ALBANY – A proposal to let utilities own large-scale renewable resources like wind farms, undoing the ban deregulation imposed almost 20 years ago, has galvanized opposition from a broad and unlikely coalition of energy groups that warn it would stifle competition in energy markets and drive away investors.
The Public Service Commission is considering the proposal as it remakes the energy grid to accomodate more clean energy. The proposal, if approved, would reverse the ban that forced utilities to sell off large power sources in the 1990s to create a competitive private market and drive down consumer costs.
Uniting to oppose the proposal are groups that are sometimes at odds – like the Independent Power Producers of New York, an industry group, and the Alliance for a Clean Energy New York, a clean energy advocacy group. The coalition also includes the Electric Power Supply Association, an industry group, and the New York Affordable Reliable Electricity Alliance, a coalition of labor and business leaders that supports nuclear and other power sources.
IPPNY president Gavin Donohue said that letting utilities own large-scale renewables would mean reverting back to the “monopolistic” days of utility ownership when consumers paid for utility projects through their monthly bills. It would send a message to private developers that the market isn’t competitive and would discourage investment, he said.
“New York cannot afford to overlook the benefits and tremendous successes of competitive wholesale energy markets by allowing utilities to once again put ratepayers directly on the hook for costly electricity investments – especially when the private sector has been successfully developing and operating large-scale renewable electric generation facilities for more than a decade,” he said in a statement.
Anne Reynolds, the executive director of Alliance for a Clean Energy New York, said a market-based program is the best way for the state to reach its goal of 50 percent renewable resources by 2030.
“Independent developers of wind energy and other technologies have proven their ability to bring clean energy to market most efficiently and cost effectively,” she said. “Allowing utilities to own and rate-base renewable generation would chill competition and discourage cost-effective investment.”
The PSC has stressed that it is still considering the possibility of utility ownership of large-scale renewables – as well as the close to 2,000 public comments that have been submitted on it.
“The State has crafted options for a new large-scale renewable energy program to diversify energy generation sources in order to deliver numerous cost and environmental benefits to residents and businesses alike,” PSC spokesman James Denn said in a statement. “The numerous comments submitted in the proceeding by active parties and the public will be closely examined.”
Central generation will continue to provide most of New York’s power for the foreseeable future, the PSC said, and the state will not let utilities own small-scale renewables like solar panels on homes.
Large-scale renewable energy projects will be a key part of the state’s ability to reach its goal of getting about half of New York’s power from renewable generation by 2030. The state is committing $1.5 billion to large-scale projects —which could include offshore wind farms off Long Island and large fields of solar panels upstate – for the next decade.
Since the markets were deregulated in the 1990s, New York has brought more than 11,000 megawatts of electricity online, including 1,700 megawatts from renewable resources. The state wants private developers to add thousands of megawatts of renewable sources to the grid within the next two decades.
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