senate Bill S2616

Directs the power authority to conduct an analysis of the economic viability of load producing electric generating facilities

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 23 / Jan / 2013
    • REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS
  • 08 / Jan / 2014
    • REFERRED TO CORPORATIONS, AUTHORITIES AND COMMISSIONS

Summary

Directs the power authority to conduct an analysis of the economic viability of load producing electric generating facilities for the purpose of determining the feasibility of entering into power purchasing agreements with such facilities.

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Bill Details

Versions:
S2616
Legislative Cycle:
2013-2014
Current Committee:
Senate Corporations, Authorities And Commissions
Law Section:
Authorities
Versions Introduced in 2011-2012 Legislative Cycle:
S7767

Sponsor Memo

BILL NUMBER:S2616

TITLE OF BILL:
An act
to require the power authority of the state of New York
to conduct an analysis of the
economic viability of certain electric generating facilities

PURPOSE:
This act would require the New York power authority to conduct an
analysis of the economic viability of load producing electric
generating facilities.

SUMMARY OF PROVISIONS:

Section 1 provides that the New York State Power Authority (NYPA)
shall conduct an analysis of the current economic viability of base
load producing electric generating facilities in the state. Based on
such analysis, and as deemed feasible and advisable by the NYPA
board, the Board shall then recommend entering into a purchase power
agreement with such facilities for at least three years.

It also provides that the eligibility for the purchase power
agreements shall be for those electric generating facilities that
currently meet or exceed the minimum standards established in the
final rule of the proposed National Emission Standards for Hazardous
Air Pollutants and stipulates that eligible plants must agree to
repower such facilities and construct new or retrofit existing
electric generators.

Further, it provides that the electric generating facilities would
have to safely demolish or decommission their existing generators and
place new generators in service no later than March 2017.

Section 3 provides that power purchased by NYPA pursuant to such
agreement with these facilities shall be considered Recharge New York
power and shall be utilized to augment ReCharge New York power
allocations for
eligible businesses.

EXISTING LAW:
Chapter 60 of the laws of 2011 established the ReCharge New York power
allocation program.

JUSTIFICATION:
This new bill would authorize the New York power Authority (NYPA) to
enter into a purchase power agreement with existing coal plants
situated in
the state, using the purchased energy to supplement the state's
ReCharge NY program, which is designed to retain and create jobs
through allocations of economic development incentives to employers.

Power plants in the state have faced enormous fiscal challenges
recently due to the fact that the transmission lines in the state
have not been given badly needed upgrades, plants have not been able


to stay competitive and get their energy delivered to where it is
needed in other parts of the state.

Power plants in the state, particularly in Western New York,
contribute significantly to the people and the economy of the region
by employing hundreds of New Yorkers with high paying jobs and
providing millions of dollars a year in direct benefits to the state
and local economy. These facilities also pay millions of dollars in
annual property taxes and payments in lieu of taxes agreements making
them, in many areas, the largest taxpayer in the school districts and
municipalities.

The economic benefits of annual labor payments and operational
expenses of power plants, including locally-procured goods and
services, are multiplied across regions. This contribution makes a
huge impact. For example, in Chautauqua County, the NRG power plant
located in the city of Dunkirk contributes over $20 million in wages
and $10 million in PILOT payments to the school, the city and county
of Chautauqua, and well over $10 million in local goods and services.

Were any of these facilities to go under, or even be reduced in
capacity by any significant margin, it would decimate the financial
viability of the municipalities and school districts that are already
facing difficult fiscal times.

This bill provides a temporary solution by allowing for NYPA to conduct
an analysis of the minimum resources necessary to maintain plant
operations and to possibly enter into a purchase power agreement with
New York power plants to keep them in operation in the short term,
while state leaders work together on a long term solution for our
ailing power plant infrastructure. It will help avoid the devastating
impact of power plants shutting down and help to maintain the
reliability of the power grid, while keeping jobs in New York.

It is critical that New York State maintains a variety of modes of
power generation to ensure the reliability of the power grid. This
legislation
will help New York State to be energy self-sufficient. For example,
the coal plants in Chautauqua and Niagara counties have just invested
millions of dollars in the last few years in state-of-the-art clean
burning technology to comply with federal Environmental Protection
Agency regulations. For example, the NRG power plant in Dunkirk
recently undertook $200 million in clean coal burning technology
upgrades. These state-of-the-art upgrades ensure that the state's
energy needs will be met in the face of unpredictable energy prices
and changing demand for other modes of electricity generation.

The ReCharge NY program is a successful economic development program
that retains and creates jobs by providing low-cost electricity to
attract new businesses and encourage existing firms and
not-for-profit organizations to stay and grow in the state. Under the
ReCharge NY program, when businesses in the state make capital
investments that
support the regional economic development priorities in the state,
they are awarded contracts based on their commitments. This
legislation utilizes the success of the Recharge NY Program and
further ensures the goals of regional economic development and job


retention in Western New York are realized, while helping to avoid
the economic catastrophe should these power plants shut down.

PRIOR LEGISLATIVE a/STORY: 2012: S.7767 Passed Senate

EFFECTIVE DATE: Immediate.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                  2616

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                            January 23, 2013
                               ___________

Introduced  by  Sens.  YOUNG,  MAZIARZ, O'MARA -- read twice and ordered
  printed, and when printed to be committed to the Committee  on  Corpo-
  rations, Authorities and Commissions

AN  ACT  to  require  the  power  authority  of the state of New York to
  conduct an analysis of the  economic  viability  of  certain  electric
  generating facilities

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. (a) Within 90 days of the effective date of this  act,  the
power  authority  of  the state of New York shall conduct an analysis of
the current economic viability of  load  producing  electric  generating
facilities, and as deemed feasible and advisable by the trustees of such
authority,  taking  full consideration of the requirements and viability
of the entire power generating system needs of the state  of  New  York,
with special consideration of the ratepayers and taxpayers of the state,
shall recommend entering into a purchase power agreement with the owners
and  operators of such facilities, if such owners and operators meet and
agree upon the conditions in subdivision (b)  of  this  section.    Such
power purchase agreements shall be effective upon the conclusion of such
90  day  period  and  be  designed  to  maintain  said facilities' power
production capacities at a rate sufficient  to  ensure  at  least  three
years  worth  of  no  less than a level of operating income necessary to
allow said facilities to remain open and functioning reliably and safely
and fully staffed at at  least  ninety  percent  of  current  employment
levels,  payrolls and local community benefits. For the purposes of this
subdivision, operating income shall include  all  expenses  of  eligible
facilities  excluding  debt  service  costs,  except for verifiable debt
service payments related to capital improvements  designed  to  substan-
tially reduce the emission of toxic air pollutants emanating from gener-
ators operating at said facility.

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD07145-01-3

S. 2616                             2

  (b)  The  power  purchase agreement permitted under subdivision (a) of
this section shall only apply to power generating units  that  currently
meet  or  exceed  the minimum standards established in the final rule of
the proposed National Emission Standards for Hazardous  Air  Pollutants.
In  addition,  such owner and/or operator of a generating unit otherwise
eligible for benefits under this section  must  agree  to  repower  such
facility and construct new or retrofit existing generators that:
  1.  are  designed and intended to operate at an electricity production
efficiency level of at least forty-eight percent;
  2. will be capable of producing at least  600  megawatts  of  electric
generating capacity running at least 7,000 hours per year;
  3.  will  be  able  to achieve a 2 parts per million limit for nitrous
oxide emissions using Lowest Achievable Emission Rate technologies;
  4. will utilize Lowest Achievable Emission Rate technologies if feasi-
ble, or, at a minimum, Best Available Control  Technologies  for  carbon
monoxide and sulfur dioxide emission levels;
  5.  will safely demolish or decommission the existing generators at an
eligible facility; and,
  6. will place in service the new  electric  generating  facilities  no
later than March 31, 2017.
  S  2. Notwithstanding any limitations or conditions contained in para-
graph 8 of subdivision (a) and paragraph 7 of subdivision (c) of section
188-a of the economic development law, any power purchased by the  power
authority  of  the state of New York pursuant to section one of this act
shall be considered Recharge New York power, and shall  be  utilized  to
augment  Recharge  New York power allocations for eligible businesses as
defined in paragraph 5 or 7 of subdivision (a) of section 188-a  of  the
economic  development  law  that are recommended for a Recharge New York
power allocation pursuant to part CC of chapter 60 of the laws of 2011.
  S 3. This act shall take effect immediately.

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