S T A T E   O F   N E W   Y O R K
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                                  5606

                       2011-2012 Regular Sessions

                          I N  A S S E M B L Y

                            February 24, 2011
                               ___________

Introduced  by  M. of A. BRENNAN, DESTITO, SCHROEDER, ZEBROWSKI, CAHILL,
  CASTRO -- Multi-Sponsored by -- M.  of  A.  CLARK,  GOTTFRIED,  MAGEE,
  MAISEL,  MARKEY, MILLMAN, PEOPLES-STOKES, PHEFFER, SWEENEY, WEISENBERG
  -- read once and referred to the Committee on Energy

AN ACT to amend the public service law, in relation to electric capacity
  and power procurement; and to amend the  public  authorities  law,  in
  relation to powers of the Long Island power authority respecting port-
  folio management services

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

  Section 1.  The public service law is amended by adding a new  section
66-i to read as follows:
  S 66-I. ELECTRIC CAPACITY AND POWER PROCUREMENT. 1. ANY ELECTRIC UTIL-
ITY  CORPORATION, IN MEETING ITS OBLIGATION TO PROVIDE ELECTRIC CAPACITY
AND POWER SERVICES TO CUSTOMERS WHO DO NOT CHOOSE  TO  RECEIVE  ELECTRIC
CAPACITY  AND  POWER  SERVICE  FROM ANOTHER PROVIDER, SHALL CONSIDER ALL
REASONABLY AVAILABLE SUPPLY-SIDE AND DEMAND-SIDE  RESOURCES,  AND  SHALL
SELECT  THE  SOURCE  OR  SOURCES  WHICH  BEST SERVE THE PUBLIC INTEREST,
TAKING INTO CONSIDERATION SUCH  FACTORS  AS  RATEPAYER  IMPACTS,  SYSTEM
RELIABILITY,  ENVIRONMENTAL  IMPACTS,  CONSERVATION OF ENERGY RESOURCES,
PRESERVATION OR CREATION OF  ECONOMIC  OPPORTUNITIES,  FUEL  EFFICIENCY,
FUEL  AVAILABILITY  AND  DIVERSITY, AND PUBLIC HEALTH AND WELFARE.  EACH
ELECTRIC UTILITY CORPORATION SHALL PROVIDE PORTFOLIO MANAGEMENT SERVICES
TO ALL ELECTRIC CUSTOMERS WITHIN ITS SERVICE TERRITORY WHO DO NOT CHOOSE
TO RECEIVE ELECTRIC CAPACITY AND POWER SERVICE  FROM  ANOTHER  PROVIDER.
FOR  PURPOSES OF THIS SECTION, "PORTFOLIO MANAGEMENT SERVICE" SHALL MEAN
THE PROVISION OF RELIABLE ELECTRIC CAPACITY AND POWER  SERVICES  DERIVED
FROM  A MIX OF SUPPLY-SIDE RESOURCES, INCLUDING LONG-TERM CONTRACTS, FOR
SUPPLY DELIVERY DATES GREATER THAN ONE YEAR, SHORT-TERM  CONTRACTS,  FOR
SUPPLY  DELIVERY  DATES  WITHIN ONE YEAR, AND PURCHASES ON THE DAY-AHEAD
AND SPOT WHOLESALE MARKETS; DEMAND-SIDE RESOURCES; AND OTHER  MECHANISMS

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD00977-01-1
              

A. 5606                             2

WHICH COLLECTIVELY REDUCE THE VOLATILITY OF WHOLESALE ELECTRICITY PRICES
AND  MINIMIZE CUSTOMER BILLS. FOR PURPOSES OF THIS SECTION, "SUPPLY-SIDE
RESOURCES" SHALL INCLUDE  CAPACITY  AND  ENERGY  DERIVED  FROM  EXISTING
CENTRAL-STATION  POWER  PLANTS  OR  FROM  PROPOSED CENTRAL-STATION POWER
PLANTS OR OTHER  ELECTRIC  GENERATING  FACILITIES,  INCLUDING  RENEWABLE
ENERGY  RESOURCES,  WHICH  DELIVER  POWER  TO  THE  TRANSMISSION  AND/OR
DISTRIBUTION  GRID.    FOR  PURPOSES  OF  THIS   SECTION,   "DEMAND-SIDE
RESOURCES" SHALL INCLUDE CAPACITY AND ENERGY DERIVED FROM CLEAN DISTRIB-
UTED  GENERATION  SOURCES,  INCLUDING  RENEWABLE  ENERGY RESOURCES, LOAD
MANAGEMENT ACTIVITIES  THAT  CAN  BE  MONITORED  THROUGH  ACTIVITIES  IN
ACCORDANCE WITH PROCEDURES ESTABLISHED BY THE NEW YORK POWER POOL OR ANY
SUCCESSOR  ORGANIZATION,  AND  OTHER ENERGY EFFICIENCY ACTIVITIES, ABOVE
AND BEYOND ANY PROGRAMS FUNDED BY ELECTRIC UTILITY RATEPAYERS MANAGED BY
THE NEW YORK STATE  ENERGY  RESEARCH  AND  DEVELOPMENT  AUTHORITY.  THIS
SERVICE  DOES  NOT  INCLUDE  OWNERSHIP AND OPERATION OF TRANSMISSION AND
DISTRIBUTION SYSTEMS.
  2. WITHIN SIX MONTHS OF THE EFFECTIVE DATE OF THIS SECTION, EACH ELEC-
TRIC UTILITY CORPORATION SHALL SUBMIT TO THE COMMISSION FOR  APPROVAL  A
DRAFT  PORTFOLIO  MANAGEMENT  SERVICE  PLAN  CONSISTING OF LONG-TERM AND
SHORT-TERM PLANS FOR ELECTRIC CAPACITY AND ENERGY  PROCUREMENT  AND  THE
MIX  OF  SUPPLY-SIDE AND DEMAND-SIDE RESOURCES TO MEET FORECAST CAPACITY
AND ENERGY NEEDS. EACH ELECTRIC UTILITY CORPORATION SHALL  ALSO  PROVIDE
AN EXPLANATION HOW SUCH PLAN IS DESIGNED TO MODERATE POTENTIAL WHOLESALE
PRICE  VOLATILITY.  THE  COMMISSION  SHALL PROVIDE PUBLIC NOTICE OF EACH
DRAFT PORTFOLIO MANAGEMENT SERVICE PLAN AND SHALL PROVIDE  OPPORTUNITIES
FOR  PUBLIC  COMMENT  AND  PUBLIC  HEARING ON THE PLAN. FOLLOWING PUBLIC
COMMENT AND HEARING, THE COMMISSION SHALL APPROVE  THE  DRAFT  PORTFOLIO
MANAGEMENT SERVICE PLAN UPON A FINDING THAT SUCH PLAN MEETS THE REQUIRE-
MENTS FOR PORTFOLIO MANAGEMENT SERVICE PLANS AS DESCRIBED IN SUBDIVISION
ONE  OF  THIS  SECTION.   THE COMMISSION SHALL HAVE AUTHORITY TO REQUIRE
EACH ELECTRIC CORPORATION TO CONDUCT  COMPETITIVE  BIDDING  AUCTIONS  OR
OTHER  PROCUREMENT  PROGRAMS  FOR  THE  PURPOSE  OF SATISFYING PORTFOLIO
MANAGEMENT SERVICE PLANS.
  3. THE COMMISSION SHALL HAVE AUTHORITY TO PRESCRIBE GUIDELINES,  RULES
AND  REGULATIONS REGARDING THE PARTICIPATION OF UTILITY COMPANIES, THEIR
AFFILIATES, SUBSIDIARIES AND ANY OTHER CORPORATION OR PERSON IN  PORTFO-
LIO  MANAGEMENT  SERVICES,  INCLUDING  COMPETITIVE  BIDDING AUCTIONS, OR
REGARDING ANY OTHER METHOD OF ACQUIRING  ELECTRIC  CAPACITY  AND  POWER.
THE  COMMISSION  MAY,  AFTER  PUBLIC  COMMENT  AND  EVIDENTIARY HEARING,
PROVIDE FOR PROVISION OF PORTFOLIO MANAGEMENT SERVICE TO CUSTOMERS IN AN
ELECTRIC UTILITY CORPORATION SERVICE TERRITORY BY AN ENTITY  OTHER  THAN
THE  ELECTRIC  DISTRIBUTION  CORPORATION,  THROUGH A COMPETITIVE BIDDING
AUCTION, SO LONG AS THE ENTITY SELECTED CAN MEET THE REQUIREMENTS OF THE
SECTION.  ANY RULES, REGULATIONS, GUIDELINES AND DETERMINATIONS  ADOPTED
OR ISSUED BY THE COMMISSION PERTAINING TO ACQUISITION OF ELECTRIC CAPAC-
ITY  SHALL  BE  CONSISTENT  WITH THE POLICY STATED IN THIS SECTION SHALL
ALSO REQUIRE ACQUISITIONS OF ELECTRIC CAPACITY TO BE REASONABLY CONSIST-
ENT WITH THE FORECASTS, POLICIES AND LONG-RANGE PLANNING OBJECTIVES  AND
STRATEGIES  CONTAINED  IN THE MOST RECENT FINAL STATE ENERGY PLAN OR ANY
SUBSEQUENT UPDATE, PROVIDED, HOWEVER, THAT ANY DETERMINATION MADE BY THE
COMMISSION UNDER THIS SECTION THAT IS NOT REASONABLY CONSISTENT WITH THE
PLAN SHALL BE DEEMED IN COMPLIANCE WITH THIS SECTION, PROVIDED THAT SUCH
DETERMINATION BY THE COMMISSION INCLUDES A FINDING THAT THE  ELEMENT  OF
THE  PLAN  IS  NO  LONGER REASONABLE OR PROBABLE BASED ON A MATERIAL AND
SUBSTANTIAL CHANGE IN FACT OR CIRCUMSTANCE, AND A  STATEMENT  EXPLAINING
THE BASIS FOR THIS FINDING.

A. 5606                             3

  4.  THE COMMISSION SHALL ESTABLISH, AFTER PUBLIC COMMENT AND EVIDENTI-
ARY  HEARINGS,  REGULATIONS  FOR PERFORMANCE-BASED REWARDS AND PENALTIES
THAT REFLECT THE EXTENT TO WHICH THE PORTFOLIO MANAGEMENT  SERVICE  PLAN
PROVIDED  BY EACH ELECTRIC UTILITY MINIMIZES CUSTOMER ELECTRIC BILLS AND
THE VOLATILITY OF ELECTRICITY PRICES.
  5.  BOARDS OF STATE OR MUNICIPALLY OWNED UTILITIES WILL REMAIN RESPON-
SIBLE FOR PORTFOLIO MANAGEMENT  SERVICES  AND  ANY  ALTERNATIVE  CHOICES
AVAILABLE TO CUSTOMERS OF THESE UTILITIES.
  S 2. Section 1020-f of the public authorities law, as added by chapter
517  of the laws of 1986, is amended by adding a new subdivision (bb) to
read as follows:
  (BB) TO DEVELOP, WITH PUBLIC COMMENT AND HEARING, PORTFOLIO MANAGEMENT
SERVICES, FOR ALL CUSTOMERS WHO DO NOT ELECT TO TAKE GENERATION SERVICES
FROM AN ALTERNATE POWER SUPPLIER, IN ACCORDANCE WITH THE  PROVISIONS  OF
SUBDIVISION ONE OF SECTION SIXTY-SIX-I OF THE PUBLIC SERVICE LAW.
  S 3. This act shall take effect immediately.