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NYS Storage Incentives Summary - VDER
For commercial community solar or standalone storage projects, electric bill credits during injections into the grid are set using the VDER rate (“Value of Distributed Energy Resources”). The VDER rate is calculated as the sum of the “value stack” components:
- Locational-Based Marginal Pricing
- Capacity, Environmental Value, Locational Adders
- Demand Reduction Value (DRV)
>>>Adding storage to a commercial solar project can increase the VDER compensation by capturing more DRV and Capacity value. The DRV value and hours within which injections are compensated depends on the utility and load characteristics of that area, and is payable during certain windows of the day that represent that area’s highest demand periods:
- In a Con Ed business district, peak demand may be mid-day or afternoon (11am – 3pm; or 2pm – 6pm)
- In a Con Ed residential district, peak demand may be later in the day (4pm – 8pm; or 7pm – 11pm)
By adding storage, a solar project can capture more revenue. For example:
- A solar project in a 7-11pm DRV area may receive almost no DRV revenues from reducing grid demand at that
time (because solar output is low)
- That same project with storage may store energy mid-day (during maximum solar output), and discharge energy
into the grid from 7-11pm, and capture significant DRV revenues
