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As U.S. policy makers look for cost-effective ways to tackle climate change, a diverse coalition of power generators, trade associations, and think tank experts this week asked the Federal Energy Regulatory Commission (FERC) to examine the policy options and implications of carbon pricing policies in competitive wholesale electricity markets. The request, submitted before FERC by a broad cross section of the electric industry and think tank voices, comes at a time when many states, utilities and electric markets are already considering policies that reduce carbon emissions in the electric sector and grappling with whether to integrate carbon pricing directly into the markets.

A report released today by Energyzt and a diverse coalition of energy, environmental and labor groups shows that New York City’s current plan to receive hydropower delivered over the proposed Champlain Hudson Power Express (“CHPE”) transmission line will not reduce climate-related emissions and, in fact, may increase overall emissions.

For New York City to achieve its climate and clean energy goals in the most cost-effective way, a diverse and growing coalition of major labor, business and environmental groups are today urging Mayor Bill de Blasio to issue a new competitive Request for Proposals (“RFP”) to meet the City’s renewable electricity needs. The groups’ call for an RFP comes in the wake of the Mayor’s announcement that the City would seek a contract for Canadian hydropower by the end of 2020 and, more recently, its interest in providing public financing to construct a new transmission line, the Champlain Hudson Power Express (“CHPE”) from Quebec to New York City. The CHPE line is estimated to cost in excess of $3 billion.

New York State Senate Minority Leader John J. Flanagan has appointed Independent Power Producers of New York (IPPNY) President and CEO Gavin J. Donohue to the New York State Climate Action Council, a 22-member body currently being assembled under the recently-enacted New York State Climate Leadership and Community Protection Act (CLCPA). The new law requires 70 percent of New York’s electricity to come from renewable energy systems by 2030, the power sector to be zero-emitting by 2040, and statewide greenhouse gas emissions to decrease by 85 percent from 1990 levels by 2050.

IPPNY President and CEO Gavin J. Donohue said, “Reaching the State’s ambitious goals will require unprecedented levels of investment in the electric system and near-complete electrification of the transportation, residential and commercial sectors. New investment will be needed in renewables, transmission, energy storage, and, most critically, power generation capable of providing reliable and dispatchable electric service during extended periods where the wind does not blow and the sun does not shine. Independent power producers look forward to working with the State to improve upon the existing competitive market structure and develop new mechanisms for attracting such investments.”

The New York State Senate late last night passed the New York State Climate Leadership and Community Protection Act (CLCPA), and the Assembly is poised to act today. This legislation was developed with the support of Governor Andrew M. Cuomo, requiring 70 percent of New York’s electricity to come from renewable energy systems by 2030 and the power sector to be zero-emitting by 2040. Importantly, the legislation allows some flexibility for the New York State Public Service Commission (PSC) to maintain electric system reliability, and it requires a yet-to-be-formed Climate Action Council to consult with the New York Independent System Operator (NYISO), which is the entity tasked with maintaining electric system reliability.

IPPNY supports A.7682 (Cusick) / S.6195 (Parker). The bills would establish: (a) minimum cybersecurity and safety standards; and (b) minimum cybersecurity insurance requirements, which would be applicable to third parties seeking to connect to any electric or gas corporation's systems to receive consumption or other data. The legislation would require the New York State Public Service Commission to promulgate rules and regulations by January 1, 2021 to ensure the implementation and enforcement of the bills’ provisions.

IPPNY opposes A.7569-B (Galef). The legislation conflicts with, and is pre-empted by, federal labor law, and it would establish a damaging precedent for all types and sizes of businesses. The legislation specifically would require employees at the Indian Point Nuclear Power Plant to be paid prevailing wages. The bill would require the successor owner of the Indian Point facility to retain its workforce. The legislation would require the Department of Labor to oversee the payment of prevailing wage to employees at Indian Point until the facility is closed.

IPPNY strongly opposes S.6112 (Parker) / A.7376 (Cusick). These bills would allow utilities (combination gas and electric corporations) to own "renewable reclamation projects," in contravention of long-standing State policy that prohibits utility ownership of electric generating facilities, which could expose ratepayers needlessly to higher costs. The bills send the wrong investment signal to private independent developers of renewable energy and energy storage projects at exactly the wrong time, when the State has announced its goals to dramatically increase its renewable and energy storage resources and is seeking private sector investment to meet those goals. If adopted, these bills would have the immediate impact of chilling private sector energy investment in the state because private developers cannot compete with rate-regulated utilities that charge energy consumers for all costs.

One of the most essential aspects to consider under the Climate and Community Protection Act (CCPA) is the role of carbon offsets. The implementation of offsets allows for the continued use of efficient facilities that are the backbone of our reliable electric system while accounting for their emissions. Furthermore, the economy-wide approach needed to significantly cut emissions requires the flexibility for implementation that can be provided by offsets.