to be smaller and more expensive given the cost of labor and truck equipment to the city. Costs of getting customers on board are high.
Part of why the credit is almost used is because almost 170 megawatts’ worth went to gas-powered fuel cell projects, e.g. A 12 megawatt project by Daroga Power that includes 48 fuel cells around New York City. In mid-2019, the PSC prevented more fuel cell projects from benefiting from Community credit to ensure that the incentive went to solar projects.
‘Projects are worthless’
The mayor’s office of sustainability, the office of resilience, NYCHA and the city’s economic development company requested the Public Service Commission early this year to rebuild the incentive to compensate for the amount allocated to fuel cell projects and plan a follow-up program.
James Denn, a PSC spokesman, said an upcoming report on the future of the sun would address “issues related to New York City awards.” The report is expected to be published sometime in the fall, and decisions are expected to be made early next year.
Until then, the local solar industry remains in limbo.
“Either we extend a successful program and make sure we support the segment that is so crucial to achieving our equity targets and our clean energy policies, or we do and we suffer a little from the consequences,” said Noah Ginsburg. , a director of the environmental nonprofit Solar One, which helps facilitate solar development in disadvantaged communities and offers job training.
New York City aims to install enough solar panels on public properties to generate 100 megawatts of energy by 2025. So far, the city has only added 14 megawatts of panels, according to the mayor’s management report.
Solar panels on private properties in the city can generate 285 megawatts of solar so far – which will help the city reach its overall goal of 1,000 megawatts by 2030.
“You will not be able to achieve these goals without these kinds of incentives, especially in places like New York City, where development is incredibly expensive and complex,” said Matt Russotti, president of development company Sol Purpose. “Today, the projects are worthless.”
NYCHA offers its roofs to solar power plants in the community, but the program is in jeopardy without state credit.
“Community credit is generally an important part of ensuring that NYCHA can achieve its goal of installing 30 megawatts of shared solar cells on its buildings,” said Rochel Leah Goldblatt, a spokeswoman. NYCHA is about a tenth of the way to that goal.
‘An incredibly hard task’
Sol Purpose developed the recently completed project in Queensbridge Houses. At 1.8 megawatts and over 27 buildings, it is the largest community solar project on top of public housing in the country. The company says it hired 13 former unemployed NYCHA residents to work on the project, five of whom live in Queensbridge.
Sol Purpose is also paying the city to rent the roof space, and the revenue – millions of dollars over 25 years, Russotti said – goes to improving the buildings.
Russotti’s company was developing two more megawatts of community solar with NYCHA, but the company had to rework the development timeline: cut corners and spend more money to lock in the credit before it ran dry.
The uncertainty about the credit is causing a chilling effect for developers like Russotti, who say they are reluctant to put resources into new projects.
Kon Ed data for applications for community solar projects for August do not show a slowdown yet. Shyam said the numbers are likely to reflect the urgency of grabbing what is left of the credit, and he expects to see declining rates in the coming months.
Brock Gibian, development director at Brooklyn-based Ecogy Energy, said every day that his company rejects future customers and will not take on new projects in New York City unless the community loan is extended. A community solar project in danger is planned on the roof of St. Charles School on Staten Island. The lease income from the project would help fund a new roof, Gibian said.
“If anyone thinks Con Ed will be able to decarbonize, just talk to a developer like me who’s trying to build a solar cell project in Westchester or the boroughs,” Gibian said. “It is an incredibly difficult task to achieve, and that is with the current economy in the community credit. If the Community credit disappears, we simply cannot make a single project work. ”
Industry experts and Con Ed have warned that space shortages limit New York City’s overall capacity to solar – with or without state aid.
This summer, the state legislature passed a bill that would enable crediting across utilities so that customers of a utility company can subscribe to a community solar project in the territory of another utility company.
The bill awaiting Hochul’s signature would require some technical coordination to make it work on the backend. But the New York Solar Energy Industries Association estimates it will give about half a million more people access to community solar.
Jamie McShane, a spokesman for Ed Ed, noted the utility’s support for the state’s plans for offshore wind plans, energy storage and transmission lines that bring clean power from places as far as the upstate and Canada down to the city.
But even though transmission lines – like the two Hochul supports – can transport solar energy into the city, neighborhoods will not reap additional benefits as jobs without local investment in harnessing solar energy.
“There are so many barriers to making solar cells in New York City, but the benefits are off the chart,” said Stephen Roundtree, Northeastern director of the law firm Vote Solar. “It’s the most efficient way to make electricity in New York City.”
In addition to the health benefits of avoiding breathing toxins spewed from gas-fired plants, customers can save about 10% on their energy bills.
Solar cells in the city can also give people jobs. NYCHA’s program has trained about 45 people, 25 of whom were hired to work on public housing projects and 10 lived with installers permanently.
“It can really change people’s financial situation in a more profound way than it does elsewhere,” Roundtree said.
‘A fair market’
In Sunset Park, 150 customers will receive a 15% discount on their electricity bills next year when a community solar project developed by UPROSE, Solar One, Co-op Power, 770 Electric Corp. and Resonant Energy on top of the Brooklyn Army Terminal go online.
At 685 kilowatts, the development capacity is more than three times as large as the median society’s solar project. The installer, 770 Electric, has said it will hire at least six community members to work on the project.
The developers secured the community credit as part of the funding, which is part of what made the project possible, said Summer Sandoval, UPROSE’s energy democracy coordinator.
“We do not want Big Oil to become a major renewable energy source,” Sandoval said. “We need to create a fair local energy market that will be centered on how we move both public and private investment and resources to frontline community projects?”
The issue is central as the state moves to decarbonise its electricity sector by 2040 and ensure that disadvantaged communities receive 35% of the benefits mandated by state legislation on emission reduction, the Climate Leadership and Community Protection Act.