New York Energy Blueprint Includes Repowering, Renewable Capacity Recommendations, Cost Recovery Not Addressed

The New York Energy Highway Task Force has released its blueprint regarding future state energy policy, which includes recommendations for repowered and new generating capacity, but does not address cost recovery of such capacity, or disposition of products from such generation.

Notably, the task force recommends the following steps to advance repowering projects: (

(1) targeted competitive solicitations for repowering of specific generating facilities,

(2) review of repowering as a potential solution when retiring generators are needed for reliability,

(3) the establishment of a new fund to provide incentives for greenhouse gas emission reductions in the electricity sector, including support of repowering, and

(4) inclusion of repowering as a potential solution in Reliability Contingency Plans, including a plan for the potential Indian Point closure.

The blueprint does not address how any energy from the repowered capacity would be disposed of (e.g. used for default service or sold into the market), and does not address what universe of customers would pay for such repowered projects.

With respect to the capacity from repowered projects, however, the task force recommends that, in the development of NYISO market rules and related FERC decisions governing how power plant owners are compensated in the restructured electricity markets for the installation of capacity, "repowering projects that are designed to address reliability concerns or provide significant enhancements to the environment should be exempt from buyer-side In-City Mitigation Rules."

The task force also recommends continuation of the RPS, with a longer-term to provide developer certainty. "In addition, the Task Force also recommends that the Public Service Commission conduct an assessment of policy options that foster activities to transform the market for these sustainable energy options, including an assessment of project investment models, cost recovery mechanisms, and associated contracting mechanisms, as well as procedures that can facilitate funding determinations that are responsive to near-term market demands, as well as foster continued diversity in the renewable energy portfolio" (emphasis added).

An examination of offshore wind, including policy mechanisms and cost recovery mechanisms, is also called for.

Link: NY Energy Blueprint