What Are VDER Credits?
VDER stands for Value of Distributed Energy Resources. It's the framework Con Edison uses to compensate solar homeowners for excess electricity sent back to the grid. Unlike simple net metering where 1 kWh exported equals 1 kWh credited, VDER uses a "Value Stack" that breaks the credit into multiple components based on the actual value your energy provides to the grid.
The Value Stack Components
Your VDER credit is the sum of several values. Energy Value is based on the wholesale price of electricity at the time your system exports. Capacity Value compensates you for reducing peak demand, higher during summer afternoons. Environmental Value (E Value) reflects avoided carbon emissions. Demand Reduction Value (DRV) credits you for reducing grid infrastructure needs, calculated on the 10 peak demand hours in your zone. Locational System Relief Value (LSRV) provides additional credits if your system is in a grid area where Con Edison would otherwise need infrastructure investment.
VDER vs. Net Metering
Under Phase 2 of NY's solar compensation rules, residential homeowners can choose between Net Metering (simple 1:1 credit at full retail rate, better for systems sized close to annual usage) and VDER Value Stack (component-based credits that vary by time and location, more valuable with battery storage). The key insight: if you have battery storage, VDER can be significantly more valuable because you can store energy during low-value hours and export during high-value peak hours.
How VDER Works with TOU Rate III
On Con Edison's TOU Rate III, electricity costs vary by time of day. With solar plus battery on VDER, your panels charge the battery during the day, you use battery power during expensive on-peak hours, you export excess to the grid during peak demand when VDER credits are highest, and you pull from the grid only during cheap off-peak hours. This triple optimization — avoiding peak rates, maximizing VDER export value, minimizing grid purchases — is where the real savings stack up.
What to Know as a Westchester Homeowner
VDER credits appear as monetary line items on your Con Edison bill and vary month to month. Credits can be banked and roll forward. System size matters: VDER is most advantageous for systems that consistently produce surplus, especially with battery storage for strategic export timing. Location matters too — if your home is in a high LSRV grid zone, your credits are substantially higher.
Get Your VDER Estimate
The actual value of VDER credits depends on your system size, battery configuration, usage patterns, and grid location. Upload your Con Edison bill and we'll model your specific VDER credit potential alongside your solar and battery savings.
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