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July 09, 2014

Clean Energy Victory in New York

16707.1This week the New York Public Service Commission announced that it will require the state to invest in more clean energy as part of its renewable portfolio standard -- and all thanks to action from the Sierra Club and nine other groups.

New York had been lagging behind in its progress to meet its renewable portfolio standard -- NY must obtain 30 percent of its energy from renewable sources by 2015 -- so the Sierra Club and these nine other groups took action. In December 2013, the Sierra Club, along with Alliance for Clean Energy New York, Inc, Citizens Campaign for the Environment, Environmental Advocates of New York, Natural Resources Defense Council, New York League of Conservation Voters, New York Public Interest Research Group, Pace Energy And Climate Center, Renewable Energy Long Island, and the Vote Solar Initiative, submitted a petition to the New York Public Service Commission seeking changes to the method by which the state engages in large-scale procurement of renewable energy resources.

Last week, the Club's efforts were rewarded with an order by the commission adopting the Sierra Club's core recommendation and requiring additional renewable procurement solicitations in 2014 and 2015. These solicitations should produce hundreds of millions of dollars in economic and environmental benefits for New Yorkers -- creating jobs and stimulating investment while also reducing emissions and New York’s dependency on fossil fuels.  

The primary mechanism for procuring large-scale renewable generation is through contracts between the state and developers for renewable energy credits (RECs).  Traditionally, these contracts have been limited to ten years. In the past, the ten-year REC contracts provided developers with sufficient certainty to obtain financing for their projects.  Indeed, analysis of the RPS program as recently as 2013 showed that early solicitations were highly successful, with benefits to the state significantly outweighing costs -- every $1 spent on the RPS generated $3 of direct investment in New York.

More recently, however, inconsistency by the state in the timing of project solicitations, as well as more attractive contracting structures in other states, made New York a less favorable place for renewable developers to site projects. As a result, progress toward New York's RPS goals slowed markedly.  

To help address the uncertainties in the solicitation process and provide renewable energy developers the contracting flexibility required to finance projects, the Sierra Club coordinated with a broad range of organizations on a petition to the Public Service Commission to remedy the shortcomings of the RPS.  

The petition made the case for more regular project solicitations by the state as well as for increased contract flexibility to help bring renewable energy developers back to New York State. The commission's order, released last week, broadly adopted the Sierra Club's requests.  The commission required that the state engage in two large-scale renewable project solicitations between now and the end of 2015, one in each calendar year.

This is great news for New Yorkers, and we look forward to seeing the continued expansion of clean energy in the Empire State.

-- Joshua Berman, Sierra Club Staff Attorney

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