Legislative Memos

Memorandum in Strong Support-S.5175-A (O'Mara)

S.5175-A (O’Mara) – AN ACT to amend the public lands law, in relation to the authority to     grant property rights

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 by utilizing cutting-edge technologies and a diversity of fuel types at facilities within this state, such as wind, hydro, cogeneration, nuclear, coal, oil, landfill gas, natural gas, and biomass.

IPPNY strongly supports S.5175-A (O’Mara). The bill would prohibit the Office of General Services (OGS) from leasing, or granting rights or easements to, the beds of Lake Champlain and the Hudson River to any company, any municipal entity, or any other legal entity to lay a new electric transmission line, including, but not limited to, a high voltage direct current electric transmission line that: connects a location outside of the United States to a location within New York; is not a merchant transmission line; and does not allow both existing and new in-state power plants, including renewable energy generation facilities, to connect into the new transmission line. The authority of the OGS Commissioner to grant rights and easements to lands under water, such as the land under Lake Champlain and the Hudson River, should be used for projects that benefit the State as a whole, such as transmission lines that provide access to electric generating facilities in New York. Importing electricity over new transmission lines, which originate outside the United States and bypass existing and new electric generating facilities (including renewable resources) in New York, does not sufficiently encourage employment opportunities or economic development in this state.

The construction of transmission and generation facilities in New York maximizes the State’s energy system reliability and also greatly benefits local communities. These facilities bring value to New York through tax revenues, creating jobs, and fostering economic development. OGS’s authority to lease state property should not be used to enable projects that would import power from another country in the manner under this bill, thus passing through communities in New York without providing the kinds of benefits that energy infrastructure located within the State provides.

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. If the importation of power across the transmission lines, which are the focus of this bill, was to be increased, 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.

Transmission lines that bypass existing and new electric generating facilities in the State discourage the building of new generating facilities in New York, especially renewable energy resources needed to meet the requirements of the State’s Clean Energy Standard (CES). The CES mandates that electricity consumers fund the development of new renewable resources, including new hydroelectric facilities with no new impoundments built after January 1, 2015, to meet the goal that renewable generation provide 50 percent of the electricity consumed in the state by 2030 (50 by 30 goal). Most of the electricity that could be transmitted across a transmission line originating in Canada that would be laid under Lake Champlain and the Hudson River is generated by large scale hydroelectric facilities with impoundments and would not meet - and would harm the ability to meet - the 50 by 30 goal because those types of imports would displace electricity generated by qualifying renewable generation in New York and discourage the development of such resources.

Transmission lines, which are the subject of this bill, also 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. 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 and replacing the entirety of Indian Point Energy Center’s capacity by or near 2021, when the facility is slated to close.

For the reasons stated above, IPPNY strongly supports S.5175-A (O’Mara).