Tier 4 – New York City Renewable Energy

The Public Service Commission’s October 15, 2020 Order [PDF] establishes a new Tier 4 within the Clean Energy Standard (CES) in response to NYSERDA’s CES White Paper. The new Tier 4 will increase the penetration of renewable energy into New York City (NYISO Zone J), which is particularly dependent on polluting fossil fuel-fired generation. NYSERDA’s CES White Paper found that without displacing a substantial portion of the fossil fuel-fired generation that New York City currently relies upon, the statewide 70 by 30 Target would be difficult to achieve.

Through Tier 4, the State will procure the unbundled environmental attributes (in the form of Tier 4 RECs) associated with renewable generation delivered into Zone J. These environmental attributes include the avoidance of GHG emissions, as well as the avoidance of local pollutants such as NOx, SOx, and fine particulate matter.                         

Eligibility

Tier 4 is open to the following renewable energy systems: solar thermal, photovoltaics, on-land wind, hydroelectric, geothermal electric, geothermal ground source heat, tidal energy, wave energy, ocean thermal, and fuel cells which do not utilize a fossil fuel resource in the process of generating electricity. To be compensated under Tier 4, the resource must either be located in Zone J or delivered to Zone J over a new transmission interconnection (that electrically connects after October 15, 2020). Non-hydropower renewables must achieve commercial operation after October 15, 2020 to be eligible for Tier 4. Hydropower resources must be existing or already under construction as of June 18, 2020.

Offshore wind RECs will be procured separately from Tier 4 resources. Behind-the-meter resources are not eligible under Tier 4.

Tier 4 – Step One Eligibility Response

NYSERDA’s Tier 4 RFP solicitation has garnered a significant level of competitive interest from the private market. NYSERDA received 18 Tier 4 Step One Eligibility Applications, from 14 proposers representing:

  • A total of nearly 57 million annual megawatt hours of renewable energy – the equivalent of powering 8 million New York homes; and
  • Nearly 14,000 megawatts of new transmission capacity, more than four times the maximum quantity sought through the solicitation.

Tier 4 – Step Two Bid Submission Response

In response to New York’s Tier 4 solicitation, NYSERDA received bids from seven proposers for seven projects with 35 alternative configurations representing:

  • A total of over 35 million megawatt hours of renewable energy per year – the equivalent of powering five million homes; and
  • Nearly 7,500 megawatts of new renewable transmission capacity – nearly five times the capacity sought through the solicitation.

The strong response provides the robust competition needed to responsibly deliver renewable electricity to New York City and unlock significant benefits, including greenhouse gas reduction and improved air quality while spurring significant private sector investment and job creation.

Tier 4 Award Selection (Pending PSC Approval)

In September 2021, Governor Kathy Hochul announced two recommended contract awards for the Clean Path NY (CPNY) and Champlain Hudson Power Express (CHPE) Projects that will deliver wind, solar, and hydropower to New York City. These awards are the result of New York’s competitive large-scale renewable energy solicitation, issued by NYSERDA in January 2021, to help create a modern transmission system capable of responsibly delivering an increasing amount of renewable electricity to high-demand areas in downstate New York.

These projects will bring unparalleled benefits to New York State:

  • 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
  • Investing approximately $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
  • Delivering approximately $2.9 billion in public health benefits that will result from reduced exposure to harmful pollutants – including fewer episodes of illness and premature deaths, fewer days of school or work missed, less disruption of business, and lower health care costs
  • Commitments to prevailing wage and project labor agreements with the State’s trades to ensure quality, good-paying jobs for New Yorkers
  • Combined, 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.

NYSERDA will submit the recommended contract awards to New York’s Public Service Commission for review, public comment, and approval. If approved, the developers can begin their detailed development work including permitting efforts, securing supply contracts, workforce development, and infrastructure development for the project. As it is already permitted, CHPE could begin construction upon award approval. NYSERDA payments under these awards will not commence until the project has obtained all required permits and local approvals, and delivers power to New York City, which is expected in 2025 for CHPE and 2027 for CPNY.

New York State map of wind, sola, and hydroelectric projects

Downstate New York map of delivery stations at Astoria Energy Complex and Rainey

To learn more about these projects, view the Fact Sheet [PDF]

Solicitation

NYSERDA seeks to negotiate contracts for up to an aggregate 1,500 MW but may exceed this quantity if it receives proposals that are sufficiently compelling. Resulting agreements for the procurement of Tier 4 RECs will be filed with the Department of Public Service Secretary for public comment and Commission approval.

Sign up to receive updates and announcements.

Schedule

The schedule for T4RFP21-1 is as follows (all times ET):

T4RFP21-1 Release Date January 13, 2021
Deadline for Notice of Intent to Propose January 21, 2021
Proposers’ Webinar [PDF] January 28, 2021
Deadline for submitting written questions on Step One February 4, 2021
NYSERDA posts responses to Step One questions [PDF] February 11, 2021
Deadline for Step One Eligibility Application and Hydropower Baseline Data February 16, 2021, 3:00 pm
NYSERDA posts responses to Step Two questions [PDF] April 5, 2021
NYSERDA provides Final Baseline Determination No later than April 12, 2021
NYSERDA Portal Opens to register for account April 14, 2021
Portal opens for Step Two Proposal submissionLink opens in new window - close new window to return to this page. April 30, 2021
Proposer's Webinar [PDF] May 3, 2021 11:30 am ET
Deadline for submitting written questions on Step Two May 3, 2021
NYSERDA posts responses to Step Two questions [PDF] May 7, 2021
Deadline to Register for NYSERDA Portal May 10, 2021
Deadline for Step Two Proposal Submission May 12, 2021, 3:00 pm
NYSERDA Award Notification Date 3rd Quarter 2021

T4RFP21-1 and Appendices (Closed)

Communications and Updates regarding the RFP

All relevant documents pertaining to this RFP will be available on this site. Proposers are advised to check this website regularly for updates.

Per RFP Section 1.12, Clean Path New York LLC. notified NYSERDA [PDF] of a change to their Step 2 Proposal for the Clean Path New York Project of the site of the Zone J converter station from land adjacent to the Bronx Terminal Market to a new industrial location in Zone J. An updated version of the Public Proposal Narrative [PDF] and Appendices [PDF] have been posted to NYSERDA’s Tier 4 website.

NYSERDA posted the final responses to submitted questions [PDF] and the slides presented during the May 3, 2021 Webinar [PDF] on May 7, 2021. Questions submitted during the Webinar are included in the posted responses.

NYSERDA will be hosting a webinar for interested Tier 4 ProposersLink opens in new window - close new window to return to this page. on Monday, May 3 from 11:30 a.m. – 12:30 p.m. ET. The agenda is as follows:

  • Tier 4 Update & President’s Remarks – Doreen Harris
  • Tier 4 Bid Submission Portal Demonstration
  • Update on the new Tier 1 RFP & interactions between Tier 1 and Tier 4

Advanced registration is not required.

An update to the Tier 4 RFP was posted on March 29, 2021. A summary of updates can be found here.

The first set of responses to submitted questions under Step 2 was posted on April 5, 2021. The responses can be found here and will be updated on a rolling basis until May 7, 2021. All questions must be submitted to res@nyserda.ny.gov by May 3, 2021.

NYSERDA has posted a Request for Comment [PDF] on whether the Tier 4 Agreement should be amended to allow proposers to benefit from any new investment tax credit recently enacted by the Federal government that could be applied to a Tier 4 transmission facility. Comments may be submitted to res@nyserda.ny.gov by 5:00pm ET April 9, 2021.

NYSERDA has posted Summary of Received ITC Comments [PDF] regarding whether the Tier 4 RFP should be amended to introduce a new provision in the Tier 4 Agreement that would share the benefits of any newly- enacted ITC or other direct financial support that would apply to transmission facilities associated with Tier 4 Proposals. Comments were due and received on April 9, 2021.

Implementation Plan

NYSERDA will file a Tier 4 implementation plan for stakeholder comment and Commission approval by December 15, 2021.  The plan will include a description of the Tier 4 compliance obligation calculations, process and structure, as well as a Tier 4 standard purchase agreement.