Residents of New York’s Long Island (2010 estimated population 7.568 million) will be getting more of their electricity from clean, renewable solar energy as the Long Island Power Authority (LIPA) and PSEG Long Island move forward with the second-round Clean Solar Initiative (CSI-2). Following a four-month application period that ended Jan. 31, the Long Island electric utility on April 2 announced that it had chosen 76 projects out of a prospective 178 CSI-2 proposals in a bid to bring an additional 100 megawatts (MW) of solar power online — enough to power some 13,000 homes.
PSEG Long Island conducted a clearing auction to determine a final bid price of $0.1688 per kilowatt-hour (kWh) for the second-round solar energy feed-in tariff (FiT). That’s the fixed rate the utility will pay to project developers over the life of their 20-year power purchase agreements (PPAs) with the utility.
CSI-2’s final bid price is almost 25 percent lower than the prices being paid for solar energy generation via CSI-1, LIPA and PSEG Long Island’s first solar feed-in tariff (FiT) — an annual savings of $8.1 million, PSEG Long Island director of Energy Efficiency and Renewables stated in a press release.
Clean, local energy benefits
PSEG attributed the decline in CSI-2 solar energy bid prices to several key factors:
- Increased consumer awareness, understanding, availability and demand for solar energy
- Competition among a growing solar industry on Long Island
- Ongoing decline in costs of manufacturing and installing solar
- Federal, state and local tax incentives
Commenting on the results of the CSI-2 bidding process, executive director of the nonprofit Renewable Energy Long Island Gordian Raacke stated:
“This is yet another major milestone in Long Island’s solar energy history. When completed, Long Island will have a distributed solar power plant which will generate reliable and clean electricity for decades to come, using our abundant sunshine instead of fossil fuels. Solar electric systems are a proven technology not only for individual rooftop installations but also for larger, utility-scale applications.”
“The expansion of Clean Solar Initiative is yet another signal that clean local energy benefits both consumers and utilities,” added executive director of the Clean Coalition Craig Lewis.
“Furthermore, LIPA’s recognition that distributed solar provides at least 7 cents per kilowatt-hour in avoided transmission and central generation costs makes clear to the rest of the country that the locational value of wholesale distributed generation is undeniable and significant.”
Stable, local, cost-effective and clean
A mix of supportive government policy measures and industry advances are contributing to raise solar energy’s place in New York’s power mix. More than $343 million was invested in residential and commercial solar photovoltaic (PV) installations in New York in 2013, a 12 percent year-over-year increase, with installed prices falling 4 percent.
With the installation of an additional 69 MW of solar energy capacity in 2013, New York ranked ninth among U.S. states, according to the New York Solar Energy Industries Association (NYSEIA). With a cumulative 247 MW, New York also ranked ninth in total installed solar electric capacity.
LIPA views solar and other renewable energy sources as cost-effective, flexible and environmentally friendly means of reliably meeting energy demand across its service territory, including insulating the utility and its customers from swings in fossil fuel prices.
Long Island residents have been hit hard recently by rising electricity costs. According to a Dec. 30, 2013 Newsday news report:
“’Average residential customers will see a $16.91 increase in their bills next month because of an anticipated jump in natural gas pricing, and a backlog of unpaid fuel costs from November,’ LIPA said.”
In order to better meet load constraints in specific areas, as much as 40 of CSI-2’s 100 MW is to be installed on the South Fork of Long Island’s East End, LIPA explains. PSEG offered an additional incentive of approximately 7 cents-per-kWh for CSI-2 projects situated within the designated area.
“Reducing the load constraint in this area will help defer, reduce or eliminate the need to invest hundreds of millions of dollars in building new generation, infrastructure, and transmission and distribution lines.”
Solar green job creation
Supporting solar energy is also seen as a way to boost local job creation. There are more than 414 solar businesses employing some 5,000 people across the value chain in New York state, according to NYSEIA. Building out CSI-2’s 76 solar power projects on Long Island is expected to create hundreds of construction jobs. As PSEG Long Island states in its press release:
“It is also significant that all 100 MW will be generated on Long Island, further advancing the development of solar energy and the growth of clean energy jobs.”
Looking ahead, LIPA intends to expand its efforts to foster renewable energy growth and reductions in greenhouse gas emissions and environmental pollution.
In order to fill an additional 20 MW of renewable energy, LIPA is developing another clean energy FiT for wind energy, fuel cells and other renewable resources. It is also preparing a Request for Proposals (RFP) for as much as 280 MW of additional renewable power. Both initiatives are expected to be ready before year-end.
A non-profit municipal electric utility, LIPA owns the retail electric transmission and distribution system on Long Island, which provides electric service to more than 1.1 million customers in Nassau and Suffolk counties and the Rockaway Peninsula in Queens.
PSEG Long Island manages LIPA’s electric grid per the terms of a 12-year contract awarded in December 2011.
LIPA is the second largest municipal electric utility in the nation in terms of electric revenues, third largest in terms of customers served, and the seventh largest in terms of electricity delivered. As LIPA highlights, in 2011 it “outperformed all other overhead electric utilities in New York State for frequency and duration of service interruptions.”
Image credit: Brookhaven National Lab/Flickr