IPPNY Comments on the State Energy Plan

IPPNY^[1] provides the following comments on the Draft State Energy Plan (Draft Plan or Energy Plan) to address recommendations to benefit all New Yorkers. IPPNY’s members support the reliable transition to a clean energy future. We are a trade association dedicated to representing the largest fleet of clean energy generating companies in New York State. Our members generate over 50% of New York’s clean electricity and have been awarded more than half of the REC contracts provided by NYSERDA. Further, IPPNY’s members produce nearly 80% of New York's total electricity, which powers our State’s economy, using all fuel sources, such as: wind, solar, hydro, energy storage, natural gas, low sulfur oil, biomass, and nuclear. In combination, these resources maintain electric system reliability for more than 19 million New Yorkers every day. Our members have invested more than $10 billion in capital improvements to their facilities, employ over 19,000 people across the State, and pay approximately $1.5 billion in local property taxes annually. Furthermore, since 2000, power producers in this State have reduced emissions of sulfur dioxide by 99%, nitrogen oxides by 92%, and carbon dioxide by 46% through the implementation of competitive electricity markets and compliance with regulatory requirements. 

Below is a summary of IPPNY’s recommendations to improve the Draft Plan:

·       Reliability attributes that are not currently compensated through the capacity market, such as dispatchability, should be appropriately valued. Attributes that do not support grid reliability are more efficient and cost effective when compensated through other means such as a carbon pricing mechanism.

·       The capacity market must continue to be the mechanism upon which the State relies to retain needed generation and incentivize new generation to come online for system reliability.

·       Ongoing examination of NYISO rules to bring the next generation of resources online is beneficial.

·       The State Energy Planning Board should include a timeline in the Energy Plan for the PSC to take action on the DPS Staff Zero Emissions Credit (ZEC) program Whitepaper (ZEC 2.0 Proposal) to preserve the environmental attributes produced by New York’s nuclear facilities.

·       NYPA should issue a competitive RFP to secure independent private sector investment under its efforts to develop at least 1 GW of nuclear power generation.

·       Utilities should not be allowed to own, develop, or operate any new electric generation to preserve the fundamental benefits of the competitive wholesale electricity market to continue to shield energy consumers from the inefficient and costly days of utilities incurring stranded costs.

·       The Energy Plan should include specific information about how its provisions will be applied in State entity decision making, especially for implementation of the CLCPA and the associated permitting process for permit renewals and for new generation development.

·       The Energy Plan should include details on the commercial feasibility of the Climate Action Council’s Climate Action Plan process for transitioning away from the operation of dispatchable fossil-fueled facilities to as-yet-to-be-defined or commercialized dispatchable zero-emission facilities.

·       The Energy Plan must continue to acknowledge that new and repowered natural gas facilities are needed through 2040 and beyond to maintain reliability until zero emissions sources, especially dispatchable emissions free resources (DEFRs), are developed and become commercially available.

·       The Energy Plan must include a specific timeline for how its recommendations for new or repowered supplies will be accomplished.

·       NYPA or NYSERDA should issue an RFP for a hydrogen demonstration project at a facility of an independent power producer to share NYPA’s experience from its successful hydrogen blending demonstration project at its Brentwood Small Clean Power Plant on Long Island.

·       The Energy Plan must include a timeline for the PSC to determine the eligibility of zero emission fuel capable technologies and develop a program to ensure the fuel availability for power plant owners to meet the 100 by 40 target by the document’s projected 2045 date.

·       NYSERDA should continue and increase its ongoing competitive procurements to reach the CLCPA’s 70 by 30 target by 2033 and its energy storage target.

·       The 15% increase in generation threshold for hydroelectric facility repowering should be removed, in order to allow a viable path through which hydro companies can make significant re-investments in their facilities.

·       Fuel cells should be considered an important option for commercial and industrial customers, including data centers, seeking to locate or expand in New York State.

·       The Federal Government, California, and Ohio have acted to recognize the benefits of linear generators, and the State should continue to foster the use of this technology for purposes such as long-duration storage, peaking facilities, reliability support for renewable resources, VPPs, DERs, and demand response resources.

·       The State could consider using RGGI money to reduce electricity bills.

·       The State should continue to find ways to reduce and mitigate the cost to energy consumers of reaching the CLCPA’s targets. To better show the true costs of the net-zero transition, a “no GHG emission reduction” program scenario must be added to the Energy Plan analysis.

1.) NYISO's Competitive Markets

The Draft Plan discusses the need for wholesale electricity market reforms to appropriately value energy, capacity, reliability, reserves, and balancing services. The current markets administered by the NYISO, including the capacity market, are always evolving to ensure the most efficient market signals are given to meet the needs of the grid. The capacity market, where prices are informed by the estimated costs of building new capacity supply, allows capacity suppliers to know whether it is economically efficient to continue to invest in existing units in the market, retire, or add new capacity supply. The capacity market does not directly value certain reliability or environmental attributes, such as dispatchability or emissions-free generation. An examination of the capacity market is currently being undertaken by the NYISO in its Capacity Market Structure Review project, which started at the beginning of this year and is expected to evolve next year into various byproduct projects with tighter scopes, including a focused effort on assessing the parameters of the NYISO’s demand curve reset process. 

Importantly, the draft document notes that the State “should continue to work with the NYISO and market participants to investigate the opportunities to evolve current markets and rules over time.” IPPNY agrees with the NYISO that the capacity market continues to be the mechanism by which to retain needed facilities and incentivize new generation to come online for system reliability. The capacity market spreads the cost of ensuring enough generation is available for high load days over the entire year, rather than creating spikes and significant volatility in consumer energy prices. While the idea of a bifurcated capacity market, which pays for existing resources and new resources separately, has been floated, numerous presentations at the NYISO, including an independent assessment by FTI Consulting, have shown that this approach would result in slightly lower short-term capacity costs and much larger future capacity costs.[2] As stated above, incremental changes to the capacity market to create more granular pricing for reliability based attributes should guide future rule evolution, not a system which would put New York State ratepayers at risk of higher costs.

Furthermore, the draft document notes the need to: “Identify additional planning or operational rules that should be further examined and potentially adjusted to support a zero-emission electric system.” IPPNY supports ongoing examination of NYISO rules to bring the next generation of resources online. 

2.) Nuclear

The Draft Plan underscores the importance of preserving the critical environmental attributes provided by the existing nuclear generating fleet and proceeding with the State’s announced initiative to develop advanced nuclear. In addition, the Draft Plan states that: “As electricity demand continues to grow, New York should work with the companies to identify and support safe and economic power uprate opportunities at the existing nuclear facilities.”

As discussed further below, IPPNY submitted an affidavit by Sargent & Lundy, a leading engineering firm with over 100 years of experience in the power and energy field, to the PSC addressing the PSC’s questions about zero emissions sources. Sargent & Lundy testified that operating characteristics make existing nuclear facilities a valuable baseload resource that emits no greenhouses gases. Additionally, small nuclear reactors are being developed and have more flexible operation. Furthermore, nuclear can be used to create pink hydrogen, which can be stored to deal with future peak loads.

As noted by the Climate Action Council’s Scoping Plan, ongoing operation of the existing baseload nuclear facilities plays a pivotal role in maintaining grid reliability and keeping emissions low as the State endeavors to achieve the CLCPA’s targets. In its Power Trends report, the NYISO indicated that factors beyond the State’s control have delayed renewable generation development and retirements have outpaced new supply, placing the State in an increasingly tenuous position to maintain system reliability as it faces ever tightening supply margins.[3]  As the NYISO further documented, the nuclear facilities within this state produce power on a continuous and predictable basis, characteristics critical to maintaining system reliability.[4]

Moreover, as DPS Staff documents and the results of the recently completed Draft SGEIS in the PSC’s CES proceeding confirm, the loss of nuclear facilities directly leads to significant increases in emissions.[5]  Last month, DPS Staff described contributions of the existing nuclear units to the State’s climate change initiatives, highlighting the fact that preserving their operation has avoided nearly 70 million metric tons of carbon emissions under the ZEC program for just the five-year period from 2020-2024.[6] 

The existing Upstate nuclear facilities, which produce 21% of the New York’s baseload electricity, are essential to prevent backsliding as the State transitions to a zero emissions electric system and to support the State’s electrification efforts under the CLCPA. Additionally, the Upstate nuclear facilities are critical to the State’s extensive efforts to attract high-load economic development investment, particularly in Upstate New York. The Scoping Plan found the State must implement a process to evaluate the role of existing and advanced nuclear facilities prior to the scheduled conclusion of the ZEC program in 2029. The Draft Energy Plan points to the need for the PSC to address a ZEC program extension timed to take into account the periods required for license renewal of two of these facilities and to refuel all four units. Based on the foregoing, IPPNY urges the State Energy Planning Board to expressly endorse DPS Staff’s findings in the ZEC 2.0 Whitepaper confirming the need to continue a ZEC program to preserve critical environmental attributes until carbon pricing in the NYISO’s markets is implemented.

The Draft Plan also recommends: “Through NYPA’s efforts to develop at least 1 GW of nuclear power generation and other actions, continue to pursue opportunities for early deployment action.” IPPNY urges NYPA to issue a competitive RFP to secure this independent private sector investment. 

3.) Utility Ownership of Renewables

Utilities should continue to not be allowed to own, develop, or operate any new electric generation. This fact is consistent with New York State’s long-standing recognition that its policies on the restructuring of, and competition within, the wholesale electricity market have produced substantial benefits for New Yorkers. The fundamental benefits of this competition must be maintained, and energy consumers cannot be returned to the inefficient and costly days of utilities developing and owning generation.  

The Draft Plan states that: “The State may also consider allowing utility ownership of clean energy resources in discrete arrangements, where there is evidence that utility ownership can expedite the pace and cost-effectiveness of clean energy investments.” No additional information is provided by the document. 

By the October 31, 2025 due date set in the PSC’s CES Case 15-E-0302, IPPNY will submit comments on the PSC’s questions, which are intended to inform the PSC as to whether changing its policy disfavoring utility owned generation (UOG) might serve the interest of ratepayers. The comments urge the PSC to continue prohibiting UOG because the benefits of such ownership, if any, do not outweigh the associated significant vertical market power concerns and adverse impacts to ratepayers and the State’s competitive markets. A report[7] by FTI Consulting discusses the higher costs that would be borne by ratepayers if utilities were allowed to enter the generation business and demonstrated the CLCPA targets would not be reached any sooner.

4.) State Actions Consistent with the Plan

The Energy Plan should include specific information about how its provisions will be applied in State entity decision-making. Additionally, it should recognize the need to expand the DEC’s decision making process to allow for internal consistency with the State Energy Plan. Indeed, the CLCPA states that the Climate Action Council’s Scoping Plan is to inform the Energy Plan. Furthermore, the State energy targets should be implemented to be consistent with the provisions of the Energy Plan. 

As discussed in our December 16, 2024 comments on the Draft Scope (December Comments), the Energy Plan should recognize the Energy Planning Law’s requirement for energy-related actions or decisions of a state agency, board, commission or authority to be reasonably consistent with the Plan’s forecasts, policies, objectives, and strategies. This law provides that “any such action or decision which is not reasonably consistent with the plan shall be deemed in compliance” if it “includes a finding that the relevant provisions of the plan are 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.” 

Article 10 of the Public Service Law includes a provision to require “the consistency of the construction and operation of the facility with the energy policies and long-range energy planning objectives and strategies contained in the most recent state energy plan.” This provision allows the New York State Board on Electric Generation Siting and the Environment to make its decisions consistent with the Energy Plan. 

The DEC should broaden its interpretation of Section 7 of the CLCPA through the lens of the Energy Plan, beyond the narrow view of DAR-21 – The Climate Leadership and Community Protection Act and Air Permit Applications. Section 7 requires all State agencies, offices, authorities, and divisions to consider whether their decisions are inconsistent with the attainment of statewide greenhouse gas emissions limits, and, where their decisions are inconsistent, these State entities are to provide a “detailed statement of justification as to why such limits/criteria may not be met, and identify alternatives or greenhouse gas mitigation measures to be required where such project is located.” The determination of consistency under CLCPA Section 7 should be coordinated with the determination of consistency of State actions under the Energy Plan. 

Section 66-p of the Public Service Law specifies the 70 by 30 and 100 by 40 targets and allows the PSC to “temporarily suspend or modify the obligations under such program provided that the commission, after conducting a hearing as provided in section twenty of this chapter, makes  a  finding that the program impedes the provision of safe and adequate electric service; the program is likely to impair existing obligations and agreements; and/or that there is a significant increase in arrears or service disconnections that the commission determines is related to the program.” The PSC should interpret this ability within the context of needing to be consistent with the Energy Plan’s provisions. 

Importantly, the Draft Plan recognizes that the CLCPA’s 70 by 30 target is projected to be met in 2033 and the 100 by 40 target in 2045. Additionally, the document acknowledges the ongoing importance of the existing fleet to maintain reliability and energy affordability for the benefit of New Yorkers. With this, the State needs to interpret these statutes and policies in a flexible and reasonably consistent way that enables it to realize a realistic, achievable and affordable electric system as envisioned by the Draft Plan. 

5.) Reliability and the Role of Existing Power Plants

The draft document acknowledges that the retirement of fossil fueled power plants will need to be timed with non-emitting replacement facilities coming into operation to maintain reliability. Importantly, the Draft Plan further recognizes: “Combustion generating units will remain essential parts of electric grid reliability and affordability, and retirement of these units will not be able to occur until resources that provide the same grid reliability attributes are put in place.” 

There is a process for transitioning away from the operation of fossil-fueled facilities to zero-emission facilities within the Climate Action Council’s Climate Action Plan, based upon the State conducting biennial evaluations of reliability in coordination with the PSC, the NYISO, and the NYSRC. The Energy Plan should include and expand on this evaluation and delineate the details for this process. Additionally, the NYISO conducts a biennial review of system reliability needs as part of its reliability planning process. In conjunction with this process and the NYSRC process to determine the annual Installed Reserve Margin, the State should coordinate with these entities’ current processes. Further, any consideration of additional reliability metrics should be deliberated with the aforementioned entities that are already responsible for abiding by the most extensive system reliability standards in the nation.

6.) Need a Timeline to Meet 2040 Target Reliably

The Energy Plan must establish a specific timeline and pathway for how its recommendations for new or repowered supplies will be accomplished. The document states that: “In the core planning scenario, by 2040, 35 GWs of solar and 9 GWs each of storage, offshore wind, and onshore wind are deployed … Existing nuclear and hydroelectric generation remain major contributors. While the process for establishing a zero-emission definition is still underway, the modeling assumes firm capacity could be met by green hydrogen. Under this assumption, the combustion generation fleet remains critical.” Also, “given insufficient renewable energy generation, natural gas units would need to provide 15 TWh of electricity under this sensitivity; or alternatively, this electricity could be supplied by other resources like new nuclear with transmission and/or renewable natural gas.” Specific action items are needed, as current gas fueled generators are making investment/retirement decisions now, which could increase the cost of transitioning to alternate fuels later. 

a.     DEC to Issue Timely Permits 

There needs to be a clear pathway for how and by when the DEC will issue the permits needed for these facilities. As discussed within our December Comments, air permits from the DEC are necessary, while the economy electrifies and until the needed amount of zero greenhouse gas (GHG) emitting resources to meet the CLCPA’s mandates are given the right investment signals, are developed, and achieve commercial viability on a valid scale. Roughly 40% of the State’s electricity is produced by natural gas-fired electric generators, and the continual operation of these RGGI units provides CO2 allowance auction revenues for reinvestment in additional emission reductions, with 40% of the benefits going to Disadvantaged Communities (DACs). Until the DEC promulgates the New York Cap-and-Invest program and implements its version of the recently adopted regional RGGI rule, increased clarity and certainty on permit decisions is essential with available regulatory tools, such as: DEC’s existing regulations that control the emissions of SO2, NOx, and CO2; the DEC’s policies on GHG emissions; and its requirements for environmental justice and addressing burdens on DACs.

b.    Repowering of Existing Thermal Power Plants

The Draft Plan accurately notes the need for new and existing natural gas turbines to stay online and be repowered to meet the State’s goals. This finding is consistent with the NYISO’s conclusions in the most recent Power Trends report. The Draft Plan recognizes the existing power plant fleet is aging and recommends that it be repowered and fueled primarily by hydrogen, half of which is to be produced by in-state electrolysis and the remainder to be “imported from green hydrogen plants, with associated costs accounting for necessary pipeline and storage infrastructure.” Alternatively, electricity could be supplied by other resources like new nuclear with transmission and/or RNG.

1)    Hydrogen

The Draft Plan states that: “Beginning in 2036 or quickly thereafter, 4.5 GW of additional hydrogen-ready thermal generation must be built on top of conversions of existing gas generation units to hydrogen-ready facilities.” Further, “the combustion generation fleet remains critical, with 17 GW of repowered and new capacity available to run on hydrogen,” and “For hydrogen produced out-of-state, NYS should require substantiation that the hydrogen was produced using clean energy.”

There are practical and engineering challenges to converting 17 GW of combustion turbines to hydrogen or zero-emissions fuel resources, particularly regarding compression, transportation, and storage. If the State intends to drive investment in hydrogen capable combustion turbines, the Energy Plan should acknowledge that State entities must issue permits to new or repowered combustion turbines, which will be more efficient, and concomitantly lower emitting, resources that will initially run on natural gas but will be capable of conversion to hydrogen or RNG in the future.

The Energy Plan must continue to acknowledge that new and repowered natural gas facilities are needed through 2040 and beyond to maintain reliability until zero emissions sources, especially DEFRs, are developed and become widely commercially available. New or repowered natural gas generators can be designed to combust multiple fuels, e.g., natural gas, oil, hydrogen, and/or RNG. Therefore, a new or repowered combustion turbine that operates on natural gas can be zero-emission fuel capable and later converted to the alternate fuel if it becomes commercially available. In the interim, natural gas must remain the primary fuel for power plants to balance intermittent generation, maintain reliability, and energy affordability. The State must model alternatives, if hydrogen or RNG are not available, and should build out a zero-emission fuel supply chain.

A specific timeline is also needed for how and when the repowering will be accomplished and when, from where, and in what quantity the hydrogen will be sourced in time to allow the repowering to be completed. The document mentions the delivery of hydrogen through means such as marine barge, for which NYSERDA recently announced available funding; however, the Draft Plan specifically states that hydrogen will not be delivered through the existing natural gas pipelines and that other dedicated pipelines will be needed. Further guidance is thus critical.

NYSERDA also recently announced that projects were selected through the Advanced Fuels and Thermal Energy Research Program, which provides funding for clean fuel innovation projects that help to decarbonize industrial processes, integrate clean fuel production with renewable energy, and demonstrate clean fuel power generation systems to support the grid reliably. Among the projects is one by National Grid Ventures, which was awarded $2 million to install the first commercially deployed, 100% green hydrogen-fueled linear generator, built by Mainspring Energy, at National Grid’s Northport Power Plant. It will be tested for one year to demonstrate its benefits as a DEFR. Other partners in the project are LIPA and the State University of New York at Stony Brook.

The Plan also must delineate a pathway for how, where, and by when the State will ensure that the in-state electrolysis of hydrogen will be accomplished and the fuel will be delivered in time to enable the repowering. The Draft Plan states that: “Nine Mile Point Nuclear Station began producing hydrogen in March 2023 as a demonstration project supported by the U.S. Department of Energy” and “NYSERDA awarded a grant to Nine Mile Point to help demonstrate long-duration energy storage using a hydrogen-powered fuel cell.” Also, according to its website[8], NYSERDA has awarded up to $11.3 million for fifteen clean hydrogen innovation projects. The State must encourage hydrogen further as a power plant fuel. In furtherance of these efforts, the State should establish realistic and cost-effective policies that would reduce emissions and benefit the economy by, for example, developing an approach to address the cost of retrofitting power plants to operate on hydrogen that takes into account the needed space requirements. 

Recent analyses commissioned by the NYISO are instructive in this regard. In the NYISO’s November 29, 2024 filing to FERC to set ICAP Demand Curves for the period 2025-2029, the NYISO’s consultant, the Analysis Group, established that the total cost to retrofit a frame turbine to operate solely on hydrogen, including the cost of storing sufficient hydrogen onsite to support operations, could exceed $2 billion for a hypothetical unit around 400 MW in size. Further citing this analysis, the NYISO noted, “The Independent Consultant also identified that the site acreage requirements to facilitate onsite hydrogen storage present significant concerns regarding whether such a facility could feasibly be constructed in New York, especially in downstate population centers such as New York City and Long Island. Notably, the Independent Consultant estimated that a site between 60-70 acres would be required to accommodate onsite storage and compression of hydrogen."[9] 

To address the feasibility and affordability of retrofitting power plants to operate on hydrogen, NYPA or NYSERDA should issue an RFP for a hydrogen demonstration project at a facility of an independent power producer as a way to share NYPA’s experience from its successful hydrogen blending demonstration project at its Brentwood Small Clean Power Plant on Long Island. This RFP would develop additional practical experience with hydrogen, while the PSC continues to work to identify eligible zero emissions sources and to develop a competitive program to secure DEFRs.

2)    RNG

According to the Draft Plan, future RNG production facilities may be sited where they can collect feedstock from multiple sources, such as clusters of farms or food waste producers, in an efficient and cost-effective manner, and may be located near existing pipeline infrastructure to minimize the need for new construction. On March 28, 2025, NYSERDA[10] issued a Request for Information to shape a future competitive solicitation for pilot research and development projects such as RNG. The State needs to increase its efforts for RNG to be an available fuel for power plants in this state. 

c.     Zero Emission Sources

Lacking from the Draft Plan is a timeline for when the PSC will determine the eligibility of zero emission sources and develop a program to ensure their availability for power plant owners to meet the 100 by 40 target. The document also does not indicate by when NYSERDA and DPS will complete the technoeconomic study and does not acknowledge the technology assessment by Sargent & Lundy, as provided by IPPNY in 2023. 

The role of hydrogen and RNG to repower existing power plants underscores the ever-increasing urgency for the PSC to decide the eligibility of zero emission sources to meet the 100 by 40 target. The PSC must also develop a program to encourage DEFRs for widespread availability in the power plant sector in time to meet that target. The Draft Plan models that the 100 by 40 target may be met by 2045 and affirms that: “As New York looks toward 2040, the State will need to identify and integrate clean firm technologies that support the operation of a zero emissions electric grid.” Accordingly, the document needs to include a specific timeline by when the PSC will decide what are eligible zero emission sources. 

In 2021, IPPNY submitted a petition with labor groups to the PSC requesting that it define what qualifies as a zero emissions source under the CLCPA and procure at least 1 GW of these resources. Further, IPPNY submitted comments to the PSC in 2023 with an affidavit from Sargent & Lundy, which also participated in a technical conference in December of 2023 and which provided a technical assessment of various zero emissions sources. In February of 2024, IPPNY submitted comments on six legal questions that the PSC posed. Nine months later, the DPS Staff released a proposal interpreting key terms under Section 66-p of the Public Service Law, involving the 100 by 40 target. IPPNY submitted comments on these questions on January 21, 2025. The PSC has not taken additional action since then. 

7.) Renewable Energy and Energy Storage

a.     Competitive Procurement 

1)    Renewable Energy

The Draft Plan indicates that the CLCPA’s 70 by 30 target is projected to be reached by 2033 through ongoing competitive procurements. The document recommends: “Support the renewable energy industry and increase clean energy supply by continuing CES solicitations” and “Continue to evaluate the contributions of longer duration storage to enhance the reliability of the electric grid.”

NYSERDA’s competitive procurement of renewable energy resources is a successful market-based mechanism, which NYSERDA should continue and increase. The PSC has affirmed that competition controls the costs of supporting renewable energy generation and yields cost-effective outcomes for ratepayers, in part by allocating risk to generation project developers and operators. The PSC has concluded that competitive solicitations remain the best mechanism to meet the CLCPA’s targets, while ensuring just and reasonable rates. Independent power producers have richly responded to NYSERDA’s procurements.

On September 26, 2025, NYSERDA issued its most recent 2025 Tier 1 RFP to procure 5.6 million Tier 1 RECs from eligible land-based facilities, in order to advance late-stage large-scale renewable energy projects ready to commence construction in New York. NYSERDA should continue and expand its competitive RFP and REC contract efforts, while speeding up the issuance and decision-making processes to ensure that the private sector can continue to invest in New York.

2)    Energy Storage

NYSERDA should continue to pursue energy storage procurements and build upon its recently released Bulk Energy Storage RFP, which is intended to procure 1 GW of bulk energy storage as part of the State’s 6 GW Energy Storage Roadmap. 

b.    Hydro Repowering 

The draft document notes that: “An example of a policy fit for reevaluation would be the PSC’s directive to DPS in the May 2025 CES Biennial Review Order to revisit repowering requirements under CES Tier 1, including potential removal of the 15 percent increase in generation for hydroelectric facilities requirement.”

Repowering could, and should, be a viable path through which hydro companies make significant re-investments in their facilities. Unfortunately, the full set of Tier 1 repowering eligibility criteria sets too high of a bar for most hydro to utilize. Qualifying for Tier 1 eligibility through repowering should require a financial commitment that results in the extended preservation of the life of the facility and its ongoing contribution to the State’s renewable baseline; however, even though the financial commitment is significant, it rarely will result in an increase in production that approaches the 15% threshold, if ever.

Hydro is a mature technology, and replacing critical components is done for useful life extension rather than efficiency gains. The 15% increase in output criterion is an unrealistic expectation of hydro repowering. Removing that 15% criterion for hydro, while preserving the useful life and net value criteria, could allow existing in-state capacity to meet the repowering eligibility criteria. 

8.) Role of Fuel Cells and Linear Generators

The roles of fuel cells and linear generators are not mentioned within the Buildings Assessment of the Draft Plan. Technologies to reduce emissions are needed now more than ever. 

Fuel cells can produce power reliably in a manner consistent with the CLCPA and can be deployed in a matter of months for customers in need of highly reliable, highly efficient, and clean power. Additionally, fuel cells produce de minimis amounts of local air emissions, use little to no water, and are easy to site. Therefore, in the near term, this technology should be considered an important option for commercial and industrial customers, including data centers, seeking to locate or expand in New York State. It should be noted that customers deploying fuel cells are exempt from the requirements of the All-Electric Buildings Act, in recognition of their environmental attributes.

The Federal Government, California, and Ohio have acted to recognize the benefits of linear generators. Linear generators, such as the one developed by Mainspring Energy, Inc. (as discussed above), are a fully dispatchable and flexible generating technology, which can generate electricity using fuels such as green or pink hydrogen, ammonia and RNG. As the generator does not combust the fuels, there are no NOx emissions. The linear generators can be used for long-duration storage (days, weeks, or seasons) and as peaking facilities. With the ability to power on and off instantly, linear generators can provide an essential and cost-effective means of supporting renewable resources reliably. They are also an inverter-based technology, so they can be used to create VPPs, operated as DERs, or utilized as demand response resources. 

9.) Cost

a.     High Electricity Bills

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. 70% of a typical electric bill is made up of utility costs, State fees and taxes.

Post-COVID, the electric industry has faced skyrocketing inflation, concomitantly high interest rates, severe supply constraints and significant cost exposure that cannot be hedged.  Those costs are reflected in higher electric prices, seen most visibly in utility rate cases. As summarized in its press release, the PSC recently approved the electric rate case for National Grid to serve customers in its service territory Upstate, which included “a total electric revenue increase, on a levelized basis, of 3.4 percent in the first year, 5.6 percent in the second year, and 4.6 percent in the third year.” Additional significant rate increases raised consumer electricity bills by 31.4% for NYSEG, 20.1% for RG&E, and 12.5% for Con Edison.

At the same time, the age of the State’s infrastructure and the State’s focus on transitioning its economy to combat climate change drive the need for unprecedented investment in maintaining existing facilities and developing new infrastructure. 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, while compensating the existing needed generating facilities to stay on-line for reliability.

b.    Ratepayer Impacts of Meeting CLCPA’s Targets

Last month, the PSC provided a report on the status of its efforts to comply with the CLCPA’s requirements and delineated the CLCPA’s customer bill impacts for 2023 and 2024 and projections through 2029. The cost information is summarized below: 

• Electric CLCPA Recoveries of Major Electric Utilities:
• $1,324,170,112 (2023)
• $1,619,357,841 (2024)
• 2024 CLCPA component of typical electric bills:
• 5.2% - 9.5% (residential)
• 5.9% - 15.7% (commercial)
• 7.5% - 18.3% (industrial)
• National Grid forecast of the CLCPA residential bill component (note that the report includes similar forecasts for each major utility):
• 9.5% (2024)
• 7.1% (2025)
• 6.2% (2026)
• 8.8% (2027)
• 12.0% (2028)
• 12.6% (2029)

This report is a step towards addressing the need for determining the CLCPA’s impact on ratepayers’ bills, as urged by IPPNY since the enactment of the CLCPA through proposed legislation and my efforts on the Climate Action Council. Additionally, for the past four years, over 60 organizations, in collaboration with IPPNY, have asked for an independent, transparent, and comprehensive ratepayer cost impact analysis of meeting the CLCPA’s targets.

c.     Use of RGGI Money for Affordability

Recently, California enacted legislation intended to drive down electricity costs. According to its press release, among these bills is AB 1207 (Irwin), which increases California’s Climate Credit that shows up on utility bills.

According to a summary of the legislation, among other provisions, California AB 1207 requires monies in the California Climate Mitigation Fund to be available, upon appropriation by the Legislature, for purposes of providing direct rebates and investments to reduce household energy costs. The new law requires credits to be provided to residential customers on their bills to maximize customer electric bill affordability. Further, the law authorizes revenues to be credited to small businesses and emission-intensive trade-exposed retail customers.

As indicated within the RGGI report, The Investment of RGGI Proceeds in 2023, which was published in July of this year, “direct bill assistance returns money to consumers as a rebate on their energy bills. Approximately 15% of 2023 RGGI investments have funded direct bill assistance. RGGI investments in direct bill assistance in 2023 returned $128 million in bill savings to energy consumers in over 141,000 households and 39,000 businesses. These programs provide rate relief to electricity consumers in the RGGI region. Some programs provide assistance specifically to low-income families, while other programs provide small on-bill credits to all consumers. Direct bill assistance typically appears as a credit on a consumer’s electricity bill.”

Among the RGGI states, Maine, Maryland, New Hampshire, New Jersey, and Rhode Island provide direct bill assistance. New York could consider using RGGI money to also reduce electricity bills. The most recent RGGI allowance auction cleared at an allowance price of $22.25 per ton and raised $102.9 million for this state. In 2023, the NYS Budget created the New York Climate Action Fund with a Consumer Climate Action Account. The State could consider allocating a portion of RGGI monies into this account to reduce electricity bills.

d.    Energy Plan Modeling of Costs

IPPNY agrees that the State should continue to find ways to reduce and mitigate the cost to energy consumers in reaching the CLCPA’s targets. The draft document indicates that: “The State should continue to evaluate the role of market-based policy mechanisms (including RGGI, the New York Clean Air Initiative, and a clean transportation standard), which both provide a price signal to encourage clean energy choices and generate dedicated sources of funding that can be used to lower the cost of clean energy adoption and for affordability investments.”

The Draft Plan also states that: “By 2030 and 2040, the Additional Action scenario raises costs modestly by 2 percent and 9 percent, respectively, relative to the No Action scenario. In contrast, the cost premium for the Net Zero scenarios reaches in excess of 35 percent by 2040.”

IPPNY observes that the Draft Energy Plan analysis “No Action” scenario is not a baseline that excludes all programs necessary to achieve the CLCPA’s targets, since this scenario includes prior legacy programs. To better show the true costs of the net-zero transition, a “no GHG emission reduction” program scenario needs to be added. 

Furthermore, IPPNY suggests that the Energy Plan should establish specific affordability, reliability, and environmental impact acceptability criteria, to measure and determine if provisions are on track. Once the criteria are established, then a tracking mechanism must be established for each one, with a mandatory course of action if the Plan’s trajectory needs further alignment.  

Thank you for the opportunity to provide these comments, and IPPNY urges their inclusion within the finalized Energy Plan. If you have any questions or need further information, please let me know.