Wednesday, February 22, 2017

NYPSC Rejects Challenge to Clean Energy Standard, Nuke Subsidy

By William Opalka

The New York Public Service Commission turned aside numerous challenges to its adoption of a Clean Energy Standard and its subsidy for upstate nuclear power generators, rejecting 17 petitions for rehearing and/or reconsideration.

Most of the petitions were dismissed by the commission. Several others, regarding “eligibility issues” for some resources, warrant further investigation by the PSC but do not warrant rehearing, the Dec. 15 order said (15-E-0302).

The commission granted a petition by Exelon seeking the elimination of a condition related to its acquisition of the James A. FitzPatrick nuclear plant, noting that the sale has already been approved. (See FERC Approves FitzPatrick Sale to Exelon.)

The CES mandates New York to acquire 50% of its energy from clean resources by 2030 and seeks to further that goal by providing zero-emission credits to support nuclear plants, which were in danger of closing.

Generators and some environmental advocates said the ZEC program — which some critics say will cost more than $7 billion over its 12-year lifespan — goes beyond the authority granted to the PSC by state law. (See CES Under Attack on Multiple Fronts in Rehearing Requests.)

The commission disagreed, saying “the ZEC requirement the commission adopted in the CES order is the best way to preserve the affected zero-emissions attributes while staying within the state’s jurisdictional boundaries.”

Complaints that the ZEC program intrudes on wholesale markets under FERC jurisdiction were similarly dismissed. “As explained in the CES order, neither the ZEC requirement nor any other aspect of the CES program inappropriately intrudes on the wholesale market or interferes with interstate commerce,” the PSC said.

nypsc clean energy standard nuclear subsidy

Tannery Island Hydroelectric facility | Ampersand Energy Partners

Owners of existing resources, including hydropower developers, said the CES order failed to properly measure their environmental benefits under the state-operated market for renewable energy credits. New large-scale hydropower projects are ineligible for ZEC payments under the order. Some smaller hydropower, wind and biomass resources built before 2015 that are eligible for smaller REC payments under previous state programs said they were in danger of closing because of extraordinarily low natural gas prices.

Staff has been directed to further study eligibility requirements, the order states, instead of waiting for a triennial review as established in the CES order in August.

The commission also dismissed petitions that claimed that state procedures were violated during the compressed time frame under which the ZEC program was open for public comment.

The commission’s order won’t be the final word on the subject, however, as two court challenges remain pending. (See Federal Suit Challenges NY Nuclear Subsidies and Environmental Group Files Second Challenge to NY Nuke Subsidy.)

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