STATE OF NEW YORK
________________________________________________________________________
6771
2017-2018 Regular Sessions
IN SENATE
June 16, 2017
___________
Introduced by Sen. CARLUCCI -- read twice and ordered printed, and when
printed to be committed to the Committee on Rules
AN ACT to amend the public service law, in relation to the state's elec-
tric system energy efficiency framework
The People of the State of New York, represented in Senate and Assem-
bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "New York electric efficiency jobs act".
3 § 2. Legislative findings and intent. The legislature hereby finds and
4 determines:
5 1. New York has long held a leadership role among the states in
6 achieving efficiency savings in its electricity sector. Yet its current
7 electric energy efficiency achievements are inadequate to generate the
8 amount of savings necessary to achieve the State's clean energy and
9 climate goals in as cost-effective a manner as possible, reducing the
10 cost of energy for the state's energy customers. New York's most recent
11 State Energy Plan calls for the achievement of several goals by 2030,
12 including a 23 percent decrease in energy consumption from buildings, 50
13 percent renewable energy supply, and 40 percent reduction of greenhouse
14 gas emissions from 1990 levels. If New York does not significantly
15 increase the amount of savings it achieves through electric energy effi-
16 ciency, reaching these goals will be significantly more difficult, if
17 not impossible. As the Public Service Commission has recognized, energy
18 efficiency "is the cheapest and most effective manner to reduce carbon
19 emissions in the energy sector." It also reduces overall capacity charg-
20 es and helps avoid the need for costly utility infrastructure upgrades.
21 In other words, New York's current underinvestment in energy efficiency
22 results in higher utility bills for New Yorkers than is necessary.
23 Public utilities and other market participants have not been given the
24 market signals necessary to aggressively reduce energy usage.
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD13149-01-7
S. 6771 2
1 2. Energy efficiency investment creates clean energy jobs, as
2 evidenced by the 2017 U.S. Energy and Employment Report published by the
3 U.S. Department of Energy, which shows that New York's energy efficiency
4 market has generated 110,582 energy efficiency jobs across the state.
5 That number represents 5.1 percent of all energy efficiency jobs nation-
6 wide. Most energy efficiency jobs in New York State are found in ENERGY
7 STAR and efficient lighting firms, followed by high efficiency heating,
8 ventilation, and air conditioning services.
9 3. Demonstrating leadership with respect to energy efficiency will
10 drive even greater clean energy job growth in the state, helping to
11 reverse recent trends of workforce reductions seen in many of New York's
12 communities; and, increase the competitiveness of the state by not only
13 increasing job opportunities for electricians, engineers, and contrac-
14 tors, but also reducing the overall energy costs in the state, bringing
15 down the cost of living and the cost of doing business and generating
16 economic activity across the state. The U.S. economy has grown signif-
17 icantly since 2007, even while electricity consumption has been flat, in
18 large part attributable to energy efficiency gains. According to Bloom-
19 berg New Energy Finance, "the key policy story of the past decade has
20 been the uptake of EERS (Energy Efficiency Resource Standards) in U.S.
21 state targets" leading to increased investment in efficiency and job
22 growth.
23 4. Cost-effective energy efficiency investment directly results in
24 lower electricity use and lower electricity bills, and also reduces
25 total statewide energy demand, peak demand, and distribution system
26 investment needs. Thus, a well-deployed energy efficiency program will
27 provide worthwhile benefits to both the individual bill payers partic-
28 ipating in it and collectively to all bill payers.
29 5. Under the current system, New York is achieving significantly lower
30 amounts of annual incremental savings through energy efficiency than the
31 amounts being achieved in other states. The American Council for an
32 Energy-Efficient Economy estimates that New York achieved only approxi-
33 mately 1.05 percent annual incremental savings in 2015, as compared to
34 annual incremental savings of 2.91 percent in Rhode Island, 2.74 percent
35 in Massachusetts, 2.01 percent in Vermont, and 1.95 percent in Califor-
36 nia (which recently set a goal of 4 percent annual incremental savings).
37 The Clean Energy Standard Order issued by the Public Service Commission
38 on August 1, 2016, estimated the amount of new incremental renewable
39 energy required to meet its 50 percent renewable energy supply target by
40 assuming 1.4 percent annual incremental savings through energy efficien-
41 cy. Should the state continue on its current trajectory and thus fail to
42 achieve the Clean Energy Standard's assumed level of savings, far more
43 renewable energy will be required to meet the state's 2030 goal than the
44 amount currently being planned for. In other words, the state is falling
45 behind the trajectory of combined energy efficiency and renewable energy
46 needed to achieve the 50 by '30 target, which may become difficult or
47 impossible to achieve, or significantly more costly, if the state's
48 energy efficiency framework is not adjusted soon. New York has the abil-
49 ity to achieve its laudable State Energy Plan goals, but only if the
50 current energy efficiency framework is redesigned to capture more of the
51 state's energy efficiency potential.
52 6. The Public Service Commission has expressed conviction regarding
53 the vital importance of energy efficiency in its "Reforming the Energy
54 Vision" (REV) proceeding and has taken steps to advance energy efficien-
55 cy through the work of the Clean Energy Advisory Council. However, more
56 is needed. REV does not yet have any mechanism to fund energy efficiency
S. 6771 3
1 procurement or catalyze the private sector to invest significant capital
2 in energy savings measures. Effective and appropriate economic signals
3 have not been provided consistently to all the utilities or to other
4 parties to pursue all cost-effective efficiency measures.
5 7. It is imperative that New York provide leadership to the nation on
6 energy efficiency, not only to protect New Yorkers and lower electricity
7 bills, but to respond to the serious threatened rollback of bedrock
8 energy efficiency programs at the federal level, including the Home
9 Energy Assistance Program, the Weatherization Assistance Program, and
10 ENERGY STAR. This leadership will provide critical assistance to low-in-
11 come customers and providers of affordable housing while also enabling
12 energy management solutions for all types of customers and providing a
13 broad range of benefits to all income levels.
14 8. Accordingly, the overlying intent of this act is to provide a clear
15 regulatory framework for energy efficiency to better serve the constitu-
16 ency of New York State and as a model for other states. This legislation
17 will help invigorate the market for energy investments foreseen by REV,
18 invest significantly greater amounts of private capital to be invested
19 in energy efficiency, thereby supporting job growth, increasing electric
20 grid efficiency, reducing emissions, and lowering customers' bills.
21 § 3. The public service law is amended by adding a new section 66-o to
22 read as follows:
23 § 66-o. New York energy efficiency development program. 1. Defi-
24 nitions. For the purpose of this section, the term "cost-effective,"
25 means generating benefits that outweigh cost, i.e. generating more in
26 electricity cost savings and other benefits than costs over a specified
27 period of time, as determined by the commission;
28 2. Program for energy efficiency development. Notwithstanding any
29 other provision of law to the contrary, including, but not limited to,
30 any order, rule or regulation promulgated pursuant to the public service
31 law, the public authorities law, and/or the state administrative proce-
32 dure act, the commission, in consultation with the New York state energy
33 research and development authority, shall adopt a program within one
34 hundred twenty days of the effective date of this section. The program
35 shall:
36 (a) Establish a robust annual incremental minimum savings mandate for
37 each utility for the years two thousand eighteen -- two thousand twen-
38 ty-one that provides for annual incremental increases in energy savings
39 of at least 0.4 percent of total electricity load served by that utility
40 until at least two percent minimum annual savings is achieved;
41 (b) Study, identify, and establish appropriate long-term annual, bien-
42 nial, or triennial incremental targets that achieve all cost-effective
43 electric energy efficiency savings levels for each utility for the years
44 two thousand twenty-two -- two thousand thirty, which shall be updated
45 every three years to allow for necessary adjustments in such targets;
46 and
47 (c) Provide a clear and consistent funding framework for electric
48 energy efficiency that applies to all the state's utilities and allows
49 them to: make investments in electric energy efficiency as a system
50 resource; earn incentives for significant savings achievements (as was
51 prescribed in the commission's Order Adopting a Ratemaking and Utility
52 Revenue Model Policy Framework issued on May 19, 2016); and, catalyze
53 private market investment in electric energy efficiency. The funding
54 framework must allow utilities to recover the costs of meeting the mini-
55 mum mandates set forth in paragraph (a) of this subdivision.
S. 6771 4
1 § 4. If any provision of this act is, for any reason, declared uncon-
2 stitutional or invalid, in whole or in part, by any court of competent
3 jurisdiction, such portion shall be deemed severable, and such unconsti-
4 tutionality or invalidity shall not affect the validity of the remaining
5 provisions of this act, which remaining provisions shall continue in
6 full force and effect.
7 § 5. This act shall take effect immediately.