In the bid to accelerate the growth of the energy storage industry and to cut the cost of deploying energy storage projects, New York Governor Andrew Cuomo, during the recent Earth Week, announced to allocate $280 million. This is part of a large $400 million investment to achieve New York’s nation-leading energy storage deployment target of 3 gigawatts (GW) by 2030.
Just days prior to this announcement, Governor Cuomo had unveiled the state’s third annual solicitation for large-scale renewable energy projects. These are expected to add around 1.5 million megawatts to annual renewable electricity production. This solicitation also includes a provision that seeks to encourage proposals that cost-effectively combine advanced energy storage technologies with renewable energy projects. In the end, this has been created to enable the solicitations to attain the Governor’s commitment to deploy 1,500 MW of energy storage by 2025 and 3,000 MW by 2030.
Why has this money been allocated?
This move came in order to stimulate energy storage deployment across the state and to boost private sector investment in the energy sector. This is of importance as it will support and facilitate the goal of reducing pollution in the long run by increasing the reliance on renewable energy sources and cutting down the use of fossil fuels. Since the introduction of the New York State Energy Storage Roadmap, this money allocation is the first storage incentive fund that has been made available.
This can be considered a novel incentive for solar plus storage projects for the commercial and industrial sectors as the storage component will make sure that renewable energy usage is moved to periods when the customer usage is the highest; for instance, during the hot summer days. Through expired federal tax credits, by combing the interconnection and permitting process and by utilizing less space, paired storage and solar systems can get lower costs for customers.
How will the funding be provided?
The New York State Energy Research and Development Authority’s (NYSERDA) Market Acceleration Bridge Incentive Program will provide the funds for this initiative. This program aims to incentivize approximately two-thirds of New York’s 1,500 MW target of energy storage by 2025. The funding will be made available in two categories:
For bulk storage projects: $150 million for systems that are over 5 megawatts and primarily provide distribution services or wholesale market energy.
For retail storage projects: $130 million for customer-sited systems that are less than 5 megawatts, are smaller and put together with onsite generation or installed alone.
Future plans for additional funding
Another $70 million will be allocated by NYSERDA in the future, depending upon opportunities that have the greatest potential to support a self-sustaining energy storage market. Later in 2019, another $53 million in Regional Greenhouse Gas Initiative funds will be provided for bulk and retail storage projects that are located on the Long Island. A further $53 million in Regional Greenhouse Gas Initiative funds will be made available later in 2019 for retail and bulk storage projects located specifically on the Long Island.