New York

Under PON 2157 The New York State Energy Research and Development Authority (NYSERDA) offers incentives for the purchase, installation, and operation of customer sited tier (CST, also called "behind the meter") fuel cell systems used for electricity production. Because such systems will help fulfill the CST component of the state RPS requirement, eligibility for incentives is generally limited to customers who pay the RPS surcharge on their electricity bills. Exceptions to this rule may be made on a case-by-case basis for projects that demonstrate significant public benefits consistent with program objectives. There are no minimum or maximum size limits for projects, though incentives will generally be granted only for installed capacity not exceeding the customer's electrical load. Exceptions to this rule may be made on a case-by-case basis and participants are permitted to install excess capacity at their own expense.

Incentive levels and limitations vary by system size. Bonus capacity incentives are available for large projects that provide secure/standalone capability at sites of Essential Public Services (e.g., police stations, hospitals, public utilities). Performance incentives can be received for up to 3 years for systems with an annual capacity factor of 50% or greater. The total value of incentives is capped at $50,000 for systems of up to 25 kilowatts (kW) and at $1 million for larger systems. The incentive amounts offered for different types of systems are as follows:

Basic Capacity Incentive: Large systems only, $1,000/kW up to $200,000 per project site

Bonus Capacity Incentive: Large systems only, $500/kW up to $100,000 per project site

Performance Incentive: $0.15 per net kWh, up to $20,000 per project site per year for small systems and $300,000 per project site per year for large systems.

Projects will receive the first half of the basic capacity payment upon system installation and the remaining portion plus any bonus incentives after the system has been commissioned and approved by NYSERDA. The capacity factor for the performance incentive will be determined annually by dividing the net system output by the theoretical maximum output (rated capacity times 8,760 hours/year). The performance incentive will be disbursed annually after performance data have been collected.

All systems, regardless of size, must be new and listed as an eligible fuel cell system by NYSERDA and are subject to post-installation inspection. All systems must have performance monitoring capability and systems larger than 25 kW are required to have high-grade monitoring and sensor equipment (e.g., revenue grade fuel and electricity meters) and remote data collection capability. Owners of small systems must report manually collected data at least every three months to NYSERDA.

Ownership of renewable energy credits (RECs) associated with system electricity production is not specifically addressed. However, the program rules do specify that attributes associated with electricity production by supported systems will be reported as part of the CST of the state RPS program for the life of the system, and participants are prohibited from entering into any transactions which would export energy outside of New York State. In cases where the system is fueled by landfill gas, biogas, or anaerobic digester gas*, methane destruction credits are considered separate from electric power based RPS attributes and may be retained by the owner.


*Fuel cell systems fueled exclusively by anaerobic digester gas (ADG) must apply first to the NYSERDA ADG-to-Electricity Rebate and Performance Incentive program. Such systems are only eligible under the fuel cell program when funds for the dedicated anaerobic digester incentives have been depleted.