NYSERDA’s $675M Bet on Battery Storage in New York City

New York City remains one of the most complex - but potentially most lucrative - markets for front-of-the-meter (FTM) battery energy storage development in the U.S. And if there’s one signal that the state is all-in on accelerating project deployment, it’s this: NYSERDA has committed $675 million in new funding to help developers get systems built and interconnected. This article breaks down exactly how NYSERDA’s incentive program works, what we can learn from past awards, and how developers can position themselves to capitalize on the latest tranche of funding.

What Is NYSERDA’s Energy Storage Incentive Program?

New York’s Energy Storage Incentive Program, administered by the New York State Energy Research and Development Authority (NYSERDA), is the backbone of the state’s strategy to accelerate battery deployment. It’s structured to reduce upfront capital costs and stimulate market growth by providing direct financial incentives to qualifying projects.

Structure of the Program

The program is divided into two tracks: Retail and Bulk.

Retail Incentive Track:
Designed for systems up to 5 MW, this track provides upfront, performance-based incentives on a $/kWh basis, tied to installed energy capacity (kWh). The incentives are allocated through a block structure, meaning that incentive levels step down as each funding block fills up. The retail track is particularly important in NYC, where developers often build multiple distributed sites under this threshold.

Bulk Incentive Track:
Aimed at projects larger than 5 MW, the bulk track operates through competitive solicitations, such as NYSERDA’s Index Storage Credit (ISC) RFP process. Instead of fixed per-kWh payouts, developers compete on pricing and project viability, with long-term contracts awarded based on evaluation criteria.

In both cases, funding is disbursed through approved NYSERDA contractors, and projects must meet various technical and interconnection milestones to qualify. Incentives are stackable with other programs (e.g., Value of DER, Clean Peak), creating the potential for robust financial layering, especially in Con Edison’s high-value Zone J territory (NYC).

Together, these two tracks form a cornerstone of New York State’s plan to reach 6 GW of installed storage by 2030 - and developers looking to break into the NYC market need to understand how these funding streams operate.

By the Numbers: Lessons from the 2019–2024 NYSERDA Tranche

Before diving into the newly launched $675 million program, it’s worth understanding the scale and structure of what came before. From late 2019 through late 2024, NYSERDA operated its original retail and bulk energy storage incentive programs, offering performance-based incentives for battery projects across New York State. The results offer a clear look at where developers focused—and how aggressively the market responded.

$254.7 Million in Awards for Sub-5 MW Projects

Between September 2019 and September 2024, NYSERDA awarded $254.7 million in incentives to 152 front-of-the-meter (FTM) energy storage projects under 5 MW. All of these fell under the original Retail Energy Storage Incentive Program, which offered incentives on a $/kWh basis and was structured in geographic blocks.

This tranche highlights several key dynamics:

• The program was highly effective in catalyzing project development, especially in dense, high-cost urban areas like New York City where upfront capital costs are a primary barrier.

• A significant portion of awards went to developers pursuing multi-site portfolios, using the retail block structure to scale incrementally.

• The funding was first-come, first-served, encouraging early participation and rewarding developers that moved quickly through interconnection and permitting milestones.

The 152 projects provide a valuable dataset—not just of where the money went, but how developers are approaching FTM storage in constrained distribution areas.

Who Captured the Capital?

While NYSERDA’s program was open to all qualified developers, the results show a clear concentration of awards among a group of well-positioned, repeat participants. These developers understood how to work within the NYC regulatory landscape, move quickly through FDNY and DOB approvals, and optimize siting based on distribution value.

Here's a breakdown of the top recipients:

This distribution reflects a mix of regional developers with deep local expertise and larger national players with the resources to build repeatable processes. Importantly, it shows that the program encouraged portfolio development - developers who understood the incentive mechanics and permitting nuances didn’t just build one site—they built many.

For developers entering the NYC market today, this historical dataset is more than a summary. It’s a playbook for how to compete in the most competitive storage market in the country.

The 2025 Relaunch: $675M in New Incentives, and Why It Matters

With the original retail incentive tranche nearly exhausted and demand for storage surging across the state, the New York State Public Service Commission (PSC) approved a massive expansion of NYSERDA’s energy storage funding in early 2025. The result is a new $675 million retail energy storage incentive program—a clear signal that New York is doubling down on distributed battery deployment, especially in New York City.

Launch Timeline and Regulatory Backing

The foundation for this funding expansion was laid in June 2024, when the PSC issued an order setting a new target of 6 GW of energy storage by 2030. That directive led NYSERDA to file an updated implementation plan for residential and retail-scale storage, which was formally approved in February 2025.

Key rollout dates include:

• March–April 2025: NYSERDA opened onboarding for approved contractors, a prerequisite for developers to access funds.

• May 20, 2025: Applications opened for retail-scale (<5 MW) energy storage projects, officially launching the new incentive pool.

The program continues to operate on a block-based structure, with incentive values stepping down as funding is claimed. For developers, this means time is critical: the most generous funding levels are available only at the front of the queue.

The program is designed not only to accelerate storage deployment but also to improve equity, simplify contractor onboarding, and sharpen regional targeting—especially in high-congestion areas like NYC’s Zone J.

Use the Data to Guide Siting Strategy

One of the clearest advantages developers have heading into this new tranche is visibility into what’s already worked. The 152 FTM projects funded from 2019 to 2024 provide a real-world blueprint for identifying viable sites, understanding local permitting timelines, and calibrating incentive strategy.

This is exactly why we built TomorrowIQ—to help storage developers compress the learning curve.

Using tools like our interconnection visibility dashboard, you can:

• Analyze where past NYSERDA-funded projects were sited

• Identify distribution substations with precedent for BESS approvals

• Evaluate permitting durations and construction timelines by location

• Track active queue positions, zoning overlays, and site viability factors in one interface

The new $675 million incentive pool gives developers the fuel. TomorrowIQ gives you the map. In a market where speed and siting precision make the difference between a profitable project and a dead one, it pays to build with data.