New York State: Give And Take
New York state giveth. New York state taketh away.
Yesterday, we lauded the state’s efforts to fight harmful algal blooms on 12 lakes statewide including Chautauqua Lake. The state’s resources and expertise can only help with a problem that there likely aren’t enough local resources to solve.
Today, however, we focus on New York’s energy policy and the actions it is taking that will increase the price most of our readers will pay for electricity.
In October, the state Public Service Commission nixed the BPU’s purchase of the EmKey pipeline, the source of gas to the BPU’s gas turbine. Under the contract, the BPU will become the owner of approximately 27 miles of underground pipeline and associated equipment which includes a natural gas fuel compressor located in Mayville and its interconnection to the Tennessee Gas Pipeline. BPU officials reasoned buying the pipeline would be better for ratepayers than paying the increased rates proposed by EmKey. The Public Service Commission reasoned the BPU was paying too much and ruled the purchase could not move forward in order to protect ratepayers.
The city’s only options, then, are to pay EmKey the increased costs or build its own pipeline. But, at the same time the Public Service Commission was suggesting the BPU builds a new pipeline, it has been opposing new natural gas pipeline construction throughout the state. The New York Post reports Con Edison in New York City is so worried about natural gas supplies and the difficulty to build pipelines that it is looking for “non-pipe solutions” to meet expanding natural gas supply.
The Public Service Commission’s reasoning in nixing the BPU’s pipeline purchase is particularly galling in that it was veiled in the idea of protecting ratepayers. It only the state’s actions lived up to that rhetoric.
New York’s Clean Energy Standard requires 50 percent of New York’s electricity, with the starting point at 25 percent, to come from renewable energy sources like wind, solar and hydro by 2030.
The state plans to do this through two mechanisms — the renewable energy credit and the zero emission credit. To meet the renewable energy credit in the Clean Energy Standard by 2030, the BPU would need to build or buy from a 100 megawatt solar farm or build or by from a 60 megawatt wind farm. Both options would be more costly and less dependable than the current natural gas fuel the utility uses. Add to that the 2017-18 zero emission credit cost of $75,000 a month, or $893,000 a year, to the state. The price is adjusted every two years so BPU officials aren’t sure how much they will pay starting in 2019.
With one hand, New York giveth. With the other, it taketh — right out of your checkbook.