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New York updates rules to clear up solar interconnection backlog

New York regulators updated regulations for interconnecting solar projects with capacity of between 50 kW and 2 MW to the electric grid to clear out a backlog of inactive project proposals and help those that are well underway to being completed.

The New York State Public Service Commission on Jan. 24 approved the new rules, which include an interim method of allocating the costs of shared system upgrades and seek to spur solar developments. The current interconnection backlog is a result of more than 2,000 solar projects larger than 50 kW but smaller than 2 MW proposed in New York between April and December 2016. The new rules include fixed decision deadlines and cost-sharing requirements for necessary system upgrades to safely connect a large solar project to the power grid.

In a news release, Commission Chair Audrey Zibelman, who is leaving the agency to head the Australian Energy Market Operator, effective March 20, said the new requirements will help determine the viability of a proposed solar project. She said she expects them to have a "tremendous impact" on new net-metering, remote net-metering and community distributed generation projects.

Quoting 18th-century French philosopher Voltaire during the commission meeting, Zibelman said "the perfect is the enemy of the good" and acknowledged that the changes are just one step in problem solving a series of issues as New York goes forward with creating a market for distributed energy resources, or DER.

"We're progressing towards a market and I wish we were all smart enough to say what is this market going to need to look like in 2020 or 2025 when we have an immense amount of DER," Zibelman said. "Unfortunately, we are building that market and in building a market … my experience is that you have to increment [change]."

Jeff Cramer, executive director of the Coalition for Community Solar Access, praised the commissioners for helping make "New York's much-anticipated community solar market a reality." The decision comes as the commission is planning to consider at its next monthly meeting reducing net-metering rates for community and municipal-owned solar projects.

To remain in the interconnection queue under the new regulations, developers must demonstrate that they have obtained the property owner's consent to develop the project and submit an executed form acknowledging that the property owner has consented to work exclusively with the developer or has signed a land-use agreement.

Zibelman said the disclosure requirements should eliminate conflicts in which two or more developers have filed applications to interconnect projects at the same time and help ensure property owners are fully informed of proposals and activities.

Once disclosure documents are filed and conflicts are resolved, remaining developers will also have to meet specific deadlines in order to progress through the interconnection process. For instance, a project with a completed coordinated electric system interconnection review, or CESIR, will be required to move onto construction within a set amount of time. Developers will also have to prove their intentions to build by paying 25% of the estimated system upgrade costs associated with a project and execute a standard interconnection agreement with the utility. These deadlines and payments will apply to projects currently undergoing a CESIR study and those that have only undergone a preliminary review so far. Projects that fail to meet the deadlines will be removed from the queue.

In instances where local municipal governments have imposed moratoria on solar developments, the new rules will extend the project deadlines if the developer pays the initial 25% cost of system upgrades identified in the CESIR study or enters into an interconnection agreement.

The order also establishes an interim cost-sharing requirement to spread the cost of certain system upgrades to all beneficiary projects. Under the mechanism, the first project to trigger the need to upgrade will bear 100% of the costs but will be reimbursed by later projects. In the long-run, Department of Public Service staff have been directed to craft a more comprehensive methodology for allocating the costs of shared system upgrades.

In order to meet compliance with the new interconnection policy, utilities will have to file tariff amendments and updated interconnection requirements. As part of the reforms, DPS ombudsmen and the New York State Energy Research and Development Authority will assist developers and utilities in resolving project-level delays and disputes arising from the interconnection process. (Case Number 16-E-0650)