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Electricity OUTLOOK: Powering NewYork City’s Economic Future
A Long-Term Deficit Looms,
As Do Potential Shortages in 2010-2015
While some
new generating capacity has been built or is under construction
since the New York Building Congress and other City-based
business and labor groups first brought attention to this
issue in 20013 , the long-term problem of needed supply and demand-side management remains.
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The 2001 report, Electricity Outlook: A Matter of Urgency,
demonstrated a need for 2,000-3,000 MW of new electricity
resources by 2006. Since then:
- 775 MW of new generation
capacity has been completed or will be in place by
year-end 2005, with an additional 1,000 MW expected
by 2006 for a total of 1,775 MW.
- Peak-load
demand in New York City has grown from 10,500
MW in 2001 to 11,304 MW in July 2005.
- The 500 MW goal
for energy efficiency and other distributed resources
has not been re alized.
- The New York State
Article X power plant approval process has expired
and no agreement has been reached on legislation
that would reauthorize or replace this important streamlining
mechanism that is necessary for the approval of
new power plants and the repowering of existing plants.
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By year-end 2005, 125 (net) MW were added with the completion of Con Edison’s
East River Repowering project. In 2006, an additional 1,000 MW areexpected from
the completion of the New York Power Authority’s (NYPA) 500
MW Poletti Plant and the 500 MW SCS plant in Astoria. The latter project is going
forward due, in part, to a 10-year power purchasing contract with Con Edison.
These projects received approval prior to the expiration in
December 2002 of the Article X licensing process. Two other
projects in New York City with full approval are currently
on hold: Reliant’s 562 (net) MW Phase I and II Repowering
Project in Astoria, and the 500 MW of SCS Phase II Astoria
Energy Project.
Most urgent is the immediate problem of a potential
shortage in projected capacity reliability by the years 2010-2015.
In
its December 21, 2005 Reliability Needs Assessment report,
the New York Independent System Operator (NYISO) stated that,
beginning in 2008, “ the Lower Hudson Valley and
south will need system reinforcements equivalent to 500
MW of capacity, which could consist of transmission reinforcements,
additional generation, demand side management, or a combination
of the three... the Hudson Valley, New York City and Long
Island will need 1,250 MW of electricity capacity by the
end of 2010 and 2,250 MW by 2015.” 4
The years between 2005 and
2009 are expected to see substantial new developments in office, residential
and infrastructure construction throughout the five boroughs. Without the assurance of new electricity capacity in the construction pipeline,
the start dates of many of the proposed projects could be jeopardized.
Meeting
the Short-Term Deficit: Assuring Sufficient Electricity Resources
by 2010-2015
The New York Power Authority (NYPA) issued a Request
for Proposal (RFP) in mid-March 2005 seeking 500 MW of In-City electricity capacity by 2008,
from either generation or transmission, to serve its New York City government
customers.
This amount, together with up to 675 MW from a distributed
resources program planned by Con Edison and the New York State Energy
Research and Development Authority (NYSERDA), could help
forestall the impending problems that begin in 2008.
With the long lead time needed for approval, planning
and construction of new generation, transmission and
distribution projects, the opportunity for planning and
constructing these new facilities is rapidly narrowing.
What is Needed to Meet the City’s Electricity Needs?
- Additional electric generating capacity
- Additional
electric transmission and distribution infrastructure
- Additional
demand-side management programs: energy efficiency,
clean on-sitegeneration, peak load management, and
high performance building design.
Major Projects Also Require:
- Substations
- Telecommunications
- Electric Cables
- Water
- Gas and Steam Mains
- Sewer
Substantial investment will
be required over the next twenty years to provide the necessary infrastructure for major projects and for
housing and commercial development
throughout the five boroughs.
Who Can Solve the Problem?
Both the public and private
sectors share the responsibility of ensuring that
New Yorkers continue to have adequate power.
To do so
requires:
- Aggressively promoting the construction of
new power plants, transmission
and distribution facilities and additional natural
gas pipeline capacity; and
- maintaining and strengthening
energy efficiency programs in both the public
and private sectors, investing in small, clean distributed
generation
technologies, and exploring options for renewable energy
such as wind
and solar power.
While the New York City Mayor and City Council
have no direct legislative role in or control over the process
of generating or providing electricity, including the matter of local plant siting, the ultimate imperative-- if not the
authority -- of assuring that New York City has sufficient
power for its residents and businesses will be borne by the City government.
The Comprehensive Reliability
Planning Process released by NYISO in December 2005, and
the System Reliability Assurance Study released by Con Edison
on December 30, 2005, have identified the long-term electric
infrastructure needs of the New York City area to ensure
system reliability through the year 2015. These new studies
underscore the urgent need for New York’s Governor
and Legislature to enact the laws and regulations to facilitate the siting,
placement, approval, and financing of environmentally sound, efficient power
plants, and ensure that they are built in a timely fashion so that needed electricity
supply is available.
New York City businesses, residents and governmen t
need to know that the
mechanisms to provide this vital electric capacity are
in place.
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