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the upgrade cost up-front and hope for pro rate reimbursement down the line from subsequent projects. The fix is an improved mechanism that removes this first-mover barrier by only requiring each project to pay its pro rata share. New York Solar Energy Industries Association (NYSEIA) is leading on this front and will be filing a regulatory proposal in conjunction with the Joint Utilities of New York as part the state-level Interconnection Policy Working Group for consideration by the Public Service Commission of New York. Secondly, the current process for property tax determination is a significant pain point for development of solar projects. New York State Real Property Tax Law 487 by default provides a 15 year exemption from Real Property Taxes for solar in all jurisdictions (except Special Districts). Each taxing jurisdiction is left to determine its own ad hoc approach with no standard assessment methodology. The lack of standardization and predictability can severely threaten and disrupt larger project development, and create unnecessary friction between developer and local communities. The fix here, which NYSEIA is also spearheading, is to standardize the methodology for assessment of property taxes for solar and storage projects—ideally legislatively—so there is a uniform approach to valuing projects across jurisdictions, and greater certainty and predictability regarding property tax and Payment in Lieu of Taxes (“PILOT”) payments. Standardizing the assessment methodology will also result in less time spent on PILOT negotiations and thus faster deployment of projects across the state, which will also bring in significantly greater tax revenue for taxing jurisdictions as we build out these projects to comply with NY's Climate Legislation and Community Act (CLCPA)-mandated goal.
What is the number one issue in getting projects completed in your region—for example, financing, siting, permitting, etc. And what does the industry need to do to help solve these challenges?
David Murray EXECUTIVE DIRECTOR MARYLAND-DC-DELAWARE- VIRGINIA SOLAR ENERGY INDUSTRIES ASSOCIATION
After passing transformative legislation in Virginia, Maryland and DC over the last two years, the solar industry cannot rest on our laurels. We continue to face challenges around implementation: some at the Utility Commissions, some at the local level and some at the legislature as we clarify laws governing solar, such as tax liability and how to permit storage. But if we at the Maryland-DC-Delaware- Virginia Solar Energy Industries Association (MDV-SEIA) could organize the industry around one issue, it would be permitting. No matter the segment, counties are grappling with the permitting and inspection process of solar power. The volume of utility-scale and commercial projects being built in our region has skyrocketed, and localities are struggling to keep up in a way that keeps projects moving. Streamlining or standardizing the process takes time—and initiative—and it's difficult for the industry to do this county by county. If we are truly going to make Virginia, DC, and Maryland solar-friendly, the industry needs to work with counties to enact solar- friendly ordinances, ensure the permitting and inspection process is straight-forward and efficient for both the locality and the developer and take advantage of cost-saving programs like the National Renewable Energy Laboratory's SolarApp.
ShyamMehta EXECUTIVE DIRECTOR NEW YORK SOLAR ENERGY INDUSTRIES ASSOCIATION
The first challenge is distribution grid upgrade costs associated with interconnection of projects—we are at a point where for the majority of new projects, there is insufficient hosting capacity to accommodate them without upgrades, and these upgrade costs can be significant (in the high five or six figure range). Compounding this, these upgrades generally benefit multiple interconnection projects at a location, but the burden of payment is on the project triggering the upgrade, which must pay 100% of
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