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Champlain Hudson & NY Energy Highway - State Senate Hearings

A coalition of New York State legislators, along with the Independent Power Producers of New York (IPPNY) and the International Brotherhood of Electrical Workers (IBEW), is opposing the proposed construction of the Champlain Hudson Power Express (“CHPE”) project – a transmission line intended to bring up to 1,000 MW of hydropower from Canada to the New York metro area.

These groups claim that CHPE threatens the ability of upstate coal fired power plants to stay in business. Many coal fired facilities in western and central New York have closed or are struggling to remain open in the wake of new environmental laws and regulations. Senate Energy Committee Chairman George Maziarz (R-Niagara) and several Senate Republicans representing parts of central and western New York say they’re concerned construction of CHPE would threaten tax revenue and jobs.

Recently, Senator Maziarz held two public hearings to examine these issues. The first hearing focused on long-term base-load energy generation and transmission needs of the state. Most of the hearing focused on CHPE, as well as the at-risk power plants. The second hearing reviewed the impacts of CHPE on residents of the Town of Stony Point in Rockland County with much of the attention being paid to potential uses of eminent domain.

At the first hearing, Senator Maziarz reiterated his opposition to CHPE and expressed support for the Energy Highway proposal submitted by the NY Transco (a public-private partnership between NY’s Investor Owned Utilities, LIPA, and NYPA) because of its emphasis on in-state transmission and jobs. He also argued that the at-risk plants could be saved by converting them from coal fired to natural gas facilities.

Entities such as IPPNY and the New York Affordable Reliable Electricity Alliance (NYAREA) testified and opposed the construction of CHPE. Both groups argued that New York should be promoting in-state jobs and generation, not outsourcing generation. There was also significant support for assisting the at-risk plants. Representatives from NRG testified and emphasized the importance of long-term contracts (LTCs) to help avoid plant closures. 

In addition, Senator Maziarz announced several legislative initiatives intended to prevent the construction of CHPE, facilitate repowering, and provide economic relief to the communities where at-risk plants are located. These include the following:

  • Restrict the use of eminent domain for any electric utility which seeks through itself, or through one or more “affiliated interests”, to build/expand a transmission line connecting a location outside of the US to a location in New York. The same restrictions apply to an electric facility seeking to build/expand outside of the US and interconnect to a point in NY. (S.7391
  • Create the “NY Clean Energy Innovation Fund” to be paid for with the sale of NYPA peaker plants located in NYC (expected to generate $300m-$700m). The revenue would be used to assist with repowering and the communities where at-risk plants are located. (S.7789
  • Provide access to the Excelsior Jobs Benefit Program (tax credits) for generators seeking to undergo repowering. (S.7743-A
  • Create the “Clean Fuel Repowering Tax Credit” which would allow power plants to take at least a 12.5% tax credit on any improvements that are necessary to comply with the environmental standards set forth in the new Article X siting law. (not yet introduced) 
  • Allow repowering projects that meet strict environmental standards to access low interest financing. (not yet introduced) 
  • Remove existing environmental exemptions (air and water) that benefit aging oil fired plants. (not yet introduced) 
  • Allow plants to redirect money paid for RGGI credits to pay for repowering, utilization of cleaner burning fuel technologies, or the inclusion of renewable energy. (not yet introduced) 
  • Apply RGGI charges to power imported from outside the state or country. (not yet introduced)

Significant attention was given to the potential use of eminent domain in the Town of Stony Point. There is a dispute as to whether eminent domain would be required to construct CHPE. Many legislators, including Senator Maziarz, believe that it would. It is this belief that prompted Maziarz to introduce the above-referenced legislation, which prohibits the use of eminent domain for developers attempting to connect a transmission line from a point outside of the US to a point in New York. However, the developers of CHPE testified that eminent domain would not be required because only existing rights of way would be used.

Additional Public Service Commission hearings on the construction of CHPE will be held in the upcoming months.

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