New York thinks it has enough power, transmission for this summer

Staff at the New York Department of Public Service told the state Public Service Commission on May 17 that the state should have adequate power system reliability and electricity generation this summer.

The commission received an update from the staff of the Department of Public Service outlining electric utilities’ summer preparedness in terms of addressing transmission and distribution reliability needs, and price volatility for residential and small commercial and industrial customers who take electric supply from the utilities.

“The state’s utilities are ready and able to provide adequate and reliable service this summer,” said commission Chairman Garry Brown. “In addition, newly introduced demand-reduction programs in the New York City area will help ensure that the metro area — the region with the highest electricity demand in the state during the summer — will have a significant excess capacity margin.”

Staff told the commission that a review of the supply of electric generation capacity and transmission system condition in the state indicates that the system is ready to provide adequate and reliable service for this summer. The New York ISO reports that there are adequate generation and demand-side resources for summer load. Transmission owners also report that they are able to meet peak projected load in all areas with all circuits in service.

Staff said that given the dense population and unique characteristics of Consolidated Edison of New York Inc.’s (Con Edison) service territory, the company continually has the highest loads in its area during the summer. To help redress this situation, the company continues to offer load-relief programs that are available for deployment during high-load system conditions. The enrollment levels in these programs in 2012 are greater than in 2011 due to recent program changes intended to increase demand response benefits for both customers and the company.

Additionally, Con Edison continues to offer its peak-shaving program, where large commercial or industrial program participants receive financial incentives to reduce load during events which are called by the company when the day-ahead forecasted load level is at least 96% of the forecasted summer system-wide peak.

Staff also reported to the commission that the utilities have taken steps to reduce price volatility of their estimated May 2012-April 2013 commodity needs through fixed and indexed hedges. Generally, residential and small commercial and industrial customers or mass market customers electing to take supply service from utilities instead of alternative providers are more risk-adverse, the commission noted. Mass market customers can benefit from the restraints utility hedges provides on electric commodity price volatility.

Based on current projections from the New York Mercantile Exchange (NYMEX) data, summer electric prices — in the June-September period — are lower than last year’s forecast prices. Actual prices can vary from the forecasts due to a number of factors such as weather and economic conditions. With the hedges that the utilities have entered into, full service residential customers will not experience the full magnitude of any market price changes, the commission said.

About Barry Cassell 20414 Articles
Barry Cassell is Chief Analyst for GenerationHub covering coal and emission controls issues, projects and policy. He has covered the coal and power generation industry for more than 24 years, beginning in November 2011 at GenerationHub and prior to that as editor of SNL Energy’s Coal Report. He was formerly with Coal Outlook for 15 years as the publication’s editor and contributing writer, and prior to that he was editor of Coal & Synfuels Technology and associate editor of The Energy Report. He has a bachelor’s degree from Central Michigan University.