NEW YORK STATE
PUBLIC SERVICE COMMISSION

Case 15-E-0302 – Proceeding on Motion of the

Commission to Implement a Large-Scale Renewable

Program and Clean Energy Standard.

COMMENTS OF INDEPENDENT
POWER PRODUCERS OF NEW YORK, INC.

On January 6, 2026, the Coalition for Safe and Reliable Energy (“Coalition”) petitioned the New York State Public Service Commission (“PSC” or “Commission”) to hold a hearing, pursuant to Section 66-p of the New York Public Service Law (“PSL”), to evaluate whether to temporarily suspend or modify the targets under the Renewable Energy Program (“Program”) established as part of the Climate Leadership and Community Protection Act (“CLCPA”) that, by 2030, 70% of statewide electricity generation be from renewable energy systems and that, by 2040, the statewide electric grid be zero emissions (“2040 Target”).[1]  Pursuant to the PSC’s January 28, 2026, notice soliciting comments on the petition[2] and extension of the comment due date until May 1, 2026,[3] Independent Power Producers of New York, Inc. (“IPPNY”),[4] a not-for-profit trade association representing the independent power industry in New York State, hereby comments on the Petition.  IPPNY’s members include companies involved in the development and operation of electric generating facilities and the marketing and sale of electric power in New York.  Further, IPPNY members produce a majority of the State’s electricity using nearly every available generation technology, including wind, solar, natural gas, low sulfur oil, hydro, biomass, energy storage, and nuclear.

Pursuant to PSL § 66-p(4), the PSC may temporarily suspend or modify the obligations under the Program, after a hearing, if it finds that the Program impedes the provision of safe and adequate electric service or increases energy costs (i.e., if there is a significant increase in arrears or service disconnections).  In a series of reports, the most recent issued just two weeks ago, the New York Independent System Operator (“NYISO”) has repeatedly emphasized the need for new or repowered resources in the interim to maintain reliability as the system transitions to the end state envisioned by the CLCPA.[5]  As discussed below, the system has evolved in ways that were not considered when the CLCPA was enacted; its implementation must be realigned commensurately.  It is prudent, therefore, for the PSC to convene a hearing under Section 66-p to examine modifying the Program to ensure electric system reliability needs continue to be met by providing investors with adequate investment signals to maintain needed existing facilities and, where needed, take steps required to support the economic viability of repowering needed existing facilities and develop new resources to complement intermittent resource development.

The current reliability risk is caused by a generation supply gap attributable to retirements outpacing new additions and unexpectedly rapid demand growth.[6]  Indeed, the supply gap is in part a direct consequence of the policy uncertainty fossil plant investors have long faced; without clear line of sight into future market conditions and asset longevity, capital has not flowed to repower or replace aging conventional resources.  A hearing focused on closing that policy certainty gap—for all resource types—would serve the Commission's reliability mandate.  The hearing, if held, should focus on market structure and regulatory reforms needed to accelerate repowering and support the growth and modernization of a reliable grid.

I.               It is Prudent for the State to Hold a Hearing Under PSL Section 66-p Given the Absence of Dispatchable Emission-Free Resources (“DEFRs”) at Commercial Scale at This Time, the Benefit of Repowering Existing Resources, and the Need to Maintain Reliability During the Transition Period.

The Coalition cautions that sufficient DEFRs will not be commercially available at scale to meet system reliability needs by the 2040 Target.[7]  Additionally, the Coalition raises the concern that investors will not develop repowered conventional generation that will be needed to maintain reliability because “the 2040 Zero Emissions Target presents a risk that any repowered plant would be forced to retire by 2040, preventing full recovery of the investment.”[8]  In comments filed in this proceeding on April 6, 2026, the New York Energy Consumers Council correctly cautioned: “[w]ithout a recalibration that reflects the practical conditions of the energy market, New York faces potentially dire consequences—consequences starkly in opposition to the goals of CLCPA.”[9] 

Innovative new DEFRs are promising.  As evidenced by the State’s ongoing funding of some of these initiatives,[10] doing so has been—and should remain—a key priority.[11] Commercializing these technologies at scale and then subsequently permitting, siting, and bringing them into operation at the levels needed will, however, realistically take many years at best.  Maintaining and/or repowering needed existing facilities and developing new, dispatchable, conventional generation, particularly that which can be converted to operate as a zero emissions source in the future, must thus proceed in parallel to ensure system reliability in the interim.[12]  Indeed, providing the paths and corresponding market signals to repower existing generation with more efficient ones will substantially reduce emissions in the interim period, providing substantial environmental benefits while also shoring up system reliability and reducing costs.[13]  Accordingly, it is prudent for the PSC to hold a hearing to examine modifying the Program to ensure investors are able to finance and develop conventional resources to timely meet reliability needs in the interim until DEFRs become viable on a commercial scale.[14]

The 2025 State Energy Plan echoed the NYISO’s warnings throughout 2025 that the confluence of aging generation, load growth due to CLCPA mandates, and large load projects and slower than projected renewable generation development had put the State at an inflection point.  The 2025 State Energy Plan advised that the “State will need to be strategic about the pace of combustion unit retirements and/or replacements as it works toward its clean energy goals and to meet reliability needs as quickly and cost-effectively as possible.”[15]  The 2025 State Energy Plan, thus, logically concluded that “[c]ombustion-generating units will remain essential parts of electric grid reliability and affordability and the retirement of these units will not be able to occur until resources that provide the same grid reliability attributes are put in place” and that “New York will seek to carefully manage the retirement of existing assets and evaluate whether there is a need to invest in their repowering or in new generation that is compatible with long-term policy targets.”[16]

The 2025 State Energy Plan opens with a letter from Governor Kathy Hochul, demonstrating the need for a “much-needed all-of-the-above strategy,” which includes, “modern gas infrastructure to keep the system stable during the transition.”[17]  The 2025 State Energy Plan further provides that “[a]ll major fuels currently used in New York State are projected to continue to provide meaningful volumes of energy throughout the planning period, while the contributions of clean and renewable energy sources will grow.”[18]

Indeed, to reach its findings, the 2025 State Energy Plan cited extensively to the NYISO’s full analysis of the significant system buildout that must occur for the State to achieve its climate change initiatives.  The NYISO’s 2023-2042 System & Resource Outlook (“Outlook”) notes that “[t]he scale of and pace at which new generation will be needed on the system to satisfy [the CLCPA’s target of having the electricity sector be zero-emissions by 2040 (“100 by 40 target”)], projected demand, and estimated capacity reserve margins is unprecedented.”[19]  The Outlook also emphasized the fact that the NYISO had already established solar and wind resources cannot alone make up the gap between the forecasted capacity of existing renewable generation technologies and the projected demand because these resources do not provide the same amount of essential grid services currently provided by fossil fuel generators, such as operating reserves, ramping, regulation, voltage support, and black start.[20]  To replace these electrical attributes, the NYISO projected that the system would need to add at least 20 GW, and upwards of 40 GW, of DEFRs by 2040 to complement the renewable resource deployment.[21]

As the NYISO acknowledged, however, no DEFR technology is currently available at a commercial scale.[22]  Further complicating the timely deployment of DEFRs by 2040, the NYISO noted that, even if such resources were to become commercially viable prior to the CLCPA’s 2040 date, “there remains significant work in implementation and logistics that must be overcome to economically justify transitioning the dispatchable fleet to some combination of new technologies in the next 15 years.”[23]

The NYISO’s Outlook and a second independent study[24] both confirm that the time required to develop thousands of megawatts of intermittent solar and wind generation will not permit conventional resources to leave the system any time soon.  For example, the NYISO has projected that electric demand in the State, which will increase between 50%–90% over the next 20 years, must be matched with the addition of approximately three times the capacity of the current generation fleet to meet that demand.[25]

The combined effect of factors now undeniably straining system reliability to its near breaking point were not—indeed, could not have been—anticipated much less addressed when the CLCPA was enacted.  Given its economy-wide scope and the time over which CLCPA implementation spans, the CLCPA empowered the PSC to conduct a hearing process for the very purpose of assessing whether changing facts and circumstances warrant modification of the Program to ensure the continued reliable and affordable operation of the electric system.

During the transition from fossil generation to non-emitting resources, the all-of-the-above strategy directed by the 2025 State Energy Plan is demonstrably the viable option available to maintain a reliable system as it evolves to a cleaner footprint.[26]  The State is in a time of immense federal policy uncertainty, both in terms of tax incentives available to renewable projects through the Inflation Reduction Act and the ability to issue permits for offshore wind projects.[27]  The federal government has previously attempted to halt construction of the Empire Wind project, expected to deliver over 800 megawatts of non-emitting electricity into New York City.[28]  The NYISO, in its most recent Power Trends report released in June of 2025, advised, “every plausible option and opportunity to bolster both reliability and resource needs should be on the table.”[29]

The State has taken a number of important steps to animate the Governor’s “all-of-the-above” approach policy including implementing the Zero Emission Credit 2.0 program, pursuing new nuclear development, proceeding with renewable energy auctions,[30] and initiating a review of the most effective steps that can be taken to support offshore wind development to support downstate needs.  The uncertainty facing conventional generation and pending development of DEFRs at commercial scale—particularly given the limited supply options available to meet the electric needs of New Yorkers downstate—at a minimum, warrants consideration in a hearing. 

Over the past 26 years, the Commission has relied on competitive markets to meet system needs timely and affordably.[31]  Private entities have consistently and effectively responded when market signals have been adequate by providing the needed investment to maintain system reliability.[32]  The Commission must stay the course it previously has charted and continue its proven policies, now more than ever with the documented very narrow supply margins available to meet New Yorkers’ electric needs, to ensure private investors are given adequate signals and incentives to develop all types of technologies that may meet resource needs effectively and affordably.

The growth and modernization of New York’s reliable grid delivers the greatest cost savings and consumer protections when investors have the long-term policy certainty needed to develop large-scale resources competitively.  If that certainty is disrupted, the cost of capital for grid investment increases, and those costs are broadly and ultimately passed on to ratepayers.

A signal also is sent across all energy investment categories that long-term regulatory commitments are subject to revision, thereby chilling investments.  Investors will be reluctant to commit capital to repowering projects whose market position and future eligibility are subject to uncertainty.  The answer to the supply gap is more policy certainty—not less—and a hearing that productively closes the investment certainty gap across all resource categories would deliver far greater reliability and ratepayer benefits.

II.            It is Prudent for the State to Hold a Hearing Under PSL Section 66-p Given the Affordability Concerns that the State is Facing.

Energy affordability concerns have been at the forefront of discussions, especially as New York State’s government engages in negotiations to adopt the 2026 budget.  Consideration about how to move forward with reaching the CLCPA’s targets is now occurring with greater awareness about the importance of affordability as energy consumers are experiencing higher electricity bills.[33]  Post-COVID, the electric industry has faced skyrocketing inflation, concomitantly high interest rates, severe supply constraints, and significant cost exposure that cannot be hedged.[34]  These costs are reflected in higher electric prices, seen most visibly in utility rate cases.  Utility bills will continue to rise as progress continues toward meeting the CLCPA’s targets, given the essential massive investment in new energy infrastructure to reach the targets.

On January 26, 2026, the New York State Energy Research and Development Authority’s (“NYSERDA”) Board of Directors approved the 2026 Amendment to its Operating Plan for the use of Regional Greenhouse Gas Initiative (“RGGI”) monies.[35]  The amended Operating Plan states that the use of these monies for affordability is not limited to programs that serve low-to-moderate income households.  Over the next three years, 62% of RGGI proceeds will go towards affordability.  Thirty-four percent of auction proceeds above the amount projected by the Operating Plan would support a new ratepayer cost reduction initiative; remaining additional monies would be provided for purposes, such as supporting studies and analyses of zero-emission technologies.  However, it is not clear if these measures will be enough to mitigate consumer cost increases to an acceptable level, which the hearing should analyze.[36]

The NYISO’s January 2026 white paper detailed the price drivers resulting from this winter’s extreme cold weather operations and indicated that increased heating demand and natural gas exports led to rising natural gas prices throughout the Northeast.[37]  To maintain adequate electric supply and support energy affordability, dual-fueled power plants were switched from operating on natural gas to low-sulfur oil when gas became either unavailable or more expensive, so that more natural gas supply remained available to keep residential customers warm under such conditions.

The NYISO’s white paper explains that recent higher wholesale prices are also due to shrinking reliability margins and increasing reliance on older and less efficient generation.  Since 2019, 4,315 MW of capacity has left the system, while 2,274 MW has been added, despite projected increased demand levels.[38]  Further, the reliability value of the dispatchable assets that left the system surpasses those entering the system.  As recently as two weeks ago, the NYISO reaffirmed repowering or replacing older plants with newer and more efficient equipment would more efficiently support system reliability while also helping to limit rising prices.[39]

III.          Conclusion

As discussed above, it is prudent for the PSC to hold a hearing under Section 66-p to examine whether the Program should be modified to ensure safe and adequate service can continue to be provided efficiently and affordably. The hearing also should examine necessary market structure and regulatory reforms to support the growth and modernization of a reliable grid, including investment in repowering and transitional resources that bridge the gap to meet system needs.