New York Data Center Seeks To Sell Electricity To Non-Affiliate Customers, Disclaimer Of Jurisdiction From PSC

January 29, 2020

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Reporting by Paul Ring • ring@energychoicematters.com

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Greenidge Generation LLC, which operates on-site generation and its own data center operations, filed a petition at the New York PSC for a declaratory ruling disclaiming jurisdiction over the company's sale of electricity to data center tenants

Greenidge operates a 106 MW generating facility in the Town of Torrey, Yates County New York, and previously sought a ruling from the PSC that such generation could be used for its own on-site data processing operations that are conducted by Greenidge itself. As first reported by EnergyChoiceMatters.com, Greenidge was expected to later seek a ruling concerning the sale of electricity from such generation to non-affiliate tenants at the data center, and the company has now filed such a petition.

"This Petition seeks a declaratory ruling disclaiming jurisdiction over Greenidge’s proposal to construct and operate certain overhead and underground electric distribution facilities at the Greenidge site (the 'Project') and to use those facilities, along with the existing Greenidge Facility, to furnish and/or sell unmetered electricity from the Facility to third-parties leasing space from Greenidge for the installation of their own data processing equipment at the Facility site (the 'Tenants')," Greenidge said

"The Project will include installation of a data processing facility and the associated grading and roads needed to accommodate the data processing facility. The Project will include up to 30 separate metal box type units installed on gravel pads, which will house computer processing and networking equipment to be used for data processing activities. Electrical equipment will be installed overhead and underground to connect these facilities to the Greenidge Generation Facility. The total project area is approximately 4 acres, including the roads. An eight-foot high security fence will be installed around the project area, and a stormwater management system will also be installed as part of the project," Greenidge said

"None of the equipment used to provide such service would cross any public street or other public property, and all of the electricity in question would be furnished and/or sold to the Tenants on an unmetered basis for on-site use and not for resale. The equipment to be installed to serve the Tenants would not take power from the New York State Electric and Gas Corporation ('NYSEG') at any time, including when the Facility is out of service, as Greenidge intends to install breakers and relays acceptable to NYSEG and the New York Independent System Operator, Inc. ('NYISO') that will disconnect all data processing operations whenever the output of the Greenidge Facility falls below the total electric power demands of the Tenants. Greenidge will not place these new facilities in service until they have been approved by both NYSEG and NYISO," Greenidge said

Citing various sections of the PSL concerning existing exemptions for sales by landlords to tenants, Greenidge said, "Because it is unlikely that the Legislature contemplated the development of the wholesale-only electric utilities that have become common after restructuring, and because Greenidge does not sell electricity to others in retail transactions subject to Commission jurisdiction under the PSL, the Commission should find and declare that its furnishing and/or sale to end use customers located on its premises for their own use and not for resale does not involve any transactions subject to the Commission’s jurisdiction under the PSL."

"Alternatively, Greenidge respectfully requests that the Commission find and declare that while such furnishing and/or sales of electricity are subject to Commission jurisdiction, no amendment to Greenidge’s CPCN or other Commission approvals are required for Greenidge to engage in these activities," Greenidge said

"Greenidge’s ability to furnish and/or sell electric power to the Tenants at just and reasonable rates is demonstrated by the fact that in order to attract and retain Tenants at its site, Greenidge must offer a package of services that operators of data processing equipment find appealing, including competitive lease rates and power supply costs. Accordingly, Greenidge’s charges for these services will be determined by competition and market mechanisms and not by cost-based regulation. The Commission has recognized in a number of cases that prices set by properly functioning competitive market forces are just and reasonable," Greenidge said

Case 20-E-0044

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