Article X: The Future of Electric Generating Facility Siting in New York
![handle is hein.journals/alev6 and id is 47 raw text is: ARTICLE X: THE FUTURE OF ELECTRIC GENERATING
FACILITY SITING IN NEW YORK
By Jennifer Cordes
I. Introduction
It is indisputable New York needs more power.1
New York's electricity is the most expensive in the
country2, yet production cannot keep up with
consumption. When demand exceeds supply, a
shortage will surely follow. New York will feel the
impact if something is not done to remedy the
situation.3 The state recently deregulated the electric
industry, but without new power plants to drive the
competitive market, the venture will fail.4 Part II of
this article examines New York's current electricity
situation, specifically the higher than average cost and
increasing shortage which is creating a dire need to
build new power plants in the State.5 Part III looks at
the development of siting legislation in New York
over the past three decades.6 Part IV examines the
concept of approved procurement process, the key
difference between New York's most recent siting
statute, Article X, and its predecessor, Article VIII,
which failed to produce the needed generating
facilities.7 Part V evaluates the progress made so far
under Article X and concludes that there are
developing signs that Article X will be a greater
success than Article VIII in producing the electricity
that New York needs.8
II. State of New York's Electricity Situation
A. Cost
The cost of electricity in New York is higher than
anywhere else in the country.9 In 1995, electric
utilities in New York were charging 72 percent more
than the national average.'0
New York's prices began to rise in 1973, during the
energy crisis, and continued to climb over 270 percent
through 1995.11 Such high prices have numerous
consequences on both residents and businesses in the
Jennifer Cordes is a J.D. Candidate at Albany Law School of
Union University. Upon graduation in 2002 she will become an
associate at the law firm of Crane, Greene and Parente.
state. Businesses often consider the cost of electricity
as a factor when choosing a location and determining
whether or not to expand.12 Therefore, electricity
costs often affect job retention and growth.13
Additionally, in 1995 New Yorkers paid $5.4 billion
more in electricity costs than they would have paid if
New York State's average electricity price had been
on par with the nation's average price.'14 Factors
such as higher capital costs, purchased power costs
and taxes are attributable to New York's higher than
average electricity prices.'5
Further compounding New York's electricity
situation is the fact that only 12 percent of its energy
requirement is fulfilled with resources from within the
state, leaving 88 percent to be brought in from outside
sources, most commonly neighboring states.16
Importing such a large percentage of energy also has
a negative effect on the state's economy because that
same percentage of the state's annual energy
expenditure, which is over thirty-four billion dollars,
goes outside of the state.17 Therefore, [i]mproving
energy efficiency and increasing the use of
indigenous energy resources increases New York's
fuel diversity and reduces economic leakage from the
state, enabling more dollars to be retained in New
York's economy.'18
Reducing energy costs will help New York's
economy in many ways. For example, it would
attract new businesses, enable existing businesses to
stay in New York and expand within the state, and
increase business profitability and consumer
purchasing power by stimulating business
investments and consumer spending.'9 Therefore,
New York's businesses and industries would become
more competitive with these in other regions and
states leading to increased job growth as well.0
B. Shortage
Despite New York's high electricity costs,
demand is increasing faster than the supply can keep
up. Consequently, severe shortages could be rapidly
approaching unless new power can be produced.2'
The shortage is the result of a stagnant power supply
and a booming demand, which diminishes capacity.22
Volume 6 Issue 1](ViewImageLocal?handle=hein.journals/alev6&div=10&collection=&method=preview&ext=.png&size=3)
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Article X: The Future of Electric Generating Facility Siting in New York
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