IPPNY Letter - “Stop Climate Polluter Handouts Act” (Part BB of S.9009-B); Raises Energy Costs
Dear Governor Hochul, Leader Stewart-Cousins, and Speaker Heastie,
Part BB of S.9009-B would unnecessarily raise energy costs for New Yorkers while the State is urgently working to address energy affordability. Ironically, this proposal is counterproductive to the State’s efforts, since it would create a cost shift from the State Treasury to energy consumers.
Among other provisions, this Budget proposal would remove the exemption from the Sales and Use Tax for fuel and gas used to produce electricity and revenue from the sale of gas involving a gas pipeline. The Budget language would also repeal a utility credit or reimbursement under the Petroleum Business Tax (PBT) for residual fuel products imported into this state for use by generators to produce electricity. If the State ceased to provide the exemption and the credit or reimbursement, the cost of affected fuels used to produce electricity would increase, and electricity prices would rise, commensurate with the cost of fuels to produce it.
As originally warned by the Bill Jackets associated with the enactment of laws related to the PBT, the reimposition of the PBT under this Budget proposal would: increase gas and electric rates, directly contrary to the longstanding efforts to stabilize energy costs, foster a healthy economy, and create jobs; and greatly raise electric bills for New Yor City and Long Island customers, given that those regions are heavily dependent on petroleum-based fuels to generate electricity. Importantly, 90% of Downstate New York’s electricity is provided by power plants fueled by natural gas or low-sulfur oil. These points from the Bill Jackets illustrate the negative consequences, which would occur if this Senate Budget language were to be enacted.
As a member of the Climate Action Council, I strongly support helping our state have affordable, reliable, and clean electricity. If you have any questions or need additional information, please contact me. Thank you for your consideration.
Sincerely,
Gavin J. Donohue
President & CEO
