About 33,700 GWh of new renewable generation must be added to New York's fuel mix to have 50% of its power from renewable sources by 2030, as mandated by the new clean energy standard, the Public Service Commission staff said.

"We believe that participation by all parties, private developers, utilities, businesses and residents will be needed in order to accomplish the state's clean energy goals," John Maserjian, a spokesman for the state's utilities, said Tuesday.

The state's clean energy standard is one of three legs that will support the New York's long-term goal of reducing greenhouse gas emissions 80% of 1990 levels by 2050, and its interim goal of a 40% reduction by 2030, staff said in a white paper issued late Monday. The PSC is expected to issue a final order on the recommendations in June.

A robust level of energy efficiency also is required along with a plan to make sure that existing emission-free nuclear plants remain in operation, the staff said.

Staff has recommended a tiered level of renewable generation to meet the requirements, but added a third tier for zero-emission credits specifically for nuclear units. ZECs are an opportunity to provide qualifying nuclear units with support payments that reflect the forward cost of operation, staff said.

"This tier is created to facilitate a market to recognize the value of fully licensed nuclear power plants that face financial difficulties, as a source of zero-emission electric generation, something which is not adequately captured in the energy market today," staff said.

Tier 3 has a 7,500 GWh target for 2017, rising to 25,000 GWh in 2020, which represents 15.7% of forecast load.

Tier 1 will include new eligible renewable resources that began commercial operations on January 1, 2015, or after. The group does not have limitations on facility size so a wide range of system capacities and configurations are eligible to participate, staff said. Tier 1 sources include solar, wind, tidal ocean, biomass, biogas, liquid biofuels, fuel cells and hydro generation.

Tier 1 has a 1,536 GWh target for 2017 increasing to 5,465 GWh in 2020, representing 3.4% of forecast demand.

Tier 2 includes existing renewable resources not owned by the state and those contracted sources already in operation. The tier is designed to provide a lesser degree of support for operating units that do not need support to attract financing.

Tier 2 will be divided into two subtiers with 2A to include renewable supply that New York must compete to obtain. Tier 2B is for generation located within the state that does not meet requirements to compete for out of state renewable energy portfolio standard obligations. Tier 2A has a 1,931 GWh target for 2017 increasing to 3,198 GWh in 2020 representing 2% of forecast demand. Tier 2B has a 15,330 GWh target for 2017 increasing to 15,423 GWh in 2020, which represents 9.7% of forecast demand.

Generation in areas adjacent to New York is eligible to participate as long as it meets certain requirements.

Staff recommended that utilities be allowed to own renewable generation only in exceptional circumstances where there are demonstrated consumer benefits that could not otherwise be achieved, including using utility capital in collaboration with private developers and others. Staff prefers private investment in new resources.

--Mary Powers, newsdesk@platts.com
--Edited by Jason Lindquist, jason.lindquist@platts.com

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