Exciting new opportunities are emerging for energy storage in New York. Last week, Consolidated Edison (ConEd) and the New York State Energy Research and Development Authority (NYSERDA) announced the details of a plan to incentivize the installation of energy storage in ConEd’s service territory. New York State leaders frequently use the phrase “market animation” meaning that regulatory and financial initiatives should catalyze and launch vibrant markets. The newly proposed energy storage incentives are an important step in achieving this objective.
The Indian Point nuclear plant produces about 20% of New York City’s base load and its Federal operating license expires in 2015. As a result, the NYS Public Service Commission (PSC) directed ConEd to work with the New York Power Authority (NYPA) and NYSERDA to develop a contingency plan to address the reliability concerns that may arise from the potential retirement of that generating facility.
As part of the plan, ConEdison has worked with NYSERDA and developed a proposal to provide 100 MW of load reduction measures that include demand response, energy efficiency and energy storage. Last week, ConEdison and NYSERDA made some of the details of the proposed program public for the first time. These include significant incentives for specific approaches including energy storage. The proposed incentives are not final and are subject to change, but as outlined would be a critical enabler and driving force for the growth of energy storage in ConEd’s territory.
This Enhanced Load Reduction Program offers new incentives for systems that provide summer on-peak demand reduction. Incentives for thermal energy storage would be $2,600/kW compared with $600/kW under existing programs. Incentives for battery storage systems would be $2,100/kW. Additional bonus incentives would be available for large (>500kW) projects. Incentives will be capped at 50% of the project cost (plus a bonus for large projects). Eligible projects need to provide peak reduction of at least 50 kW and would need to be installed and operational by June 1, 2016. The program will be jointly administered by ConEd and NYSERDA and is a team effort by those two, along with NYPA and the Department of Public Service.
NY-BEST has been actively working to help bring this exciting program to fruition. We believe that it will lead to a significant increase in the number and total capacity of storage systems in our state in the near future. If you are a member of NY-BEST and interested in applying for these funds or learning more, we can provide you with assistance and information. We will be providing more detailed information in additional blog posts and communications as new details emerge. These are indeed exciting times for energy storage in New York!