BILL NUMBER:S2613

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 certain 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 Chautauqua, Tompkins
and Niagara counties. 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.

Section 2 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 between coal plants situated in
Chautauqua and Niagara Counties and NYPA, 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.
Western New York power plants 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 Western 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
heir 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.
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 HISTORY:
2012: S.6842,A./A.9873A Referred to Energy and Telecommunications

EFFECTIVE DATE: Immediate.