ALBANY – The Twin Counties, along with other upstate communities, may be asked to help pay for transmission of power from proposed wind turbines the state is looking to build downstate through higher utility rates.
Gov. Andrew Cuomo announced July 12 the state is moving forward with plans to build wind turbines off the coast of New York City, or Long Island, as part of his initiative to generate 2,400 megawatts of new offshore wind power by 2030.
Much of the wind power generated in the state comes from the northern and western regions. The governor’s overall goal is to obtain 50 percent of the state’s electricity from renewables by 2030.
The first phase includes obtaining approximately 800 megawatts of offshore wind power by 2019.
Representatives from local utility companies confirmed that it is possible that local power customers could end up paying for transmission costs of proposed turbines through rate hikes.
“Under the current rules, we believe that there could be some cost impacts for our customers,” Central Hudson Gas and Electric Corp. Media Relations Director John Maserjian said. “The initiative is in its early stages, and the costs will depend on which facilities are built and when, so we’re uncertain of the amount. The cost for each customer would likely vary with their energy use.”
The state Public Service Commission, the agency that regulates utility companies, issued several orders to meet the state’s goals in July. The orders require utility companies such as Central Hudson and National Grid to invest in the state’s efforts by purchasing offshore renewable energy credits – intangible commodities that can be traded that represent power has entered the grid from a renewable energy source – and ensuring the utility’s capability to include cost of offshore wind power in supply cost rates.
“New York looks at New York as one gigantic electrical grid,” National Grid Strategic Communications Representative Nathan Stone said. “We are mandated by the PSC to buy these credits. The PSC has not asked us to do anything yet because nothing has been implemented. This does not affect us until the wind turbines are up and working; it has to be generating power.”
All utility services and charges must be specified in each utility’s rate-making and approved by state regulators. Utility companies are required to enable the costs of offshore wind to be included in electric supply charges by Sept. 28, 2018, according to the PSC’s orders.
Utility companies are also directed to provide contracts to the New York State Energy Research and Development Authority, which is heading up the wind power initiative, by March 31, 2019.
The state should expand investment in solar energy, rather than installing wind turbines to avoid increased rates for energy customers, Greene County Administrator Shaun Groden said.
“I have a lot of friends who went to solar for their homes and they rave about it,” Groden said. “Wind is inconsistent. Even in the winter solar still generates energy. You have to decide where you get the best bang for your buck.”
The Empire Center for Public Policy, a nonprofit think tank based in Albany, raised the alarm for upstate with a report in response the governor’s announcement.
The think tank posits that the 800 MW generated will not meet the full energy demand of New York City or Long Island. The Long Island Power Authority alone used more than 7,000 gigawatts of power in 2017 according to data from the New York Independent System Operator, which coordinates and directs the flow of electricity through the grid.
The Empire Center also argues that the majority of the renewable energy credit costs will be paid by upstate rate payers based on energy demands last year.
“All New Yorkers will benefit from a more diverse and resilient energy system that also combats climate change,” according to a statement from the PSC. “Introducing a new, cost-effective energy source into the statewide grid will not only provide significant statewide environmental benefits, it will stimulate an emerging industry, creating thousands of new jobs across New York.”
New York energy consumers pay for the cost of turbines in the northern and western parts of the state, and the same process has been used for other energy sources.
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