BILL NUMBER: S996

SPONSOR: YOUNG
 
TITLE OF BILL:

An act to amend the public service law, in relation to the effect of
power importation on electrical markets

 
PURPOSE:

The bill is designed to examine the competitive disadvantages faced by
New York's state power generation facilities associated with the impor-
tation of out of state power, and to ensure that the letter and spirit
of renewable energy goals are enforced with regard to imported power.

 
SUMMARY OF PROVISIONS:

Section 1 adds a new section 77-a subdivision 1 of the public service
law to state legislative intent which specifies that it is in the best
economic and environmental interests of the state that to adopt consist-
ent policies that to the to the greatest extent possible to ensure that
              

environmental policy goals are enforced for any generator that does
business in the New York state energy markets.

A new section 77-b is added to direct the public service commission,
through a comprehensive monitoring and reporting methodology, to deter-
mine undue competitive advantages in the state's electricity markets
that out-of-state power generators have over in-state power generators
due to the state's imposition of charges, fees, assessments, environ-
mental standards and/or allowance auctions of in-state generated power
imported into the state. Such methodology shall be established pursuant
to a stakeholder process through a proceeding established by the commis-
sion. The commission is further directed to report the negative conse-
quences of imported power as well as how these consequences could be
minimized to the governor and the respective chairs of the senate and
assembly energy committees within 9 months of establishing the methodol-
ogy. The report must reflect stakeholder review and comment on the
impact of imported power's impact on local employment and revenues, and
adverse environmental impacts both within and outside the state. Subdi-
vision 2 provides definitions for "competitive advantage", "in-state
power generator", and "out-of-state power generator".

Section 2 provides that this act shall take effect 30 days after enact-
ment.

 
JUSTIFICATION:

Power generators outside of New York that do business in New York,
should not obtain competitive advantages over in-state generators.

It is in the best interest of the state to adopt consistent policies
that, to the greatest extent possible, utilize electrical power in as
cost efficient and environmentally friendly means possible whether the
power is produced within or outside the state of New York.

Policies that encourage unfair competitive advantages for out of state
power producers, threaten jobs and local tax bases and encourage the
importation of pollution intensive power into the state and are a
significant threat to the health of New York residents. In their efforts
to reach environmental and renewable energy goals, New York power regu-
lators have increasingly opted to promote and approve transmission
upgrades to the state's electrical grid that obviate the need for
in-state generation of significant megawatts of power.

Instead of promoting the repowering of power plants into cleaner tech-
nology or preservation of in-state generation, they have chosen in many
cases to endorse policies that export New York jobs, revenue, and
control of the power supply. These policies have favored transmission
upgrades, and have had the consequence of encouraging major out of state
power producers to produce more energy, creating more harmful emissions
and negatively impacting the environment.

While these policy decisions appear to have lowered emissions to more
quickly meet the state's emissions reduction goals, the irony is that in
order to meet energy consumption demands of residents and businesses in
the state, out of state power plants are increasing their energy
production, and in many cases, are now producing more "dirty" power than
would have been produced by instate generators that now are going out of
business.

In addition to the detrimental effects upon communities that would occur
if most of our generation is replaced by transmission, PILOT payments
will be at risk and this will create a great deal of angst and uncer-
tainty in the community, limited power supply in the state and importa-
tion of dirty coal power from out of state will result.

Importing power primarily through transmission upgrades as a priority
policy direction for the state is a detrimental direction to take. It
will hurt our communities and our in-state manufacturers.  Manufacturers
need the ability to expand since expansion often entails a need for more
power. Manufacturers are dis-incentivized from expanding their busi-
nesses in New York when there are no easy means to increasing their
power supply, and no base load power plants are nearby which is the
result when power is imported via transmission lines rather than
produced locally.

A key factor that is seemingly not considered by power regulators who
endorse transmission over instate generation, is that for every megawatt
of power that is imported there is an impact on emissions at other power
plants. When dirtier power plants out of state have to produce more
energy, those power plants increase harmful emissions which hurts the
environment more and is in opposition to the spirit and intent of New
York's clean energy goals.

There are upwind and downwind emissions in the air that carry pollution
over New York's borders. Emissions actually are increased as a result of
power plants out of state increasing their power production to meet the
need of New York's bellying-up fossil fuel plants.

New York has much higher standards for clean power production than many
other states. Replacing our in-state generation with transmission
projects only serves to import dirty power out of bordering states.  The
public has a right to know what the sources of our power are and whether
emissions overall are truly being reduced. This bill will provide a way
for a full and accurate analysis of true sources of power and emissions,
and will help state policymakers to make more informed decisions that
will better help to promote policies that are more in line with the
goals of promoting a clean environment while preserving New York energy
independence.

Policymakers in the state should not advance policies that promote out
of state generators to produce increased amounts of dirty power to meet
our state's power needs with costs borne on the backs of ratepayers.
Instead policies should be promoted that encourage private investment,
job creation and clean technology repowering of power plants. Energy
policies that preserve our communities' futures and serve our state's
and the environment's best interests should be prioritized.

The analysis and reporting that this legislation requires will help to
steer energy policy in a direction that helps improve the environment
overall, not just in New York, will save jobs, and encourage businesses
to grow.

Reliability and congestion on the state's power grid cannot be as effi-
ciently managed by simply importing power from out of state generation.
In the case of emergency situations such as black-outs, attacks on the
grid or spikes in demand, if we rely solely on transmitted power, New
York is in a weakened position to respond and solve issues, because
decisions are being made by authorities outside of our jurisdiction.

In contrast, a healthy balance between base load power generation, local
renewable sources and reliable short and long range transmission in the
state is needed to give New York the control that we need, to help elec-
tricity rates stay low, protect consumers and jobs and help assure a
better environmental and economic future for our state.

 
LEGISLATIVE HISTORY:

2017,2018: S.529/A.3628 REFERRED TO ENERGY AND TELECOMMUNICATIONS
2016: S.8055/A.10717 PASSED SENATE

 
FISCAL IMPLICATIONS:

Undetermined

 
LOCAL FISCAL IMPLICATIONS:

None.

 
EFFECTIVE DATE:
This act shall take effect immediately.