CONGRESSMEMBERS CHALLENGE CLEAN CAR RULES: A bipartisan group of New York’s federal delegation is pushing Gov. Kathy Hochul to reconsider the state’s implementation of rules aimed at boosting EV sales. They warn that the rules — which New York lawmakers passed into law and are aligned with California’s clean car regulations that have an imperiled federal waiver — threaten consumers and auto dealers. “Many New Yorkers, especially those in rural and underserved areas, will be left without affordable options if the supply of internal combustion engine (ICE) and hybrid vehicles diminishes as the mandate progresses,” warns the letter signed by Republican Reps. Nick Langworthy, Claudia Tenney, Nicole Malliotakis, Mike Lawler and Nick LaLota, and Democratic Reps. Tim Kennedy, John Mannion and Joe Morelle. They want Hochul to slow down implementation of the EV sales requirements. The letter contains claims that the Department of Environmental Conservation has declared “misleading,” including that dealers will be required to sell one EV for every two gas cars. New York’s rules (and California’s) place a requirement on manufacturers, not dealerships, to sell increasing amounts of electric vehicles — starting with 35 percent of sales for model year 2026 and up to 100 percent by 2035. Manufacturers can purchase credits from other carmakers that sold more EVs to comply with the requirements, according to DEC. But dealers have raised concerns that manufacturers will stop sending them gas cars unless they sell enough EVs to meet the mandates, even if consumers aren’t interested. DEC sent a letter to car manufacturers earlier this month seeking to reassure them, citing federal uncertainty. The department emphasized that automakers would have three years before the agency would require companies to make up any deficits from model year 2026. “A manufacturer will not need to resolve a 2026 MY deficit until the conclusion of the 2029 MY,” wrote Tom Berkman, DEC’s deputy commissioner and general counsel. Berkman said the agency is committed to work with carmakers to “ease any compliance burdens” including exercising enforcement discretion and working with California and other states “to counter any harmful impacts of the current federal administration on New York state.” Berkman indicates dealers have raised concerns about Trump’s policies including tariffs making it more difficult to meet the EV requirements. Interim DEC Commissioner Sean Mahar assured lawmakers last month that the department would be flexible on the California-aligned rules for trucks and heavy-duty vehicles as well. — Marie J. French NYISO: NOT IT! — The independent operator of New York’s electric grid is preparing contingency plans if tariffs on imports from Canada go into effect and impact its operations. But the official stance of the organization responsible for keeping the lights on is that the tariffs don’t apply to electricity — and if they do, it's not their problem. “The duties do not appear to apply to Canadian electricity and, if they are, the [New York Independent System Operator] is not the responsible party to implement the tariffs or to remit payments to the U.S. government,” the NYISO said in a statement on its website earlier this week. Nevertheless, the NYISO plans to file plans today for how to implement and collect a tariff on electricity imports with federal regulators as they continue to seek clarity. President Donald Trump has delayed 25 percent tariffs on Canadian and Mexican imports — 10 percent on energy — until at least March 4, but he’s caused some confusion and signaled another potential delay. “NYISO will not implement its proposed tariff revisions unless relevant federal authorities decide that the NYISO must pay duties on Canadian electricity,” the grid operator stated. (NYISO's tariff governs its operation of the grid and energy markets. Changes need approval from the Federal Energy Regulatory Commission. Confusing, we know.) Energy experts expect tariffs will have an upward pressure on utility bills due to rising material costs on the distribution side. Tariffs on electricity imports would also impact New Yorkers’ bills, as the state imports from Canada and relies on the neighboring grids to ensure reliability. — Marie J. French MUSK FACTOR LOOMS IN DIRECT SALES FIGHTS — POLITICO’s Marie J. French: Elon Musk is taking Washington by storm, but in statehouses controlled by Democrats on both coasts, his lobbyists are facing a frigid welcome. Tesla’s ability to sell electric vehicles directly to consumers remains restricted in several states where the deeply entrenched franchise dealership model prevails. Musk’s company has lobbied to be allowed to set up its own sales locations in those states over the last few years — with only limited success. WHERE DOES THE WIND BLOW? HOCHUL ADMIN DEMANDS PROOF: Gov. Kathy Hochul’s administration wants the owner of the largest fossil fuel plant in New York City to justify an offshore wind transmission line the company says is key to transitioning to renewables. The Department of Public Service filed a “motion to compel” in the permitting process for the Queensboro Renewable Express project on Wednesday. The motion seeks to force Queensboro Development to provide information about what offshore wind projects the transmission project would deliver energy from. “When an applicant for a certificate proposes to transmit power from a specific source, the applicant provides the locations and details of interconnecting generators,” the motion states. The Public Service Commission must have this information to make a finding of need and other determinations required to issue a permit under Article 7, the department argues. It’s admittedly an obscure filing. But it sets the stage for Hochul’s utility regulator to move to dismiss or delay the permitting process for the Queensboro project, which doesn’t have a deal with an offshore wind project to supply power. Queensboro Development is a subsidiary of Ravenswood owner Rise Light and Power. The transmission line to deliver offshore wind is one piece of a sweeping, multi-phase plan to transition New York City’s largest fossil fuel power plant as New York seeks to achieve its climate goals. The company sought approval for the project in 2022, when they filed an Article 7 application for 18.5 miles of transmission in New York waters to an interconnection point at the power plant in Queens. The project could bring 2.6 gigawatts of offshore wind into New York City. The transmission line proposal and shutting down some fossil fuel turbines at the Ravenswood site were part of an offshore wind project that almost secured a NYSERDA contract before three large tentative contracts were canceled in April 2024. Rise owns a stake in Attentive Energy One, an offshore wind project also backed by Total Energies and Corio Generation. The project withdrew from the latest NYSERDA offshore wind solicitation before finalizing a bid and its future is uncertain. Queensboro argued information about where the energy for the line would come from was not relevant. “There will be commercial agreements in place prior to the commencement of construction,” the company wrote in response to the department’s questions. The company pointed to the PSC approval for the Champlain Hudson Power Express before it had a state contract, but DPS staff shot back that Canadian hydropower was always the expected source of energy on the line. The project lacked an offtake agreement to finance the line for years, however, until it secured a NYSERDA contract under Hochul. But the prospect of substantial amounts of new offshore wind coming online in the next several years, beyond projects that already have their own plans for hooking into the grid, are dimming by the day. Trump has expressed open hostility to offshore wind and ordered a review of permitting that may even ensnare an onshore transmission project aimed at allowing more offshore wind on Long Island. Still, project backers say the PSC should still review the transmission line’s plan. “We urge the Commission to continue its crucial work reviewing projects like this one and — when the merits of the project justify it — issue permits so that they can proceed,” wrote Robert Fruedenberg, vice president of the Regional Plan Association’s energy and environmental programs, in a comment submitted Wednesday to the department. “Any delay could signal an erosion of the State’s support for renewable energy, indicate an abandonment of its leadership role, and threaten its ability to meet climate targets.” Another backer of the project, former New York City Council member Costa Constantinides, told POLITICO he hopes Hochul sees the benefit of the transmission line. “I think this governor is the climate governor,” he said. “The governor herself believes that New York State needs to do its part so I have faith in her that she wants to move forward.” A spokesperson for Rise declined to comment. — Marie J. French ICYMI: CONGESTION TROLLING — POLITICO’s Ry Rivard: Call it congestion trolling. Gov. Kathy Hochul flew down from Albany on Wednesday for an MTA board meeting to continue her attack on President Donald Trump’s move to kill the Manhattan toll program. During her noon appearance in Midtown, the governor held up and flipped through a presentation her staff made for Trump as if she were at the head of an elementary school classroom instead of the MTA board table. ILA DEAL: Dockworkers ratified a contract with the shipping industry, said the union that represents tens of thousands of East and Gulf coast longshore workers. The approval, which was expected, came after a brief pre-election strike that won the union huge wage increases and weeks after reaching a deal about the use of technology at ports. Harold Daggett, the head of the International Longshoremen’s Association, continued to praise President Donald Trump’s role in resolving the disputes that threatened to upend the economy. In a social media post, Trump congratulated the union and thanked them for their “overwhelming support in the Presidential Election.” He added, "Slowing down automation, just a little bit, is an OK thing to do!!!” The shipping industry had already ratified the contract and it’s expected that the new agreement will be signed the week of March 10 and go into effect after that. — Ry Rivard NJ TRANSIT GETS MONEY BUT SO DOES SURPLUS — The largest new spending in Gov. Phil Murphy’s budget proposal, unveiled on Tuesday, is $815 million to fill the long-anticipated hole at NJ Transit. In the current budget year, which began last summer, the governor levied a “corporate transit fee” on the state’s largest businesses to raise money for the transit agency, but the governor is planning to use the $1 billion being collected this year to pad the surplus. The New Jersey Business and Industry Association, which represents businesses who pay the tax, praised the proposed budget (for FY ’26) for planning to spend the money collected for transit on transit, but questioned the use of the $1 billion being collected in the current budget year (FY ’25). In a statement, industry association CEO Michele Siekerka said: “$1 billion collected from our largest job creators last year still remains in surplus and therefore open for purposes other than NJ Transit. Our business community deserves clarity on the use of that money as it was intended for NJ Transit.” On X, NorthJersey.com’s Colleen Wilson wonders what happened to Senate budget committee chair Paul Sarlo’s pledge last year that “every dollar” from the fee would go to NJ Transit. State lawmakers, who are already questioning some of the $1.2 billion in tax and fee increases Murphy proposed, might see the transit revenue as a tempting pot of money to tap for their own priorities, but a senior Murphy administration official said that corporate transit funds would go to NJ Transit and would not be considered negotiable with the Legislature. Alex Ambrose, a policy analyst at New Jersey Policy Perspective, said the language dedicating money from the corporate fee to transit “needs to be stronger” to avoid “raids,” but her group does not have a problem with the way the money is being spent now. Murphy also mentioned clean energy — but not offshore wind, which was a prominent feature of previous major speeches but is now in a stupor, with every wind project approved by the state dead or delayed in some way. Instead, he singled out growth in the state’s solar industry and also highlighted hundreds of millions of dollars raised by the Regional Greenhouse Gas Initiative. — Ry Rivard ICYMI: NEW DEC CHIEF NOMINATED: Hochul has officially nominated Amanda Lefton as commissioner of the Department of Environmental Conservation. Lefton works for an offshore wind developer and has a long history in Albany. She was also with the Biden administration as the head of the Bureau of Ocean Energy Management, which oversees offshore wind permitting among other duties. Lefton’s expected nomination was first reported by POLITICO last month. If confirmed by the Senate, she’ll replace interim DEC Commissioner Sean Mahar, who took the helm after Basil Seggos departed last year. Hochul’s choice drew praise from environmental groups, including the New York League of Conservation Voters and Environmental Advocates NY. “Governor Hochul made an excellent choice in nominating my friend,” said Julie Tighe, president of NYLCV. “Amanda’s time as director of BOEM — during which she helped usher in a new era for offshore wind energy — combined with her prior work in the state government, private and non-profit sectors makes her well suited to help New York take bold climate action and protect our air, water and open space.” State Sen. Pete Harckham, who chairs the Environmental Conservation Committee, said he looked forward to the vetting process. The Senate has not yet set a timeline to consider Lefton’s nomination. Hochul on Monday also announced the nomination of two acting agency heads to permanent posts. She put forward Denise Miranda as the commissioner of the State Division of Human Rights and Willow Baer as commissioner of the State Office for People With Developmental Disabilities. — Marie J. French BUDGET DECARBONIZATION PUSH: A coalition backed by environmental groups, labor unions and industry stakeholders is pushing for Gov. Kathy Hochul and lawmakers to fund $200 million in decarbonization projects on college campuses and in an upstate city. The Upgrade NY campaign, which includes the New York League of Conservation Voters, the Building Decarbonization Coalition and the New York State AFL-CIO, sent a letter to Hochul last week laying out its request. The groups have a specific list of “thermal energy network” projects they want the state to fund. “These emissions-free infrastructure projects connect multiple buildings using an underground network of water-filled pipes and can scale up to serve entire neighborhoods and multi-building campuses,” the letter says. The money could come from Hochul’s proposed $1 billion for climate mitigation projects, although the governor’s budget plans indicate that money could take five years to spend. The Upgrade NY campaign wants $68 million to support the University at Buffalo campus in decarbonizing by building an emissions-free heating and cooling network on the university’s South campus. The SUNY school was recently awarded $12 million in environmental bond act funding. Those funds are earmarked for a geothermal well field under a parking lot and heat pump equipment at a building slated to undergo a gut renovation. Eventually, with more funding, other buildings would be connected to the system as they’re renovated. “We have to bring those on as money becomes available, and in a phased-in way that limits disruption,” said Ryan McPherson, the university’s chief sustainability officer. McPherson said the university is exploring all its options for fully funding its long-term decarbonization plan. He said it’s a positive sign that Hochul allocated $100 million for SUNY and $50 million for CUNY from the bond act to fund campus decarbonization. “This is the first time that I have seen designated funding for decarbonization work across the SUNY campuses, and I think that's the really hopeful thing, because you can't just cannibalize the deferred maintenance money,” McPherson said. The Upgrade NY coalition’s other funding asks are $50 million for a thermal network at SUNY Purchase, $55 million for a geothermal system at University at Albany on its downtown campus, $19 million for Jamestown’s Board of Public Utilities for a thermal loop utilizing heat from waste water, $5 million for geothermal energy at Stony Brook University’s campus libraries and $3 million for the SUNY headquarters. Even with the governor’s proposed $1 billion, the investment needed to reduce building emissions is enormous, said Lisa Dix, New York director for the Building Decarbonization Coalition. “We need a lot more, which is why we need cap and invest,” Dix said. Hochul punted on regulations to implement the economy-wide cap-and-trade program she previously endorsed, delaying their release and any potential revenues and costs. “It is a delay, and I hope that she continues to stay on track, that the regulations get completed and that we look at first thing, first stop next year, program funding,” Dix said. — Marie J. French CALIFORNIA FOLLOWS — POLITICO’s Blanca Begert: A bill that would require major oil companies to pay fees to cover climate damages based on their past emissions was reintroduced in California on Friday. California Sen. Caroline Menjivar and Assemblymember Dawn Addis introduced the Make Polluters Pay Climate Superfund Act in both houses of the Legislature. | 
