Clean Path New York on Wednesday asked state regulators to include it in any inflation adjustments approved for Tier 1 renewable energy certificates (RECs), saying generators would otherwise shun the 174-mile transmission project being planned to deliver power to New York City.
CPNY — a project of the New York Power Authority, Invenergy and EnergyRe — filed its petition with the Public Service Commission in response to a June 7 request by the Alliance for Clean Energy New York (15-E-0302).
ACE NY asked the PSC to authorize the New York State Energy Research and Development Authority to add an inflation-adjustment mechanism for projects awarded through NYSERDA’s 2021 renewable energy certificate solicitation. ACE NY said its solar and onshore wind developer members were facing the same inflationary pressures that have caused offshore wind developers to seek to renegotiate their deals. (See OSW Developers Seeking More Money from New York.)
CPNY said it was seeking relief “due to the unforeseen and severe market disruptions that have occurred” since April 2022, when NYSERDA awarded it a contract to deliver 1,300 MW of renewable energy from upstate to Zone J in New York City. (See NYPSC OKs 2 Huge Clean Energy Projects for New York City.)
CPNY’s contract is based on a single strike price that includes production and delivery of emissions-free power, with a portion of the REC payments going to 23 generation projects and the balance used to fund the transmission line.
Fourteen of the 23 projects in CPNY’s generation portfolio hold Tier 1 contracts with NYSERDA, and the other nine are Tier 1-eligible wind and solar projects “that are experiencing exactly the same cost pressures,” CPNY said.
“To the extent that the commission provides an adjustment mechanism that shifts the price of Tier 1 RECs upward, CPNY will need to increase its payments to Tier 1 generators in order to induce their participation in CPNY,” it said. “If CPNY does not provide the same level of net revenues to [its] resources … those resources would be commercially disadvantaged by participating in the CPNY project and therefore motivated to participate only in Tier 1.”
CPNY, which emphasized it is not seeking to change the transmission component of its contract, asked the PSC to rule by Oct. 12. The transmission project, which has an expected in-service date of 2027, is currently undergoing permitting and interconnection analysis.
“If the commission fails to provide concurrent relief to CPNY, or if it fails to act on this request by its Oct. 12, 2023, session, CPNY will be unable to attract capital for the CPNY project or proceed with binding orders for the hundreds of millions of dollars in materials and equipment needed,” it said.
