Energy Committee Update
December 3, 2012

Staff Contact: Darren Suarez

Energy Committee

This has been an interesting year so far for the development of energy policy in the State of New York. The coming year is likely to be more thought-provoking as many different initiatives, reports, program, oversight, and legislation are reviewed by multiple parties in the State. Specifically, the Public Service Commission (PSC) has started the process of implementing the Energy Highway Blue Print, RGGI Inc., will complete its program design, the PSC will address the recommendation of the Moreland Commission, and the Draft State Energy Plan will be reviewed. Throughout the coming year, the Energy Committee will be more active in the development of recommendations, to the multiple governmental and regulatory bodies that will be developing energy policy.

Moreland Commission

On November 13, 2012, Governor Andrew M. Cuomo established a Moreland Act Commission that will investigate the response, preparation, and management of New York’s power utility companies with major storms hitting the state over the past two years, including Hurricanes Sandy and Irene, and Tropical Storm Lee.

The Commission's mandate includes examining and making recommendations to reform the overlapping responsibilities and missions of NYPA, LIPA, NYSERDA, and the Public Service Commission. As evidenced by Hurricane Sandy, the existing labyrinth of regulatory bodies, state agencies and authorities, and quasi-governmental bodies has contributed to a dysfunctional utility system.

The Commission will have the power to subpoena and examine witnesses under oath. The Commission members include:

Co-Chair Robert Abrams, former Attorney General of New York State
Co-Chair Benjamin Lawsky, Superintendent of the Department of Financial Services
Peter Bradford, former Chair of the Public Service Commission
Tony Collins, President of Clarkson University
John Dyson, former Chairman of the New York Power Authority
Rev. Floyd Flake, Senior Pastor of Greater Allen African Methodist Episcopal Cathedral
Mark Green, former New York City Public Advocate
Joanie Mahoney, Onondaga County Executive
Kathleen Rice, Nassau County District Attorney
Dan Tishman, Vice Chairman at AECOM Technology Corporation, and Chairman and CEO of Tishman Construction Corporation

The Moreland Commission, as of time of publishing this report has not publicly met. The Commission has postponed its first scheduled public meeting, originally scheduled for Friday, November 30. A statement from the state's Department of Financial Services issued the following statement Thursday evening: "The Moreland Commission's public hearing scheduled for Friday November 30th has been postponed. Notice of a new time and location for this hearing will be released in the near future."

It has been reported that “The commission's organizational meeting, conducted in private, resulted in the formation of two subcommittees as well as a tentative work schedule. One committee led by Nassau County District Attorney Kathleen Rice 'will investigate preparation and response' and the other 'will focus on a strategic review of utilities and regulatory structures,' led by Peter Bradford, former chairman of the Public Service Commission and a professor at Vermont Law School.” Abrams and Lawsky also announced that Regina Calcaterra, chief deputy to Suffolk County Executive Steven Bellone, will serve as the new executive director of the Moreland Commission.

The Moreland Commission, last week delivered one subpoena to each utility. The Moreland Commission is a seldom-used power of the governor that carries with it the power to subpoena witnesses. Additionally, the Moreland Commission sent the first letters seeking detailed information about how the preparation and response of the New York power utilities to power outages caused by Hurricane Sandy impacted critical infrastructure in the State. The letters were sent to the Metropolitan Transportation Authority and the Port Authority.

Indian Point (CASE 12-E-0503)

The Public Service Commission has directed Con Edison, with the assistance NYPA, to develop a contingency plan for the potential closure of Indian Point upon the expiration of its existing licenses by the end of 2015. The DPS staff will work with Con Edison and NYPA to develop such a contingency plan. The Indian Point Contingency Plan is due by February 1, 2013, with any comments on the plan due by February 22, 2013.

The contingency plan will include the form of Request for Proposals (RFP) that would be issued to procure needed resources to address system reliability needs by the summer of 2016, along with “halting mechanisms” in the event it becomes apparent that the Indian Point Energy Center remains operational and replacement capacity is not required as of that time.

Energy Highway

The PSC on November 27th took action on three items highlighted in the Energy Highway Blueprint.

12-T-0502 [Alternating Current Transmission Upgrades]
In pursuit of congestion relief and reliability enhancement, the PSC has instituted a proceeding to solicit written public Statements of Intent from developers and transmission owners proposing projects that will increase transfer capacity through the congested transmission corridor, which includes the Central East and UPNY/SENY interfaces as described above, and meet the objectives of the Energy Highway Blueprint.

All Statements of Intent must be filed with the Secretary of the Public Service Commission electronically by January 25, 2013. Following submission of Statements of Intent, staff will undertake a multi-agency review and evaluation process to develop a structure and deadlines for making project-specific determinations. The PSC expects staff to consider whether phased reviews, perhaps on an interface by interface approach and to perform coordinated hearings on a joint record wherever such an approach is likely to facilitate timely decision-making.

An informal technical conference open to the public has been scheduled for 10:30 a.m. on Monday, December 17, 2012, in the 19th floor Board Room of the Commission’s Albany Offices, 3 Empire State Plaza, Albany, New York.

12-G-0297 [Expansion of Natural Gas Service]
The PSC has instituted a proceeding to review PSC policies regarding expansion of the natural gas delivery system. In order to facilitate the review, the staff will convene a technical conference beginning at 10:00 a.m. on Wednesday, January 9, 2013 at the New York State Department of Public Service’s Albany Offices, 19th floor, 3 Empire State Plaza. The aim of the conference will be to provide stakeholders with an overview of the existing natural gas system, the manner in which existing Commission and utility policies are implemented, the role Commission and utility policies play in maintaining, improving and expanding the system, and how Commission policies may be modified to enhance the potential benefits to New Yorkers from an expanded and/or more reliable natural gas system.

Upon completion of the Technical Conference, staff will provide a report to the Commission along with any recommendations it may develop. The natural gas utilities will make presentations at the technical conference including overviews of their existing systems and policies; current plans for improving or expanding their systems; and responses to the issues and questions. Other parties will have an opportunity to seek clarification or further information from the presenters following the presentations.