EDITOR’S NOTE: New York State is embarking on one of the boldest energy plans in the nation. Its principal architect, Richard Kauffman, will sit down with The Energy Times for an exclusive webcast at 2 pm on October 14. We recently met with Con Edison in New York to explore its responses to the bold business transformations that are coming.
New York energy planners have big plans for renewable generation and venerable Con Edison is eager to get in on the act.
Under the REV initiative now being hammered out in the Empire State, policymakers want to see half of the electric power generated by 2030 coming from renewables.
“It is a big lift to get there,” said Matthew Ketschke, Con Edison vice president of distributed resource planning. He recently met with The Energy Times in the company’s headquarters in lower Manhattan.
Currently, about one-quarter of the state’s electricity comes from renewables – primarily hydroelectric generation located upstate.
A utility like Con Edison, with decades of experience financing costly electric power project, is uniquely positioned to help secure low-cost financing for the renewables buildout, Ketschke said. He is on the frontline of Con Edison executives working on the state’s huge REV initiative.
REV, or Reforming the Energy Vision, was a policy objective set by Gov. Andrew Cuomo early this year to spur clean energy innovation and investment and provide consumers with more economic choices for energy.
New York for decades has barred utilities from owning generation assets in a bid to inject more competition into a business long dominated by vertically integrated monopolies.
Ketschke said that to speed deployment of renewables, “we think there are areas where we should own certain types of generation.” That would include large utility scale solar installations of up to 200 megawatts as well as wind farms, he said.
Third party developers are best equipped to plan and execute the renewables projects.
“When constructed, the utility could buy them and own them for the benefit of customers,” Ketschke said.
The only alternative would be for the utility to buy the power through power purchase agreements, and that would be less than ideal, he said. “With PPAs, you pay a market premium to use other peoples’ money.”
Since Con Edison passes through the cost of energy to customers, having the utility more directly engaged in owning renewables assets would benefit the ratepayers, he said.
Under REV, Con Edison as a distribution utility must orchestrate a vast and growing number of distribution end points.
Currently, Con Edison has 5,500 solar installations producing 75 megawatts of power, according to Mike Clendenin, company spokesman. The company projects that output climbing to 113 megawatts by the end of the year and 343 megawatts by 2019.
There are currently no utility scale – large – solar installations in New York, although one project was proposed for a Staten Island landfill during former Mayor Mike Bloomberg term in office.