PSC approves NYSERDA’s expansion of the distributed solar (NY-Sun) program in New York to at least 10 GW-DC by 2030; New program will take effect June 1, 2022

May 26, 2022
Andrew Kinross

On April 14, 2022, the New York Public Service Commission approved a new framework to achieve at least 10 GW-DC of distributed solar by 2030, an incremental 4 GW-DC above the NY-Sun target launched in 2014 (Figure 1).

The NY-Sun program has successfully incentivized solar development in New York, with the State well on its way to achieve 6 GW of distributed solar before 2025. According to the Order, 93.5% of the 6 GW Target consists of either completed projects or projects in the NY-Sun pipeline, with 3,322 MW completed and 2,461 MW in development.

New Roadmap

The new Order incentivizes 3,393 MW of which at least 2,943 MW to be built in Upstate (about 73% of the incremental 4 GW target), and at least 450 MW to be built in ConEd territory (covering New York City and parts of Westchester), increasing the installed solar capacity in that area to over 1 GW by the end of the decade (Figure 2).  An additional 607 MW is to be developed in Long Island as unincentivized solar projects of which at least 560 MW is targeted for LIPA territory though the LIPA projects would either need to move forward without incentives or would need incentives from other sources since they don’t pay into the Clean Energy Fund (CEF), There will also be an additional 47 MW of statewide residential deployment.

The incentives for each category are shown in Table 1 and Table 2.

Community Adder

As noted above, the community adder will be $0.07/W-DC for Upstate projects and $0.10/W-DC for ConEd territory projects (reflective of higher costs in New York City).  There will be funds for an additional 2,270 MW-DC of community adder capacity through 2030.  The Roadmap adds that the rates were designed to reflect an anticipated balance of approximately 70% community solar and 30% of new capacity being developed as Remote Crediting or BTM projects.

Solar Energy Equity Framework (SEEF)

The Solar Energy Equity Framework supports projects serving LMI households, regulated affordable housing, and disadvantaged communities (DACs).  The Commission has directed to achieve a goal of at least 1,600 MW-DC or 40% of the Incremental 4 GW-DC target, targeted toward LMI residents, those living in regulated affordable housing, and disadvantaged and EJ (Environmental Justice) communities under SEEF.

These existing initiatives are extended under the program expansion with the additional $252M:
> Affordable Solar Residential Incentive
> Multifamily Affordable Housing Incentive
> Inclusive Community Solar Adder
> Affordable Solar and Storage Predevelopment and Technical Assistance
> Expanded Solar for All

Prevailing Wage

The new Roadmap has increased the scope from projects PV ≥ 5 MW-AC to projects ≥ 1 MW-AC to meet prevailing wage requirements to qualify for the NY-Sun incentive.

As detailed above, such projects are eligible to receive an additional NY-Sun incentive adder

  • Upstate Prevailing Wage adder is $0.125/Watt-DC
  • ConEd Prevailing Wage adder is $0.20/Watt-DC
Approved Budget

The Commission estimates that the costs to achieve the incremental 4 GW-DC target will have a statewide average residential ratepayer bill impact of $0.75 per month over the 11-year program period, with a maximum residential ratepayer bill impact of $1.24 per month occurring in 2024. This equates to a 1.27% bill increase for a typical upstate National Grid customer, and a 0.91% bill increase for a typical downstate Con Edison customer, both assuming the customer uses 600 kWh of electricity per month.

Table 3 provides detail of the total budget and additional funding authorized, inclusive of SEEF funds, the Prevailing Wage Adder, and funds associated with administration, implementation, evaluation, customer education, and the Cost Recovery Fee.  The budget totals $3.3 billion.

The order to fund the expanded NY-Sun program through 2032 (inclusive of close-out activities), requires some additional funds. These incremental costs shall be allocated to each investor-owned electric utility based on its proportion of overall MWh load, and collected from ratepayers via the SBC surcharge. NYSERDA is directed to file an update to its Cash Flow Analysis to reflect the projected expenditures and authorized collections associated with this Order.

Figure 3 shows the incentive budget for the different applications through 2030.  As can be seen, upfront Upstate C&I and ConEd incentives account for 41% and 37% of the budget, respectively.  The Community Adder (across Upstate and ConEd territory) accounts for 19%.  The fact that Upstate C&I accounts for 73% of the MW, but only 41% of the budget is reflective of the fact that development and CapEx costs are lower in Upstate than in New York City. (Landfill/Brownfield adders account for about 1% of the total budget.  Not shown is the ConEd rooftop canopy adder which is $800,000, or 0.1% of the budget).

Eligibility for New Incentives

As per the Order, projects that already received a NY-Sun award are prohibited from canceling and reapplying to get a new incentive, but Projects that received CA, ICSA, or brownfield/landfill adder but not a base incentive will be able to receive the new base incentive.

ConEd Nonresidential projects applied for after Dec 17, 2021, as well as ConEd Nonresidential projects in Block 10, that did not receive the Community Credit, can receive the new block rate.

Project Returns and Valuations

Project rates of return are based on a number of variables.  Some key points include:


  • Day ahead solar-weighted energy prices – These are highest in ConEd territory (Zones H, I and J) though land and rooftop access in these areas can be difficult.  Other favorable utility-zone combinations include Orange & Rockland – Zone G, and National Grid – Zone G
  • DRV (Demand Reduction Value) – This value, a measure of how much a solar system would reduce peak demand on the grid, is generally the highest in the same areas as where energy prices are highest.
  • Incentives and Adders – Adders for such items as community solar, LMI communities, brownfield/landfills, and canopies can improve returns


  • Solar resource – The best solar resource is in the northwest part of the state.  This impacts capacity factor which reduces levelized cost.
  • Local construction cost – Wages downstate are higher than upstate with labor rates in the most expensive municipality being 47% higher than that of the least expensive.
  • Availability and cost of owning or leasing land or rooftop space – While land and rooftop space are the most abundant in upstate, the incentives are highest in downstate.  Finding land or rooftop space at reasonable prices in downstate locations is key.
  • Cost of Capital / Financing – The cost of capital figures prominently in the levelized cost.  One option for sponsors is to borrow from the state-sponsored New York Green Bank (NYGB). NYGB offers two distinct CDG solar financing structures: one uses an approximately 30% discount to the variable portion of projected VDER revenue and the other does not discount any of the variable portion of VDER revenue. Counterparties working with NYGB can choose the structure they find most favorable.

The new incentives provide for some reasonable project returns, particularly in ConEd territory and Zones F and G.  But with many variables at play, the devil is in the details!

Next Steps

As per the Order, NYSERDA has to file an updated Operating Plan with DPS by May 31, 2022. NYSERDA intends to update the NY-Sun program on June 1, 2022, with the changes and additions specified in the Order and Operating Plan, including new incentive offerings and updates to the Program Manuals.  


Please reach out to Andrew Kinross at to discuss our services in New York.  We provide electricity market analysis and forecast all VDER components (energy, capacity, E-Value, DRV, Community Credit, LSRV).  We have an hourly dispatch model that forecasts power prices.  We support project developers, investors, utilities, and government agencies, among others.