Memorandum in Support - S.2585-A (Parker)

S.2585-A (Parker) - AN ACT to amend the public service law, in relation to establishing a program for eligible zero emissions energy systems

The Independent Power Producers of New York, Inc. (IPPNY) is New York’s premier trade association dedicated to representing the largest fleet of clean energy generators in New York State and companies involved in: the competitive power supply industry; the development of electric generating facilities; the generation, sale, and marketing of electric power; and natural gas transmission facilities. IPPNY Member companies produce the majority of New York's electricity, utilizing all sources such as: wind, solar, hydro, energy storage, natural gas, low sulfur oil, waste-to-energy, biomass, and nuclear.

IPPNY supports S.2585-A (Parker). This bill passed the Senate unanimously in 2021, and it would further the implementation of the Climate Action Council’s adopted Scoping Plan. The Scoping Plan indicates that the NYS Public Service Commission (PSC), in coordination with the New York State Energy Research and Development Authority, the NYS Department of Environmental Conservation, and other agencies “should identify, explore, evaluate, and support the development of dispatchable technologies and solutions as they emerge in support of the Climate Act’s requirements for a zero-emission electricity system by 2040 and for consistency with Section 7(2) and 7(3) of the Climate Act.”

This legislation would help meet the Climate Leadership and Community Protection Act’s (CLCPA) requirement of having a zero-emitting statewide electrical demand system by 2040 (100 by 40 target), while maintaining electric system reliability, creating high quality jobs, and maintaining consumer affordability. The bill calls upon the PSC to establish a competitive program to foster the development of, and investment in, 1 gigawatt (GW) of zero emissions energy systems to help reach the CLCPA’s 100 by 40 target. Importantly, this legislation does not specify what zero emissions energy systems should be and asks the PSC to determine what technologies should be eligible and to address costs. The program would create market signals for these technologies and associated fuels. Further, this legislation would also require the PSC to include within the program provisions of benefit to labor unions, along with an apprenticeship training program: the prevailing wage; project labor agreements; and Buy American provisions that were enacted for renewable energy systems.

This bill would help begin to fill the technology gap that is needed to ensure the 100 by 40 target can be met reliably. The New York Independent System Operator’s (NYISO) 2021-2040 System & Resource Outlook, released just a few months ago, points to the essential need for this technology innovation to be developed and commercialized. 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 Outlook Report makes it clear that, to meet the 100 by 40 target, more than 111 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 current 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 goal. According to the Outlook, 27-45 GW of DEFRs will need to be in operation by 2035 to maintain electric system reliability.

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 CLCPA’s targets, electricity demand will grow, and the current electricity grid will need to be expanded at least three-fold. This legislation would help ensure that needed resources are in place to enable electrification of the economy, while maintaining reliability and affordability.  

For the reasons stated above, IPPNY supports S.2585-A (Parker).

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