Legislative Memos

Memorandum in Strong Support-S.5126 (Griffo)

S.5126 (Griffo) - AN ACT to amend the public authorities law, in relation to the authority to contract for energy

The Independent Power Producers of New York, Inc. (IPPNY) is a trade association representing companies involved in the development of electric generating facilities, the generation, sale, and marketing of electric power, and the development of natural gas facilities in the State of New York. IPPNY Member companies produce approximately 75 percent of New York’s electric power.

IPPNY strongly supports S.5126 (Griffo). This legislation would ensure that the New York Power Authority (NYPA) does not encourage the development of transmission lines that do not allow electric generating facilities located in New York State to transmit their electricity across such transmission lines. Instead, NYPA’s ability to contract for electricity should be used to help achieve a public purpose that benefits New York State as a whole.

This bill would apply to electricity transmitted from outside of the country over a new transmission line, which: includes, but is not limited to, a high voltage direct current electric transmission line; connects a location outside of the Unites States to a location within New York; and does not allow both existing and new in-state power plants, including renewable energy generation facilities, to connect into the new transmission line. More specifically, the legislation would prohibit NYPA from contracting for, or otherwise buying or acquiring, electricity, or environmental attributes associated with electricity, that is transmitted over this type of transmission line. 

Among its customers, NYPA supplies power to the City of New York, as well as a number of other Downstate entities. The City of New York has documented that it is considering acquiring energy over a high voltage direct current electric transmission line from outside of the United States. If NYPA, either directly or on behalf of the City of New York, were to enter into a contract to buy electricity from outside the United States over the type of new transmission line that is the subject of this bill, the contract would increase costs for NYPA’s customers and specifically for the City’s taxpayers. That misguided contract also dramatically could reduce revenues that NYPA has for its other programs and obligations.

Independent power producers in this state employ over 10,000 workers and have invested over $10 billion in private energy infrastructure development in New York; they also pay annual taxes of more than $600 million and provide more than $50 million to their communities. However, New York State generation resources are struggling like most businesses in today’s economy. If NYPA’s contracting ability was to increase the importation of power across the transmission lines, which are the focus of this bill, hundreds of well-paying, essential jobs for New York’s workforce would be put at substantial risk, and the contributions of millions of dollars of property taxes for, and other payments to, localities made by New York’s power plant owners would be jeopardized. NYPA's contracting ability should not be used to enable projects that would import power from another country when greater value is derived by investing in New York's electricity system and from the economic benefits, tax revenues, and jobs those generation and transmission resources provide to their local communities. The State cannot afford to send those jobs and taxes outside the country.

New York State will be able to maintain electric system reliability and meet its renewable energy and emission reduction goals without importing more electricity from another country. Multiple in-state power and transmission projects have been completed, are planned, and currently are under development, and these resources are capable of meeting the State’s power needs. Emission reduction gains will be increased by the thousands of megawatts of renewable energy resources expected to come online to meet the Clean Energy Standard (CES). The State’s renewable energy goals are not advanced by the types of imports that are the subject of this legislation because neither existing nor new large-scale Canadian hydropower qualifies as “renewable” under the CES due to the adverse environmental impacts associated with such hydropower developments.

Electricity imports over transmission lines, which are the subject of this legislation and which bypass existing and new electric generating facilities in New York State, discourage the building of new generating facilities in New York, especially renewable energy resources needed to meet the requirements of the CES. Also, such transmission lines would reduce the economics of existing generating facilities within the State to repower and to reduce emissions further. Additionally, such lines would inhibit the construction of new, or the rebuilding of existing, transmission lines to transmit energy generated in New York State to where it is needed, such as from Upstate to Downstate.

For the reasons stated above, IPPNY strongly supports S.5126 (Griffo).