TRUMP LOOKS AT UPENDING CONGESTION PRICING — POLITICO’s Nick Reisman and Ry Rivard: President Donald Trump is considering withdrawing federal support for a controversial New York City toll program — a move that could halt it, according to three people familiar with the discussions. WIND IS BLOWING OFF TRACK — POLITICO’s Ry Rivard: New Jersey’s offshore wind industry is on life support following President Donald Trump’s executive order to halt wind development. In recent days, two New Jersey projects have been thrown into uncertainty. On Thursday, energy giant Shell paused involvement in Atlantic Shores, an offshore wind project that Trump last week called “dead.” It was the only active project in New Jersey that had federal permits to proceed. Attentive Energy, a TotalEnergies subsidiary, also told state utility regulators it needs to delay key deadlines on its project through the end of the year. The request for the delay was submitted last week but only made public Thursday. SOLAR AT RISK OF DIMMING — POLITICO’s Marie J. French: The bright spot in New York’s lackluster progress toward its climate goals is at risk of going dark. Solar companies in the state are considering layoffs as they struggle with new development restrictions, declining state subsidies and costly connections to the grid, warned Noah Ginsburg, executive director of the New York Solar Energy Industries Association. Ginsburg said the industry expects headwinds at the federal level, with President Donald Trump and Republicans in Congress threatening to yank tax incentives and other support. But they didn’t anticipate a “fight at home against a blue governor.” ENVIRONMENTAL JUSTICE SITING REGS OUT: Rules aimed at protecting historically pollution overburdened and low-income communities from additional environmental impacts have been released for public comment. The Department of Environmental Conservation published updates to the state’s environmental review rules on Wednesday to implement “cumulative burdens” legislation passed in 2022. The law requires the consideration of existing pollution sources impacting disadvantaged communities as part of environmental permitting processes for new polluting facilities. “Proactive, state-led efforts to advance equity and environmental justice are more critical than ever, and New York State’s laws requiring robust evaluation of potential impacts will be instrumental in helping disadvantaged communities prevent the discriminatory siting practices of the past,” said DEC Interim Commissioner Sean Mahar in a statement. State policies on environmental justice may serve as a bulwark against rollbacks at the federal level. Other states including New Jersey and Washington have implemented similar policies. The updated regulations also limit environmental review of multi-family housing projects of less than 10,000 square feet. The proposal is subject to public comment, which is due by May 7. Public hearings will be held in April. — Marie J. French NYPA RENEWABLE PLANS — POLITICO’s Marie J. French: North America’s largest state-owned utility is planning its first major buildout of new clean energy since the 1970s — but critics aren’t thrilled. The New York Power Authority has finalized its first ever strategic renewables plan, which lays out a blueprint to build more than 3,200 megawatts of new solar and battery storage capacity. The projects face more hurdles before they can become a reality though — including development and financing challenges. “We continue to assess the economics, community impacts and real estate considerations for each project,” NYPA President and CEO Justin Driscoll told lawmakers at a budget hearing Tuesday. “We intend to update the plan with more projects in the first half of 2025 as we are currently evaluating up to 3 gigawatts of additional projects for inclusion.” Lawmakers and advocates who supported NYPA’s ability to build new renewables aren’t satisfied — and one group backed by the city’s Democratic Socialists of America chapter is calling for Driscoll to resign. CLIMATE FUNDING FOCUS — POLITICO’s Marie J. French: Key lawmakers had more questions than answers about Gov. Kathy Hochul’s climate funding plans at a Tuesday budget hearing. Several legislators asked interim Department of Environmental Conservation Commissioner Sean Mahar about the state’s implementation of “cap and invest” rules Hochul has previously championed but punted on this year. They also pushed for details on the governor’s alternative push to provide a one-time shot of $1 billion for climate priorities. Mahar was not able to provide a timeline of when “cap and invest” would ultimately be implemented. TRUCK RULE FLEX — POLITICO’s Marie J. French: Democratic and Republican lawmakers raised concerns Tuesday about Gov. Kathy Hochul’s implementation of clean truck rules aimed at reducing transportation emissions. The regulations are aligned with California’s rules. New York is considering delays in coordination with other states that have adopted these rules because of concerns from the trucking industry about the lack of electric charging infrastructure and available technology. “We don’t want to be inflexible,” interim Department of Environmental Conservation Commissioner Sean Mahar said after a budget hearing Tuesday. FEDERAL FREEZE: The decision by President Donald Trump to broadly freeze federal funding for programs could have major impacts on New York’s environmental and energy agencies. Much remains unclear, but federal guidance notes that the funding pause particularly targets “ending DEI, the green new deal, and funding nongovernmental organizations that undermine the national interest.” “We are truly witnessing madness,” said Sen. Pete Harckham, chair of the Environmental Conservation Committee. Interim Department of Environmental Conservation Commissioner Sean Mahar said about 25 percent to 30 percent of the agency’s funding is from the federal government. NYSERDA President and CEO Doreen Harris said there’s about $1.2 billion in federal funds the authority is working to deploy but only about 10 full-time staff working on that process. “We are monitoring the impacts that this may have because, of course, we want to continue to scale our programs and advance them,” Harris said. A judge paused the pause of funding until at least 5 p.m. today. KEEP THE GASLIGHTS ON: Hochul’s top energy and environment officials repeatedly claimed there’s no delay of “cap and invest” rules on Tuesday. But those who have been following along know Hochul’s 11th-hour decision to punt on the program this year is a significant delay — and not even the first one since the policy was first embraced by her officials in the state’s climate scoping plan in December 2022. RADIOACTIVE GLOW UP: Several lawmakers zeroed in on Hochul’s focus on advanced nuclear power, with several Democratic legislators questioning the costs and waste issues raised by the technology. Republican lawmakers were more positive on the embrace of nuclear. “You're seeing this year the embrace of various complementary technologies,” Harris told Republican Assemblymember Ed Ra in a collegial exchange on the potential role of new advanced modular reactors. She said there’s a need for “10s of gigawatts” of dispatchable, emissions free technology to achieve the state’s 2040 zero emission electricity goals. “The governor is very interested in the technology,” Harris said. Assemblymember Dana Levenberg, a Democrat from Ossining, put the focus on nuclear in the context of the recent pullback of artificial intelligence stocks due to a Chinese company’s technology that uses less energy and computing power. “Do you really think that the state should be spending resources on bringing online untested nuclear technology that doesn't exist and will not be up and running for decades?” asked Levenberg. Harris emphasized the continued work on NYSERDA’s master plan for nuclear and the state’s energy plan. NYSERDA finalized a blueprint for a master plan for advanced nuclear earlier this year. “We have many questions, and we're committed to looking at this rationally,” Harris said. She said there’s been a robust response to NYSERDA’s request for information for entities interested in developing advanced nuclear in New York. That includes communities, workforce development programs and more. Hochul also announced as part of her State of the State agenda that she’d support Constellation, the energy company that owns the upstate nuclear fleets, in pursuing federal funding for a potential small modular reactor on the site of its Oswego plant. Harris said if the company is successful, NYSERDA would provide a required cost share to support the planning grant. Several lawmakers asked about an appropriation for the nuclear master plan, which is part of a $7 million increase in an existing utility assessment. NYSERDA said $6 million is for the nuclear road-map effort including supportive studies. UPHILL BOTH WAYS: How kids will get to school in the coming decade was also a major focus of lawmakers during the budget hearing. The state has a mandate for new school bus purchases to be zero emission by 2027, with a target of a zero-emission fleet by 2035. School district leaders are alarmed at the looming deadlines and lawmakers pushed for answers, with some Republican lawmakers calling for changing the law. “It is a cause of a lot of stress and consternation,” said Sen. George Borrello. Harris said NYSERDA was trying to do more engagement with school districts to get them more comfortable with the transition. “We have more work to do,” she said. STAFFING UP: The Department of Environmental Conservation would get 58 new positions as part of Hochul’s budget proposal. Those people would help implement the Climate Superfund program and various regulations including the freshwater wetlands expansion, Mahar said. The Department of Public Service is also getting added staff funding. CEO Rory Christian said the agency’s headcount has increased from 470 when he started in the role in 2021 to 570 today. Added staffing will be focused on customer service, he said. “Hiring freezes over the years, and other concerns, have left the department wanting,” Christian told lawmakers. Other tidbits … There were also concerns raised about DEC’s freshwater wetlands rules, which solar developers and others have said threaten development. Mahar said the agency would issue general permits soon to make compliance easier. The five general permits will cover adjacent areas for structures like sheds, shoreline treatments, community solar and renewables, affordable housing and shallow, weedy lakes. DEC also plans to issue draft rules on Wednesday to implement a law requiring the consideration of the cumulative impacts of polluting facilities on disadvantaged communities. Several legislators also raised concerns about the release of refrigerant regulations before Christmas with a first deadline in early January. Mahar said the agency was providing enforcement flexibility and engaging with companies that have raised concerns. — Marie J. French BIG APPLE PLAYS COPYCAT: A New York lawmaker has reintroduced a bill in Albany that would require large companies operating in the state disclose their full carbon footprint, mirroring California's first-in-the-nation law that's set to go into effect next year. State Sen. Brad Hoylman-Sigal, a Democrat representing parts of Manhattan, is renewing his effort after the measure failed to gain traction last year. But he'll be doing so with some noticeably different dynamics. The broader corporate climate disclosure push is all but dead at the federal level, with the incoming Trump-appointed chair of the Securities and Exchange Commission likely to pull back on a weaker rule the agency adopted last year. Even in California, regulators have balked at enforcing the measure, deciding not to penalize noncompliant companies next year. Hoylman-Sigal, an old law school pal of state Sen. Scott Wiener, the author of California's law, will also have what could be an influential advocacy group at his back that he didn't have last time. Ceres, a sustainability nonprofit that counts companies like Amazon and Bank of America as members and that pushed for California’s laws and the SEC rule, previously told us it would support climate disclosure efforts in other states — a reversal from its previous position. Washington and Illinois in addition to New York introduced copycat legislation to require climate disclosure last year, though none of those bills passed. — Jordan Wolman HOCHUL ENERGY OFFICIAL EXITS: A key member of Gov. Kathy Hochul’s climate team is departing after more than three years with the administration. John O’Leary, deputy secretary for energy and the environment, is leaving after this week. He’ll take a new role as a principal with the Coalition for Green Capital, joining NYSERDA board Chair Richard Kauffman, who is the CEO of the federally-funded national green bank. On his way out the door, O’Leary praised Hochul’s achievements on climate, rattling off achievements including new authority for NYPA to build renewables, signing the Climate Superfund Act, zero emission standards for new construction, the $4.2 billion environmental bond act, and a master plan for new nuclear power. “Through a very turbulent time in global markets and inflationary environment and interest rates and supply chain constraints, the state is actually advancing a tremendous amount of large scale clean energy infrastructure, offshore wind and [Champlain Hudson Power Express] and several dozen land based projects,” he said. “We’re advancing the cap and invest program, which is on track to be the biggest expansion of carbon markets, certainly in the United States, in more than a decade — and the governor has prioritized that, has been the tip of the spear on it, and is continuing to move it forward.” — Marie J. French BUDGET HEARING BONANZA: Pack your snacks, chug that coffee and get ready for a grilling. Lawmakers will get their chance to push Gov. Kathy Hochul’s top energy and environmental officials on the state’s expected failure to meet the climate law’s renewable target, her delay of “cap and invest” rules and how $1 billion in proposed climate funding should be spent. The hearing serves as a chance for lawmakers to signal their priorities ahead of the release of one-house budgets and the start of negotiations over the details of the $252 billion spending plan and accompanying policy changes. Here’s a few things to watch out for … The elephant in the room is Hochul’s sometimes lackluster efforts to meet New York’s climate law mandates. This is the first budget hearing since the governor’s agencies acknowledged New York is not on track to meet its 70 percent renewable electricity goal. Democratic Sen. Pete Harckham, who chairs the Environmental Conservation Committee, said that would be a focus of the budget hearing. “What is their plan to get us back on track?” Harckham said. “The answer is not let’s retrench and reset our goals downward, it’s how do we achieve the goal.” The delay of “cap and invest” rules will likely be another focus. The Hochul administration plans to release one part of the rules — the reporting requirements — in the coming months, although agency staff completed the full package in early January before the governor’s delay. O’Leary said the regulatory package is the most complex rulemaking he’s ever seen. “Releasing all three at the same time runs the risk of overwhelming folks in the regulated community,” O’Leary said. “What we found in the stakeholder conversations and this very sensitive outreach that we’ve been doing is that there still needs to be more awareness building and education about the program.” Although some environmental advocates are looking for the Legislature to provide leadership, it’s not clear what appetite they have for taking on the issue. “You can’t suddenly come up with something that’s going to saddle people with a lot more expenses without a good explanation for how they’re going to be able to be paying for that stuff,” said Assemblymember Didi Barrett, who chairs the Energy Committee. “I’d rather see them do this in a thoughtful and measured way than not.” Barrett said “smart planning” suggests the state’s climate goals need to be looked at. “I would like to see us moving forward without some of the constraints" in the Climate Leadership and Community Protection Act, Barrett said. She’s supportive of passing a low-carbon fuel standard for transportation, which is also a priority for the New York League of Conservation Voters. Nuclear strategy … Hochul has become a booster of advanced new nuclear technologies. Her administration is backing an application for federal funding by Constellation, which owns the upstate nuclear fleet. The company also expects NYSERDA to provide some funding. Some Democratic lawmakers are skeptical. Harckham said it would cost billions of subsidies to site and permit a new reactor. “It’s just not cost effective from the dollars and cents approach,” he said. O’Leary said questions about costs and state support would be answered as part of the nuclear master plan and subsequent efforts. “The Power Grid study shows this need for dispatchable emissions-free resources, and advanced nuclear has the potential to play that role,” he noted. Gas transition … The governor didn’t propose any statutory changes to the state’s utility laws requiring companies to hook up new gas customers and passing a portion of the cost on to all customers through higher rates. O’Leary said the governor’s record reflects her commitment to building decarbonization, but said he couldn’t say what her position would be on what the Legislature might put forward. Hochul had previously engaged on the complicated issue and negotiated with Senate Democrats, who back the NY HEAT Act, which also includes an affordability guarantee for some utility customers. Assembly Democrats remain the focus for environmental groups pushing NY HEAT. “There are parts of it that definitely could move this year,” Barrett said, reiterating the Assembly’s support for eliminating the 100 foot rule that requires other ratepayers to subsidize gas lines to serve new customers. Waste reduction … Hochul also omitted any proposal on reducing packaging and plastic waste. That’s a top priority for Harckham and his counterpart, Assemblymember Deborah Glick, who chairs the Environmental Conservation Committee. “I’m not going to negotiate against myself anymore,” Harckham said. His proposal passed the Senate last year but didn’t make it across the finish line in the Assembly. Both Beyond Plastics and the plastics industry are in the Capitol to lobby today as well. Permit questions … One of DEC’s big portfolios that intersects with the state’s climate law is air permits. Many polluting facilities continue to operate with permits that expired years ago as they wait for the agency to consider renewal requests. DEC has not closely scrutinized renewed clean air permits in the context of the state’s emissions goals if the company isn’t changing operations. That approach has been challenged in court. And the status quo of expired permits continuing to apply will get more scrutiny this year, Harckham said. “We’re going to make a much stronger push on our permitting legislation,” he said. — Marie J. French TRENTON PREPARES TO CEDE WATER DEPARTMENT — POLITICO’s Ry Rivard: A damning new report released Monday about mismanagement of the water department in New Jersey’s capital is prompting a new push for the city of Trenton to cede control of one of the state’s largest water systems. For decades, there have been warnings about Trenton Water Works, which supplies water to nearly a quarter million people in the city and suburbs. A list of violations over the past two decades runs more than 130 pages and two years ago state officials moved to tighten oversight on the heels of a water crisis in Jackson, Mississippi. REA-RING BACK: The Federal Energy Regulatory Commission on Friday reapproved a major gas pipeline expansion that was questioned by a federal court and that New Jersey said may derail its climate change goals. The decision allows the continued operation of Williams subsidiary Transco’s Regional Energy Access project, which added about 36 miles of new pipe in Pennsylvania and a new compressor station in New Jersey, as well as upgrades to other infrastructure to allow more gas to be moved to New Jersey from wells tapping into the Marcellus shale gas field. “Williams appreciates FERC’s swift action at a time when natural gas infrastructure is being called on to reliably deliver at record volumes,” Williams CEO Alan Armstrong said in a statement Monday. “The recent bitter cold conditions across the Northeast are an important reminder of the vital role transmission pipelines play in delivering the natural gas necessary to keep millions of Americans warm, safe and secure.” New Jersey’s Board of Public Utilities commissioned a study that says the state does not need the gas. Transco has its own evidence that shows a need. FERC sided with the gas company. But last summer, the U.S. Court of Appeals for the District of Columbia Circuit sided with New Jersey officials and environmentalists who argued the expansion project would make the state’s climate change goals impossible to meet. In approving the project again, FERC said it “cannot characterize any project’s GHG emissions as significant or insignificant,” referring to greenhouse gases. New Jersey environmental opponents are weighing their legal options. “We are extremely disappointed that FERC reissued its decision without any additional process or public review, and we are weighing our options for next steps,” said New Jersey League of Conservation Voters executive director Ed Potosnak. “The court ordered FERC to significantly improve its analysis of the need for and consequences of the project and the commission’s order falls far short.” — Ry Rivard | 
