PRIORITY ISSUE: Article X (Power Plant Siting)
New York business and industry relies on an affordable and reliable supply of electricity, and New York State needs significantly more electric generating capacity. However, New York is not siting and building enough generation to keep pace with the state's growing demand for power.
The Business Council believes that re-enactment of a streamlined Article X law for siting major power plants is an essential step toward meeting the state's long-term energy needs.
Over the past several years New York has had to take dramatic actions to meet its growing power demands. The state's dire need for more electricity has led the New York Power Authority (NYPA) to place emergency generation in New York City. The Independent System Operator (ISO) and the New York State Energy Research and Development Authority (NYSERDA) have instituted peak load reduction programs to curtail load on high consumption days. While these stop gap measures have helped avoid brownouts or blackouts, the key to alleviating shortages of power will continue to be the addition of base load generation capacity.
In 2001, The Business Council published The Power To Grow, a report detailing the adverse impact of a failure to site and build more generation in New York State. If we fail to site more plants, New York's residential, commercial and industrial consumers will face shortages, higher prices and risk having demand exceed supply.
The first step in the building of new base load generation is the siting law. The law governing the power plant siting process, Article X of the Public Service Law, expired on 1/1/03. By allowing this law to expire, the state sent a clear message to the generation and development community - New York's legislative/regulatory atmosphere NOT conducive to investment in generation. With the deregulation of the electric power marketplace, the economic risk of building new generation no longer falls on the electric customer. Under the old regulatory system, utilities were responsible for building enough generation to satisfy their customers' needs, and the costs were passed along to those customers. Under the new restructured environment, investors assume all the risks involved, and are thus understandably hesitant to build in an uncertain legislative/regulatory climate. Generation companies may instead opt to build in other states that offer public support and regulatory certainty conducive to billion of dollars in investment. To date the Legislature has failed to reenact a successor statute.
A renewed effort needs to be made to insure that New York State sites and builds enough generation to support its growing electricity needs. The Business Council supports the enactment of a power plant siting law which provides a streamlined, one-stop shopping program, such as S.4961 (Wright). On the other hand, we will oppose legislation that imposes costly regulatory and procedural burdens that make it virtually impossible to site a power plant, such as A.5865 (Tonko). Additionally, there is another bill in the Assembly which is very similar to the expired law, A.1908 (Nesbitt), which includes provisions to encourage the use of previous industrial properties and brownfields as generating sites. The Business Council supports this proposal as well.