New York Passes Net Energy Metering Law

Construction Law: New York Legislation: Renewable Energy: The governor of New York recently signed into law a bill that will allow businesses to earn credit for electricity they generate utilizing renewable resources. Under the “New York Net Energy Metering Law,” businesses that generate power from wind, solar and farm waste will be able to sell the power that they do not use back to their electric companies. Prior to the passage of this law, such a right was limited to residential property owners.

In addition to providing an energy credit for businesses that utilize renewable energy sources, the law also requires that electric companies “develop a model contract and file a schedule that establishes consistent and reasonable rates, terms and conditions for net energy metering to non-residential customers.” Electric companies are also required to establish standards that are necessary to conduct net energy metering and that will allow for the interconnection of the company’s system to a business’s solar electric generating equipment.

The law was one of a series of Bills seeking to encourage residents and businesses to invest in green energy installation and to take steps to improve efficiency. According to Governor Paterson, “these bills will help improve New York’s air quality, curb our dependency on fossil-fuel based energy sources, and create ‘green’ jobs while simultaneously leading to greater investment by homeowners, farms and businesses in facilities that will generate renewable energy power and allow them to sell their excess power back to the grid.” The State’s goal is to generate 25% of its electricity from renewable sources by 2015.

Allowing businesses to earn credit for unused energy produced by solar, wind and other renewable sources could result in substantial savings on energy costs for those businesses. For example, if a business generates solar power and only uses 25% of the solar power that it generates, that business can “sell” the extra 75% of unused solar power back to the electric company as a credit against its regular utility bill. By providing businesses with this ability to save on energy costs by generating renewable energy, the new law has the potential to open up the marketplace for renewable energy installations.

The new law is effective as of August 5, 2008.

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