“New York has led and will continue to lead on clean energy and climate, but reality has been harsh,” Gov. Kathy Hochul said Thursday as she announced mandates under the 2019 Climate Act will be adjusted. “We cannot meet the current timelines without driving energy costs higher. The facts bear that out, and I cannot let that happen.”
Times Union file photo
ALBANY — Lawmakers and Gov. Kathy Hochul have agreed to make several amendments to New York’s 2019 Climate Act to head off what the governor’s administration as well as business and energy sector leaders have warned could be significant price increases for utility and gasoline prices for consumers.
A few details were revealed at a news conference the governor convened Thursday morning at the Capitol, where she announced a $268 billion budget deal had been reached that includes numerous policy measures. She said “the Legislature will be conferencing and voting on the budget bills, and as always, the final details will be worked out through that process.”
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The 2019 legislation had mandated having 70% renewable electricity sources by 2030 and net-zero emissions by 2040 — mandates that critics of the law had said would be unattainable. On Thursday, Brian K. Mahanna, a counsel to the governor, confirmed that under the budget deal “there’s going to be a new target in 2040 for a 60% reduction in emissions.”
The deal also includes changing the formula used to measure greenhouse gas emissions from a 20-year to a 100-year time span, which will artificially lower the measurable amounts that some fossil fuels have on the atmosphere.
In addition, the budget will allocate $1 billion in rebates for utility customers, the governor said. The proposed budget also includes — for the second year in a row — a $1 billion allocation for sustainable energy projects, “with a specific carve out for environmental justice communities,” Hochul said. It’s unclear where that money will come from.
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“We’re also establishing a ratepayer protection plan to hold utilities accountable and reforming the rate-setting process so utility companies can no longer pass their lobbying costs on to you,” the governor said.
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The proposed changes follow an October ruling by a state Supreme Court Justice who said the state Department of Environmental Conservation needed to follow the Climate Act’s statutory mandate to establish rules to ensure New York reaches its targets of achieving a 40% reduction in greenhouse gas emissions by 2030. The rules were supposed to be in place two years ago, and environmental advocacy groups sued the state to force compliance.
The state attorney general’s office has appealed the judge’s ruling, but the uncertainty of that case left state lawmakers and the governor scrambling to adjust the provisions of the 2019 law that had set strict mandates for reducing greenhouse gas emissions and other pollutants.
“I’ve been candid about the Climate Leadership and Community Protection Act,” Hochul said. “New York has led and will continue to lead on clean energy and climate, but reality has been harsh. We cannot meet the current timelines without driving energy costs higher. The facts bear that out, and I cannot let that happen.”
Hochul said the amendments to the Climate Act are necessary to “strike the right balance between our clean energy ambitions and the affordability pressures that real New Yorkers are facing right now. So we’re adjusting the CLCPA implementation timeline in targeted ways so it works for everyone.”
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The governor declined to say whether any of the emissions mandates will be adjusted. Her public remarks on the issue this year also have been largely void of saying whether repowering antiquated fossil-fuel power plants will be done to help the state meet its future energy needs.
Those plants, blamed for much of the state’s carbon emissions, are essential during times of grid stress, particularly in New York City. But many of the generating plants are up to 70 years old. Energy sector leaders said repowering those plants — which would make them more efficient and reduce their emissions — offers the most efficient and economic pathway to enhance reliability and protect consumers from price fluctuations.
The New York State Energy Research and Development Authority released a memo in February asserting that to bring emissions down enough to meet the 2030 requirements, the state would need to implement a highly costly version of a program that would place a price on carbon emissions so heavy industry pays an additional amount to operate. The money from that program is intended to be partly directed to households in the form of rebates and otherwise invested into clean energy technology.
Under the deal brokered in the state budget, the regulations establishing the greenhouse gas reductions would not go into place until 2028.
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If accounting methods are updated to match the global 100-year standard, New York’s 2030 greenhouse gas reduction mandate could be reached between 2031 and 2035 — when coupled with a slight increase in investment into clean energy technology, according to the New York State Energy Research and Development Authority. Under the state’s current environmental policies, the 2030 requirement wouldn’t be met until at least 2037, the authority reported last year.
“New York state was the only state in the nation that had an accounting system that had to measure emissions after 20 years,” Hochul said. “And the rest of the nation and the entire world, the international accounting standard was 100 years. So that really created enormous pressure to have this happen.”
The three-page memo issued in February by Doreen M. Harris, president and CEO of the New York State Energy Research and Development Authority, buttressed the warning days earlier from state Budget Director Blake Washington, who, along with Hochul, has been cautioning that adhering to the Climate Act’s strict zero-emission mandates will sharply raise future costs for oil, natural gas and gasoline.
Democrats in the Legislature and environmental advocates had pushed back over the past several months, asserting that the memo from Harris, which predicted upstate households could see natural gas and oil costs increase more than $4,000 a year — and businesses facing a 46 percent increase — was not supported by a deeper analysis explaining the projection.
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Liz Moran, an environmental lobbyist for the advocacy organization Earthjustice, had called the timing of Harris’ memo “shady” and told reporters, “We’re here because New Yorkers are depending on Gov. Hochul and the Legislature to lower our energy bills.”
“And despite what the governor’s administration wants you to believe, rolling back our nation-leading climate law is only going to do the opposite,” Moran said in February. “Last week after the governor’s budget director threw out a number that nobody had heard before, about how the climate law could raise costs, NYSERDA released a memo backing him up.”
A memo released that month by Earthjustice sought to pick apart the memo from Harris, which was sent to Jackie Bray, the director of state operations. The memo asserted that the analysis was flawed and that families living in all-electric homes would save more than $1,000 in utility costs compared with those whose homes are heated with oil or natural gas.
Still, the dire prediction from Hochul’s administration — and her calls to adjust the Climate Act — was not unexpected. Business and energy sector leaders have for years warned that the mandates of the 2019 Climate Act are unattainable, including reducing New York’s greenhouse gas emissions 40 percent from 1990 levels by 2030. They and others have also long called for the state to conduct a cost-analysis of the mandates; if that has been done, the state has never made any report public.
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In January 2021, two members of the state’s Climate Action Council — Donna L. DeCarolis, president of the National Fuel Gas Distribution Corp., and Gavin J. Donohue, president of the Independent Power Producers of NY — sent a letter to the co-chairs of that council urging them to authorize a study to determine the short- and long-term costs of the alternative ways being pursued to reduce emissions under the Climate Act.
That letter was also signed by more than 70 business, labor and power industry leaders across New York, but it received no response from the council’s co-chairs or other state leaders.
The state also has not formulated a detailed plan for pulling away from a power grid that’s more than 70 years old, and as more than 85 percent of electricity being supplied to New York City and Long Island is from gas and oil.
Donohue, a former longtime deputy and executive deputy commissioner with the state Department of Environmental Conservation, said the goals of the 2019 legislation, told the Times Union several months ago that the goals of the law are supported by his organization, but that they were “well-intentioned but not well planned out mandates.”
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“It is possible for New York to retain its leadership in climate initiatives while ensuring both reliability and affordability, provided that policy decisions are grounded in practical, consumer-based realities,” Donohue said.