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New York PSC Addresses Cost Allocation To LSEs In Approving Continuation Of ZEC Program
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The New York PSC has approved an extension of the zero-emissions credit program (now ZEC 2.0) that provides support to nuclear facilities with costs allocated to LSEs, including ESCOs
In doing so, the PSC maintains the existing cost allocation and cost recovery methodology for use in the extended ZEC 2.0 Program
ZEC costs will continue to be applied on a volumetric basis, as the PSC rejected proposals from certain large customer interests to allocate a portion of costs on a demand, not volumetric, basis
Under the continuation of the existing cost recovery mechanism, NYSERDA will provide each
LSE a uniform wholesale per-MWh charge that is applied to the
LSE’s actual wholesale load to calculate their monthly ZEC
obligation payments beginning April 1, 2029, and each year
thereafter. NYSERDA will work with DPS Staff to determine the LSE
ZEC Rate owed by each LSE for the next compliance year of the
ZEC 2.0 Program.
To continue the current cost allocation and recovery process, the Commission directed each LSE to enter into a
contractual relationship with NYSERDA that aligns with the
duration of the ZEC 2.0 Program to periodically purchase ZECs
during a program year based on initial forecasts and a balancing
of reconciliation at the end of each program year.
After the
reconciliation process, each LSE will have purchased the correct
proportion of ZECs on an annual basis, the PSC said.
Notably, ZECs will continue to
not be tradable except between NYSERDA and the LSEs during this
balancing process.
The PSC did direct NYSERDA to submit a proposal detailing how a
potential voluntary ZEC sale mechanism would work.
Case 15-E-0302
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January 22, 2026
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Copyright 2026 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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