IPPNY Urges Public Service Commission to Open Upstate Transmission Development to Competitive Bidding
The Independent Power Producers of New York, Inc. (IPPNY) submitted a letter on Friday to the New York State Public Service Commission (PSC) urging regulators to introduce competitive bidding for major Upstate New York transmission projects, rather than continuing to rely solely on utility monopolies to develop them. IPPNY says the reform is essential to protecting ratepayers from rising electricity costs and reinforces the advantages of a competitive marketplace in reaching New York’s energy goals.
The letter comes as the Commission considers proposals that would expand utility-monopoly ownership and operation of electric generation facilities across the state. Citing recent analysis by FTI Consulting, IPPNY warns that such a shift would lead to higher energy costs for ratepayers and consumers.
Furthermore, the Federal Energy Regulatory Commission’s Order 1000, establishing the framework for competitive transmission development, coupled with a history of utility project delays and cost overruns in the State and around the country, presents an opportunity for New York to fully embrace the approach of competitive transmission.
"Opening the door for more competition benefits all New Yorkers while increasing the reliability and safety of our electric grid," said Gavin Donohue, President and Chief Executive Officer of IPPNY. "Competition incentivizes cost discipline and timely project completion. Extending this successful model to new transmission development projects, especially Upstate, perfectly aligns with New York’s vision of economic expansion and clean energy initiatives."
The need is especially urgent given the state of New York's grid: according to the 2025 New York State Energy Plan, 60 to 95% of Hudson Valley and Upstate transmission infrastructure is more than 70 years old, even as annual electricity demand is projected to rise 24% by 2040. IPPNY points to Micron's planned $100 billion investment in Central New York, which is expected to create more than 50,000 jobs, as a reminder of the reliable, affordable power that Upstate economic growth will demand.
IPPNY’s letter cites empirical data showing competitive procurement consistently outperforms incumbent utility development on both speed and cost:
● Competitive transmission lines have come online faster than incumbent-built projects in most U.S. markets, while incumbent projects nationwide routinely finish well past their original in-service dates. In New York, three competitive transmission projects placed in service since 2022 all beat their expected completion dates.
● Competitive bidding brought the cost of one 345 kV transmission line, between the Indiana and Michigan border, down from a projected $254 million to $77 million — a 70% discount that saved consumers $177 million.
● IPPNY members supply roughly 75% of New York's electricity at 35% lower cost than the old utility-monopoly model.
New Yorkers also significantly oppose proposals that give utilities more monopolistic control. Earlier this year, IPPNY commissioned a statewide poll of New York voters, which found:
● 8 in 10 say the state should prioritize increasing competition in the energy market to keep prices down
● More than 2/3 of New Yorkers say utility costs are out of control
● 71% of New Yorkers report their electricity bill has increased in the past year
● A majority of New Yorkers support continuing New York's competitive electricity system
● A plurality of New Yorkers identified monopoly utilities as having the greatest influence on energy costs, more than any other factor tested.
A full copy of IPPNY's letter to the Commission is available here.
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