Cooler heads prevailed this session, in part, as New York State Assembly leaders declined to take up the Home Energy Affordable Transition (NY HEAT) Act, and instead acted responsibly to consider the financial costs and potentially devastating impacts on customers and the electric grid.
The NY HEAT Act, trumpeted by certain extreme interests as a panacea for reducing reliance on clean – and reliable – natural gas, would have prohibited the modernization of the existing natural gas delivery system by barring the replacement of aging gas hookups used to generate electricity, and curtailing the ability to deliver low carbon fuels. Instead, those sections of pipeline would have been permanently removed from service, thus banning natural gas from entire neighborhoods.
The measure also would have capped utility bills for low- and moderate-income households at 6% of their income. While that may sound commendable, it’s unclear who would supplement the transition costs to utility companies should the costs rise above 6%. Most likely, New Yorkers would foot the bill – directly or indirectly – through either higher utility rates or higher taxes.
The NY HEAT Act was included in the state budget to complement the mandate for electrification of new construction. New York now has the dubious distinction of being the first state in the nation to ban gas hookups in new building construction, beginning in 2026. The ultimate goal is to force the conversion of homes and businesses to electric heat, which flies in the face of what many New Yorkers want, according to a recent statewide poll by the Siena College Research Institute. The survey found a sizable majority of New Yorkers both use and want to continue using natural gas, and that one in four simply are not willing to pay additional costs on their utility bills to fund climate policies.
Fortunately, a proposal to ban natural gas in existing homes and businesses was removed from the budget following an outcry over costs and reliability. For good reason: Estimates from the state put the costs of converting a home to electric heat at $20,000 to $50,000 per household. It is not that New Yorkers don’t care about the environment. We all want to protect our environment, now and for future generations, but we also want to do so in a manner that is practical and fair to everyone. While advocates of the NY HEAT Act and natural gas ban have been vocal in praising the proposals, little is said about funding the measures. New York already has some of the highest energy costs in the nation. Gov. Hochul and state lawmakers have an obligation to protect customers, and they must reconsider pushing public policies that will be prohibitively expensive but have no meaningful impact on the climate.
There are also legitimate concerns about reliability. We’ve seen major blackouts – most recently the Buffalo blizzard of 2022 that wreaked havoc on western New York. As our population and energy-reliance increase, is the state’s electricity supply equipped to handle it? It seems unlikely. The New York Independent System Operator, which manages the state’s power grid, says the state will need 20 gigawatts (about 20,000 megawatts) of additional renewable power generation – a 54% increase – by 2030 to support its energy policies. After millions of dollars in subsidies and years waiting, construction is just getting underway on the first wind-energy project and it will take years before turbines generate the expected 132 megawatts of power. At the same time, we continue to phase out affordable and reliable sources without ensuring we have the necessary infrastructure to keep the lights on. Additionally, there are several open proceedings at the Public Service Commission, including the Gas Planning Proceeding and the Clean Energy Standard, which recognizes the gap between the capabilities of existing renewable energy technologies and future system reliability needs. The legislature acting before the state’s utility regulator finished its work surely is not prudent. We must give PSC, which has the expertise and a mission to provide safe and reliable service at affordable rates, the opportunity to conclude its proceedings.
Efforts to transition to green energy may be well-intentioned, but they come at a hefty price – both financially and by way of unintended consequences. We must work together to find a balance to achieve climate goals and ensure the system is affordable and reliable for everyone.
Daniel Ortega is the Executive Director of New Yorkers for Affordable Energy, a coalition of community, labor, business and industry leaders who support greater access to clean, reliable and affordable sources of energy for residential and business consumers.
