1 week Ago
The authors of a recent Another Voice column lament the pace at which New York’s 2019 Climate Act is being implemented. But a closer look at the economic realities of this aggressive energy policy should cause any New Yorker to question why we’re moving as quickly as we are. David P.
Bauer is president and chief executive officer of National Fuel Gas Co. In March 2019, several months before the Climate Act was passed, electricity cost more than $0.17 per kilowatt hour.
This past March, New Yorkers paid an average of $0.24 per kilowatt, a 40% increase. And we’re only getting started – costs will continue to increase in the near-term.
The Energy Information Administration estimated that New York electric bills would be 9% higher this summer than a year ago. On top of that, most electric utilities in the state have filed for 20%+ rate increases to cover the initial costs of complying with the Climate Act. As well, the Climate Act’s “Cap and Invest” carbon pricing scheme is scheduled to take effect in 2025 , and here the numbers really start to get big .
By our calculations, the fees proposed by this program will increase the average residential customer’s yearly natural gas heating costs by more than $500. On top of that, if a two-car household drives vehicles with internal combustion engines, Cap and Invest will increase what they pay at the pump by $750. To avoid these fees, a New Yorker must spend $20,000 to $40,000 to electrify their home and $50,000-plus for an electric vehicle.
The NY HEAT Act purports to limit energy costs borne by the low-income population to 6% of their income, but how will everyone else afford it? As costs increase, electric reliability in the state is becoming a greater risk. Since the Climate Act was passed, approximately 5 gigawatts of mostly nuclear and natural gas-fired electric generation have been taken out of service. Sadly, only 2 gigawatts of wind and solar generation has been added, and some state agencies are admitting we won’t achieve our 2030 generation targets.
To electrify everything as soon as possible when there is no certainty that the grid will be able to serve the increased electric demand is a risky proposition. I believe New York should be a leader in energy policy, but anything we do must be reasonable, affordable and not unduly risk reliability. In the five years since the Climate Act was passed, it has become abundantly clear that the implementation of it will be extraordinarily expensive and take considerably longer than the state envisioned.
Affordable, reliable energy is absolutely critical to our society. Now is not the time to implement laws like NY HEAT that risk still higher costs and reduced reliability. Instead, let’s revisit any laws that limit energy choice and develop an “all of the above” energy strategy that achieves significant emission reductions while preserving the quality of energy service in the state.
David P. Bauer is president and chief executive officer at National Fuel Gas Co. Catch the latest in Opinion Get opinion pieces, letters and editorials sent directly to your inbox weekly!.
