August 8, 2012
New York
New York
PSC study draws power industry critics; Plan to renew financial report mandate raises competitive concerns
By Larry Rulison | www.timesunion.com 8 August 2012
By Larry Rulison | www.timesunion.com 8 August 2012
ALBANY – Power plant owners are pushing back at a proposal by state regulators to require annual financial reports with the state that haven’t been required since the 1990s.
The state Public Service Commission has been asking for industry members and consumer groups to submit comments on a plan to require the financial disclosures after the issue was brought up last year by New York City Assemblyman James Brennan.
Brennan had been looking into the financial condition of the Indian Point nuclear power plant when he discovered the PSC had dropped requirements that power plants file annual reports.
The policy was changed in 1991 after the commission recognized that power plants were already obligated to make financial disclosures to the Federal Energy Regulatory Commission, or FERC.
Brennan and others have argued that FERC has since weakened the financial disclosure requirements, which is why the PSC has decided to take another look at the issue.
But industry advocates say the disclosures – if made public – could put them at a competitive disadvantage in the wholesale electric markets, which operate as a complex auction.
The Independent Power Producers of New York, a nonprofit group that represents power plant owners in the state, says it can only support new reporting requirements if the disclosures are kept out of public view. Utilities and other regulated companies often petition the PSC to redact sensitive information in documents, although whole categories of filings are not typically kept secret.
“It has long been established that the release of such information would be detrimental not only to the company itself but also to markets and concomitantly, consumers,” IPPNY wrote in a recent filing in the case.
Even the renewable energy industry, which operates wind farms and builds solar electric systems, opposes new financial disclosure requirements.
“The reporting requirements are inapplicable and inappropriate given that the reporting requirements for FERC, contrary to the Commission’s belief, have not changed substantially,” Carol Murphy, executive director of the Alliance for Clean Energy New York, wrote the PSC in a July letter.
Still, Brennan doesn’t see it that way. He claims in filings with the PSC that the public cannot ensure it is getting the lowest possible price for electricity without being able to see a power plant’s actual costs, which factor into its price bids into the wholesale market. The information would also help consumers guard against industry collusion, he said.
“Failure to require generators to fully report to the PSC would severely impair the ability of the markets and the public to adequately evaluate and price electric generation in New York state,” Brennan wrote in a July 30 letter to the PSC.