Governor Hochul Announces Approval of Contracts to Deliver Clean, Renewable Electricity to New York City
Largest Renewable Energy and Transmission Projects in New York State in 50 Years
April 14, 2022
Governor Kathy Hochul, in advance of Earth Week, announced today that the State Public Service Commission has approved contracts with Clean Path New York LLC for its Clean Path NY project and H.Q. Energy Services Inc. for its Champlain Hudson Power Express project to deliver clean, renewable solar, wind and hydroelectric power from upstate New York and Canada to New York City. Earth Week, which this year runs from April 18-22, is celebrated with events worldwide in support of the environment and to raise awareness for the environmental protection and care of our planet.
"New York continues to lead the nation with innovative green energy initiatives and has been an example to the rest of the world how to confront the perils of climate change, the existential threat of our time," Governor Hochul said. "Today's decision is a major step forward in achieving New York State's goal of 70 percentage of our energy from renewable resources, while paving the way for thousands of high-quality jobs, spurring billions in economic activity, reducing our dependence on fossil fuels, and ushering in a cleaner, greener New York for all."
The state's first-of-its-kind renewable energy and transmission projects are expected to deliver up to $5.8 billion in overall societal benefits statewide, including greenhouse gas reductions and air quality improvements, and $8.2 billion in economic development across the state, including investments in disadvantaged communities. Further, when built these projects will help protect against volatile fossil fuel price fluctuations and stabilize long-term energy costs.
As the largest transmission projects contracted for New York State in the last 50 years, these projects will reduce the city's reliance on fossil fuel-fired generation by more than 50 percent in 2030. Today's announcement accelerates progress to exceed New York State's goal for 70 percent of the state's electricity to come from renewable sources by 2030 on the path to a zero-emission grid by 2040 as outlined in the Climate Leadership and Community Protection Act.
Today's decision was bolstered by the City of New York's confirmation that it will join in these landmark awards by agreeing to purchase a portion of the renewable attributes generated by the two projects, thus helping to make the scale of these projects possible while creating the opportunity to reduce the cost impact of these projects by up to $1.7 billion to all other ratepayers. The NYS Office of General Services has also committed to entering into a contract with the New York State Energy Research and Development Authority (NYSERDA) for Tier 4 RECs associated with the energy used by State agencies and departments located in the City. NYSERDA will also offer renewable attributes from these projects for voluntary purchase, finally enabling the many New York City organizations with interest in switching to clean energy, but who have been unable to do so on-site due to practical constraints, to go one hundred percent renewable with confidence. The government commitments and likely potential for additional private sector purchases are expected to significantly reduce the statewide utility ratepayer impact of implementing the CLCPA and Tier 4 program.
The PSC's October 2020 order adopted a Tier 4 program as part of the PSC's Clean Energy Standard with the purpose of increasing the penetration of renewables into New York City, and directed NYSERDA to conduct a Tier 4 solicitation. In January 2021, NYSERDA issued a Tier 4 renewable energy solicitation seeking projects that can cost effectively and responsibly deliver renewable energy to New York City, an area of the state that relies on aging fossil fuel-fired generation. The selected projects are expected to deliver 18 million megawatt-hours of clean energy per year, or more than a third of New York City's annual electric consumption, from a diverse and resilient clean generation portfolio including onshore wind, solar, and hydroelectric power, backed by energy storage, from upstate New York and Quebec. Combining these projects with the existing contracted portfolio of offshore wind projects connecting directly into New York City, turns the page on the City's energy history, increasing resilience and reliability while significantly improving air quality.
With approval of the contracts, NYSERDA payments will commence for each respective project once the project has obtained all required permits and approvals, has completed construction, and is delivering power to New York City, which is expected to begin in 2025 for the fully permitted CHPE project and 2027 for the CPNY project.
New York City Mayor Eric Adams said, "This is a historic milestone in our mobilization against climate change and fight for environmental justice. Today, we begin dismantling the disparate access to renewable energy that has plagued our city for far too long, especially those communities that reside in the shadow of some of the oldest, most polluting power plants in the state. Not one but two new transmission lines will be built to bring clean renewable energy from the north into New York City — a feat that has not occurred at this scale in decades. I'm proud of the city's commitment to purchase 100% of its electrical need from these lines, catalyzing others to do the same. I want to applaud the commission, NYSERDA, and Governor Hochul for taking this bold action and I look forward to continued partnership with the governor to tackle climate change."
Rory M. Christian, Chair of the PSC, said, "Governor Hochul's climate and energy leadership is providing the right vision New York needs to create a just, clean, resilient, and affordable energy system. This comprehensive and ambitious plan delivers on those goals and will enable all needed kinds of renewable energy to reach all New Yorkers. Today's action puts the 2030 climate and energy goals well within reach, while firmly establishing a foundation to achieve our 2040 and 2050 goals, which includes zero emissions from the electricity sector by 2040."
Doreen M. Harris, President and CEO, NYSERDA said, "Today's historic decision by the Public Service Commission is a game-changer for New York's transition away from fossil fuels and helps to ensure New York City, the nation's most populated city, will be powered with clean and reliable renewable energy. These transformational projects pave the way for cleaner air and a healthier future for all New Yorkers, especially in communities disproportionately burdened by air pollution, and will stimulate our statewide economy with an investment of $8.2 billion in economic development and create thousands of high-quality jobs. We look forward to working with our partners at Clean Path NY and Hydro Quebec to deliver these critical benefits for families and businesses across the state."
“We are both humbled and proud to see this formidable partnership between Quebec and New York move forward,” said Sophie Brochu, President and CEO of Hydro-Québec. “This project is a model for an equitable energy transition and an eloquent example of how we can work together to decarbonize the Northeast.”
“Today’s Public Service Commission vote lays the cornerstone for New York’s clean energy future. The Champlain Hudson Power Express will significantly reduce New York City’s dependence on fossil fuels, improve the health of all New Yorkers by reducing harmful pollutants and create thousands of New York jobs,” said Transmission Developers CEO Donald Jessome. “This project–which will deliver renewable, reliable, power–would not have been possible without the bold leadership on climate issues from Governor Hochul and NY State, NYSERDA, the City of New York, and the countless advocates who recognized the benefits of this project and supported it."
“Today’s decision is a key milestone and critical step forward in the fight for New York’s clean energy future and the Clean Path NY team is ready to move ahead with this major clean energy project for the benefit of all New Yorkers,” said Clean Path NY leaders Michael Polsky of Invenergy, Jeff Blau of energyRe, and Justin E. Driscoll of the New York Power Authority. “Clean Path NY is a turning point for New York as we work to finally resolve the congestion that has plagued our electricity grid for decades and slowed progress on urgent climate goals. The Clean Path NY project will deliver good-paying jobs, make our air cleaner, and provide reliable emissions-free power to residents and businesses across the state—a win-win-win for New York. We are proud to help make New York a healthier, more resilient place to call home.”
As a component of these landmark deals, Hydro-Quebec will purchase electricity from the planned Apuiat wind farm, developed by the Innu communities in Quebec, as well as enter into a partnership with the Mohawk Council of Kahnawà:ke for joint ownership of the line in Québec that will connect to the Champlain Hudson Power Express.
“The Champlain Hudson Power express is a game changer,” said Mohawk Council Grand Chief Kahsennenhawe Sky-Deer. “We will continue our responsibility as stewards of the environment to always protect our Mother Earth, especially from the dangers of climate change and global warming. But we are also ensuring Indigenous peoples have a seat at the table as business partners, and have a voice in the overall economy moving forward.”
NYSERDA's successful procurement resulted in the award of projects that bring the highest and best value to New York, including promoting the interests of disadvantaged communities, ensuring economic benefits accrue to the State, and promoting workforce development. Key benefits of these projects include:
Protecting New York Families: The projects will deliver up to $2.8 billion in public health benefits resulting from reduced exposure to harmful pollutants - including avoided premature deaths, reduced asthma-related hospital visits, and lost workdays due to illness.
Massive Economic Driver and Job Creator: The projects will create approximately 10,000 family-sustaining jobs statewide with $8.2 billion in economic development investments, helping accelerate the state's economic recovery from COVID-19. The project developers have also committed to prevailing wage and project labor agreements to ensure quality, good-paying jobs for New Yorkers.
Developer-Committed Investments in Disadvantaged Communities: The two projects committed to investing a combined $460 million in community benefit funds to create pathways to green energy jobs, support public health, advance capital improvement projects, realize habitat restoration and improve the environmental footprint of buildings in disadvantaged communities.
Environmental Protection: Combined, the projects are expected to reduce greenhouse gas emissions by 77 million metric tons over the next 15 years, the equivalent of taking one million cars off the road over this time period.
Cost Effective: The two Tier 4 approved contracts combined will result in significant societal benefits up to $5.8 billion. The contracts include an index REC structure to help cushion customers against spikes in energy prices so when electricity prices rise the Tier 4 program costs go down. The average statewide bill impact for the typical residential customer will be approximately 3 percent, or $3 per month beginning once the projects are in operation.
In addition, these new underground transmission lines will avoid, minimize, and mitigate environmental damages including impacts on sensitive species and habitats and be resilient in the face of extreme weather. Both projects are required to go through the PSC's Article VII permitting process, which includes a full review of the need for the project and any environmental impacts of the siting, design, construction, and operation of major transmission facilities in New York State. CHPE has received its Article VII permit, and CPNY will begin the process.
The CPNY and CHPE projects will add to New York's existing robust pipeline of large-scale renewable energy, comprised of nearly 100 solar, land-based wind, and offshore wind projects totaling 11,000 megawatts of clean power—enough to power over five million New York homes when completed.
The State's commitment to building out new green energy transmission, led by 250 miles of new major upgrades already underway throughout the State and reinforced by this award, will allow the current pipeline of renewables to power more than 60 percent of New York's electricity from renewable energy once operational.
Anne Reynolds, Executive Director of the Alliance for Clean Energy New York, stated, “We applaud the selection of the Clean Path New York project to deliver made-in-New York renewable energy to New York City. The Tier 4 Program recognizes that investment in the transmission grid is, in fact, a key climate action. We appreciate Governor Hochul’s clear commitment to bringing the economic benefits of renewable energy to all New Yorkers.”
Gary LaBarbera, President of the New York State Building and Construction Trades Council said, “The Tier 4 projects are a critical component of New York’s clean energy future and to achieving our state’s ambitious climate and clean energy goals. These projects also duly recognize the importance of ensuring a just transition in the sustainable economy for working people — with robust opportunity offered through thousands of new family-sustaining jobs and workforce training. We applaud Governor Hochul and NYSERDA’s leadership in advancing these crucial projects that will ensure that sustainable power generation goes hand-in-hand with the creation of middle-class careers with benefits.”
REBNY President James Whelan said, “The Public Service Commission’s approval of these two projects is a significant step forward in reducing carbon emissions, creating good jobs, and addressing long-standing environmental injustices. The clean power delivered by these projects will help the public and private sector continue working together to comprehensively address our shared climate goals. We applaud Governor Hochul and her Administration’s commitment to this critical initiative.”
Thomas A. Callahan, President of the NYS Conference of Operating Engineers said, “These green energy projects are good for the environment and good for the economy, a win/win for the state. We commend the PSC for giving final approval to CHPE and CPNY so we can deliver much needed power to New York City while also creating good paying jobs in Upstate New York, the Hudson Valley, and New York City. We look forward to working with these companies to put New Yorkers back to work and deliver reliable, affordable energy.”
Michael Welsh, International Vice President, International Brotherhood of Electrical Workers said, “Today, New York’s Public Service Commission took an especially crucial step on the road to a cleaner environment and Just economy in New York by approving NYSERDA’s Tier 4 and distributed solar initiatives. The major energy projects borne from these programs will create well over ten thousand prevailing wage construction jobs, inject Billions of dollars into New York’s economy and vastly improve the state’s air quality. These projects will be a major component to achieving New York’s nation leading Climate Leadership and Community Protection Act. The IBEW recognizes NYSERDA’s commitment to helping workers in transitioning industries as critical and one in which we will stand together to achieve. We look forward to continuing our partnership with all stakeholders to bring these important initiatives to fruition and applaud the Public Service Commission for these important approvals.”
New York State Laborers Organizing Fund Director John Hutchings said, "Our members are currently working on projects that represent thousands of megawatts of clean, renewable energy throughout New York State. Today represents the critical next step forward ensuring that energy can be transported and used in load-pockets throughout the state. Projects like CHPE and Clean Path NY will help accomplish that while also creating thousands of construction jobs that pay workers a prevailing wage. We applaud the Public Service Commission for approving both of these projects and paving the way for workers and energy customers to share in the new clean energy economy.”
Daniel Zarrilli, Special Advisor on Climate and Sustainability at Columbia University said, "This is the critical decade to achieve deep reductions in carbon pollution and avoid the most catastrophic impacts of climate change. Today's approval by the Public Service Commission of two new clean energy transmission projects for New York City is absolutely transformative and puts New York City on the path to ending its reliance on fossil fuels. Congratulations to Governor Hochul and NYSERDA for identifying these two projects, which support our work at Columbia University to align with the goals of the Paris Agreement, clean the air in our surrounding communities, and end the world's addiction to fossil fuels—all part of our commitment to empowering the next generation of climate leaders."
Nation-Leading Climate Plan
New York State's nation-leading climate agenda is the most aggressive climate and clean energy initiative in the nation, calling for an orderly and just transition to clean energy that creates jobs and continues fostering a green economy as New York State recovers from the COVID-19 pandemic. Enshrined into law through the CLCPA, New York is on a path to achieve its mandate of a zero-emission electricity sector by 2040, including 70 percent renewable energy generation by 2030, and to reach economy-wide carbon neutrality. It builds on New York's unprecedented investments to ramp-up clean energy including over $33 billion in 102 large-scale renewable and transmission projects across the state, $6.8 billion to reduce buildings emissions, $1.8 billion to scale up solar, more than $1 billion for clean transportation initiatives, and over $1.6 billion in NY Green Bank commitments. Combined, these investments are supporting nearly 158,000 jobs in New York's clean energy sector in 2020, a 2,100 percent growth in the distributed solar sector since 2011 and a commitment to develop 9,000 megawatts of offshore wind by 2035. Under the Climate Act, New York will build on this progress and reduce greenhouse gas emissions by 85 percent from 1990 levels by 2050, while ensuring that at least 35 percent with a goal of 40 percent of the benefits of clean energy investments are directed to disadvantaged communities, and advance progress towards the State's 2025 energy efficiency target of reducing on-site energy consumption by 185 trillion BTUs of end-use energy savings.
Email: [email protected]