Bill Text: NY S02016 | 2023-2024 | General Assembly | Introduced
NOTE: There are more recent revisions of this legislation. Read Latest Draft
Bill Title: Aligns utility regulation with state climate justice and emission reduction targets; repeals provisions relating to continuation of gas service; repeals provisions relating to the sale of indigenous natural gas for generation of electricity.
Spectrum: Partisan Bill (Democrat 30-0)
Status: (Engrossed) 2024-03-19 - referred to corporations, authorities and commissions [S02016 Detail]
Download: New_York-2023-S02016-Introduced.html
Bill Title: Aligns utility regulation with state climate justice and emission reduction targets; repeals provisions relating to continuation of gas service; repeals provisions relating to the sale of indigenous natural gas for generation of electricity.
Spectrum: Partisan Bill (Democrat 30-0)
Status: (Engrossed) 2024-03-19 - referred to corporations, authorities and commissions [S02016 Detail]
Download: New_York-2023-S02016-Introduced.html
STATE OF NEW YORK ________________________________________________________________________ 2016 2023-2024 Regular Sessions IN SENATE January 18, 2023 ___________ Introduced by Sens. KRUEGER, MAY, BRISPORT, BROUK, CLEARE, COONEY, GIANARIS, GOUNARDES, HARCKHAM, HOYLMAN-SIGAL, KAVANAGH, MYRIE, RAMOS, RIVERA, SALAZAR, STAVISKY -- read twice and ordered printed, and when printed to be committed to the Committee on Energy and Telecommuni- cations AN ACT to amend the public service law and the transportation corpo- rations law, in relation to aligning utility regulation with state climate justice and emission reduction targets; to repeal section 66-b of the public service law relating to continuation of gas service; and to repeal section 66-g of the public service law relating to the sale of indigenous natural gas for generation of electricity 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 "NY Home Energy Affordable Transition Act". 3 § 2. Legislative findings. The legislature finds and declares that: 4 1. The Climate Leadership and Community Protection Act (the "CLCPA") 5 created legal mandates for dramatic greenhouse gas emission reductions 6 from all sectors of New York's economy. The CLCPA also emphasizes equity 7 in addressing climate change by requiring all state agencies and author- 8 ities to prioritize reductions of greenhouse gas emissions and co-pollu- 9 tants in disadvantaged communities and by mandating that certain state 10 investments deliver benefits to these communities. 11 2. Buildings are New York's largest source of greenhouse gas emis- 12 sions, accounting for approximately one-third of the greenhouse gas 13 emissions in our state. New York state's buildings also produce more 14 local air pollution than any other state in the country, resulting in 15 negative health outcomes such as increased rates of asthma, particularly 16 among children, and heart disease. Therefore, reducing greenhouse gas 17 emissions and toxic air pollution emitted from New York's buildings, EXPLANATION--Matter in italics (underscored) is new; matter in brackets [] is old law to be omitted. LBD02688-02-3S. 2016 2 1 especially in disadvantaged communities, is necessary to meet the CLCPA 2 mandates. 3 3. To meet the state's bold climate and equity mandates, New York will 4 need to update how it regulates gas utility service. Doing so will 5 enable strategic planning and investments in neighborhood-scale building 6 decarbonization and help bring the statewide gas distribution system 7 into alignment with the two thousand thirty and two thousand fifty 8 greenhouse gas emission reduction mandates in article seventy-five of 9 the environmental conservation law through an orderly and equitable 10 process, coordinated with appropriate investments in the electric system 11 to ensure all New Yorkers have non-discriminatory, affordable access to 12 the energy needed for heating, cooling, and powering the buildings in 13 which they live and work. 14 4. The New York public service law not only contains barriers to 15 neighborhood-scale building decarbonization solutions such as thermal 16 energy networks, but also works at cross purposes with the state's 17 climate and affordability goals, by requiring and subsidizing the 18 continued expansion of natural gas infrastructure. 19 a. The gas utility obligation to serve codified in the public service 20 law is a major obstacle to utilities developing neighborhood-scale 21 building decarbonization projects that would facilitate bringing the gas 22 system into alignment with the two thousand thirty and two thousand 23 fifty greenhouse gas emission reduction mandates in article seventy-five 24 of the environmental conservation law in a manner that can mitigate 25 costs for all utility customers, reduces greenhouse gas emissions and 26 co-pollutants impacting local air quality, and provides a transition for 27 impacted workers. 28 b. Statutorily mandated utility system extension allowances require 29 existing ratepayers to subsidize gas infrastructure hookups for new 30 customers. According to a recent joint filing with the Public Service 31 Commission by the New York state gas utilities, these required allow- 32 ances cost gas utilities hundreds of millions of dollars per year. 33 These costs are passed directly to existing gas customers. 34 c. Gas utilities in New York are on track to collectively spend $150 35 billion to replace thousands of miles of leak prone pipe in the coming 36 years. These investments pose a risk of becoming stranded assets, with 37 $77 billion of the total cost coming due after 2050, but can be avoided 38 in many cases by strategically investing in neighborhood-scale decarbon- 39 ization projects. 40 5. New Yorkers are suffering from dramatic fossil fuel price spikes 41 driven by the increasingly integrated global commodity market, subject 42 to the whims of foreign dictators such as Russia's Vladimir Putin or 43 Saudi Arabia's Prince Mohammed bin Salman. Fossil fuel prices have 44 spiked to historic high levels, making both electricity and gas utility 45 service unaffordable for many New Yorkers. Decarbonizing buildings 46 through the strategic development of neighborhood-scale building decar- 47 bonization projects, along with investing in energy efficiency and 48 renewable electricity, will save New Yorkers money now and in the 49 future, protect against price volatility, and promote true energy inde- 50 pendence for New York state. 51 6. Fossil fuel price spikes are exacerbating the affordability impacts 52 of the COVID-19 Pandemic. Over a million households in New York now 53 struggle to pay their utility bills. The Public Service Commission has 54 declared, but not yet achieved, a goal that customers should not pay 55 more than 6% of their income for utility energy services, a number based 56 on a nationally accepted standard.S. 2016 3 1 7. Thus, it is the intent of the legislature to enact the NY Home 2 Energy Affordable Transition Act for the following purposes: 3 a. to ensure that the public service law regarding regulation and 4 oversight of gas utilities will provide for the timely and strategic 5 decarbonization and right-sizing of the gas distribution system in a 6 just and affordable manner as required to meet the climate justice and 7 emission reduction mandates of the CLCPA, appropriately balancing rate- 8 payers' needs and interests with the maintenance of financially sound 9 utilities, prioritizing low-to-moderate income customers and disadvan- 10 taged communities, and encouraging neighborhood-scale transitions; 11 b. to provide the Public Service Commission with the statutory author- 12 ity and direction to align utility regulations and planning with the 13 CLCPA climate justice and emission reduction mandates and to require the 14 Public Service Commission to take a proactive role in the timely iden- 15 tification and amendment of such regulations or rulings as may pose an 16 impediment to achieving CLCPA mandates, and to identify any laws that 17 may pose an impediment; 18 c. to end statutorily mandated, ratepayer-subsidized incentives for 19 the expansion of fossil fuel infrastructure while maintaining the equi- 20 table provision of electric service for efficient heating, cooling, 21 cooking, hot water, and other uses; 22 d. to provide affordable access to electricity for heating and cooling 23 and to protect low-income and moderate-income customers from undue 24 burdens as they decarbonize their buildings; and 25 e. to clarify that municipal building codes regulating on-site emis- 26 sions are not preempted under New York state law. 27 8. This legislation does not establish a ban on the use of gas. It is 28 neither the intent nor would it be the effect of this legislation to 29 require the immediate transition of any existing gas customer to alter- 30 native heating and cooling services. 31 § 3. Subdivision 1 of section 4 of the public service law, as amended 32 by chapter 594 of the laws of 2021, is amended to read as follows: 33 1. There shall be in the department of public service a public service 34 commission, which shall possess the powers and duties hereinafter speci- 35 fied, and also all powers necessary or proper to enable it to carry out 36 the purposes of this chapter and to enable achievement of the climate 37 justice and emission reduction mandates in article seventy-five of the 38 environmental conservation law, and such successors in law and function 39 as may arise from time to time. The commission shall consist of five 40 members, to be appointed by the governor, by and with the advice and 41 consent of the senate. A commissioner shall be designated as [chairman] 42 chairperson of the commission by the governor to serve in such capacity 43 at the pleasure of the governor or until his or her term as commissioner 44 expires whichever first occurs. At least one commissioner shall have 45 experience in utility consumer advocacy. No more than three commission- 46 ers may be members of the same political party unless, pursuant to 47 action taken under subdivision two of this section, the number of 48 commissioners shall exceed five, and in such event no more than four 49 commissioners may be members of the same political party. 50 § 4. Subdivisions 1 and 2 of section 5 of the public service law, 51 subdivision 1 as amended and subdivision 2 as added by chapter 155 of 52 the laws of 1970, paragraph i of subdivision 1 as added by chapter 375 53 of the laws of 2022, are amended to read as follows: 54 1. The jurisdiction, supervision, powers and duties of the public 55 service commission shall extend under this chapter:S. 2016 4 1 [b.] a. To the manufacture, conveying, transportation, sale or 2 distribution of gas (natural or manufactured or mixture of both) and 3 electricity for light, heat, cooling, or power, to gas plants and to 4 electric plants and to the persons or corporations owning, leasing or 5 operating the same. 6 [c.] b. To the manufacture, holding, distribution, transmission, sale 7 or furnishing of steam for heat or power, to steam plants and to the 8 persons or corporations owning, leasing or operating the same. 9 [d.] c. To every telephone line which lies wholly within the state and 10 that part within the state of New York of every telephone line which 11 lies partly within and partly without the state and to the persons or 12 corporations owning, leasing or operating any such telephone line. 13 [e.] d. To every telegraph line which lies wholly within the state and 14 that part within the state of New York of every telegraph line which 15 lies partly within and partly without the state and to the persons or 16 corporations owning, leasing or operating any such telegraph line. 17 [f.] e. To the furnishing or distribution of water for domestic, 18 commercial or public uses and to water systems and to the persons or 19 corporations owning, leasing or operating the same. 20 [g.] f. To every stock yard within the state and to the stock yard 21 company owning, leasing or operating the same, to the same extent and in 22 respect to the same objects and purposes as such jurisdiction extends, 23 under this chapter, to depots, freight houses and shipping stations of a 24 common carrier, including the duty of such stock yard company to submit 25 reports and be subjected to investigation as if it were a common carri- 26 er, and the powers and duties of such commission to fix charges and make 27 and enforce orders relating to adequate service by such company. 28 [h.] g. A corporation or person owning or holding a majority of the 29 stock of a common carrier, gas corporation or electrical corporation 30 subject to the jurisdiction of the public service commission shall be 31 subject to the supervision of the public service commission in respect 32 of the relations between such common carrier, gas corporation or elec- 33 trical corporation and such owners or holders of a majority of the stock 34 thereof in so far as such relations arise from or by reason of such 35 ownership or holding of stock thereof or the receipt or holding of any 36 money or property thereof or from or by reason of any contract between 37 them; and in respect of such relations shall in like manner and to the 38 same extent as such common carrier, gas corporation or electrical corpo- 39 ration be subject to examination of accounts, records and memoranda, and 40 shall furnish such reports and information as the public service commis- 41 sion shall from time to time direct and require, and shall be subject to 42 like penalties for default therein. 43 [i.] h. To thermal energy provided by gas corporations, electric 44 corporations, or combination gas and electric corporations. 45 2. The commission shall encourage all persons and corporations subject 46 to its jurisdiction to formulate and carry out long-range programs, 47 individually or cooperatively, for the performance of their public 48 service responsibilities, including the achievement of the climate 49 justice and emission reduction mandates in article seventy-five of the 50 environmental conservation law, with economy, efficiency, and care for 51 the public safety, the preservation of environmental values and the 52 conservation of natural resources. 53 § 5. Section 30 of the public service law, as amended by chapter 686 54 of the laws of 2002, is amended to read as follows: 55 § 30. Residential gas, electric and steam service policy. 1. This 56 article shall apply to the provision of all or any part of the gas,S. 2016 5 1 electric or steam service provided to any residential customer by any 2 gas, electric or steam and municipalities corporation or municipality. 3 It is hereby declared to be the policy of this state that the continued 4 provision of [all or any part of such gas,] electric [and steam service] 5 services to all residential customers without unreasonable qualifica- 6 tions or lengthy delays is necessary for the preservation of the health 7 and general welfare, is consistent with the achievement of the state's 8 climate justice and emission reduction mandates, and is in the public 9 interest. It is further the policy of this state that gas service for 10 existing residential customers must be provided in a manner that is safe 11 and adequate, not unjustly discriminatory or unduly preferential, and in 12 all respects just and reasonable, while providing for an orderly right- 13 sizing of the gas distribution system to achieve consistency with the 14 climate justice and emission reduction mandates in article seventy-five 15 of the environmental conservation law, prioritizing low-to-moderate 16 income customers and disadvantaged communities as defined in article 17 seventy-five of the environmental conservation law, and encouraging 18 neighborhood-scale transitions. 19 2. The commission shall regulate for the continued provision of gas 20 service to all existing residential customers who choose to continue 21 service, unless the discontinuance of service is part of a process of 22 orderly right-sizing of the gas distribution system to achieve consist- 23 ency with the climate justice and emission reduction mandates in article 24 seventy-five of the environmental conservation law. As part of such 25 process, the commission shall take any such action, after notice and a 26 hearing, as is necessary to facilitate the achievement of consistency 27 with the climate justice and emission reduction mandates in article 28 seventy-five of the environmental conservation law, but in doing so it 29 shall actively encourage a transition away from fuels with high life-cy- 30 cle greenhouse gas emissions and on-site co-pollutant emissions, encour- 31 age neighborhood-scale transitions, and ensure that all residential 32 customers have access to electricity for heating and cooling services 33 without unreasonable qualifications, unreasonable costs, or lengthy 34 delays, with a goal that low-to-moderate income customers, defined as 35 households with annual incomes at or below eighty percent of the area 36 median income of the county or metro area where they reside, including 37 those who are already eligible for the commission's energy affordability 38 program, are adequately protected from bearing energy burdens greater 39 than six percent of their income, including any undue burdens imposed by 40 the cost to purchase and operate electric equipment needed to facilitate 41 the achievement of the climate justice and emission reduction mandates 42 in article seventy-five of the environmental conservation law. 43 § 6. Subdivisions 1, 3 and 4 of section 31 of the public service law, 44 as added by chapter 713 of the laws of 1981, are amended to read as 45 follows: 46 1. Every gas corporation, electric corporation or municipality shall 47 provide residential service upon the oral or written request of an 48 applicant, provided that any residential gas service shall only be 49 provided in accordance with section thirty of this article and is 50 subject to any orders or regulations limiting or discontinuing gas 51 service that are implemented by the commission to facilitate the 52 achievement of consistency with the climate justice and emission 53 reduction mandates in article seventy-five of the environmental conser- 54 vation law, and provided further that the commission may require that 55 requests for service be in writing under circumstances as it deemsS. 2016 6 1 necessary and proper as set forth by regulation, and provided further 2 that the applicant: 3 (a) makes full payment for residential utility service provided to a 4 prior account in [his] the applicant's name; or 5 (b) agrees to make payments under a deferred payment plan of any 6 amounts due for service to a prior account in [his] the applicant's name 7 and makes a down payment based on criteria to be established by the 8 commission. No such down payment shall exceed one-half of any money due 9 from an applicant for residential utility service, or three months aver- 10 age billing, whichever is less; or 11 (c) is a recipient of public assistance, supplemental security income 12 or additional state payments pursuant to the social services law, or is 13 an applicant for such assistance, income or payments, and the utility 14 corporation or the municipality receives payment from, or is notified of 15 the applicant's eligibility for utility payments by the social services 16 official of the social services district in which such person resides 17 for amounts due for service to a prior account in the applicant's name, 18 together with guarantee of future payments to the extent authorized by 19 the social services law; and 20 (d) receives clear, timely information from the gas corporation, elec- 21 tric corporation, municipality, or retail energy service company, writ- 22 ten in plain language, available in the top twelve most common non-Engl- 23 ish languages spoken by limited English proficient New Yorkers, and 24 approved by the commission after stakeholder input, on incentives and 25 opportunities for installing, energy-efficient electric heating and 26 cooling technologies, weatherization, demand-side management, and 27 distributed energy resource programs. 28 (e) nothing in this subdivision shall be construed to prohibit exist- 29 ing gas customers, in accordance with section thirty of this article and 30 subject to any other regulations implemented by the commission, from 31 reconnecting to the gas distribution system following a gas interruption 32 due to emergency repairs or remediation of leaking equipment. 33 3. Subject to the requirements of subdivisions four and five of this 34 section, and in accordance with section thirty of this article, whenever 35 a residential customer moves to a new residence within the service 36 territory of the same utility corporation or municipality, [he] the 37 applicant shall be eligible to receive service at the new residence and 38 such service shall be considered a continuation of service [in all39respects] as operationally feasible based on infrastructure and commod- 40 ity availability at the site of the new residence, with any deferred 41 payment agreement honored, and with all rights of such customer and such 42 utility corporation provided by this article unimpaired. 43 4. In the case of any application for service to a building which is 44 not supplied with electricity or gas, a utility corporation or munici- 45 pality shall be obligated to provide electric service to such a build- 46 ing, and to provide gas service for such a building in accordance with 47 commission regulation, provided however, that the commission may require 48 applicants for service to buildings [located in excess of one hundred49feet from gas or electric transmission lines] to pay or agree in writing 50 to pay material and installation costs relating to the applicant's 51 proportion of the pipe, conduit, duct or wire, or other facilities to be 52 installed. 53 § 7. Section 12 of the transportation corporations law, as separately 54 amended by chapters 713 and 895 of the laws of 1981, is amended to read 55 as follows:S. 2016 7 1 § 12. Gas and electricity must be supplied on application in accord- 2 ance with commission rules and regulations. Except in the case of an 3 application for residential utility service pursuant to article two of 4 the public service law, upon written application of the owner or occu- 5 pant of any building [within one hundred feet of any main of a gas6corporation or gas and electric corporation, or a line of an electric7corporation or gas and electric corporation, appropriate to the service8requested,] and payment by [him] the applicant of all money due from 9 [him] the applicant to the corporation, it shall supply [gas or] elec- 10 tricity as may be required for [lighting] such building and it may 11 provide gas for such building in accordance with commission regulation, 12 notwithstanding there be rent or compensation in arrears for gas or 13 electricity supplied, or for meter, wire, pipe or fittings furnished, to 14 a former occupant thereof, unless such owner or occupant shall have 15 undertaken or agreed with the former occupant to pay or to exonerate 16 [him] them from the payment of such arrears, and shall refuse or neglect 17 to pay the same; and if for the space of ten days after such applica- 18 tion, and the deposit of a reasonable sum as provided in the next 19 section, if required, the corporation shall refuse or neglect to supply 20 gas or [electric light] electricity as required, such corporation shall 21 forfeit and pay to the applicant the sum of ten dollars, and the further 22 sum of five dollars for every day thereafter during which such refusal 23 or neglect shall continue; provided that no such corporation shall be 24 required to lay service pipes or wires for the purpose of supplying gas 25 or electric light to any applicant where the ground in which such pipe 26 or wire is required to be laid shall be frozen, or shall otherwise pres- 27 ent serious obstacles to laying the same; nor unless the applicant, if 28 required, shall deposit in advance with the corporation a sum of money 29 sufficient to pay the cost of [his proportion] the applicant's portion 30 of the pipe, conduit, duct or wire required to be installed, and the 31 expense of the installation of such portion. 32 § 8. Subdivision 2 of section 66 of the public service law, as amended 33 by chapter 877 of the laws of 1953, is amended and a new subdivision 34 12-e is added to read as follows: 35 2. Investigate and ascertain, from time to time, the quality of gas 36 supplied by persons, corporations and municipalities; examine or inves- 37 tigate the methods employed by such persons, corporations and munici- 38 palities in manufacturing, distributing and supplying gas or electricity 39 for light, heat, cooling, or power and in transmitting the same, and 40 have power to order such reasonable improvements as will best promote 41 the public interest, preserve the public health and protect those using 42 such gas or electricity and those employed in the manufacture and 43 distribution thereof, and have power to order reasonable improvements 44 and extensions of the works, wires, poles, lines, conduits, ducts and 45 other reasonable devices, apparatus and property of gas corporations, 46 electric corporations and municipalities; and have power after an inves- 47 tigation and a hearing to order any corporation having authority under 48 any general or special law or under any charter or franchise, to lay 49 down, erect or maintain wires, pipes, conduits, ducts or other fixtures 50 in, over or under the streets, highways and public places of any munici- 51 pality for the purpose of supplying, selling or distributing natural 52 gas, to augment its supply of natural gas, whenever the commission deems 53 necessary and whenever artificial gas can be reasonably obtained, by 54 acquiring by purchase, manufacture or otherwise a supply thereof to be 55 mixed with such natural gas, in order to render adequate service to the 56 customers of such corporation or to maintain a proper and uniform pres-S. 2016 8 1 sure; and have power after an investigation and a hearing to order any 2 corporation having authority under any general or special law or under 3 any charter or franchise, to lay down, erect or maintain wires, pipes, 4 conduits, ducts or other fixtures in, over or under the streets, high- 5 ways and public places of any municipality for the purpose of supplying, 6 selling or distributing artificial gas, to augment its supply of artifi- 7 cial gas, whenever the commission deems necessary and whenever natural 8 gas can be reasonably obtained, by acquiring by purchase or otherwise a 9 supply thereof to be mixed with such artificial gas, in order to render 10 adequate service to the customers of such corporation or to maintain a 11 proper and uniform pressure; and to fix such rate for the supplying of 12 mixed gas as shall secure to such corporation a fair return; and may 13 order the curtailment or discontinuance of the use of natural gas for 14 manufacturing or industrial purposes, for periods aggregating not to 15 exceed four months in any calendar year, if it is established to the 16 satisfaction of the commission that the supply of natural gas is not 17 adequate to meet the reasonable demands of domestic consumption and may 18 [prohibit the use of natural gas in wasteful devices and practices] 19 order the curtailment or discontinuance of the use of the distribution 20 system, where the commission has determined that such curtailment or 21 discontinuance is reasonably required to implement state energy policy, 22 provided that such curtailment or discontinuance shall be consistent 23 with a plan for the phase-out of the use of a gas distribution system to 24 achieve consistency with the climate justice and emission reduction 25 mandates in article seventy-five of the environmental conservation law, 26 including the opportunity for the full recovery of the utility's invest- 27 ment in such system, encouraging neighborhood-scale transitions for 28 clean heating and cooling, prioritizing disadvantaged communities as 29 defined in article seventy-five of the environmental conservation law, 30 and accompanied by coordination assistance and, where reasonably 31 required, financial assistance in the identification and adoption of 32 alternatives, and may prohibit the use of natural gas in wasteful 33 devices and practices, as defined by the commission, and require conser- 34 vation and efficiency in gas usage. 35 12-e. The commission shall review the capital construction plan of 36 each gas corporation and establish a process to examine feasible alter- 37 natives to such construction in order to achieve consistency with the 38 climate justice and emission reduction mandates in article seventy-five 39 of the environmental conservation law, encouraging neighborhood-scale 40 transitions away from fuels with high life-cycle greenhouse gas emis- 41 sions and on-site co-pollutant emissions, prioritizing low-to-moderate 42 income customers and disadvantaged communities as defined in article 43 seventy-five of the environmental conservation law. Such process shall 44 include thresholds and criteria for the types of projects subject to 45 such examination. The commission shall require participation in such 46 process by each electric corporation with a service area overlapping the 47 service area of the gas corporation; and the commission shall have the 48 power to require any such electric corporation to participate in alter- 49 natives to gas capital construction, including participation in financ- 50 ing. Any costs incurred by such electric corporation for such corpo- 51 ration's participation shall be subject to an opportunity for full 52 recovery, as determined by the commission. 53 § 9. Section 66-a of the public service law, as added by chapter 7 of 54 the laws of 1948, subdivision 1 as amended and subdivision 3 as added by 55 chapter 582 of the laws of 1975, subdivision 2 as amended by chapter 722 56 of the laws of 1977, is amended to read as follows:S. 2016 9 1 § 66-a. Conservation of gas, declaration of policy, delegation of 2 power. 1. It is hereby declared to be the policy of this state that 3 when there develops in any area a situation under which a gas corpo- 4 ration supplying gas to such area is unable to meet the reasonable needs 5 of its consumers and of persons or corporations applying for new or 6 additional gas service, the available supply of gas shall be allocated 7 among the customers of such gas corporation, in such manner as may be 8 necessary to protect public health and safety and to avoid undue hard- 9 ship, particularly for low-to-moderate income residential customers, 10 electric generation needed for electric system reliability, and custom- 11 ers with hard-to-electrify industrial and commercial uses, pursuant to 12 rules and regulations as may be adopted by the commission, and that to 13 carry out this declared policy the jurisdiction of the public service 14 commission should be clarified. It is further declared to be the policy 15 of this state that gas service to existing customers must be provided in 16 a manner that is safe and adequate, not unjustly discriminatory or undu- 17 ly preferential, and in all respects just and reasonable. 18 2. Notwithstanding the provisions of any statute or any franchise held 19 by a gas corporation, the commission shall have power, upon the finding 20 that continued gas service is not consistent with the achievement of the 21 climate justice and emission reduction mandates in article seventy-five 22 of the environmental conservation law, or that there exists such a shor- 23 tage of gas in any area in the state, that the gas corporation supplying 24 such area is unable and will be unable to secure or produce sufficient 25 gas to meet the reasonable needs of its customers and of persons or 26 corporations applying for new or additional gas service, to require such 27 corporation to immediately discontinue the supplying of gas to addi- 28 tional customers or of supplying additional service to present custom- 29 ers, for such purpose or purposes as may be designated by the commis- 30 sion, or to customers using gas for a purpose prohibited by the 31 commission pursuant to this act, and that upon the finding that the 32 supply of gas available is and will be insufficient to supply the 33 demands of all consumers receiving service, to require such gas corpo- 34 ration to curtail or discontinue service to any or all classes of 35 customers of such gas corporation. In imposing such a direction or 36 requirement, the commission shall give consideration first to existing 37 domestic uses and uses deemed to be necessary by the commission to 38 protect public health and safety and to avoid undue hardship [and shall39be limited to the period of the emergency provided that the gas corpo-40ration affected shall make such restriction, curtailing or discontin-41uance applicable to all customers or applicants for service in a like42class. If the commission determines that good cause exists for supplying43service to additional customers or for supplying additional service to44some existing customers, notwithstanding the curtailment or discontin-45uance of service to other existing customers, it shall, to the extent46feasible, allocate gas with equal priority to new or additional domestic47uses of gas and commercial or industrial processes which require gas48because there is no practical substitute for it in such proportion as49the commission determines to be reasonable. Provided that the commis-50sion shall be permitted, after public hearing, to authorize any natural51gas produced from lands under the waters of Lake Erie to be used for52process or feedstock requirements]. The commission is authorized to 53 adopt such rules, regulations and orders as are necessary or appropriate 54 to carry out these delegated powers. 55 3. In carrying out the delegated powers provided for in this section, 56 the commission shall, to the extent practicable, determine and establishS. 2016 10 1 gas conservation measures or standards, including energy efficient elec- 2 trification of gas end uses. The commission may require compliance with 3 such measures or standards as a condition of receiving service. 4 4. The commission shall determine conditions under which new or addi- 5 tional gas service is warranted notwithstanding the need to conserve 6 resources for service to existing gas customers. Such determination 7 shall be consistent with the achievement of the climate justice and 8 emission reduction mandates in article seventy-five of the environmental 9 conservation law, and may take into account factors including economic 10 development, impacts on new and existing customers including low-to-mod- 11 erate income customers, impacts on system safety and adequacy, equity 12 toward existing customers with limited conversion alternatives, and the 13 feasibility of neighborhood-scale alternatives to usage of fuels with 14 high life-cycle greenhouse gas emissions and on-site co-pollutant emis- 15 sions, including thermal energy networks. 16 5. The commission shall require gas and/or electric utilities to 17 provide coordination assistance and financial assistance, in such forms 18 as the commission deems reasonably required to implement state energy 19 policy, to identify and adopt alternatives where applications for new or 20 additional gas service are denied and encourage neighborhood-scale tran- 21 sitions. 22 § 10. Section 66-b of the public service law is REPEALED. 23 § 11. The public service law is amended by adding a new section 66-u 24 to read as follows: 25 § 66-u. Expansion of gas distribution infrastructure. Except as 26 provided in this section, and notwithstanding any other provision of 27 this chapter, after December thirty-first, two thousand twenty-four, no 28 gas corporation shall commence construction of new gas distribution 29 infrastructure the result of which would be to expand the availability 30 of service into geographic areas where gas service was not available 31 prior to that date as defined by the applicable utility's certificate of 32 public convenience and necessity approved by the commission. No such 33 new gas distribution infrastructure shall be put into service after 34 December thirty-first, two thousand twenty-five. The commission may 35 authorize exceptions on a case-by-case basis, provided that the commis- 36 sion finds that the project qualifying for the exception serves a 37 compelling state interest, alternatives to gas service are either not 38 technically feasible or prohibitively expensive, and that the project 39 will be completed and put into service not later than December thirty- 40 first, two thousand twenty-seven. For the purposes of this section, gas 41 distribution infrastructure shall include all real estate, fixtures and 42 personal property operated, owned, used or to be used for or in 43 connection with or to facilitate the manufacture, conveying, transporta- 44 tion, distribution, sale or furnishing of gas (natural or manufactured 45 or a mixture of both) for light, heat or power, but does not include 46 property used solely for or in connection with the business of selling, 47 distributing or furnishing of gas in enclosed containers. 48 § 12. Section 66-g of the public service law is REPEALED. 49 § 13. The public service law is amended by adding a new section 77-a 50 to read as follows: 51 § 77-a. Aligning utility regulation with climate justice and emission 52 reduction mandates. 1. Within three months of the effective date of 53 this section, the commission shall initiate a proceeding, or multiple 54 proceedings, as it deems appropriate, to consider and act on the matters 55 identified in this section in order to better align its regulation of 56 utility services with the timely achievement of consistency with theS. 2016 11 1 climate justice and emission reduction mandates in article seventy-five 2 of the environmental conservation law. If the commission is already 3 engaged in a proceeding addressing one or more of the matters identi- 4 fied in this section, it shall not be required to open a new proceeding 5 on that matter. Following completion of all proceedings initiated 6 pursuant to this section, the commission shall initiate regular subse- 7 quent proceedings, as it deems necessary, to ensure the achieve- 8 ment of the goals outlined in this section. The proceeding or 9 proceedings shall include: 10 (a) Within one year of the effective date of this section, a review of 11 the public service law and its current rules and policy guidance to 12 identify any law, rule, guidance, or lack thereof, that may inhibit 13 timely, equitable achievement of consistency with the climate 14 justice and emission reduction mandates in article seventy-five of the 15 environmental conservation law. The commission shall report to the 16 legislature its progress and findings, identify subsequent actions it 17 will take, and make recommendations for any statutory amendments or 18 other actions that may be needed to facilitate the timely achievement 19 of such mandates. 20 (b) Within one year of the effective date of this section, a revision 21 of the commission's rules and regulations for determining appropriate 22 allowances for the extension of gas and electric utility services to 23 ensure that utility service is provided in a manner consistent with the 24 achievement of the climate justice and emission reduction mandates in 25 article seventy-five of the environmental conservation law. In estab- 26 lishing rules governing the allowance for the extension of gas service, 27 the commission shall eliminate all main and service line extension 28 allowances for gas service and may increase allowances for electric 29 service. The commission may establish rules that provide for distinct 30 electric allowances for all-electric customers and for dual-fuel custom- 31 ers and may provide additional electric allowances to buildings that are 32 made ready for beneficial electric loads such as those with electric 33 vehicle charging facilities and grid interactive buildings. The commis- 34 sion may also establish allowances for buildings seeking interconnection 35 with thermal energy networks. 36 (c) In order to minimize long-term costs and stranded assets, and 37 maximize savings and benefits for customers, within one year of the 38 effective date of this section the commission shall issue an order 39 requiring each gas corporation, within one hundred eighty days of the 40 issuance of the order, to restructure its plan for addressing the leak- 41 prone gas mains and service lines on its system to facilitate the order- 42 ly right-sizing of the gas distribution system to achieve consistency 43 with the climate justice and emission reduction mandates in article 44 seventy-five of the environmental conservation law while maintaining 45 safety and reliability of the gas system, subject to all relevant feder- 46 al laws and regulations. To accomplish this, the commission shall 47 require each gas corporation, in coordination with any and all electric 48 corporations with overlapping service areas, to pursue a geographically 49 targeted approach to implementing alternative solutions that minimize 50 the replacement of leak-prone gas mains and service lines while encour- 51 aging neighborhood-scale full building electrification, including 52 through the installation of thermal energy networks, resulting in the 53 decommissioning of the maximum feasible segment of gas main or service 54 line. The commission shall require each gas corporation, after notice 55 and comment, to establish criteria for evaluating whether specific 56 segments of leak-prone mains and service lines are candidates for such aS. 2016 12 1 geographically targeted approach and to evaluate their entire inventory 2 of leak-prone pipes to create a strategic decommissioning ranking in 3 which it ranks the segments in terms of the ability to electrify all 4 customers served by the segment and retire the gas distribution infras- 5 tructure. The commission shall require each gas corporation to file an 6 annual report that provides a qualitative and quantitative assessment of 7 the reduction of leak-prone pipe inventory and that updates the strate- 8 gic decommissioning ranking from the prior year. The commission shall 9 establish notice requirements and consumer and affordability protections 10 in accordance with section thirty of the public service law applicable 11 to customers served by segments of the gas distribution system targeted 12 for decommissioning. 13 (d) In order to maximize the cost savings and benefits of the transi- 14 tion of the electric system for the equitable, orderly, and affordable 15 achievement of consistency with the climate justice and emission 16 reduction mandates in article seventy-five of the environmental conser- 17 vation law, within one year of the effective date of this section the 18 commission shall issue an order requiring all electric corporations to 19 pursue all available electric energy efficiency and demand flexibility 20 measures that are cost-effective, reliable, and feasible. No less 21 frequently than every three years, the commission shall identify the 22 statewide achievable potential for energy efficiency and demand flexi- 23 bility measures for the subsequent ten-year period and establish annual 24 energy efficiency and demand flexibility targets for each electric 25 corporation that are no lower than its proportional share of the state- 26 wide achievable potential. 27 (e) Within one year of the effective date of this section, the commis- 28 sion shall complete a proceeding to develop and issue a report evaluat- 29 ing and considering rate making strategies to encourage and facilitate 30 achievement of the climate justice and emission reduction mandates in 31 article seventy-five of the environmental conservation law. The report 32 shall explore options for developing and assessing the impacts of rates 33 for electric, gas, steam, and thermal energy networks on total customer 34 energy costs, and shall explore options for integrating cost sharing and 35 recovery across utilities and services. The report shall also identify 36 statutory barriers to the implementation of such strategies. In consid- 37 ering such rate making strategies, the commission shall have a goal of 38 ensuring that all low-to-moderate income residential customers pay no 39 more than six percent of their income for electricity. 40 (f) Within one year of the effective date of this section, the commis- 41 sion shall determine, based on the best available information, the 42 greenhouse gas emission reductions necessary to bring the statewide gas 43 distribution system into alignment with the statewide two thousand thir- 44 ty and two thousand fifty greenhouse gas emission reduction targets in 45 article seventy-five of the environmental conservation law, and set 46 interim emission reduction targets for each gas utility as well as 47 developing a periodic process to review and update such targets; 48 (g) Within one year of the effective date of this section, the commis- 49 sion shall revise its rules and regulations for conducting benefit-cost 50 analyses so that the methodology and the base financial and framework 51 assumptions for the analysis support achievement of the climate justice 52 and emission reduction mandates in article seventy-five of the environ- 53 mental conservation law. Such revisions shall include, but not be limit- 54 ed to: 55 (1) Greenhouse gas emission reduction mandates shall be used as a 56 constraint in designing the scenarios to be analyzed such that all theS. 2016 13 1 scenarios shall comply with the statutory greenhouse gas emission 2 requirements and any interim targets set by the department of environ- 3 mental conservation or the commission in order to internalize the cost 4 of achieving such targets in the benefit-cost analysis. 5 (2) Quantification of public health impacts from improvements in ambi- 6 ent and indoor air quality. When quantitative metrics are not possible, 7 qualitative analysis shall be included. 8 (3) Consideration of the significant uncertainties and risks associ- 9 ated with different scenarios, including the environmental impact of 10 leaked gas, the prolonged reliance on the gas system that results from 11 long-lived investments in gas infrastructure and gas-consuming equip- 12 ment, the positive option value associated with measures that can elimi- 13 nate or defer the need for investments in gas infrastructure and gas- 14 consuming equipment, and potential challenges associated with full 15 electrification. 16 (4) In instances where an alternative fuel has an environmental attri- 17 bute, only attribute alternative fuels with emission reduction benefits 18 under the benefit-cost analysis if the environmental attributes are 19 retained by the utility for the benefit of the utility's customers or by 20 the end-use customer. 21 (5) Use accurate depreciation schedules that assume the full value of 22 any new gas asset is fully depreciated no later than two thousand fifty, 23 absent demonstration that the specific asset will remain in service 24 beyond two thousand fifty, and earlier if it is likely that such asset 25 will need to be phased out or retired before two thousand fifty given 26 any interim greenhouse gas emission reduction targets or geographically 27 targeted strategic asset retirement. 28 (6) Assess demographic impacts by measuring with as much geographic 29 granularity as possible and considering different levels of exposure and 30 risk factors for impacts on disadvantaged communities and other popu- 31 lations with vulnerability to changes induced by regulation. 32 2. Nothing in this chapter or any other law of New York state shall be 33 interpreted or otherwise construed as preempting a municipality from 34 adopting building codes or other regulations regarding on-site emissions 35 for new and existing buildings within their localities. 36 § 14. This act shall take effect immediately.
