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Legislative Memo

Darren Suarez
Director of Government Affairs
T 518.694.4461
www.bcnys.org

BILL:

S.7508-B (Budget) Part TT

Support

SUBJECT:

ReCharge New York

 

DATE:

March 20, 2018

 

The energy cost savings provided by the Power Authority of New York (NYPA) have positively affected the economic wellbeing of New York State. Unfortunately, due to a number of factors, the benefits of the ReCharge New York Power Program (ReCharge), the largest NYPA low cost power program, have been eroding. The State needs to take steps now or it will put in jeopardy its economic future.

This legislation would provide some minor amendments to the ReCharge to increase the program’s effectiveness. Specifically the legislation would:

Overview

The mission of NYPA is to power the economic growth and competitiveness of New York State by providing customers with low-cost, clean, reliable power and the innovative energy infrastructure and services they value. Chapter 60 (Part CC) of the Laws of 2011 created ReCharge, which allocates ReCharge New York Power to businesses and not-for-profits that commit to retain or increase New York State jobs and agree to make capital investments. ReCharge makes available 910 megawatts (MW) of economic development power, 50 percent to be purchased by NYPA on the open market and 50 percent from its own hydropower. As of July 2017, 760 MW out of 910 MW have been allocated, but of the 200 MW block of ReCharge Power made available for businesses, a 101.5 MW remain unallocated. There are many contributing factors to the large amount of unallocated power but a few statutory amendments could address some of the issues. 

ReCharge Market Power

Currently an Eligible ReCharge Applicant who has been awarded an allocation of ReCharge Power from NYPA has an option to accept and purchase ReCharge Market Power from the Authority. ReCharge Market power refers to the market power and energy components of a ReCharge Power allocation and is distinct from ReCharge New York Hydropower. ReCharge Market power which is purchased on the open market, is often rejected by an Eligible ReCharge Applicant. Requiring NYPA to provide power at less than the utility default service will make ReCharge more appealing to business customers, and is a reasonable goal for NYPA. 

ReCharge New York Hydropower

Currently a ReCharge Customer can receive an allocation of ReCharge New York Hydropower of 5 to 25% of the facilities load. Hydropower allocations are a fixed price that is historically below-market energy cost. The proposal would all ReCharge customers to take all of their hydropower allocation first. Currently, recipients of ReCharge Hydropower must reduce their Hydropower allocation consistent with any load reduction. As an illustration, an industrial facility with a 10,000kWh billing cycle allocation (25% of total load (40,000 kWh)) experiences a 10% reduction of load due to an unscheduled shut down, currently they can only use 9,000 kWh of hydropower. The proposed amendment would just allow the ReCharge customer to receive their entire 10,000 kWh allocation.

Maximum Allocation

The proposal would allow NYPA customers to receive an allocation greater than 10 MW if the allocation receives the unanimous support of the members of the New York State Economic Development Power Allocation Board. 
It is the right time to make some minor amendments to the ReCharge New York Power Program. As President and CEO of NYPA, Gil C. Quiniones has said "States are now competing on a global scale to attract and retain businesses, spring job growth and create capital investment opportunities. ReCharge NY is one of the more prominent tools in New York State's tool belt, designed to provide the state with the needed leverage in keep the economy going strong.”