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Prod LIPA for Power Options

Thu, 04/01/2021 - 16:52

State Assemblyman Fred W. Thiele Jr. has introduced legislation to facilitate the development of community choice aggregation programs in the Long Island Power Authority's service territory. State Senator Todd Kaminsky is to follow with the same legislation in that chamber.

Community choice aggregation, C.C.A., allows a local government to procure electricity and/or natural gas on behalf of its residents, businesses, and municipal accounts from a provider other than its current utility. In a C.C.A. program, a municipality enters into contracts with energy service companies for power supply purchase options. Options include power produced through 100-percent renewable sources, power produced through nonrenewable sources, or a combination.

The East Hampton Town Board voted to enable a C.C.A. program last year, joining Southampton, Brookhaven, and Hempstead Towns on Long Island.

The New York State Public Service Commission authorized the programs in 2016, but its order applied to investor-owned utilities only. As a public utility, the order did not apply to LIPA. It also "did not fully account for the complexities" of LIPA's service territory and rate structure, according to a statement from Mr. Thiele on Friday. Advocates for C.C.A., including officials of Joule Assets, which Southampton Town selected to administer its nascent program, have criticized LIPA's C.C.A. terms and conditions, which they say renders such a program unworkable on Long Island.

Jessica Stromback, managing director of Joule Assets, wrote to Tom Falcone, LIPA's chief executive, in September to complain that the utility's terms and conditions "will not allow for a competitive C.C.A. electricity supply process." The tariff, combined with its billing limitations, "blocks C.C.A. in its entirety," she wrote, as it requires the energy service companies to pay a charge for energy and another for capacity. LIPA, she wrote, asserts that the energy charge is simply a pass-through, but "trading market realities dictate that the energy market pass-through has ensured that no competitive suppliers will participate in an energy offering" because suppliers lose money if market prices are high and earn money only when market prices are low, "and they are therefore offering consumers a bad deal."

"Long Islanders deserve to have the same access to greener and more affordable energy as other ratepayers across the state," Mr. Thiele said in Friday's statement. "Several localities on Long Island have expressed an interest in participating in C.C.A. programs," he said, and "these municipalities should be allowed to proceed."

C.C.A. "promises to be a significant avenue to help further our renewable energy goals," East Hampton Town Supervisor Peter Van Scoyoc said in the same statement. "Allowing municipalities to select green energy will not only reduce a town's carbon footprint but will help to support the development of renewable energy alternatives. I support this legislation that will help to pave the way to make C.C.A. a viable option." 

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