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Legislative Memo

Darren Suarez
Manager of Government Affairs
T 518.465.7511
www.bcnys.org

BILL:

S.4178-A (Maziarz)

Support

SUBJECT:

Mandated Purchase of Solar "Renewable Energy Credits"

 

DATE:

May 24, 2011

 

The Business Council opposes this legislation that would lock energy distribution utilities into a solar purchasing mandate with contracts running as late as 2032. The initial version of this bill has a projected cost of up to $30 billion over the life of the program, with total costs escalating significantly over time. We believe this amended bill still represents a costly, ill-advised approach to supporting deployment of renewable generation in New York.

Given the state’s already high electric power costs - driven by state imposed taxes, fees and surcharges - we oppose measures like this that would add further to energy costs paid by the industrial and commercial sector.

This legislation would immediately add significant additional costs on business energy consumers, adding to the state’s competitiveness burdens, and because of this program design, its costs would continue to increase over the life of the mandate.

Moreover, we question the need for this solar REC purchase mandate considering other renewable power initiatives already underway in New York State, including support through the renewable portfolio standard, which received $200 million in additional resources earlier this year.

We also oppose new provisions of this legislation imposing prevailing wage requirements on qualifying solar installations, a provision certain to add more costs to this program.

While advances in solar technology may soon make this renewable energy source more efficient and more cost-effective, at present it is a high cost renewable option. Rather than rely on current market conditions to determine our mix of renewable energy in response to the state’s “45 by 15 commitment, this bill would “force feed a specific renewable technology into the state’s electric power system, regardless of its costs on ratepayers.

At most, the state should consider a reasonable solar REC pilot project.

The Business Council has major concerns about the cost impact, and long duration, of this solar REC purchase mandate. For these reasons, The Business Council recommends against approval of S.4178-A.