Climate Act Integration Analysis – Pragmatic Environmentalist of New York

New York Energy Burden Definition

I worry that the implementation of New York’s Climate Leadership & Community Protection Act (Climate Act) is going to increase the cost of energy to those least able to afford it. New York State does not have a clearly defined affordability threshold for the Climate Act nor does it track energy burden metrics. The only metric referenced in the Climate Act Scoping Plan is a Public Service Commission target energy burden set at or below 6 percent of household income for all low-income households in New York State. This post addresses that metric.

I have followed the Climate Act since it was first proposed, submitted comments on the Climate Act implementation plan, and have written over 350 articles about New York’s net-zero transition. I have devoted a lot of time to the Climate Act because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that the net-zero transition will do more harm than good by increasing costs unacceptably, threatening electric system reliability, and causing significant unintended environmental impacts. The opinions expressed in this post do not reflect the position of any of my previous employers or any other organization I have been associated with, these comments are mine alone.

Climate Act Background

The Climate Act established a New York “Net Zero” target (85% reduction and 15% offset of emissions) by 2050. It includes an interim 2030 reduction target of a 40% reduction by 2030 and a requirement that all electricity generated be “zero-emissions” by 2040. The Climate Action Council is responsible for preparing the Scoping Plan that outlines how to “achieve the State’s bold clean energy and climate agenda.” In brief, that plan is to electrify everything possible using zero-emissions electricity. The Integration Analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants quantifies the impact of the electrification strategies. That material was used to develop the Draft Scoping Plan. After a year-long review, the Scoping Plan recommendations were finalized at the end of 2022. In 2023 the Scoping Plan recommendations are supposed to be implemented through regulation and legislation.

Renewable Energy Program Affordability Concerns

Proponents of the Climate Act don’t acknowledge that there is a affordability safety valve. New York Public Service Law § 66-p (4). “Establishment of a renewable energy program” includes constraints for affordability and reliability that could be used to limit the damage of Climate Act implementation. § 66-p (4) states: “The commission may temporarily suspend or modify the obligations under such program provided that the commission, after conducting a hearing as provided in section twenty of this chapter, makes a finding that the program impedes the provision of safe and adequate electric service; the program is likely to impair existing obligations and agreements; and/or that there is a significant increase in arrears or service disconnections that the commission determines is related to the program”.

There are affordability considerations regarding the constraint “significant increase in arrears or service disconnections”. I believe that the Hochul Administration’s Climate Action Council should define what that means. For example, Addressing Energy Poverty in the US offers possible criteria:

According to the U.S. Department of Energy, the average energy burden for low-income households is 8.6%. That is three times higher than for non-low income households, which is about 3%. And according to the Kleinman Center for Energy Policy at University of Pennsylvania, more than one-third of US households are experiencing “energy poverty,” having difficulty affording the energy they need to keep the lights on and heat and cool their home.

I think that New York should define its energy poverty targets and track them. Once the standard is defined, the status of the standard in New York should be monitored and made publicly available, and a threshold for acceptability established. For example, if the New York state low-income standard is 8.6% and the baseline energy burden level is 9%, then if the average energy burden increases to 10% provisions to temporarily suspend or modify the obligations should be triggered.

In order to implement my recommendation, the first task would be to establish the energy burden standard. As far as I can determine there is only one existing candidate. The Public Service Commission has a target energy burden set at or below 6 percent of household income for all low-income households in New York State. Reviewing it raises questions about its suitability for this purpose.

Order Adopting Low Income Program Modifications and Directing Utility Filings

The six percent target was included as part of Public Service Commission (PSC) Case Number: 14-M-0565, the Proceeding on Motion of the Commission to Examine Programs to Address Energy Affordability for Low Income Utility Customers. According to the PSC: “The primary purposes of the proceeding are to standardize utility low-income programs to reflect best practices where appropriate, streamline the regulatory process, and ensure consistency with the Commission’s statutory and policy objectives.” On May 20, 2016 the Order Adopting Low Income Program Modifications and Directing Utility Findings adopted “a policy that an energy burden at or below 6% of household income shall be the target level for all 2.3 million low income households in New York.”

The order notes that:

There is no universal measure of energy affordability; however, a widely accepted principle is that total shelter costs should not exceed 30% of income. For example, this percentage is often used by lenders to determine affordability of mortgage payments. It is further reasonable to expect that utility costs should not exceed 20% of shelter costs, leading to the conclusion that an affordable energy burden should be at or below 6% of household income (20% x 30% = 6%). A 6% energy burden is the target energy burden used for affordability programs in several states (e.g., New Jersey and Ohio), and thus appears to be reasonable. It also corresponds to what U.S. Energy Information Administration data reflects is the upper end of middle- and upper-income customer household energy burdens (generally in the range of 1 to 5%). The Commission therefore adopts a policy that an energy burden at or below 6% of household income shall be the target level for all low-income customers. The policy applies to customers who heat with electricity or natural gas.

The energy burden statistics cited in the Staff Report suggest a significant energy divide exists for low-income households. About 2.3 million households are at or below 200% of FPL, with an energy affordability “gap,” i.e., an average annual energy burden above the 6% level. Approximately 1.4 million of these households receive a HEAP benefit; however, for the 2013-2014 program year, only about 316,000 of those households received a benefit for utility service.

The Order notes that reducing this energy burden will be a challenge:

Closing such a wide gap for 2.3 million low-income households is a non-trivial pursuit, and will require a comprehensive effort that involves all of the tools at the state’s disposal, including, but not limited to, utility ratepayer-funded programs. A central role in achieving energy affordability for low income customers is played by the financial assistance programs administered by the Office of Temporary and Disability Assistance (OTDA), including the Home Energy Assistance Program (HEAP). Another important role is played by low income energy efficiency programs such as the Weatherization Assistance Program administered by New York State Homes and Community Renewal (HCR) and the ratepayer–funded EmPower-NY program administered by the New York State Energy Research and Development Authority (NYSERDA). Utility ratepayer funded programs also include the rate discount programs under discussion here, as well as investments designed to create opportunities for low income households to benefit from the cost savings offered by Distributed Energy Resources.

The Order goes on to offer suggestions to close the gap. It argues that a holistic approach among many state agencies is needed. For that to work there must be better coordination “among the various governmental and private agencies” that address this issue. The Order suggests that “achieving an optimal design will require building new partnerships and new mechanisms for identifying and enrolling eligible households”.

The most tangible aspect of the Order to address the energy burden problem was to establish low-income bill discount programs for each of the major electric and gas utilities. This included standardization of utility energy affordability programs statewide to “reflect best practices where appropriate, streamlining of rate cases, and greater consistency between the programs and the Commission’s statutory and policy objectives.”

On Augst 13, 2021 a press release describing the expansion of the low-income affordability program noted:

To reach the target of no more than a 6 percent energy burden for low-income New Yorkers, it would be necessary to coordinate and leverage all available resources at the State’s disposal, including multiple sources of financial assistance to lower customers’ bills, energy efficiency measures to reduce usage, and access to clean energy sources to lower the cost of the energy itself. As part of the Commission’s decision, Commission staff will work closely with other entities, including OTDA and the utilities, to ensure that low-income customers receive the assistance they need.

The utility companies submit quarterly reports documenting the number of low-income customers receiving discounts and the amount of money distributed. However, I have been unable to find any documentation describing how many customers meet the 6% energy burden criteria, much less any information on how those numbers are changing. The biggest problem with this energy burden program is that it only applies to electric and gas utility customers. Citizens who heat with fuel oil, propane, or wood are not covered.

Sc=oping Plan Energy Burden

The only reference in the Scoping Plan to the PSC low-income energy burden target of 6% was in Appendix A, the Enabling Initiative #7 slide in the Power Generation Advisory Panel Considerations. The relevant sentence states a potential barrier to success is “The State’s ability to project how much financial support will be adequate while assuring that low-income customers will not surpass the 6% energy burden during the transition to electrification”. As noted previously, this ignores citizens who do not heat with electricity or natural gas.

I am aware of only one other suggestion for an affordability metric. In the 2021-2022 legislative session there was a proposal that included a requirement for state agencies to identify policies to ensure affordable housing and affordable electricity using an “affordability of electricity” metric that was defined as “electricity does not cost more than six percent of a residential customer’s income.”

I don’t think either is the appropriate metric for the Climate Act transition. The legislative proposal only addresses electricity and the PSC energy burden target only addresses only utility bills. This fails to address the concerns of citizens who heat their homes with fuels not provided by a utility such as heating oil or propane. The Climate Action Council has proposed a cap-and-invest program that will put a price on gasoline and diesel fuels. Those should also be considered part of the energy burden.

Reality Disconnect

The Order Adopting Low Income Program Modifications narrative on the clean energy transition is inconsistent with the experience of every jurisdiction that has tried to replace existing sources of electrical generation with wind, solar, and storage. The total costs to integrate intermittent and diffuse wind and solar inevitably increase costs. The argument in the Order claims:

In addition, the best solution for all customers, including low income, lies in facilitating opportunities to invest in clean energy and the means to reduce energy costs. Greater access and support for low income and underserved communities to Distributed Energy Resources is the best way to narrow the affordability gap that needs to be filled with direct financial assistance for customers with low incomes. Greater access to advanced energy management products to increase efficiency for low-income customers will empower those for whom these savings may have the greatest value, as well as allowing the most disadvantaged customers more choice in how they manage and consume energy.

There are two aspects to the claim that clean energy will reduce energy costs that are problems. The first problem is the cost of new generating capacity in general. The New York State Energy Research & Development Authority recently announced that investments in three offshore wind and 22 land-based renewable energy projects totaling 6.4 gigawatts. For the offshore wind projects “the average bill impact for customers over the life of the projects will be approximately 2.73 percent, or about $2.93 per month.” For the other projects the average bill impact for customers over the life of the projects will be approximately 0.31 percent, or about $0.32 per month. If future projects somehow stay at the same price despite the costs of inflation, supply chain issues, and all the other reasons that developers for existing projects recently argued when calling for renegotiation of their project contracts, then the average monthly bill impacts will be $16.40 per month for the projected offshore wind, onshore wind, and solar capacity needed in 2030. That is just the cost of additional generating capacity and does not include the energy storage needed to address intermittency or transmission upgrades needed to address diffusivity. The Order’s claim that clean energy will reduce energy costs is unsupportable.

The second problem is that those additional costs necessitate changes to low-income customer support. In order to maintain the same relative level of energy burden more money will be required for these higher costs. Furthermore, the higher costs will mean more people will qualify for energy burden support. That additional money must be covered by the remaining ratepayers, driving their costs higher, and increasing the number of people that quality for energy burden support. At some point this spiral of costs will become unsustainable.

Conclusion

Increased energy costs are regressive taxes and impact those least able to afford them the most. I believe that the net-zero transition will inevitably increase energy costs. Surely there is a point when the costs are unaffordable overall or the impacts to low-income ratepayers are unacceptable.

I believe it is necessary to establish a energy burden standard. The first step to address this problem is to develop a transparent metric for energy burden. The Public Service Commission target energy burden of 6 percent of household income only applies to utility costs. A metric that considers all energy costs including transportation has to be developed. The second step would be to establish energy burden acceptability criteria that could be used to comply with the New York Public Service Law § 66-p (4) affordability considerations associate with the constraint “significant increase in arrears or service disconnections”. Finally, a transparent and readily available tracking system needs to be established.

Clearly there is a reluctance by any of the politicians supporting the clean energy transition to be accountable for costs. There is an existing energy burden metric but the status of ratepayers relative to the 6 percent metric is not documented. It is almost as if the State does not want us to know where we stand. As such, the possibility of properly tracking energy poverty is unlikely. I think that is to the great shame of the proponents of the clean energy transition.

Climate Act Comparison of Generating Resources: Integration Analysis Mitigation Scenarios vs. NYISO Resource Outlook

At the October 25, 2022 Climate Action Council meeting Carl Mas compared the New York Independent System Operator (NYISO) 2021-2040 System & Resource Outlook and Integration Analysis generating resource projections for the net-zero transition plan required by New York’s Climate Leadership and Community Protection Act (Climate Act). I have long advocated for such a comparison but I remain concerned that this is more of an empty gesture than the start of an open and transparent comparison and discussion of the implications of differences in the projections.

Everyone wants to do right by the environment to the extent that they can afford to and not be unduly burdened by the effects of environmental policies. I submitted comments on the Climate Act implementation plan and have written extensively on New York’s net-zero transition because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that this supposed cure will do more harm than good. The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.

Background

The implementation for the New York’s Climate Act “Net Zero” target (85% reduction and 15% offset of emissions) by 2050 is underway. The Climate Action Council has been working to develop plans to implement the Climate Act. Over the summer of 2021 the New York State Energy Research & Development Authority (NYSERDA) and its consultant Energy + Environmental Economics (E3) prepared an Integration Analysis to “estimate the economy-wide benefits, costs, and GHG emissions reductions associated with pathways that achieve the Climate Act GHG emission limits and carbon neutrality goal”. Integration Analysis implementation strategies were incorporated into the Draft Scoping Plan when it was released at the end of 2021 for public comment. Since the end of the public comment period in early July 2022 the Climate Action Council has been addressing the comments received as part of the development of the Final Scoping Plan that is supposed to provide a guide for the net-zero transition.

I have previously written that the Climate Action Council has not confronted reliability issues raised by New York agencies responsible for keeping the lights on. The only token response was a special speaker’s session for reliability on August 2, 2021 where six speakers discussed their concerns. Because subsequent analyses have raised issues, I published four more articles on this topic. The first post (New York Climate Act: Is Anyone Listening to the Experts?) described the NYISO 2021-2030 Comprehensive Reliability Plan (CRP) report (appendices) released late last year and the difficulties raised in the report are large. The second post (New York Climate Act: What the Experts are Saying Now) highlighted results shown in a draft presentation for the 2021-2040 System & Resource Outlook that all but admitted meeting the net-zero goals of the Climate Act are impossible on the mandated schedule. Recently I wrote about the “For discussion purposes only” draft of the 2021-2040 System & Resource Outlook report described in the previous article and the concerns raised. Most recently I compared the NYISO Resource Outlook and Draft Scoping Plan Generating Resource Projections and argued that they needed to be reconciled. Fortunately, there was a request from the Council for a comparison and at the October 25, 2022 Climate Action Council meeting (presentation and recording) Carl Mas described the differences between the NYISO resource projections and his Integration Analysis projections.

Integration Analysis Update

At 48:20 of the meeting recording Carl Mas presents the comparison of the Resource Outlook and Integration Analysis mitigation scenarios. The evaluation compared Integration Analysis (IA) mitigation scenario 2, Strategic Use of Low-Carbon Fuels with NYISO Resource Outlook Scenario 2 as shown in the following slide. Outlook Scenario 2 is “most aligned” with Integration Analysis (IA) scenario 2. Both analyses used the same load shapes and meet the Climate Act resource targets. Even though Mas claimed that the results were “well aligned” there are some key model differences. There are different assumptions, treatments of the electric system components are not the same, and imports are handled differently. The IA scenario includes load that they think is needed to generate hydrogen needed for the dispatchable emissions-free resource requirement and the NYISO analysis does not.

The 2030 comparison of results discussion starts at 53:00 of the meeting recording. Mas claims that the results of the two analyses are largely the same. His standard for agreement is that the directionality is the same and that the results are the same order of magnitude. In my opinion that is a pretty low bar. While I agree that the overall agreement is encouraging, I also think that the devil is in the details. Both analyses agree that Dispatchable Emissions-Free Resources (DEFR) are a necessary component of the zero-emission electric system of the future. I will address specific differences in the next section.

The 2040 comparison of results discussion starts at 55:35 in the video recording. Again, Mas claimed that the results are largely the same. During the question-and-answer session, Robert Howarth asked about the relative capacity to generation differences. Specifically, the NYISO capacity is greater than IA capacity but the NYISO generation is smaller than the IA generation. Mas said that they were still trying to figure out the difference but thought that curtailment was a factor. Because the NYISO analysis uses a more detailed transmission simulation their projections factor in more situations where the transmission system is unable to get the renewable generation where it is needed when it is needed. As a result, more capacity has to be built to ensure reliability.

Dennis Elsenbeck suggested that Mas and his modeling team work with the NYISO modelers to produce as joint reconciliation statement. Mas said that they will be engaging with the NYISO in the coming years but did not promise to reconcile all the differences. I will note some particular issues that I believe need to be reconciled and questions that I would like answered by both modeling teams in an open, transparent, and documented manner.

Comparison of Scenarios

The following table lists the data for the two NYISO Outlook scenarios and Integration Analysis Scenario 2, Strategic Use of Low-Carbon Fuels that I believe were used to produce the graphs. Per usual Mas has not documented the numbers in the graphical presentations so I am assuming that there have been no changes to the Integration Analysis numbers since the last update. I have provided the spreadsheet that I used to prepare this table and the input data extracted from the NYISO and Integration Analysis spreadsheet used. In my last post on this topic, I described each of the resource categories in the table. I am not going to repeat my description of the differences I noticed but will only address differences in the resource categories discussed at the Council meeting.

Mas thinks that the reason for fossil generation differences between NYISO Outlook Scenario 2 and the Integration Analysis Scenario is because NYISO treats the fossil resources differently. The Integration Analysis scenario considers the strategic use of low-carbon fuels, but NYISO does not assume that existing power plants will use alternate fuels in 2040.

In my opinion low-carbon fuel is the crux of an issue raised by Gavin Donohue. Donohue argued that the DEFR technologies cannot be evaluated until the Public Service Commission defines what fuels can be used and whether any fuel can be combusted. There are members of the Council that believe that combustion is outlawed in the Climate Act but the Council has not made a decision about a recommendation. I agree with Donohue that this should be decided sooner rather than later.

Mas noted that the Integration Analysis used higher capacity factors for wind and solar resources than the NYISO used. The following table compares the capacity factors for the resources. I have calculated New York land-based wind capacity factors since 2006 based on NYISO data. I agree with the NYISO 2019 capacity factor of 25% but the 2020 Integration Analysis capacity factor of 28.6% does not agree with the observed capacity factor of 23.9%. In fact, it is 19.3% higher than the observed value. Note that I submitted a comment that argued the land-based wind capacity factors were biased high and recommended that the final scoping plan correct that bias. There never has been any acknowledgment of that comment or anything related to the Integration Analysis itself at the Climate Action Council meetings. Dennis Elsenbeck asked if there was data available from existing systems because of the dangers that the data might not confirm the projections. Based on this, the answer is the data are being ignored and that means how can the Scoping Plan be finalized if there are errors in the Integration Analysis?

There are differences in the renewable resource category projections between the NYISO Outlook and the Integration Analysis scenarios. In my opinion, the overview discussion of results did not satisfactorily address the significance of these differences and the potential that they could represent feasibility implementation problems.

In the land-based wind (LBW) resource category, the NYISO Outlook scenarios both project 19,087 MW in 2040 but the Integration Analysis projection is only 12,242 MW (>35% different). That could be related to the unrealistic capacity factors the Integration Analysis used but it may also be related to the relative weighting of land-based and offshore wind.

The NYISO production resource model apparently does not think that offshore wind is a cost-effective option because both scenarios do not increase the projected capacity significantly beyond the Climate Act mandate of 9,000 MW. On the other hand, the Integration Analysis scenarios nearly double the amount of offshore wind resources projected. Overall, the NYISO Outlook offshore wind capacity is 40% lower than the average of the Integration Analysis scenarios and generation is 43% lower.

In the solar resource discussion, Mas explained that the difference between the Integration Analysis and NYISO Outlook Scenario 2 solar implementation transition was that the Champlain Hudson Power Express transmission line implementation was handled differently. As a result, more solar was added earlier in the Integration Analysis. The final resource allocation was the same. However, he did not address the fact that NYISO Outlook Scenario 1 is significantly different than all the other projections. The capacity is 63% lower and the generation is 71% lower than the averages of the other scenarios.

The energy storage resource category capacity values are pretty much the same all the scenarios. However, the numbers used for the generation projections are presented differently so that it is not possible to compare them. The Mas presentation did not explain the different methodologies.

As noted in the NYISO Outlook report, the Dispatchable Emissions-Free Resource (DEFR) category is a proxy generator type that represents a yet unavailable future technology that would be dispatchable and produces emissions-free energy (e.g., hydrogen, RNG, nuclear, other long-term season storage, etc.). The DEFR capacity and generation is substantially higher in Resource Outlook Scenario 1 than all the other scenarios. Even Resource Outlook Scenario 2 is higher than the Integration Analysis scenarios. In addition, Resource Outlook Scenario 1 capacity factor is 9% whereas the others are all around 2%. Mas did not address these differences.

On the other hand, there was considerable discussion about DEFR itself. As mentioned above, Donohue’s question about acceptable future fuel was related to DEFR. Thomas Falcone also commented on DEFR but I disagree with him. Paraphrasing he said:

“We don’t have to decide right now what they are”
“Nobody’s crystal ball is that accurate to predict the future”
“The nature of technology is evolution
“We don’t have to solve the 2035 DEFR problem based on 2022 technology information”
“Don’t rule anything out today”

On one level those are reasonable assertions but there are caveats that I don’t think the Council on a whole understands. Unless there is a major change in emphasis to accept nuclear as the only scalable proven DEFR, all the options are unproven technologies. In the first place counting on an untested technology to be available, permitted, and constructed by 2035 is an ambitious challenge. In addition, the alternatives are pushing the limits of physics. Long duration storage options must overcome the Second Law of Physics. The Draft Scoping Plan chose green hydrogen as its candidate resource and in order to prove that it can work a comprehensive feasibility analysis is required. If the Council were to actually consider doing a feasibility analysis of the affordability, reliability, and permitting acceptability of the DEFR options I believe that we could rule out some of these potential technologies. That could have major ramifications for the Scoping Plan.

Donna DeCarolis asked about the difference between NYISO Outlook Scenarios 1 and 2. Mas described Scenario 1 as a “highly unmanaged future”. Outlook Scenario 2 and all the Integration Analysis mitigation scenarios presume that load can be managed dynamically. That means that electric vehicle charging could be limited at times so that system load is reduced. It may also mean that homes and businesses might be required to be on smart meters so that electricity for heating and cooling load can also be reduced as needed. Mas described NYISO Outlook Scenario 1 as the worst-case benchmark where energy efficiency does not work as expected and heat pumps don’t perform as claimed in very old weather. My impression is the scenario as using a more realistic estimate of future load in the highest demand periods.

Mas offered several key takeaways. He said he was “really pleased about amount of similarity” but as shown he did not address potentially significant differences. He admitted that there are some things we can learn but did not make any suggestions how those lessons could be incorporated into the Scoping Plan. He also promised that they will be engaging with NYISO in the coming years. I will comment on that remark in the discussion below.

Discussion

The Climate Act has prompted a massive revamping of New York’s energy system. The Scoping Plan that is supposed to inform the future Energy Plan depends on an Integration Analysis that has not documented its control strategies and costs. The overall plan depends upon electrification of everything but the Integration Analysis generation resource projections have not been reconciled with the projections prepared by the NYISO who is responsible for operating and planning for a reliable electric grid. I fear that this short discussion is all that the Climate Action Council will consider before the Scoping Plan is finalized.

Dennis Elsenbeck suggested a joint reconciliation statement to address differences. He suggested it would allow the Council to compare differences in the perceptions of the modelers. In my opinion, such a statement should be the ultimate product of a process where the discussions between the NYISO and Integration Analysis modelers are open and the opportunity for stakeholder input is included. The forum could address issues raised about the Integration Analysis but ignored in the response to comments.

One missing component in the response to comments thus far has been any mention of Integration Analysis technical issues raised by stakeholder comments. I mentioned a couple of examples above but I am particularly concerned about one aspect of all this modeling. It is not clear to me how the worst-case renewable energy resource is treated. At some point any projection for future generating resources has to account for the fact that there are prolonged periods of light winds during the winter so there are limits to how much energy will be available from wind and solar resources. I submitted an unacknowledged comment explaining that I do not think that the Integration Analysis treatment of this condition is adequate. I am not familiar with the NYISO methodology for the worst case but I think it does a better job than the Integration Analysis. I believe this should be a primary topic for a reconciliation process.

Both modeling approaches are designed to force the system to meet the 70% zero-emissions generation by 2030 mandate. That metric is based on generation not capacity. As a result, DEFR is not needed until later because existing fossil generation can fill in where needed. That also means that it would be inappropriate to retire fossil capacity prematurely just because it is not used much. Peaking generation plants provide dedicated energy where and when it is needed. They cannot be replaced until DEFR provides equivalent energy at the location within the system where it is needed from resources that are dedicated to that service. That is significant feasibility hurdle so far ignored by the Council.

There was another implementation issue mentioned but not really addressed. The difference in some generating resources depends on whether imports include fossil generation. Anyone who mentioned this said that the Climate Act clearly precludes fossil imports. Based on many years of tracking power plant emissions I believe that no one knows how that could be tracked on a real-time basis so that the NYISO system operators can dispatch and meet the criterion. More importantly, is that requirement so important that the dispatcher is supposed to start rolling blackouts instead of accepting imported fossil-fired power?

I had a thought when Mas said that they will be engaging with the NYISO in the coming years. At what point does Mas shut down his New York State Energy Research & Development Authority modeling empire and the State put its trust in the existing reliability planning process by the organizations responsible for electric system reliability. The NYISO process has worked for years and should be the standard going forward. Having two sets of modeling results is confusing and the NYISO process has checks and balances on its modeling that are not included in the Mas modeling analyses.

I have one overriding question. What are the expected costs? Both analyses incorporate cost estimates to choose the least-expensive solution but neither one has provided any detailed numbers. That would be a prime consideration for the differences discussion. For example, offshore wind is minimized in the NYISO modeling which I suspect is because their cost estimates are much higher than the Integration Analysis that projects over 50% more offshore wind capacity in 2040. Without more information we won’t know and cannot decide which is the more appropriate approach.

Conclusion

In response to Climate Action Council member requests the October 25, 2022 Council meeting finally offered a token comparison of the difference between the generating resources projected by the Integration Analysis and the latest NYISO analysis. The presentation was covered in three slides and lasted about 20 minutes with questions. I have long advocated for such a comparison but I remain concerned that this is more of an empty gesture than the start of an open and transparent comparison and discussion of the implications of differences in the projections.

I cannot over-emphasize that reconciliation makes a difference. Just because Carl Mas said that there is “close agreement” between the scenarios does not mean that there are no implications. For example, NYISO and I agree that current land-based wind capacity is under 25% but the Integration Analysis uses a factor that is 19% higher than observed. Therefore, at a minimum, the Integration Analysis land-based wind capacity projected is 19% lower than necessary to meet the generation requirement. The Council has not responded to any of my technical comments and questions that showed in every instance the Integration Analysis over-estimated benefits and under-estimated costs. Add that to the fact that the Scoping Plan does not include a feasibility analysis of the affordability, reliability, and permitting acceptability of the propose implementation strategies leads me to conclude that the Scoping Plan process could easily lead to negative consequences far greater than any climate change effects attributable to New York GHG emissions.

Reconcile NYISO and Integration Analysis Electric Generation Projections Comment

The Climate Leadership and Community Protection Act (Climate Act) has a legal mandate for New York State greenhouse gas emissions to meet the ambitious net-zero goal by 2050. This article describes the comments I submitted to the Climate Action Council describing the differences between the projections for future electricity generation by the New York Independent System Operator (NYISO) and those in the Draft Scoping Plan.

Everyone wants to do right by the environment to the extent that they can afford to and not be unduly burdened by the effects of environmental policies. I have written extensively on implementation of New York’s response to that risk because I believe the ambitions for a zero-emissions economy embodied in the Climate Act outstrip available renewable technology such that it will adversely affect reliability, impact affordability, risk safety, affect lifestyles, and will have worse impacts on the environment than the purported effects of climate change in New York. New York’s Greenhouse Gas (GHG) emissions are less than one half one percent of global emissions and since 1990 global GHG emissions have increased by more than one half a percent per year. Moreover, the reductions cannot measurably affect global warming when implemented. The opinions expressed in this post do not reflect the position of any of my previous employers or any other company I have been associated with, these comments are mine alone.

Climate Act Background

The Climate Act establishes a “Net Zero” target (85% reduction and 15% offset of emissions) by 2050. The Climate Action Council is responsible for preparing the Scoping Plan that will “achieve the State’s bold clean energy and climate agenda”. They were assisted by Advisory Panels who developed and presented strategies to the meet the goals to the Council. Those strategies were used to develop the integration analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants that quantified the impact of the strategies. That material was used to write Draft Scoping Plan that was released for public comment at the end of 2021. The Climate Action Council will revise the Draft Scoping Plan based on comments and other expert input in 2022 with the goal to finalize the Scoping Plan by the end of the year.

The key point is that the Scoping Plan “shall inform the state energy planning board’s adoption of a state energy plan” but the Climate Action Council membership is generally lacking the background, experience, and education to decide technical matters such as the fuel mix of the future generating system. Thomas Sowell said “It is hard to imagine a more stupid or more dangerous way of making decisions than by putting those decisions in the hands of people who pay no price for being wrong”. Therefore, my comments explained why I believe the differences between the Draft Scoping Plan and the NYISO have to be addressed in a public forum.

Summary

The New York Independent System Operator (NYISO) is currently (June 6, 2022) updating its System and Resource Outlook. The last Outlook Study Status presentation (April 26, 2022) noted that the draft report will be issued in June 2022. One of the supporting documents for this study is the Capacity Expansion Zonal Results Analysis spreadsheet. The projected new generating resources in the preliminary modeling results are different than the capacity additions in the Draft Scoping Plan Integration Analysis. The projection for future generation capacity and energy for the baseline case with a forecast for Climate Act is shown in the following table.

The Draft Scoping Plan Appendix G: Integration Analysis Technical Supplement “summarizes, reports, and documents the findings, results, and methodology of the Integration Analysis developed to support the Climate Action Council in its development of the Draft Scoping Plan pursuant to the Climate Act”. For this analysis I relied on data in the Appendix G: Annex 2: Key Drivers and Outputs spreadsheet. The following two tables list the installed capacity and annual generation for the three mitigation scenarios in the Draft Scoping Plan.

The capacity (MW) and generation (GWh) for the NYISO outlook study baseline with CLCPA case forecast scenario and integration analysis mitigation scenarios were combined in a spreadsheet and a table that is too large to include in this article. The point of my comment was that although the total generation capacity is pretty close between the analyses, the Climate Action Council and the NYISO have to reconcile four significant differences in the projections. The NYISO analysis projects dispatchable emissions-free resources capacity on the order twice as much as the three Integration Analysis mitigation scenarios. The NYISO analysis projects land-based wind capacity development about three times larger than the three Integration Analysis mitigation scenarios. The NYISO analysis projects off-shore wind capacity about 50% less than the three Integration Analysis mitigation scenarios. The NYISO analysis projects that solar will provide about one tenth the projected capacity of the three Integration Analysis mitigation scenarios.

Conclusion

The NYISO presentation notes that their study should be finalized this summer: “July 2022: Seek Board of Directors review and approval”. I believe that it is important that when the NYISO report and projections are finalized the differences between the Integration Analysis and this report are reconciled.

At one of this year’s Climate Action Council meetings, I believe the idea of workshops to consider specific issues as suggested. I think this would be an ideal candidate topic for just such a meeting. In the first place there is a clear need to determine which analysis should be the primary driver for the ultimate energy plan. In addition, this workshop could also include sessions to address other reliability issues.

Another Example of Gamesmanship in the Climate Act Integration Analysis

I still have not figured out how to do guest posts. Dietmar Detering from Nuclear New York has been digging into the economic assumptions used in the Climate Act Integration Analysis, sent me his latest analysis and asked if I would share widely. We have collaborated on this post describing his analysis of the Draft Scoping Plan gamesmanship with numbers to “prove” value for the net-zero transition.

Detering is a member of Nuclear New York, independent advocates for reliable carbon-free energy. His organization strongly supports nuclear power as a necessary component of any zero-emissions transition because it is the only scalable proven zero-emissions technology available. After growing up on a dairy farm in Germany, Dietmar Detering earned his Ph.D. in political science in 1999 at Münster University. He then moved to New York City and built an online event publishing business (EventMe! Inc.), which he still runs. He has served in volunteer leadership roles with several community organizations while raising two daughters with his wife. Passionate about environmental protection since he was a teenager, Dietmar started focusing on nuclear power advocacy in 2018. Besides his activities in New York, he is also a member of Germany’s Nuklearia group.

Climate Act Background

The Climate Leadership and Community Protection Act (Climate Act) establishes a “Net Zero” target by 2050. . The Climate Action Council is responsible for preparing the Draft Scoping Plan that defines how to “achieve the State’s bold clean energy and climate agenda”. They were assisted by Advisory Panels who developed and presented strategies to the meet the goals to the Council. Those strategies were used to develop the Integration Analysis prepared by the New York State Energy Research and Development Authority (NYSERDA) and its consultants that quantified the impact of the strategies. That analysis was used to develop the Draft Scoping Plan that was released for public comment on December 30, 2021.

Draft Scoping Plan Shortcomings

There are many obvious shortcomings of the CAC scoping plan/NYSERDA integration analysis. The projections for renewable energy use exaggerated capacity factors for wind and solar, leading to vast underestimates of needed investments, land requirements and environmental impacts. The future capacity projections also rely imported electricity from both clean sources and dirty sources. It appears the projections are biased to underestimate the needed investments in solar, wind, battery, and hydrogen infrastructure.

Despite its proven capabilities there is no commitment to expand the use of nuclear energy. In fact, there have been comments from working groups that argue that the existing power plants should be shut down sooner rather than later.

Detering and I share the concern that the Draft Scoping Plan does not recognize some practical implementation issues. There is no appreciation of rural resistance to wind and solar build-out at the scale needed. As word gets around about the massive buildout needed there will be more and more resistance. Affordability is a major concern and the Draft Scoping Plan overestimate how much New Yorkers will be willing to pay for higher energy prices for the benefit of future generations in other countries.

The largest benefit claimed is associated with societal benefits of avoid carbon emissions. I have shown that the Draft Scoping Plan manipulates emissions inconsistent with all other jurisdictions to increase benefits and incorrectly calculates avoided GHG emissions benefits by applying the value of an emission reduction multiple times. Detering notes that the Integration Analysis uses a discount rate 3.6% per year for all of its economic projections. However, for social costs of carbon, it is using NY’s official $125/ton which is based on a 2% discount factor. Apples and oranges!

Gross State Product (GSP) Degrowth

The main point of this post is that Detering has uncovered a truly bizarre aspect of the NYSERDA Integration Analysis economic modeling. One of the key drivers of future energy use is how the GSP will change over time in the future. The Key Drivers Outputs spreadsheet lists future annual GSP in the GSP table. He confirmed that the spreadsheet explicitly uses 2020 dollars, for past and future years.

Detering prepared a spreadsheet that incorporates the GSP data from the Key Drivers Outputs spreadsheet. The spreadsheet shows an average 1.9% per capita GSP growth in the years back, but .84% for the future. On the other hand, the text in Appendix G says that the Integration Analysis assumes a 1.9% growth of GSP (not per capita) and a .2% growth of population. It is not clear whether they are using nominal GSP numbers, which would explain the mismatch with the table, which uses 2020 dollars. The point is that 1.9% GSP growth is a good number for real dollars (inflation-adjusted) but not nominal ones. The table shows that their growth assumption (in 2020 dollars) per capita practically drops by half (-55%).

He has checked this math and is confident about the assumed 55% drop in per capita GSP growth. The possible conclusions are all bad:

NYSERDA’s Integration Analysis needs a low growth because GSP is linked to energy usage. Over 30 years, .84% translates to a 29% growth, but 1.9% means a 76% growth. Big difference – much less wind and solar to plan for, again!
NYSERDA’s Integration Analysis assumes with a program like this, there is no way New York can pull off much more growth in incomes and wealth. High energy costs will drive jobs away and New Yorkers will be poorer as a result. Naturally, growth assumptions need to be reduced.
It appears that NYSERDA’s Integration Analysis is yielding to degrowth ideas.
This is a game of low expectations. It allows the state to say 30 years from now: Look, the Climate Act wasn’t so bad for the state after all. We assumed annual per capita GSP growth of only .84% and we’ve gotten over .9% on average!

Conclusion

Jim Shultz recently described the text of the Draft Scoping Plan: “The plan is a true masterpiece in how to hide what is important under an avalanche of words designed to make people never want to read it”. Dietmar Detering and I have found that the Integration Analysis documentation spreadsheets are worse. There are reams of numbers hiding the fact that the numbers really needed to explain the cost implications of the plan are not included. There are only a handful of people who have dug into the complexities of the Draft Scoping Plan enough to understand the deceitful actions being taken to “prove” that the Climate Act transition will have benefits that out-weigh the costs.

Detering’s analysis documents another game with the numbers in NYSERDA’s Integration Analysis. In order to “prove” benefits out-weigh costs for the future net-zero energy system, there have been multiple games played to lower costs. In this example, future load is reduced by using a lower growth rate for the economy. This lowers the cost of the necessary wind and solar resources needed.

New York Climate Act: What the Experts are Saying Now

On February 6, 2022 an article of mine was posted: New York Climate Act: Is Anyone Listening to the Experts? This post shows that the experts are saying now that there is a major problem with New York’s plan for a “zero-emissions” electric grid by 2040. Unfortunately, the message is buried in a technical analysis product and expressed in jargon so the warning will likely be ignored.

Background

New York’s Climate Leadership and Community Protection Act was passed in 2019 and became effective on 1/1/2020. The Climate Action Council has been working since then to develop plans to implement the Act. Over the summer of 2021 the New York State Energy Research & Development Authority (NYSERDA) and its consultant Energy + Environmental Economics (E3) prepared an Integration Analysis to “estimate the economy-wide benefits, costs, and GHG emissions reductions associated with pathways that achieve the Climate Act GHG emission limits and carbon neutrality goal”. Integration Analysis implementation strategies were incorporated into the Draft Scoping Plan when it was released at the end of 2021.

My last post here described the New York Independent System Operator’s (NYISO) 2021-2030 Comprehensive Reliability Plan (CRP) report (appendices) released late last year. The difficulties raised in the report are so large that I raised the question whether any leader in New York listening to this expert opinion. This post highlights results shown in a draft presentation that all but admits meeting the net-zero goals of the Climate Act are impossible on the mandated schedule.

Ultimate ProblemI have discussed the ultimate problem before so will only sum up here. In their presentation to the Power Generation Advisory Panel on September 16, 2020 E3 included the following figure. The problem is that there are significant periods when winds are so low that wind generation output is negligible and, especially in the winter, solar output is also low: “The need for dispatchable resources is most pronounced during winter periods of high demand for electrified heating and transportation and lower wind and solar output”. The presentation notes: “As the share of intermittent resources like wind and solar grows substantially, some studies suggest that complementing with firm, zero emission resources, such as bioenergy, synthesized fuels such as hydrogen, hydropower, carbon capture and sequestration, and nuclear generation could provide a number of benefits”. New York has substantial existing hydro resources but cannot be expected to develop much more. Nuclear is the obvious choice going forward but New York policies shut down 2,000 MW of nuclear capacity in the last couple of years so that is unlikely for the net-zero plan. The ultimate problem is what Dispatchable Emission Free Resource (DEFR) will be used to supply electricity during multi-day winter wind lulls. In the CRP NYISO stated:

“While there are hundreds of projects in the NYISO interconnection queue, there are none that would be capable of providing dispatchable emission-free resources that could perform on a multi-day period to maintain bulk power system reliability. Such resources are not yet widely commercially available.”

NYISO Analysis

A bit of background about the NYISO. It is the Regional Transmission Organization/Independent System Operator for New York State. Independent System Operators (ISO) grew out of the orders that enabled de-regulation of the electric system. The concept of an Independent System Operator was one way for existing tight power pools to satisfy the requirement of providing non-discriminatory access to transmission. The Federal Energy Regulatory Commission encouraged the voluntary formation of Regional Transmission Organizations (RTO) to administer the transmission grid on a regional basis throughout North America (including Canada).

The NYISO Electric System Planning Working Group (ESPWG) is the stakeholder group that provides Market Participant input on the NYISO’s comprehensive planning processes. On March 24, 2022 the NYISO Economic Planning Department made a presentation to the EPSWG on their System & Resource Outlook Update. The presentation itself is a draft – “for discussion purposes only” so the specific numbers are not finalized. The point of referencing this analysis is to show what the experts are saying now about the critical dispatchable emissions-free resource needed for the net-zero electric system transition. The purpose of the System & Resource Outlook analysis is to project what electric generating resources will be needed to maintain a reliable electric system in the future. The Economic Planning Department is collaborating with EPSWG and the presentation was to designed to solicit EPSWG and stakeholder input.

This type of capacity expansion modeling analysis develops a reference case that represents what is expected to happen to the system without any changes to “business as usual”. Then the analysis develops “Policy” case simulations and the model calculates an optimized projection of what capacity is needed as the Climate Act policy is implemented. The presentation described 27 different policy case scenarios that covered a wide range of different possible outlooks for the future. For example, they included two different low load projections for the future that, not surprisingly, were predicted to need much less future generation capacity. Scenarios to consider increased imports from Canada, different cost projections for wind and solar capacity, changes in nuclear retirements, and lower hydro output were also included. In addition, there were six scenarios that considered different future projections for DEFR were included.

In response to a request from the EPSWG three DEFR build types were addressed:

High Capital, Low Operating (HcLo)
Medium Capital, Medium Operating (McMo)
Low Capital, High Operating (LcHo)

As has been the case for all the other analyses to date, these build types are only proxies for what could happen if a DEFR were to be developed with the identified characteristics. The authors chose three cost and operational profiles to show what kinds of DEFR would be built. These build types were included so that the capacity expansion model can provide solutions to load requirements and build resources if they are economic to build using the assumed characteristics.

What the Experts are Saying

The following two slides from the presentation are the focus of my claim that the experts are warning there are problems with the New York transition to net-zero. The first slide describes one of the policy case scenarios in the analysis described above. I have highlighted one of the caveats: Significant uncertainty related to cost / availability of DEFR technologies, as well as regulatory definition of “zero-emissions” compliant technologies.

Figure 1: NYISO System & Resource Outlook Update Dispatchable Emission Free Resource (DEFR) Scenario Description in March 24, 2022 Presentation to EPSWG.

The following DEFR capacity expansion scenarios slide describes the assumptions used for five different scenarios. I have highlighted the note: Assumption included in the scenarios are not an endorsement or estimate of the validity of the values modified. Some scenarios do not represent realistic system performance but are helpful in identifying directional impacts and sensitivity to key variables.

Figure 2: NYISO System & Resource Outlook Update Dispatchable Emission Free Resource (DEFR) Scenario Description in March 24, 2022 Presentation to EPSWG.

Experts from the NYISO, the organization primarily responsible for keeping the lights on, said there is “Significant uncertainty related to cost / availability of DEFR technologies, as well as regulatory definition of “zero-emissions” compliant technologies” and that “Some scenarios do not represent realistic system performance but are helpful in identifying directional impacts and sensitivity to key variables”. For people familiar with the jargon and the electric system these are red flags. Let me unpack the statements for everyone else.

Dispatchable emissions free resource technologies do not exist at this time to provide power for the long-duration periods when wind and solar resources are expected to provide minimal generation. This kind of technical report says “significant uncertainty” because they can’t flatly say “we don’t think this will occur”. Because they don’t think there is a resource that will be available, they certainly can’t guess a cost. A scenario that does not represent “realistic system performance” pretty clearly says that we cannot expect the system to perform as needed with the scenario’s resources. This is as close to telling the Climate Action Council that their “plan” to go to zero emissions by 2040 is not going to happen as it gets without actually explicitly saying that. In a perfect world an “independent” organization would just tell it like it is, but this is the state of New York so politics color everything including the future of the electric system.

Furthermore, during the presentation discussion the point was made that the capacity projected numbers indicate an enormous amount of generation is needed. That result was described as just “stunning”. Someone asked whether anyone on the Council is looking at what this means. These experts are clearly worried about the enormous resources that have to be built to meet to transition the New York electric grid to a net-zero. That concern is above and beyond my concern about DEFRs.

There is one other aspect of the first statement that needs to be addressed. The reference to the “regulatory definition of ‘zero-emissions’ compliant technologies” is included because the Climate Action Council has not defined what is meant by “zero-emissions”. Several of the most vocal members of the Council believe that zero-emissions means no combustion and are determined to impose that restriction. All of the New York analyses that have tried to project what types of generation and how much from each type will be needed for the future net-zero electric system have included combustion generation using hydrogen or renewable natural gas. The leaders of the Council have not had the courage to tell the members who have no reliability responsibilities and little relevant expertise “Sorry, even if we combust those arguably zero-emission fuels, there still are great risks to a feasible system that is reliable. If we don’t use them the feasibility risks are so high that the system will be unreliable”.

Conclusion

The NYISO capacity expansion modeling has been forced to be consistent with the Draft Scoping Plan by using DEFR technology and building enormous amounts of generating capacity. The capacity resource modeling is based on what is needed to keep the lights on rather than whether dispatchable emissions-free resources that provide those resources will actually be available. The authors of the report essentially say that they don’t think DEFR technologies will be available but I don’t think the message is blunt enough to force the Climate Action Council to respond.

Not so long ago the idea that natural gas could be used a bridge fuel until these aspirational dispatchable emission-free resources could be tested at the scale needed, perform like a natural gas fired generating unit, and provide power at a similar cost, was generally accepted as a rational approach. The analogy for skipping the need for a bridge fuel is that proponents want to jump out of a perfectly good airplane without a parachute because they assume that the concept of a parachute will be developed, proven technically and economically feasible, and then delivered in time to provide a soft landing. That cannot end well and this won’t either.

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Roger Caiazza blogs on New York energy and environmental issues at Pragmatic Environmentalist of New York. More details on the Climate Leadership & Community Protection Act are available here. This represents his opinion and not the opinion of any of his previous employers or any other company with which he has been associated.