Relates to residential micro-combined heat and power generating equipment

Summary of provisions

Subdivision 1 of §66-j of the Public Service Law is amended to provide that residential Micro-CHP systems may be eligible for net metering under certain circumstances.

A new subdivision 1(f) is added to §66-j of the public service law that defines Micro-CHP systems.

The bill also amends §66-j of the Public Service Law and subdivision (h) of §1020-g of the Public Authorities Law to require electric corpo- rations to permit net energy metering for Micro-CHP generating equip- ment, and to provide for the interconnection to the electric system of Micro-CHP generating equipment in the same manner as other technologies. Unlike other systems which are subject to net metering, however, in the event a Micro-CHP customer-generator produces more electricity than they can use during a billing period, the customer will be credited for any excess only at the corporation's avoided costs.

Justification

New York State and its residents face significant energy and climate change challenges. Energy efficiency continues to be the most cost-effective, and the most immediate way to reduce the burden of rising energy and environmental costs as well as our energy-related carbon footprint. The Micro-CHP technology is at the forefront of energy efficiency. It is essentially a small scale cogeneration device provid- ing both heat and electricity with the same amount of fuel needed to operate a standard furnace. Proliferation of these devices brings about benefits not only to the homeowner, but also to utility corporations and society as a whole. Consider the benefits:

Energy efficiency - typical central power generation delivers only 30-35% of fuel energy; 55-65% is lost as waste heat and the remainder is lost as a normal function of transmission and distribution losses. In contrast, a Micro-CHP unit utilizes over 90% of the fuel for fuel ener- gy. This will result in a 36% reduction in fuel consumption. Looked at from a macro-perspective, the US Department of Energy estimates that if 20% of US energy needs were met by CHP it would be the equivalent of taking 154 million cars off of US roads.

Reduced greenhouse gas emissions - lowers the carbon footprint as follows:

* 86% reduction in NOx;

* 100% reduction in S02; and

* 46% reduction in CO2.

Furthermore, Micro-CHP has been identified by the US Environmental Protection Agency as one of just two technologies to achieve a "Climate Choice" rating under the Energy Star Program. Climate Choice is a new partnership program that recognizes emerging technologies that have the potential to substantially reduce greenhouse gas emissions once they are more widely adopted.

Grid enhancement - Distributed generation enhances grid reliability and supports the grid in peak demand times through demand response.

Economic Stimulus - Micro-CHP systems are built right here in New York State. The US Department of Energy estimates that if 20% of US energy needs were met by CHP by 2030 it would generate $234B in new investment and would create one million new highly skilled jobs. With cutting-edge technology already underway here, New York could be at the forefront of the benefits arising from this technology.

In sum, using a more efficient process to supply both heat and power to homes promotes energy efficiency and creates a path toward energy inde- pendence as we increase our nation's energy security. By essentially doubling the benefits received from each unit of fuel used, residential energy consumers will now be able to achieve significantly improved energy efficiency, reduce their energy costs and reduce pollutant emis- sions all at the same time. Micro-CHP systems can achieve most of the environmental benefits of renewable energy systems at a fraction of the cost.

The bill is necessary to encourage investments in Micro-CHP systems. These systems will provide significant benefits to residential consumers such as reduced energy costs and will help the state achieve its goal of reduced emissions as well. Additionally, the bill will help achieve the broad state policies of the Public Service Commission's Energy Efficien- cy Portfolio Standard program and NYSERDA's energy efficiency programs. Finally, as these systems are manufactured in New York State, the expanded usage will encourage economic investment in skilled New York jobs.

Legislative history

2008: A.8990-B - Referred to Assembly Calendar - Rules Report 215 2007: A.8990 - Referred to Assembly Energy Committee

Fiscal implications

None.

Effective date

This bill shall take effect immediately.