Memorandum in Support - S.1694 (Parker)

S.1694 (Parker) – AN ACT to amend the public service law and the energy law, in relation to establishing the New York state grid modernization commission

The Independent Power Producers of New York, Inc. (IPPNY) is a trade association representing companies involved in the competitive power supply industry in New York State and in the development of electric generating facilities, the generation, sale, and marketing of electric power, and the development of natural gas transmission facilities. IPPNY Member companies produce the majority of New York's electricity, utilizing hydro, nuclear, wind, natural gas, solar, energy storage, biomass, oil, and waste-to-energy.

IPPNY supports the purpose of S.1694 (Parker), which is to identify technology solutions to address the electric system reliability warnings made by the New York Independent System Operator’s (NYISO) 2021-2040 System & Resource Outlook, released just a few months ago. The NYISO is the federally established entity that ensures electric system reliability requirements are met and that operates competitive wholesale electricity markets in this state. The NYISO has continually provided warnings regarding looming reliability concerns, especially for New York City and Long Island.

Most recently, the NYISO warned that fossil fueled facilities, which have been providing the largest share of energy into the grid, are being taken offline faster than renewable sources can be added. The system's total resource capability was lower last year than it had been in 2021. As the State’s economy electrifies to meet the targets of the Climate Leadership and Community Protection Act (CLCPA), electricity demand will grow, and the current electricity grid will need to be expanded at least three-fold.

The CLCPA established a target of having a 100% emissions-free electricity system by 2040 (100 by 40 target). The NYISO’s Outlook makes it clear that, to meet the 100 by 40 target, more than 111 gigawatts (GW) of total installed generation capacity will be needed, and 95 GW of this amount must be new generation. To put these numbers into perspective, 1 GW is enough to power roughly 750,000 homes. The invention and installation of a new class of technology, beyond energy storage, that is both dispatchable (able to operate on demand whenever needed) and emissions-free – also known as dispatchable emissions-free resources (DEFRs) – will be necessary to meet the 100 by 40 target. According to the Outlook, 27-45 GW of DEFRs will need to be in operation by 2035 to maintain electric system reliability.

The NYS Public Service Commission (PSC) has not yet established the program to reach the 100 by 40 target and still needs to identify what technologies and fuels should qualify as DEFRs. This legislation provides a context for the urgency of the PSC to make these decisions.

This bill would help identify “tools, resources, and deployment models” that could improve the grid’s performance through adoption of “emerging, commercially available or advanced grid technologies or solutions” and would “establish and facilitate a collaborative process… to examine the impacts of different combinations of resources (including different quantities of distributed energy resources and large-scale, central generation) on the electric grid.” This process would include input from stakeholders, such as ratepayers, trade associations, electricity generation companies, and labor unions.

For the reasons stated above, IPPNY supports the purpose of S.1694 (Parker).

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