New York projects nixed

Presented by Community Offshore Wind: Delivered every Monday by 10 a.m., New York & New Jersey Energy is your guide to the week’s top energy news and policy in Albany and Trenton.
Dec 11, 2023 View in browser
 
Weekly New York & New Jersey Energy newsletter logo.

By Ry Rivard and Marie J. French

Presented by Community Offshore Wind

Good morning and welcome to the weekly Monday edition of the New York & New Jersey Energy newsletter. We'll take a look at the week ahead and look back on what you may have missed last week.

QUICK FIX

NEW YORK PROJECTS NIXED: The fallout from the Public Service Commission’s decision to reject increased subsidies for new renewables that had won competitive awards continues. About a third of the projects awarded under the state’s onshore renewables program have been canceled since mid-October, according to data reported by NYSERDA on Friday.

Put another way, that’s 27 projects that may or may not seek new awards in the expedited large-scale renewable solicitation NYSERDA kicked off on Nov. 30. The newly canceled projects total nearly 3 GW of new renewable capacity and 159 MW of energy storage. They were expected to support New York’s 70 percent renewable by 2030 target for the electric sector.

The new cancellations are for projects from the 2021 and 2022 solicitations: All 22 from the 2021 round (awarded in 2022) and five from the 2022 solicitation that Gov. Kathy Hochul announced the winners of this November, seeking to shift the narrative about the risks to New York’s climate goals. Many of the projects awarded in the last two cycles haven’t signed contracts with NYSERDA and thus don’t have capital at risk. The authority set a Nov. 30 deadline for companies awarded in 2022 to sign and post security or decline the awards after offering flexibility. That round did not include an inflation adjustment option in the bidding process, unlike the most recently announced awards and solicitations.

Cordelio Power, which bought SunEast’s portfolio in January 2022, canceled five projects, as did Boralex. EDF Renewables canceled three solar-plus-storage projects.

The decisions by developers to cancel all 22 projects awarded in 2022 adds urgency to NYSERDA’s ongoing large-scale renewable solicitation process that is intended to ensure the state stays on track to meet its 2030 target. Since those developers hadn’t formally signed contracts, there was no risk to them to reject awards before re-bidding into the 2023 solicitation. For earlier awards with signed contracts and posted security, NYSERDA is offering an option to sign a mutual termination agreement that will go into effect if the developers win awards. NYSERDA would then add the security to what it already holds if the developer wins or be able to keep it if the developer doesn’t get an award. The authority has asked developers to submit these agreements by Dec. 14. The deadline for step one of the expedited procurement is Dec. 28. — Marie J. French

HIGH INTEREST —  POLITICO’s Zack Colman: Plans to push South Africa and Indonesia off coal sputtered. So have offshore wind farms on the New Jersey and British coasts, and a green hydrogen project in an Italian port city.

Climate projects around the world are sinking because of high borrowing costs driven by interest rates — jeopardizing a major plank of the international effort to prevent the most catastrophic damage from warming temperatures.

COMMUNITY SOLAR —  New Jersey utility regulators said they’d received more than 300 applications from developers hoping to build community solar projects, totaling 300 megawatts of generating capacity.

The Board of Public Utilities can award 225 megawatts of projects in the coming year, a capacity limit that is divided across and varies by utility service areas. Developers’ applications exceed capacity in the PSE&G service territory, while capacity remains available and a new round of applications will be accepted in the Jersey Central Power & Light, Atlantic City Electric Company, and Rockland Electric Company service territories.

Unlike grid-scale projects or home rooftop solar projects, which largely benefit homeowners, community solar is considered a way to bring the local and price benefits of solar to low-income communities.

“I am thrilled at the amount of interest we have received in the first year of our permanent community solar energy program, a major achievement for advancing our equitable clean energy transition,” BPU president Christine Guhl-Sadovy said in a statement. “Community solar allows those who live in low-and moderate-income communities or cannot otherwise access solar due to their location, to reap the benefits of renewable energy and save money on their bills.”

Of the 150 community solar projects approved by the BPU since 2018, about half are up and running to generate enough power for 16,000 homes (130 megawatts). — Ry Rivard

HAPPY MONDAY MORNING: Let us know if you have tips, story ideas or life advice. We're always here at mfrench@politico.com and rrivard@politico.com. And if you like this letter, please tell a friend and/or loved one to sign up.

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A message from Community Offshore Wind:

Offshore wind means more than just clean, reliable energy. It means new, good-paying jobs, with tremendous economic opportunity for communities across the region. It means a local supply chain that keeps the benefits of the growing industry in the region for generations to come, and workforce development investments to prepare today’s students for the offshore wind careers of the future. For New York and New Jersey, offshore wind means opportunity.

 

Here's what we're watching:
MONDAY
— The New York Department of Public Service starts a technical conference on zero emissions technologies to meet the state’s 2040 target for the electric sector, 9:30 a.m.

TUESDAY
— NJ Transit meets at 10 a.m.
— The New York Department of Public Service holds the second day of a technical conference on zero emissions technologies to meet the state’s 2040 target for the electric sector, 9:30 a.m.

WEDNESDAY
— The New Jersey Board of Public Utilities is holding a technical conference on energy efficiency incentives from the Inflation Reduction Act, 8:30 a.m. to 4:30 p.m.

THURSDAY
— ​​The Port Authority of New York and New Jersey meets.
— The Public Service Commission meets, with energy storage subsidies and a gas transition plan for western New York utility National Fuel Gas on the preliminary agenda, 10:30 a.m.

FRIDAY
— The New Jersey Board of Public Utilities holds its quarterly public meeting, 10 a.m.

Around New Jersey

— Oil facility spill was source of mysterious tar balls, investigators say.

—  Nokia Bell Labs leaving legendary headquarters for New Brunswick, N.J.

What you may have missed

HOCHUL EYES TRANSMISSION, STORAGE PERMITTING — POLITICO’s Marie J. French: Gov. Kathy Hochul’s energy officials want to expedite approvals for transmission and large-scale energy storage projects in a bid to help the state meet its climate goals and quell local opposition. The Hochul administration is considering a proposal that would be part of her State of the State address next month to move approvals for storage and transmission lines under the statewide Office of Renewable Energy Siting, according to three people familiar with the discussions.

Environmental advocates and clean energy boosters are largely supportive of the concept, but it may spark a backlash from local governments concerned about the state encroaching on home rule. “It is very clear that the next blockage or impediment to meeting our renewable energy goals is transmission,” said Julie Tighe, president of the New York League of Conservation Voters.

New York’s climate goals will require a massive buildout of clean energy and fundamental changes to the current grid. New transmission lines to deliver renewables from upstate or offshore to where the energy is most needed face a lengthy approval process. Hochul has set an energy storage goal of 6 GW by 2030, and even more is likely needed to achieve the state’s 2040 zero-emissions electricity target. Projects have proved challenging to build and several local governments have placed or considered moratoriums on storage.

TIME FOR SOME RECUSAL TALK — POLITICO’s Ry Rivard: A federal judge overseeing the fate of New York’s landmark congestion pricing plan should recuse himself because of New Jersey political ties, according to a letter sent Wednesday by New York Senate Judiciary chairperson Brad Hoylman-Sigal.

In a letter to the court, Hoylman-Sigal, a Democrat who represents part of Manhattan, flagged that U.S. District Judge Brian Martinotti is married to an ally of New Jersey Gov. Phil Murphy, whose administration has a case pending before the judge that seeks to upend federal approval of New York’s tolling plan.

The development adds a deeply personal layer to an already tense standoff between the two states.

HOCHUL RAISES CONCERNS ON TROPICAL DEFORESTATION BILL — Gov. Kathy Hochul’s office has proposed changes to legislation that passed both chambers of the statehouse earlier this year that would require New York state contractors to prove their products don’t contribute to tropical deforestation or forest degradation.

“The proposal as submitted to us would not be acceptable for any number of reasons but we are going to be negotiating with her staff to get back as close as possible to the bill both houses passed,” state Sen. Liz Krueger said at a press conference Thursday with supporters of the legislation.

She declined to elaborate on what issues Hochul’s office has with the legislation, but said “there’s quite a few” and that both chambers are working together to jointly take to the governor what they think is not acceptable.

Hochul has until the end of this year to take action on the bill. Her office didn’t respond to a request for comment as to what issues it has with the legislation.

The bill’s supporters include the European Union, Environmental Advocates NY, the Natural Resources Defense Council and the New York Sustainable Business Council. The Empire State Forest Productions Association is among those who oppose the bill. — Allison Prang

 

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FIRST OFFSHORE WIND POWER HITS LONG ISLAND: New York has gotten its first power from an offshore wind turbine, nearly seven years after the Long Island Power Authority inked a contract for the South Fork wind project. The first of 12 turbines was completed last month and is delivering power to New York. "South Fork Wind will power thousands of homes, create good-paying union jobs and demonstrate to all that offshore wind is a viable resource New York can harness for generations to come,” Gov. Kathy Hochul said in a statement.

South Fork is expected to provide 130 megawatts of power. It’s located about 35 miles off Montauk and developed by Orsted and Eversource. The cost to customers for the project under a power purchase agreement is about $1.35 per month. The first power milestone comes as the offshore wind industry faces rising costs that have led to canceled projects in several states. The future of the other early New York projects is in limbo as developers decide how and whether to participate in NYSERDA’s new offshore wind solicitation with a Jan. 25 deadline. That process could result in new projects being awarded or the Equinor and Orsted projects still under contract getting new prices and moving forward. — Marie J. French

TAX BREAK REQUESTS PILE UP: Renewable energy boosters are pushing for a few different tax breaks to bolster certain technologies, urging Gov. Kathy Hochul to include them in her upcoming executive budget. The state’s solar industry has been mobilizing its supporters to contact Hochul about lifting a $5,000 cap on a 25 percent tax credit for solar systems. They want to raise the cap to $10,000 and make it a refundable credit so low-income households and seniors can benefit. A bill to do so has already been introduced by Sen. Pete Harckham and Assemblymember Latrice Walker. “The incentive is supposed to make solar more affordable; however, the cap has not increased in 17 years and the incentive is often hard to access for low-income families and families living in co-ops and condos,” the New York Solar Energy Industries Association told supporters in an email setting up a call relay earlier this week.

Another renewable energy industry group, the Alliance for Clean Energy New York, also wants sales tax exemptions for a range of electrification technologies: electric vehicles, including used ones; energy storage and heat pumps. “The inclusion of this exemption in the Executive Budget will help to reduce the upfront cost of purchasing or leasing an EV, a critical barrier to EV adoption,” ACE NY wrote in a budget memo to the governor’s office. — Marie J. French

CONGESTION MOVING — POLITICO’s Ry Rivard: The New York Metropolitan Transportation Authority's board voted 9-1 on Wednesday to put out for public comment a plan to increase tolls for drivers heading into parts of Manhattan.

The vote moves the landmark congestion pricing plan closer to reality after decades of debate about how to curb traffic in New York City, but there are still changes that could be made to the plan, which creates new tolls of $15 or more for most drivers coming into Manhattan south of 60th Street.

It ain’t over til it’s over: New York City Mayor Eric Adams has asked for further exemptions for taxis, which are already set to get a discount. He’s but one player asking for a carve out to the plan the MTA voted to advance.

At least for now, New Jersey officials also have some leverage over the MTA while a lawsuit the state filed to block the plan remains unresolved in federal court.

"We can’t absolutely count on money showing up,” MTA CEO Janno Lieber said, referring to the legal uncertainty while the case is pending.

New Jersey is seeking more or larger exemptions for drivers who are crossing bridges and tunnels into New York.

ABOUT THOSE TOLLS: The Metropolitan Transportation Authority’s board took its first crack Wednesday at reviewing a landmark congestion pricing plan, which creates new tolls to fund billions of dollars of new public transit construction.

But there are still several unanswered questions about that plan, including how much money the new tolls will raise for the MTA and exactly how the plan was crafted in the first place.

The plan, for now, is based on recommendations from the Traffic Mobility Review Board, a six-member body created by state law to draft the landmark plan. The MTA board will now have to hold a series of public hearings before its board can finalize the plan.

In an earlier press conference, the review board’s chair, Carl Weisbrod, said the traffic review board’s recommendations were unanimous.

But one of the board members, John Samuelsen, quit in protest as the final report was released and his name was not on the final report.

And while the board held three public meetings, it never voted in public on the recommendations.

Samuelsen’s resignation hinted at the complicated task of crafting a controversial, first-of-its-kind tolling plan. In an interview last week, Samuelsen — who is also an MTA board member and head of the Transport Workers Union — said the recommendations were the product of one-on-one meetings and some Zoom calls by board members. Those calls and meetings were not open to the public.

“A public body is supposed to conduct business in public, including voting on a report that is being released,” said Paul Wolfe, head of the Coalition for Open Government.

Another question is how much money the tolls will generate. The recommendations assert that the tolls will fulfill the review board’s mandate, which is to give MTA enough revenue for $15 billion of capital projects. But the board report does not show the math. Tolls that are too high or too low could both undermine the point of the plan, which is to discourage traffic, yes, but also ensure enough people pay tolls to raise the revenue the MTA wants.

The top staffer at the review board, known as the TMRB, said the board met its legal requirements.

“The TMRB was required to make recommendations regarding Central Business District toll amounts and submit them to the TBTA Board for consideration,” the board’s executive Juliette Michaelson said in a statement released by an MTA spokesperson. “This requirement was met on November 30th when the TMRB sent a report unanimously approved by all five members to the TBTA/MTA.”

And the tolling plan has the backing of Gov. Kathy Hochul, who said people should love the tolls.

“Anybody sick and tired of gridlock in New York City?” the governor said at a rally in support of congestion pricing on Tuesday. “Anybody think we deserve better transit, especially those who live and work here? Anyone think that people with disabilities deserve to have more accessibility when they travel through this city? Anybody want cleaner air for our kids and for future generations? Well then you love congestion pricing, right?” – Ry Rivard

 

A message from Community Offshore Wind:

Offshore wind is more than just clean energy – it’s an opportunity. Projects across the region are establishing our communities as a critical hub for offshore wind development, bringing jobs, investments and economic growth to the communities that need them most. Investments in workforce education and training programs are creating real, accessible and equitable economic opportunity for workers and families, breaking down longstanding barriers that too often prevent workers from pursuing stable, high-paying careers. And the growing offshore wind supply chain will bring thousands of additional jobs, revitalizing local economies and keeping the benefits of the clean energy transition in our communities for generations to come.

Offshore wind is leading the way to a resilient, independent and renewable energy future for the Northeast, and building a better tomorrow for the communities where we live and work.

 

NICHE NEW JERSEY BILL: The House on Tuesday waded into New Jersey commutes, passing a bill, H.R. 1547, that would require DOT to conduct a cost-benefit analysis of a one-seat ride into New York City versus the current transfer in Newark on NJ Transit’s Raritan Valley Line. The bill was co-sponsored by Rep. Tom Kean (R-N.J.), who faces a competitive re-election effort, and House Transportation Committee Chair Sam Graves (R-Mo.) noted how important the bill is to Kean’s district. The bill passed on a 356-61 vote, with “no” votes coming from the House GOP’s right flank. — Alex Daugherty

CON ED CLEAN ENERGY UPDATE: Con Edison expects its customers to set another record for solar installation although the company lags some other utilities as siting solar in New York City remains challenging. The utility reported on its clean energy progress for the third quarter. Con Ed customers have 554 megawatts of solar installed across the five boroughs and Westchester. All utilities have to report on certain clean energy metrics each quarter, and NYSERDA maintains a dashboard summarizing the information.

Con Ed is also predicting growing electricity demand and needs for more electric vehicle charging due to the new rules from the Taxi & Limousine Commission. New incentives for the utility-side costs of EV chargers (which Con Ed calls the PowerReady program and is known statewide as the “Make Ready” program) will help accommodate more chargers, the utility indicated. Con Ed is also working to place chargers for electric bikes and scooters at New York City Housing Authority properties. — Marie J. French

BARTON IS BACK — E&E News’ Ben Storrow: A former state regulator and power company executive who helped lay the groundwork for the offshore wind industry in the U.S. is set to become the new CEO at Vineyard Offshore, one of America’s largest wind developers. Alicia Barton will take over in January from Lars Pedersen, a Danish executive who shepherded the United States’ first major offshore wind project, Vineyard Wind, through development. The 800-megawatt project is under construction in the Atlantic Ocean south of Martha’s Vineyard and scheduled to be completed next year. In selecting Barton, Vineyard Offshore turned to an industry veteran who was instrumental in the embrace of offshore wind in Massachusetts and New York. As the CEO of the Massachusetts Clean Energy Center, Barton oversaw development of a key staging port in New Bedford, Massachusetts, that is now being used in the construction of Vineyard Wind. She later played a similar role at the New York State Energy Research and Development Authority, where she helped set a goal of buying vast amounts of electricity from offshore wind as one way to meet the state’s climate goals.

 

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