Thanks to a new payment plan designed to attract power plants to the Lower Hudson Valley, ratepayers might see a five percent increase in their energy costs during the summer months.
The plan involves the merging of NYC and the Lower Hudson Valley into a new “capacity zone,” which the New York Independent Systems Operator (NYISO) argues will provide an incentive for companies to establish new plants. The zone paves the way for new regulations which will allow energy producers to charge higher prices for energy purchased by downstate providers during peak summer energy use, costing ratepayers an estimated $280 million.
In addition, providers will be required to obtain at least 88 percent of their power from within the zone. This setup is expected to not only encourage the construction of new plants but spur the growth of existing ones like Indian Point and Haverstraw’s Bowline Point Plant.
The NYISO is arguing the bottleneck between upstate energy producers and downstate consumers necessitates more localized plants, especially as energy needs continue to grow. Others criticize the plan as unnecessary, with opponents arguing other plans are available which manage the bottleneck by updating outdated energy transmission infrastructure.