| | | | |  | | By Ry Rivard, Janaki Chadha and Marie J. French | | Presented by |  | | | 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.
| | NY HEAT(S) UP PRIMARY RACES: A new independent expenditure committee backed by climate advocates is following through on threats to attack incumbent Democrats for failing to act on a high-profile gas transition measure this year. The Spring Street Climate Political Fund has paid for LED billboard trucks and organized protests and canvassing against Democratic Assembly Members Didi Barrett and Michael Benedetto, who are facing challengers from the left. The two races could serve as a test of the influence of climate advocates in primary elections. “We're sort of doubling down on the operations that we have started,” said John Raskin, who heads up the political fund. “The purpose of it all is to make sure that constituents know what their representatives and Albany are doing, or in this case, not doing on their behalf.” An environmental group with a longer-standing electoral operation, the New York League of Conservation Voters, has endorsed both Barrett and Benedetto in the primary. NYLCV Gives Green contributed $2,000 to Barrett’s campaign in May, according to campaign filings. NYLCV president and CEO Julie Tighe said Benedetto has been a “steadfast supporter.” She said NY HEAT isn’t in his or Barrett’s committee so they aren’t blocking the bill. “She's been good on these issues for a long time,” Tighe said of Barrett. “It's easy for people to talk the talk. It's harder to walk the walk. So we are supporting those incumbents for that reason.” Barrett’s office has not responded to multiple interview requests. — Marie J. French BUDGET DEAL INCLUDES NJ TRANSIT — POLITICO’s Daniel Han and Matthew Friedman: New Jersey’s most profitable businesses are expected to pay higher taxes for the next five years to fund transportation in the state, according to three people familiar with budget negotiations. The preliminary agreement on the corporate tax rate, which is also expected to be applied retroactively, is part of a principle budget agreement between state lawmakers and Gov. Phil Murphy's office, according to the three people, who were granted anonymity to discuss ongoing negotiations. Other details are still being finalized on the proposed $56 billion spending plan. — The deal represents a reversal and win for Murphy, who previously opposed increasing the corporate business tax but then came to the conclusion the tax was perhaps the only way to fund a long-promised fix for NJ Transit. Earlier this year, we reported on Democrats, advocates and environmentalists across the region casting Murphy as a mass transit villain and New York’s business leaders souring on him. But the budget deal makes him something of a hero for many of these same people, especially compared to New York Gov. Kathy Hochul and her last-minute decision to blow up the congestion pricing plan that MTA was relying on for its long-term infrastructure needs. — Ry Rivard TRANSMISSION PLANS: The New York Power Authority and LS Power have submitted joint proposals to upgrade transmission infrastructure to transfer clean energy from offshore wind facilities into the state’s power grid. The proposals, named Five Boro Energy Connect, would deliver 4,770 to 8,000 megawatts of offshore wind resources to the statewide energy grid, officials said. The bids, submitted June 17, came in response to a solicitation for transmission proposals from the New York Independent System Operator. “These proposals are cost-effective and beneficial for electricity consumers and build upon our past shared success with NYPA,” LS Power CEO Paul Segal said in a statement. The two organizations jointly completed the Central East Energy Connect transmission project last December. — Janaki Chadha 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. Want to receive this newsletter every weekday? Subscribe to POLITICO Pro. You’ll also receive daily policy news and other intelligence you need to act on the day’s biggest stories.
| | A message from Con Edison: Summer is heating up. As temperatures rise and New Yorkers rush to cool their spaces, Con Edison’s grid is ready. We're continuously modernizing infrastructure to ensure a resilient energy delivery system. We’re working to keep Con Edison’s service among the most reliable in the world — transforming energy today for a cleaner tomorrow. See our incentives. | | | Here's what we're watching this week: TODAY
— All eyes are on the MTA board members who meet today for committee meetings starting at 9 a.m. and Wednesday for a full board meeting at 9 a.m. They will have a lot to talk about, if they choose: Gov. Kathy Hochul’s “pause” on congestion pricing and a New York federal judge’s OK for the plan’s environmental review that handed the MTA a win last week in several of the lawsuits challenging the tolling plan. — The NYSERDA board meets, with some new members, starting with committee meetings at 10:30 a.m. — The New Jersey Legislature is approaching its budget deadline, so we'll keep an eye on the voting sessions.
| | — Con Edison reached a tentative agreement with unionized utility workers just hours after their previous contract expired, averting a strike.
| | | — Several North Jersey towns urged or mandated residents to conserve water amid the heat wave.
| | FWIW, CONGESTION PRICING WIN — A federal judge handed congestion pricing a major victory on Thursday — at least he would have if Gov. Kathy Hochul hadn’t already stepped in to pause the plan. U.S. District Court Judge Lewis Liman rejected lawsuits aimed at blocking the tolls by the United Federation of Teachers, the Staten Island borough president and others. A similar lawsuit brought in federal court in New Jersey by that state’s governor is still pending. The lawsuits challenge the environmental review of the tolling plan. Liman acknowledged the changed circumstances since he heard oral arguments in the cases this spring. “The question before the court is whether federal regulatory power, not political choices, stands in the way of a novel public policy approach to a pressing public issue,” he said. The 113-page ruling prompted a curious response from MTA general counsel Paige Graves on Thursday night. “We stand ready to relieve congestion and improve transit service for millions of riders,” she said in a statement. In the ruling, Liman laid out the history of the tolling plan dating all the way back to the 1950s and running through Michael Bloomberg’s time at City Hall and Andrew Cuomo’s time in Albany. Liman did leave the door ajar to revisiting his ruling by inviting further briefing on the final tolling scenarios, if they ever take effect. If congestion pricing is ever put back on track, there are still other outstanding legal challenges, including the New Jersey litigation, potential appeals, and state and federal constitutional arguments against it. — Ry Rivard ENERGY STORAGE EXPANSION — The Public Service Commission approved a new roadmap Thursday to expand the state’s energy storage programs to grow renewable energy across the state and boost grid reliability. The plan will allow the state to achieve six gigawatts of energy storage by 2030 — accounting for some 20 percent of New York’s peak electricity load. The framework is also expected to reduce projected future statewide electric system costs by nearly $2 billion by supporting a buildout of storage deployments, officials said. “Expanding energy storage technology is a key component to building New York’s clean energy future and reaching our climate goals,” Gov. Kathy Hochul said in a statement. “This new framework provides New York with the resources it needs to speed up our transition to a green economy while ensuring the reliability and resilience of our grid.” The roadmap lays out the path for procuring 4.7 gigawatts of new storage projects, adding to the 1.3 gigawatts of existing energy storage that’s being procured or is already under contract, officials said. — Janaki Chadha ELECTRICITY MOVES — New York is seeking proposals for new large-scale, land-based renewable energy projects, per a solicitation Hochul announced Thursday — aimed at supporting the state’s goal of obtaining 70 percent of its electricity from renewable sources by 2030. The competitive solicitation is being administered by the state’s Energy Research and Development Authority, with final bids due on Aug. 8. “New York is expeditiously moving our state forward as a leader in the transition to reliable and clean energy,” NYSERDA president and CEO Doreen M. Harris said in a statement. — Janaki Chadha
| | | | A message from Con Edison:   | | | LAWMAKERS WHIFF ON CLIMATE — POLITICO’s Marie J. French: Lawmakers returned to their districts this month with few significant environmental wins to campaign on — the latest sign that reducing emissions and achieving climate law mandates remain elusive. Upon concluding its annual session this month, the Legislature failed to pass any major elements of the state’s plan to slash emissions 40 percent from 1990 levels by 2030 and reach net zero emissions by 2050. Elected officials left the Capitol without acting on sweeping bills to reduce plastic packaging, begin plans to transition buildings off of gas and mitigate vehicle traffic. And their inaction will have political consequences. A new climate-focused independent expenditure fund plans to spend about $20,000 opposing two Assembly Democrats and backing their progressive challengers as a result. Assembly Democrats squeaked through a potential major revenue raiser for infrastructure to respond to the ongoing and future damage from rising seas, historic rainfall events and hotter temperatures. Yet five years after passage of the state’s Climate Leadership and Community Protection Act, a mandate barring fossil fuels in new construction is the only significant emissions reduction measure to have passed. "What we're seeing is just basic climate indifference," said Eunice Ko, the deputy director for the New York City Environmental Justice Alliance. "Partly what we're seeing is an overemphasis, I think, on affordability from the governor and the Legislature.” “I would argue, affordable for who?,” Ko added. “You can subsidize suburban people, I guess, but won't be willing to subsidize caskets in the Bronx when people are dying from extreme heat." CON ED PUSHES FOR COST OVERRUN COVERAGE: Con Edison wants the Public Service Commission to reconsider a decision rejecting higher than approved costs for a software system to serve customers. The utility filed a rehearing request on Monday, arguing that the commission was wrong in a May ruling. The dispute stems from the utility’s spending on a customer service system approved in its 2020 rate case. The system cost $88 million more than a cap included in that case. So, the company wants to start the process to pass those added costs on to ratepayers. The commission refused the request. Con Ed challenges the decision based on three alleged legal and factual errors. Those are: Con Ed was not required to ask to exceed the cap in its most recent rate case since it was not yet aware of the higher costs; that the commission treated this as a cost recovery petition rather than an accounting question; and that the PSC set a higher bar for Con Ed’s spending than the traditional “prudence” standard. “We believe the Commission’s order did not sufficiently consider all available information, and this petition is an effort to enhance and clarify the record as it relates to this project and New York State’s regulatory compact,” said Jamie McShane, a spokesperson for Con Ed. These issues seem somewhat esoteric, but the PSC could take a hard line and incentivize utilities to limit their spending on costly IT projects when spending is capped in rate cases. The issue of a higher standard than the “prudent” review used by the PSC to scrutinize utility spending could raise concerns for other utilities with caps on spending projects. Con Ed’s filing warned that if the company is forced to write off the overrun, it “is tantamount to a significant monetary penalty.” The company advised investors of the significant potential hit to their second-quarter earnings in an SEC filing. Con Ed’s filing expressed skepticism about cost caps generally, arguing they can be misused to deny prudent spending. The company argues that its rollout of a new customer service system for billing and other services “was a rousing success compared to similar projects at peer utilities in New York State and nationwide.” That’s a reference to additional testing Con Ed undertook after the botched rollout of a new billing system by Central Hudson that had big consequences for that smaller utility. The commission should actually encourage the additional spending that supported this successful rollout, Con Ed indicates. “Con Edison succeeded where others failed because it did not treat its business plan as frozen in amber. Instead, it adjusted to the increased complexity of its work and addressed emerging risks as it continued to learn from the experience of other utilities,” the utility’s petition states. “The Commission should encourage such diligence.” — Marie J. French ENVIROS PAN CONGESTION PRICING REVERSAL: Five leading environmental groups told New York Gov. Kathy Hochul last week that they are “sorely disappointed” by her decision to put congestion pricing plans on hold. The heads of Evergreen Action, League of Conservation Voters, Sierra Club, Earthjustice and Environmental Defense Fund urged Hochul in a letter to reconsider and requested a meeting with her on the matter. “This decision will have significant consequences for New York, and it will reverberate nationally,” the green group heads wrote. “Your proposed indefinite delay poses a significant risk to achieving New York’s climate goals and the imperative to both reduce traffic congestion and ensure sustainable funding for more affordable and reliable transportation.” — James Bikales
| | A message from Con Edison: Con Edison’s grid is ready to meet the rising summer temperatures. We’re modernizing New York's electric grid with more resilient infrastructure, so New Yorkers are prepared for longer heat waves, heavy thunderstorms, and flooding. Customers will experience a more dependable and equitable system through our grid modernization projects that include the installation of new substation equipment, 28 underground and 69 overhead transformers that regulate voltage, plus over 900 sections of underground and overhead cable.
Con Edison is also building an electric delivery system capable of delivering reliable clean energy from solar arrays, wind turbines, and other renewable resources to support electrification and New York State’s climate goals. Infrastructure projects that support these goals are managed by Con Edison’s dedicated, highly skilled workforce in all five boroughs and Westchester. We’re bringing all New York homes and businesses along in the energy transition by incentivizing energy-efficient upgrades to heating, lighting, and cooling. See our incentives. | | | | | | | Follow us on Twitter | | | | Follow us | | | | |
