New York expands Megawatt Block solar incentives

Under Governor Andrew Cuomo (D), New York has been very aggressive about implementing policies to deploy more renewable energy. This includes setting a 50% by 2030 renewable energy mandate, which ties with California and now New Jersey as the third-most ambitious in the nation.

But often it is not the nameplate numbers that matter most, but instead the plan of how to get there. In this regard New York has also been a leader, with the Megawatt Block incentive program under the NY-SUN initiative providing stable and predictable incentives for residential and commercial & industrial installations, instead of the fluctuating values from renewable energy credits.

New York was the second state to implement a declining block grant incentive program after California, and this basic program design has since been emulated by other states including Massachusetts with its SMART program.

Today the New York Research and Development Authority (NYSERDA) announced several changes to the Megawatt Block program. First, much larger systems can now receive incentives. Systems participating in the “non-residential” program were previously capped at 200 kW, but now systems up to 750 kW are allowed in the program.

But it was the commercial and industrial (C&I) segment which really got super-sized, with systems up to 7.5 MW now allowed to participate. As there are very few roofs that can host that much solar, it essentially removes an upper limit to rooftop solar deployment on big box stores or warehouses under the program.

This follows a February increase in the capacity of projects which can participate in the state’s community solar program to 5 MW.

In addition to the larger systems allowed, NYSERDA appears to be taking a page from Massachusetts’ SMART program by creating a system of “adders” for systems in preferred locations, including brownfields, landfills, and at low-income housing. Brownfield and landfill projects will receive an extra $0.10 per watt in incentives.

For the Con Edison service area, there will also be a $0.30 per watt adder for parking and rooftop canopy projects. This could assist with the difficulties in deploying solar that New York City and Westchester County have seen, given a shortage of suitable roofs and challenges with set-backs on flat roofs.

Plenty of room left

Incentives under the Megawatt Block program have declined significantly since the program launched, and only in Con Edison’s service area are non-residential projects paid more than $0.45 per watt. For the C&I segment, both Upstate New York and Long Island are on the last block, with incentives of $0.25 per watt.

In Con Edison territory, the C&I program has been folded into the non-residential, and both are currently incentivized $0.60 per watt, which is a nice bonus for building large C&I projects. Canopy projects will receive incentives starting at $0.90 per watt.

And if incentives have generally fallen, in all of these areas there is still a great deal of capacity left for non-residential and C&I projects. NYSERDA estimates that across all segments the program has supported 652 MW of solar projects to date, with another 979 MW under development. However, the NY SUN program pages on the NYSERDA site still show nearly 1.1 GW of capacity available for non-residential and C&I incentives in all three geographies combined.

Between the Megawatt Block Program and multiple large-scale solicitations, NYSERDA expects at least 3 GW of solar to be deployed by 2023.