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For Immediate Release

NEW YORK CITY’S FUTURE HINGES ON SUFFICIENT ELECTRICITY FOR
NEW RESIDENTIAL AND COMMERCIAL DISTRICTS

Coalition Releases Report Citing Need for up to 7,000 MW by 2025 to Support Citywide Developments and Meet Air Quality Requirements

NEW YORK, January 19, 2006 – A coalition of business, civic, environmental and building industry organizations today released a report warning that New York City faces a looming electricity shortage, which must be addressed to ensure sufficient energy is available to accommodate all of the major new office, commercial and residential projects planned or proposed throughout the five boroughs over the next twenty years.

According to the report, Electricity Outlook: Powering New York City’s Economic Future, New York City needs an additional 6,000 to 7,000 megawatts (MW) of new electricity resources by 2025, as well as new infrastructure to carry and distribute that electricity.

The report also warns that a critical threshold looms as early as 2010. Based on current projections for rising power demand within the City, the available supply of locally-produced electricity will fall substantially below the State-mandated level between 2010 and 2015, if new power plants and/or dedicated transmission lines are not built and operational.

The New York Building Congress prepared the report in consultation with the Association for a Better New York (ABNY), Building & Construction Trades Council of Greater New York (BCTC), Natural Resources Defense Council (NRDC), Partnership for New York City and the Real Estate Board of New York (REBNY).

“The Bloomberg Administration is committed to ensuring that the City’s long-term economic growth is maintained by a sufficient supply of clean and reliable power,” said Deputy Mayor for Economic Development & Rebuilding Daniel L. Doctoroff. “Our Energy Plan calls for solutions that include energy efficiency, high-performance building design, clean on-site generation, the repowering of existing power plants and the development of new transmission lines and generation plants. We will continue to pursue projects that are consistent with the City’s environmental and land use goals to make sure we have sufficient capacity to meet the demands of current and future generations of New Yorkers.”

Building Congress Energy Committee Chairman and Rudin Management C.O.O. John J. Gilbert III added, “New York City’s requirements for additional electricity capacity in the next twenty years are driven by the ongoing economic recovery, by expected long-term growth in employment and population, by intensified use of appliances by residents and businesses, by the need to replace aging power plants and, most visibly, by power required for the many major commercial and residential projects that are currently planned or proposed.”

Kathryn S. Wylde, President & CEO of the Partnership for New York City, noted, “The New York Metropolitan Region is the world's tenth largest economy, as measured by economic output, but our continued economic growth is at risk unless we invest now in new and expanded facilities to supply and transmit electricity. Energy is quite literally the fuel that allows our economy to thrive.”

Added ABNY Chairman William C. Rudin, “The next few years in particular will be a time of intense building at the World Trade Center site, the Atlantic Terminal complex in Brooklyn, and the third phase of the Queens West development in Long Island City, as well as the annual addition of nearly 20,000 new housing units in all five boroughs.”

On July 27, 2005, peak demand in New York City reached a record 11,304 MW. The report credits recent government actions to increase supply, which helped to avert potential shortages during this period. However, the report notes that the sharp increase in demand was accompanied by sharp energy supply price increases for business and residents.

“To address the dual problems of global warming pollution and growing energy needs, we have no choice but to expand our energy efficiency and green building initiatives and replace dirtier generation with cleaner natural gas facilities,” said Ashok Gupta, Director of the Air and Energy Program for the Natural Resources Defense Council. “Increased investments in energy efficiency and distributed generation as well as the building of more efficient and cleaner plants will only take place if we address the financial markets need for long-term contracts and remove utility disincentives with regards to efficiency and distributed generation.”

“From a political and legislative perspective, the responsibility for assuring adequate electricity supply in this era of deregulation has been effectively orphaned,” said Building Congress President Richard T. Anderson. “If New York City hopes to accommodate projected growth, New York’s political leadership must focus on a series of critical investments, including electric cables, substations, gas, steam, water and sewer mains, telecommunications cables and towers.”

The New York State power plant approval process, Article X, expired more than two years ago, and no agreement has been reached on legislation that would reauthorize or replace this important streamlining mechanism.

BCTC President Edward J. Malloy said, “With the long lead time needed for approval, planning and construction of new power plants, the opportunity for constructing adequate generating facilities is rapidly narrowing. The enactment of legislation needed to streamline the power plant approval process requires the urgent and cooperative efforts of New York’s Governor and legislative leaders. The impasse has gone on far too long.”

REBNY President Steven Spinola added, “To assure that sufficient power is available between 2010 and 2015, construction of new power plants should begin as soon as possible. At present, two projects, totaling more than 1,000 MW, have been approved and should be expedited. For the long-term, however, it is important to get future power plants into the approval process.”

The report urges business and government leaders to support continued and additional participation in energy efficiency programs, investment in small, clean distributed generation technologies and exploration of options for renewable energy such as wind and solar power. The report also calls for more aggressive promotion of new power plant construction as well as new transmission and distribution facilities and additional natural gas pipeline capacity.
The report’s recommendation of between 6,000 and 7,000 MW in additional capacity by 2025 is based on a number of projections, including:

• Total New York City employment reaching 5,032,500, a 21 percent increase from 2002;
• Total New York City population reaching 9,352,500; a 16 percent increase (1.28 million people) from 2002;
• At least 44 million square feet of new office development (according to forecasts, the Hudson Yards project alone could require 200 MW of electricity in 2025);
• Substantial new university and hospital developments and expansions, as well as the initiation of major public capital projects, including public school and subway system expansions;
• The need to replace approximately 3,000 MW of aging generation capacity. By 2025, plants producing about 6,000 MW will be 45 years old or older;
  
• An additional 1,000 MW of capacity to assure market stability and avoid wide price swings in a deregulated market.

Copies of Electricity Outlook: Powering New York City’s Economic Future are available from the New York Building Congress, 44 West 28th Street, New York, NY, 10001, or through the organization’s website, at http://buildingcongress.com/code/research-electricity.htm.