Wednesday, March 26, 2008

Gov's power woes; Beyond Eliot's dim-bulb plan

March 24, 2008 -- ENERGY was one of the few issue areas in which David Paterson was allowed at least briefly to play a visible role during 14 months in the shadows as New York's lieutenant governor. But now that he has succeeded the disgraced Eliot Spitzer in the governor's office, Paterson needs to break with policies that have made energy increasingly expensive and potentially scarce in New York.

New Yorkers pay the third-highest electricity rates in the country, 66 percent more than the national average - and the Spitzer-Paterson administration was in the process of driving costs even higher.

For example, Spitzer's budget proposal - for which Paterson now inherits responsibility - would sock energy companies with $40 million in new taxes and fees, costs ultimately borne by ratepayers. That may not sound like much in the context of a $900 billion state economy, but it comes on top of a variety of other direct and indirect state charges that already raise energy costs. And those are going up, too.

Take the state's Renewable Portfolio Standard. New York now gets about 20 percent of its electricity from renewable-energy sources. The RPS calls for increasing the renewable share to 25 percent by 2013. To achieve that goal, it tacks a surcharge on the utility bills of every residential and commercial customer in New York. The revenues subsidize private corporations that develop renewable-energy projects. Since the state's major hydropower sources, such as the Niagara and St. Lawrence rivers, are already exploited, this growth must come from expensive technologies like solar and wind power. (Nuclear power doesn't count toward the RPS goal.)

The state's Renewable Energy Task Force, chaired by then-Lt. Gov. Paterson, recently reported that the $782 million budgeted to implement the RPS won't be enough to meet the 2013 target. Translation: Higher surcharges are on the way.

(Click to read entire article)

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