New York is home to Wall Street, Broadway, and arguably the best pizza in America. It can do so much so well. Why not large-scale solar?
'Relative to New Jersey, California, even Massachusetts to some extent, and Colorado and Arizona, New York has not stepped up to the plate,' said Carrie Cullen Hitt, vice president of state affairs for the Solar Energy Industries Association (SEIA).
The numbers support Hitt's argument. Of the roughly 30,000 MW of utility-scale solar operating, being built or developed in the US, a mere 57 MW can be found in New York, according to SEIA. Neighbouring New Jersey beats it by more than four times. And California's 18,231 MW makes New York look like an ant next to a mountain.
Solar advocates find New York's lack of large-scale solar frustrating because the state has the right elements to build a strong market. Electricity rates are high, consumers are green leaning, and transmission is constrained, at least in the densely populated southern tier of the state.
'As the solar industry looks at potential new markets, New York is probably among the top three,' said Fred Zalcman, northeast managing director of regulatory affairs for SunEdison. 'The market is very attractive for a number of reasons, not the least of which is that retail prices, certainly in parts of New York state, are among the highest in the country. The trajectory to grid parity is much better in New York than most of the rest of the country.'
This is not to say that New York lacks renewables. Governor Andrew Cuomo's office pegs the state's renewable energy portfolio at about 2000 MW, much of it from wind power. In fact, New York held the 12th position for wind power generation nationwide last year, according to the American Wind Energy Association. This is impressive considering that New York lacks the large swathes of open land characteristic of many high ranking states. New York is 30th in geographic size among the states.
The good news is that New York's era of solar neglect may soon be coming to an end. Policymakers, as well as the electric industry, are pressing forward with new ways to build a market and attract large photovoltaic projects.
Solar Times Four
The change begins at the top. In Cuomo's 2012 annual state-of-the-state address in January, he launched the NY-Sun Initiative. Its goal? To quadruple solar by 2013, with much of the growth from large-scale solar.
'Over the decades, we have aggressively developed our hydroelectric resources and are making great progress in tapping our land-based wind resources. Now it is time to focus more attention on exploiting our solar potential,' he told lawmakers in the speech.
To that end, Cuomo proposed competitive bidding to attract large-scale solar projects. The New York State Energy and Research Development Authority, a quasi-government agency known more commonly as NYSERDA, has set out a plan to realise Cuomo's goal, which the authority says could bring 269 MW of solar to the state from 2012-2015, and 110 MW some time after. NYSERDA calls the plan 'aggressive but achievable'.
To meet the new goal, NYSERDA has asked the state Public Service Commission for US$54 million per year over four years, a doubling of its solar budget. About 75% of the money, or $39 million a year, would go towards large-scale solar.
The solar industry is praising Cuomo's effort, but also acknowledges its shortcomings. While Cuomo's programme speeds up solar development for the short term, it does little beyond four years. To attract industry investment, the state must provide a more consistent policy for long-term growth, say solar advocates. To that end, they have been pushing for a solar feed-in tariff (FiT), solar renewable energy credits (SRECs), or other methods to move the industry beyond developing hundreds of megawatts of solar into thousands of megawatts.
But that means winning support within New York's tumultuous and often distracted legislature. Last year, advocates carefully nurtured a solar bill that would have fostered development of 2500-5000 MW of solar. But it never became law; legislators turned to other issues, including the state budget, and the solar plan was put on the backburner for further study by NYSERDA.
In January, NYSERDA responded with a report that looked at the impact of developing 5000 MW of solar by 2025. The results were somewhat inconclusive because of the difficulty predicting how quickly solar costs will drop and what the future holds for federal tax incentives. Assuming solar costs could be anywhere from $1.4 million to $4.3 million per installed MW by 2025, ratepayers would pay a low of $300 million to a high of $9 billion.
The low-cost scenario produced a net benefit for ratepayers; the high case a net cost. For example, New York would create 700 jobs if solar prices fall to the low end, but lose 2500 jobs at the high end. At the same time, 5000 MW of solar would lead to environmental benefits: a 4% reduction in fossil fuel use, a 3% drop in carbon dioxide emissions, a 4% drop in nitrogen oxides, a 10% drop in sulphur dioxide and 3% drop in mercury. To reach such an ambitious goal, the state needs to pursue solar with a policy that is 'both flexible and responsive', said NYERSDA. Such a policy would include the kind of metering, sales tax exemptions and interconnection standards that drive down solar costs.
'Even with this range of cost uncertainty, given the many potential benefits that PV has to offer and the long-term potential for lower-cost PV technology, New York State should support continued investment in the steady and measured growth and deployment of PV as part of a sound and balanced renewable energy policy,' said NYSERDA.
Cuomo also is opening up new opportunity for big solar projects through his new 'Energy Highway' initiative to upgrade the state's ageing infrastructure. As part of the initiative, his office issued a formal solicitation in April 2012 seeking ideas from developers, utilities and others about how to fix various energy problems. One of the problems is how to attract more utility-scale renewable energy to New York, so that it reaches its target of getting 30% of its electricity from renewable energy by 2015 and more beyond that. A special task force plans to review the submissions and propose an Energy Highway strategy this summer. The state hopes to draw $2 billion in private investment.
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