FAQs

Microhydro Electrical Meter: If you are installing a DG source (grid-connected), your utility will install a digital net meter with an Encoder Receiver Transmitter (ERT). This device utilizes radio frequency technology to transmit readings to meter readers over a short range, and ensures accuracy. These meters operate in both forward and reverse directions to enable net metering.

Applying for Interconnection: If you are working with a contracted installer, that installer will offer you the opportunity to sign an agent authorization letter and will submit the interconnection application to the utility on your behalf. Appendix F of the  NYSSIR provides the following checklist:

1. Complete standard application form (Appendixes B & C)
2. New York State Standardized Acknowledgement of Property Owner Consent Form – For Systems above 50 kW up to 5 MW Only (Appendix H)
3. For residential systems rated 50 kW and below, a signed copy of the standard contract (Appendix A)
4. Letter of authorization, signed by the Customer, to provide for the contractor to act as the customer’s agent, if necessary
5. If requesting a new service, a site plan with the proposed interconnection point identified by a Google Earth, Bing Maps, or similar satellite image. For those projects on existing services, account and meter numbers shall be provided
6. Description / Narrative of the project and site proposed. If multiple DG systems are being proposed at the same site/location, this information needs to be identified and explained in detail
7. DG technology type
8. DG fuel source / configuration
9. Proposed project size in AC kW
10. Project is net metered, remote, or community net metered
11. Metering configuration
12. Copy of the certificate of compliance referencing UL 1741
13. Copy of the manufacturer’s data sheet for the interface equipment
14. Copy of the manufacturer’s verification test procedures, if required
15. System Diagram – A three-line diagram for designs proposed on three phase systems, including detailed information on the wiring configuration at the PCC and an exact representation of existing utility service. One-line diagram shall be accepted for single phase installations

An offtaker can enter into a PPA with a site owner or PPA provider to begin using the electricity generated by the microhydro instead of their current source of supply. In most cases, the offtaker remains connected to the grid and has access to additional and back-up power if needed.

If you have a site with microhydro potential and want to find someone else (an offtaker) who may want to use the energy, talk to your neighbors, including local businesses and ask them! You may find that people are increasingly interested in going green, and that they will find a local source of green energy to be very appealing.

Planned maintenance and repairs may need to occur, such as changing bearings or valves. Unplanned maintenance and repairs may include the need to unclog an inlet screen, replace broken equipment, no operation from drought (long periods of low flow), or even electrical grid outage (if facility is grid-connected).

The typical PPA charges the offtaker an agreed upon price per kWh delivered. If the plant goes offline or ceases to operate, it is not delivering electricity, and the offtaker will not be charged. In the instance where a microhydro plant goes down, either for maintenance or because of some natural damage or other reason, the offtaker can resume receiving power from the utility at their current rate until the plant becomes operational again. The PPA provider cannot guarantee the offtaker anything about the price the utility may charge if the plant goes down.

Solar and wind PPAs rely on tax incentives to attract investors, however hydropower is not currently eligible for federal tax credits. A PPA may still be possible even without tax credits, if the cost of construction, permitting and maintenance can be recovered within the desired period of time for the investor based only on the agreed upon payment schedule of the offtaker.

This may vary, but most investors prefer to see a return within 6 years in order to invest in the project. From the offtaker perspective, there is no upfront capital investment and entering into a PPA can be cashflow positive from day one. Developers will likely realize their investment objective within six years thanks to incentives, depreciation and other financial benefits.

The pricing for the PPA considers the total cost of permitting, design and construction, as well as expected costs for operation and maintenance. That amount will be used to schedule a repayment term over as many years as it is necessary to pay off the costs while still allowing for a reasonable return on investment for the party providing the initial cash. There is usually an escalator, as much as 3 to 4% per year, but not always. Sometimes the payments are flat for the full term, in which case the initial payment is likely to be slightly higher than what the offtaker is used to paying for electricity, but the payments in later years will be proportionally lower than market rates.

A PPA allows you to secure predictable and moderate electricity prices. Usually the initial rate starts out lower than your current rate, and the modest escalator is a lower rate than how utility rates are expected to increase over time. As a result, a PPA should save you money in the long run.

In many instances interested site owners might have to pay a consultation fee for a professional site assessment with a hydropower developer. Based on that initial assessment a general project and study plan can be developed to set up a PPA. Further costs would be accounted towards the total project costs as defined in the PPA contract.

The project’s soft cost are closely related to the hydropower system size and complexity, and site specific parameters like existing infrastructure, property size, proximity to on-site loads or the utility grid, and environmental water quality and habitat concerns.

A property owner who installs a microhydro plant with a PPA developer will want to have the option in their contract to assign the contract over to a future property owner.

The RECs are owned by the PPA developer who uses their value as an additional revenue stream to pay off the initial cost of construction. In New York, the PPA developer will have the option to sell both RECS and the output to the offtaker in a bundled contract, if the offtaker is interested in claiming the renewable energy attributes. Or, the PPA developer may sell the RECs to NYSERDA, which offers solicitations for RECs twice each year.

A microhydro PPA may run from 15 to 25 years. The terms will vary dependent on the specific cost of the project and consumption of the offtaker.

The PPA developer owns the plant, with a long-term agreement to sell all of the electrical output to the offtaker. Sometimes at the end of the term there is an option for the offtaker to buy the plant from the developer at fair market value.

If you are interested in regular monthly payments and prefer to have a professional hydro developer deal with building and operating your project than a PPA could be a great way to go.

On streams that flow year-round and carry water even in the dry summer months, waterfalls of 6 feet or more in height already fulfil the basic requirements of a small dam-free micro-hydropower system (see Figure 16 for more detail on the necessary head-flow requirements). More on the physical requirements for a dam-free micro-hydropower system can be found in the Dam-Free Micro-Hydro Feasibility Report.

Dam-related micro-hydropower development is limited by the number of existing non-powered dams – about 6,600 in New York State. But many of the dams do not make good candidates for hydropower development due to environmental, dam safety and flood concerns or the overall condition of the dam. But as the example of the Lower Saw Kill shows, there a multiple possible locations for dam-free hydropower development within the landscape of existing dams.

Dam-Free Micro-Hydropower systems do not rely on or are limited to the existence of historic dams and thus do not promote barriers to fish migration, do not pose the same kind of safety and flood concerns, and do not unnaturally impound water.

Once the CDG is setup, managing a CDG primarily involves maintaining and billing the subscriptions. Each month the utility will send the CDG host information on how much credit was applied to each subscriber. The host uses that information to prepare the bill for each subscriber. If the CDG is set up like a shareowner or Community Supported Hydropower (CSH) model then the subscriber will prepay for a year or in perpetuity (or perhaps a fixed monthly amount if that is what is agreed to). If subscribers drop out, or if generation increases and there is need, effort will be required to obtain new subscribers.

Typical questions from new CDG subscribers include:

• What benefits can I expect from this program?
• Do I need to send you a year’s worth of my electric bills?
• Can I opt out easily?
• Are you an ESCO?
• Am I buying part of the hydro plant by signing up?
• As a subscriber, do I have to maintain anything?
• What happens if I move?
• How much will I save on my electric bill?
• Will I lose money if there is a drought?
• Is there a subscription cost or any other fee?
• How does the billing work?
• What percentage of your production do I get credit for?
• Am I changing utilities?
• Why do I have to pay a second bill? Can’t you just bill me through the utility?
• Can I use automatic payment or a credit card?

Signing up subscribers to a CDG involves marketing, or sales, just like any other product. Electricity consumers are increasingly aware of climate change and GHG emissions and are interested in green energy, which is a positive factor. However, explaining the CDG program in a clear and understandable way can be a challenge, particularly as it relates to explaining monetary crediting for host using the Value Stack price. More information on the challenges of marketing a CDG are available in our  CDG Model Description.

NYSERDA provides a tool to estimate the value stack for your project, available at  https://www.nyserda.ny.gov/All-Programs/Programs/NY-Sun/Contractors/Value-of-Distributed-Energy-Resources/Solar-Value-Stack-Calculator

The Value Stack is the compensation mechanism in use for small commercial DER in New York State, comprised of multiple layers of locational and time dependent values reflecting the value that a particular DER provides to the grid. (See Value Stack description in the  CDG Model Description.)

The price a CDG host can charge a subscriber per kWh is a term defined in the contract between the subscriber and host. Unless the utility offers automatic billing, CDG billing takes place in two stages; first the utility applies a credit on the subscriber’s electric bill that offsets the amount of electricity consumed; and second, the CDG host collects payment for that credit by sending each subscriber a bill the subsequent month. The nature of the credit applied by the utility may be volumetric (credits applied in kWh) or monetary (a dollar credit), depending on whether the CDG host account is non-demand or demand meter. For a non-demand metered host, the credit is a volumetric kWh credit, and the host can send the subscriber a bill that charges the agreed upon price per kWh. For a demand metered host, the credit is applied to the subscriber bill as a monetary credit using the Value Stack compensation mechanism. The host can then send the subscriber a bill charging the same amount as the utility credit, or a different amount if the contract between the subscriber and host so dictates.

CDG hosts can adjust the allocations as necessary on a monthly basis if kWh generation exceeds the sum of kWh used by all subscribers. Each year on the anniversary of the establishment of the CDG, the CDG host has the opportunity to distribute excess credits with the annual allocation request. A CDG host can add new subscribers at any time to ensure that all credits will be consumed. If a CDG host does not apply 100% of credits to subscriber accounts then they are forfeited at the end of the anniversary year.

This is a term that is defined in the contract between the CDG host and subscribers. Where the contract allocates a fixed percentage of output as a credit and the amount allocated is larger than anticipated, it will still be applied as a credit. If the credit exceeds the subscriber’s consumption, then the credits can carry forward to a future billing period. The CDG host and subscriber have flexibility to reduce future allocation percentages to ensure that the subscriber is not receiving more credit than they can use.

The contract between the host and the subscriber should clearly state what happens in this instance. If the subscriber receives less credit than she/he consumes, then they will be charged the regular price for any kWh they consume from the utility that are in excess of the credit applied. If the subscriber uses less energy than the credit applied, then the contract will typically provide that excess credits carry forward to future billing cycles, and that the host may adjust the percentage of output allocated to that subscriber to better match the subscriber’s consumption.

CDG Subscriber Bills CDG subscribers will receive two bills – their electric bill comes from the utility as before, and they also receive a bill from the CDG host (unless the utility has already implemented automated billing). The bill from the utility looks similar to before, only it will have a credit on it applying the percent output of the CDG that was agreed between the subscriber and host, as either a monetary or volumetric credit. The bill from the host to the subscriber is sent by the host, and charges the subscriber the amount due to compensate the host for the credit applied to the subscriber on the utility bill the previous month.

The host customer is responsible for the cost of transformer upgrades. If you are hiring a company to install your system, check with your agent/contractor, as they may cover this cost on your behalf. For microhydro systems 25 kW or less installed at a residential account, the host is responsible for the cost of $350 towards the total cost of the transformer upgrade. For micro hydro systems installed at non-residential accounts, the host cost share is determined on a case-by-case basis by the utility, but is subject to review by the PSC if the customer requests it. These costs can include the total costs for upgrades to ensure the adequacy of the distribution system which would not have been necessary but for the interconnection of the net metered DG resource (as per PSL §66-l(3)(c)(iii)). See  NYSSIR Appendix E

For systems 50 kW or less, if any utility grid upgrades are deemed necessary, they will be itemized by your utility in your notification of acceptance to proceed with your proposed installation. Common upgrades for systems 50kW or less include: transformer upgrades and secondary service upgrades. For systems above 50 kW up to 5 MW, this will be analyzed during the preliminary screening analysis which may require a supplemental and/or Coordinated Electric System Interconnection Review (CESIR) to finalize the specific upgrades necessary to interconnect your proposed system.

You may. The transformer size feeding your home or business was originally designed appropriately for the load (kWh usage). In cases where your proposed DG system size exceeds your normal load the existing transformer size may be insufficient. This also includes the aggregate of any existing DG or DG in queue on the transformer prior to your proposed installation. Without upgrading the transformer, the DG system could overload the transformer and cause the customers fed from the transformer to experience high voltage and/or other power quality issues.

Yes, utilities will provide you with the option of submitting a Pre-Application, Appendix D of the NYSSIR, at the cost of $750 prior to submitting a complete interconnection application. If you choose to submit a full application within 15 Business Days of the utility’s pre-application results, the additional $750 interconnection application fee will be waived. (See page 9 of the  NYSSIR). For more information check with your utility.

A demand metered host is a generation source connected to the utility using a demand meter and demand billing rate; typically in New York this applies to sites with 2,000+ kWh of monthly consumption on site. This may vary between distribution utilities. Whether a CDG host is demand metered or non-demand metered decides whether CDG subscribers see volumetric or monetary (Value Stack) credits on their bill.

Microhydro Electrical Meter: If you are installing a DG source (grid-connected), your utility will install a digital net meter with an Encoder Receiver Transmitter (ERT). This device utilizes radio frequency technology to transmit readings to meter readers over a short range, and ensures accuracy. These meters operate in both forward and reverse directions to enable net metering.

Yes, it is the host’s responsibility to obtain all necessary permits and electrical inspections, as well as ensure that the system passes an interconnection functional test before the utility will allow interconnection.

Yes, electric service will be interrupted during utility outages unless a battery back-up system or stand-by generator is also installed. For safety reasons, Distributed Generation systems are required to shut down and/or disconnect from the utility grid when an outage occurs to prevent electricity from back feeding into the lines to avoid injury to repair crews and the public. It is possible to install the hydropower system so that it actively disconnects the generator from the utility grid; the generator would then be able to supply electricity to your house during the utility outage. Depending on the frequency and duration of power outages in your neighborhood, the additional expense for the necessary equipment to also allow the microhydropower system to operate off-grid may or may not be justified.

The optimal system size for a CDG depends on a multitude of factors and site-specific parameters including but not limited to head, flow, on-site loads and cost. The first consideration when determining the maximum potential output of a system based on head and flow should always be what is environmentally sustainable. Once that is determined, the cost of construction and feasibility of using the output, either by the owner or shared with other customers via CDG, might swing the decision towards a smaller but more cost-efficient system. Talk to your developer about your goals and restrictions in microhydropower design.

Net metering is only allowed to net against the energy consumed on-site where the generation source is metered. A CDG allows a host to generate more output than is consumed on-site and allocate it to other subscribers in the same utility service territory. If the host owns multiple properties within the same utility territory, remote net metering may also be an option.

Net metering is a method for those using qualified generating systems, such as microhydro, to be credited for electricity generated in excess of their usage, and is achieved by allowing participating customers’ meters to measure electric flows in reverse and forward directions. When the customer’s generator is producing less energy than the customer is using, the electric meter will measure the supplemental energy passing from the utility to the customer and register the flow of electricity in a forward direction. When the customer’s generator is producing more energy than the customer is using, the electric meter will measure the excess energy passing from the customer to the utility and register the flow of electricity in a backward direction. The surplus energy is subtracted, or “netted,” from the energy supplied by the utility to the customer, thus “net metered.” Therefore, the utility is only able to see the net difference between what was generated and what was consumed during a billing period.

Receiving electricity from the CDG instead of the utility, impacts the energy supply side of your utility bill, the utility will continue to charge you delivery, which includes your service charge, cost of distribution and transmission and other charges. The specific amounts depend on the subscriber’s service class as well the respective utility. For more information on your energy bill, have a look our  CDG economics blog post.

Credit allocation forms are submitted to the utility once per month and the utility has 30 days to respond and update credit allocations. Specific response times for other inquiries vary from utility to utility.

If a subscriber is joining a CDG that is already active, it typically takes just one billing cycle to add that subscriber to the program. If the CDG is not yet operational and accepting new subscriptions, then a subscriber may not see billing credits appear on their bill until the host has found enough subscribers for the utility to activate the CDG.

The documentation and forms required by the PSC and the utilities are available online for download, however the process is handled through emails and other communications between the host and the utility.

The CDG host must sign up subscribers using a contract with their utility that complies with program rules. This includes the interconnection agreement and related documents, host self-certification form, subscriber allocation form and additional documents including certification of creditworthiness, cyber security standards, landowner consent (even if the host is the landowner) and other necessary information. The host also will need to analyze each subscriber’s average monthly consumption to determine the appropriate percentage of output to allocate to each subscriber. Each utility provides a process to look at individual customer historic consumption data. Once the appropriate percentage of generation output is determined for each customer, the host completes the utility’s CDG allocation form.

The length of time to complete the application process may vary greatly depending on how quickly the host can secure contracts with subscribers, the interconnection process and other factors. Once all the application paperwork is submitted, the utility typically takes sixty (60) days to activate the credit allocations for each subscriber.

If you are a current electricity customer then your utility is already sending you an electric bill each month. If you are uncertain, you can use this mapping tool created by New York State:  https://data.ny.gov/Energy-Environment/NYS-Electric-Utility-Service-Territories/q5m9-rahr

The utility is required by the Public Service Commission to offer CDG opportunities to customers in its service territory. Their role is to accept interconnection of a CDG host generation source, subject to the PSC rules and utility tariff, and to facilitate the application of generation credits on the billing accounts of any customers who have subscribed to the CDG.

See  Microhydro CDG Model Description or  download a detailed report about microhydro Community Distributed Generation.

Each utility has limited capacity to accept CDG hosts, and allocates that space in a first come first served basis. First, the utility receives applications and the potential CDG host reserves a spot by signing the interconnection agreement. For those hosts using the Value Stack compensation mechanism, the Market Transition Credit (MTC) has a total capacity limit that varies by utility territory and is available on a first come – first serve basis.

Each distribution utility requires an interconnection agreement and related documents including the host self-certification form, subscriber allocation form, certification of creditworthiness, cyber security standards, landowner consent (even if the host is the landowner) and other necessary information. The exact requirements and nature of the forms may vary between the utilities. The  CDG host must also register as a Distributed Energy Resource (DER) with the Public Service Commission, which requires the  Distributed Energy Resource Supplier Registration Form as well as the following material:

• Copy and proof of acceptance of your registration with the NYS Department of State and a copy of your certificate of assumed name (if applicable);
• Sample sales agreements, including customer disclosure statements, and sample bills for each customer class for each material category of the CDG or On-Site Mass Market products or services that will be offered;
• Copies of information and promotional materials used for mass marketing purposes for each product offering;
• A list of entities, including contractors and sub-contractors, that market on behalf of your company;
• The NYS DPS Office of Consumer Services Service Provider Form [ NYS DPS Office of Consumer Services Service Provider Form]

CDG subscribers are utility customers who contractually agree to purchase generation output from a Community Distributed Generation host. They can be individual residential account holders or commercial accounts. The CDG subscriber remains a customer of their utility company who will bill them for delivery and transmission and additionally used electricity. To be a CDG subscriber, the customer must be in the same  utility territory and NYISO zone as the CDG host.

The CDG host is the entity that manages and sells electricity to subscribers who elect to participate. In most cases the CDG host operates or owns a renewable energy project that generates more electricity than can be used on site. The host defines the stipulations for subscribers to join the CDG. More about the basics and  essential elements of New York CDGs.

The  key CDG requirements are to have an eligible renewable energy source, an interconnection agreement with the distribution utility, and a group of at least ten subscribers who sign a CDG contract.

Community Renewable Energy refers to a renewable energy project that is shared by a community (like community solar or hydro). In other words, instead of a single owner using the output from a renewable energy project, with a Community Renewable Energy project, the output is shared by a group of individuals, businesses or other entities who consume electricity.  Community Distributed Generation (CDG) is New York State’s program that allows distributed renewable energy resources to share their output with retail customers.