July 29th, 2016

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Agenda

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Distributed solar is still in its infancy, but steadily progressing

towards dynamic, flexible, and controllable assets

Phase 1

Phase 2

Phase 3

PV

1.0

PV

2.0

PV

3.0

No $

Down

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New York Solar Progress Partnership Joint NEM successor proposal by NY IOUs and solar parties

Community solar • Customers keep NEM over time while

community system assumes locational

value + a transitional gap credit

• Developer to pay difference between

retail rate and LMP+D+E

• Projects awarded value for energy

production for term of 15-25 years

• Priority in the interconnection queue

based on location

Rooftop solar • NEM until 2020 as default

transition date

• Projects grandfathered for

15-25 year term, to be

decided by PSC

• Transition to a locational

value tariff after 2020, to be

defined later

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NY: Maintain NEM through 2020 for rooftop solar,

while transitioning Community Solar to LMP+D+E

Source: Solar Progress Partnership Comments on an Interim Successor to Net Energy Metering

Laddered tranches based on increased penetration

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Optional Smart Energy Home Rate EFCA Smart Energy Home Rate Proposal in New York

Fixed Charge /

Minimum Bill

Source: “Initial Comments of the Energy Freedom Coalition of America in Response to the Commission’s Notice Soliciting

Comments and Proposals on An Interim Successor to Net Energy Metering”, NY Public Service Commission Case, April 2016

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0%

2%

4%

6%

8%

10%

12%

14%

VT NJ MA AZ CA NV CO CT MD NY

NEM Solar Capacity as Percentage of Total System Peak

NEM penetration in Nevada is still very low

Medium

Penetration

Low

Penetration

Very Low

Penetration

Source: U.S. Energy Information Agency (EIA), July 2015 preliminary data.

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Revitalize distributed solar market, then evaluate

NEM successor options as penetration increases

3-5 years

Net Energy Metering

Successor Potential Options:

• NEM with increased Minimum Bill

• NEM with Mandatory TOU

(e.g. California)

• Value of Solar

(e.g. New York)

• NEM with Export Cap

• Other potential structures

Today

Net Energy Metering

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Agenda

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What Should the 21st Century Grid Look Like?

Future Today

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Distributed Energy Resource Aggregation Utilize portfolios of distributed energy resources to provide grid services

Voltage & Reactive Power

Ramping / Ancillary Services

Demand Response / Dynamic Capacity

Contingency Support

Distributed Energy Resources (DERs)

Aggregated DER Portfolios Grid Services

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Engaged consumers are increasingly able to

manage their own energy and provide grid services

Solar Universal

Gateway

Smart

Thermostat Battery

Real-time

Monitoring

Smart

Water

Heaters

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However, distribution planning must be

modernized in order to capture DER benefits

Integrated Distribution Planning

Planning Interconnection

Traditional Planning

Image Sources: CYME, Kevala, PG&E

A holistic approach to meeting grid needs and expanding customer

choice by unlocking the benefits of distributed energy resources

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Benefits of Integrated Distribution Planning Value of Small & Targeted Infrastructure Solutions

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Grid planning data must be transparent and

accessible to enable industry innovation

Data Access Data Transparency

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solarcity.com/gridx

A Pathway to the

Distributed Grid

Evaluating the economics of distributed

energy resources and outlining a

pathway to capturing their value

Find out more:

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Thank you