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Commentary By Max Schulz

Darkness Ahead?

State must not accept bad assumptions about power supply

Can New York keep its lights on this summer? Anyone concerned about the Empire State's susceptibility to blackouts received news recently that, at first blush, appears comforting: New York's Independent System Operator (NYISO), overseer of the state's bulk electricity system, recently declared that "no reliability issues [are] anticipated through 2018."

That's a relief, right? Not so fast. Unfortunately, NYISO's optimism is unsupported by its data. That could distract policymakers from taking necessary steps to plan for economic growth and accompanying increases in energy consumption.

What is curious about the reliability report is the stunning turnaround from NYISO's previous grave warnings. Those suggested that electricity resources were barely adequate to get through 2011. They predicted "a change for the worse" in the next several years unless significant capacity and infrastructure additions were undertaken. That was to serve as a wakeup call to the state's political leadership that the time to get serious is before portions of New York are plunged into darkness.

So what explains the difference between last year's wakeup call and this year's "don't worry, be happy" take? It can't be chalked up to significant changes having been made. Some new generation is planned, and several scheduled power plant retirements have been scrapped. But that's just window dressing.

The real difference is that NYISO has a new chairman, Stephen Whitley, who is an unabashed booster of Gov. David Paterson's energy plan. Unfortunately, that boosterism for highly dubious proposals represents the triumph of hope over facts.

Most alarmingly, Whitley's group downgrades its forecast for 2018 electricity demand based on the assumption that Paterson's "15-by-15" strategy which aims to lower electricity consumption by 15 percent from previously forecasted 2015 levels will fully succeed.

Sounds great, but meeting the "15-by-15" goal is highly unlikely. The state economy is already fairly energy-efficient, partly because of the high number of apartment dwellers and because high energy prices have driven heavy manufacturing away. The likelihood of finding substantial efficiency gains to decrease overall consumption is slim. The only realistic hope is a prolonged economic downturn, which nobody wants.

For all the good feeling of the current report, a few hidden warnings can be detected. These warnings could spell real trouble.

First is NYISO's warning about new ozone-reduction regulations to reduce power-plant emissions on the hottest days, when electricity demand peaks. These effectively require the installation of expensive scrubbers on peaking plants, which are only fired up a few days each year when extra generation is desperately needed. They don't operate enough to justify expensive upgrades. These peaking facilities could close, making it even more difficult to provide power when New Yorkers need it most. If that occurs, we might see problems this summer.

Those running the grid also caution about shutting down part or all of the Indian Point nuclear facility. One of the plant's reactors is scheduled to be retired in 2013, though operators are seeking a license extension (which Attorney General Andrew Cuomo opposes). Losing the 1,040 megawatt reactor, according to the report, "would cause an immediate violation of reliability standards." Translation from bureaucratese: New York's vulnerability to blackouts would skyrocket.

What New York really needs is more power plants and new transmission lines. NYISO knows this, having made a compelling case for them in past years. What a shame that the current reliability assessment, reading like it could have been produced by Gov. Paterson's staff, is so, well, unreliable.

This piece originally appeared in

This piece originally appeared in