At the final Management Committee meeting of 2025, NYISO CEO Rich Dewey addressed stakeholders and staff, thanking them for their cooperation and work during a full, “challenging” year.

“When we started the year, we talked a lot about our concerns we had with respect to reliability,” said Dewey, who went on to list aging generation and explosive load growth as key drivers of reliability concerns. “Some tough decisions were made through the course of the year. … I am really happy and confident where we landed thinking about the planning process.”

Dewey warned stakeholders and staff that 2026 would be just as full, if not fuller, than 2026.

“If I told you 2026 was going to be easier, you should not believe me,” he said. “We have a lot of continued work ahead of us, and so it’s going to be a challenge to address the issues that we have on our plate already.”

Chief among those challenges are the upcoming discussions on changes to the reliability planning process. Stakeholders recently approved a Comprehensive Reliability Plan that calls for structural changes to the process. (See NYISO Reliability Plan Calls for ‘New Dispatchable Generation’.) NYISO wants to move planning from a “reactive posture” to a more proactive approach accounting for a wider range of outcomes in reliability planning rather than a single expected future. The ISO also called for new dispatchable generation. This angered environmental stakeholders, who accused the ISO of endorsing fossil fuel-fired development in all but name.

Most of the specifics of how the reliability planning process would determine needs were left open to discussion. During an Operating Committee meeting Oct. 16, Ross Altman, NYISO senior manager of reliability planning, said discussions with stakeholders would need to happen in order to determine which range of forecasts would be considered actionable. (See NYISO Notes ‘Fluctuation’ of Outlooks for Grid Reliability.)

New York City Reliability Need

The third-quarter Short-Term Assessment of Reliability (STAR) found there was a reliability need in New York City. This is the second year in a row a reliability need was found for the city. (See NYISO Again Identifies Reliability Need for NYC.) The city could be 650 MW short by the summer of 2026 if the Champlain Hudson Power Express (CHPE) does not come online on time.

The STAR also found reliability needs for Long Island and the Lower Hudson Valley in 2027 and 2030, respectively, but neither are as large as New York City’s.

The findings triggered a formal process in which the ISO will seek solutions to the issue, including transmission, generation and energy efficiency, either alone or in combination. The process is sure to dominate stakeholder discussions for months in 2026.

The shortfall is driven primarily by the impending retirements of the Gowanus and Narrows gas generators in the city. These generators are being kept online by an ISO reliability designation under New York state’s peaker rule. If CHPE and Empire Wind complete on time, they would, according to the ISO, solve the deficiency.

The previous year’s reliability need was “solved” by considering certain large loads, including cryptocurrency mines and hydrogen electrolysis plants, “flexible,” meaning that they would not operate during peak hours for economic reasons. (See NYISO: Large Load Flexibility Eliminates 2034 Shortfall Concern.)

With the rapid proliferation of inflexible, “always on” data centers in the interconnection queue and this year’s reliability shortfall coming from a lack of generation, it is less likely that a similar solution will present itself to NYISO. Until CHPE and Empire Wind are completed, the ISO is in an awkward position of trying to solicit solutions for a problem that may solve itself.

Resetting the Demand Curve Reset

Late in 2025, NYISO began discussion with stakeholders about how the demand curve reset process would be reformed. It is highly likely that this will continue to dominate stakeholder meetings in 2026. The DCR sets capacity prices every four years based on the capital costs of a new generator on the market. DCRs are time and resource intensive and contentious between stakeholder sectors.

Even though both stakeholders and NYISO staff identified the DCR as a priority during the Capacity Market Structure Review project, it is likely that any changes to the process will also be controversial between stakeholder sectors.

An issue discovery report was supposed to be presented to stakeholders at the final Installed Capacity Working Group meeting of the year, but it was not on the agenda. (See NYISO Begins to Discuss Demand Curve Reset Process Changes.) It is unclear when this report will be presented.

A Possible Hudson Valley Power Authority?

Late in the year, a coalition of environmental groups, local activists, politicians and electricity consumers released the results of a feasibility study that found that the Hudson Valley Power Authority Act, which was introduced in the state legislature in 2025, could save the Central Hudson Gas & Electric system, including ratepayers, $15.2 million after its first year of passage. By Year 30, these savings would climb to $210.5 million annually, a 12.7% difference in rates and saving $2.9 billion cumulatively.

The bill would allow the state to acquire Central Hudson’s assets and convert the utility to a nonprofit utility. The purchase price would be roughly $3.5 billion.

“This is a common step in municipalization and other public ownership campaigns,” said Sandeep Vaheesan, legal director of the Open Markets Institute. “At a minimum, the purpose is to show that this is a practical choice in terms of dollars and cents.”

NewGen Strategies and Solutions, a management and consulting firm, conducted the study on behalf of the coalition. The firm said that the savings would be realized primarily by not paying profits to shareholders, issuing cheaper debt and being exempt from state and federal taxes.

“The question is, could they acquire and operate the utility at a lower cost to ratepayers?” said Scott Burnham, a partner at NewGen. “One of the critical elements of the analysis is that we did not conduct an appraisal of these assets. … We looked purely at publicly available information.”

Central Hudson has come under political fire for requesting double-digit rate hikes in 2024, followed by another rate case in 2025. In response to rising energy bills, lawmakers passed a bill that requires utilities seeking rate increases to “fully and publicly explain all capital expenditures included in the request.” The bill passed after the Public Service Commission approved a three-year rate hike package over the summer.

“There’s a lot of discontent with Central Hudson in the Mid-Hudson Valley, specifically over rates,” Vaheesan said. “There’s a widespread view that Central Hudson has been seeking and obtaining aggressive rate increases and that their service record is mediocre.”

The New York Times reported that Fortis, the owner of Central Hudson, had no interest in selling. A spokesperson for Central Hudson told the Times Union that any attempt to purchase the company would only result in a drawn-out and costly legal battle.