Proceed carefully on NYISO review

Letter to the Editor / February 10, 2015 / Albany Times Union

I am writing an addendum to Larry Rulison’s article “Grid study power play,” Jan. 28, on Gov. Andrew Cuomo’s proposal to have the Public Service Commission conduct a formal review of the New York Independent System Operator. This story addressed the very concerning development that is the state inserting itself into the governance process of the NYISO.

For the last 15 years, competitive wholesale markets regulated by the NYISO have brought tremendous benefits to New Yorkers in terms of private investment, reduced wholesale electricity prices and power system reliability. In other words, the costs of energy development have shifted from ratepayers to private investors all while the lights have stayed on.

Appropriately, it is paramount that the state proceed cautiously when reviewing NYISO wholesale market structure for the incorporation of distributed energy resources envisioned in Gov. Cuomo’s Reforming the Energy Vision plan, as poor long-term planning may result in a scenario where ratepayers pay more for power.

Take a quote from the article about the high electric bill prices New Yorkers pay. The concern is justified, but there may be some confusion as to what exactly drives high prices. While wholesale electricity prices do make up a portion of bills, they represent just 30 percent and, according to the NYISO, are priced at roughly the same amount today as they were in 2000. The remaining, progressively more expensive portion is made up of taxes, delivery and public policy fees. Now, poorly plan to incorporate distributed energy resources, and those fees will go up.

Gavin J. Donohue
Independent Power Producers of New York Inc.

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