Authorizes the aggregate purchases of energy for state agencies, institutions, local governments, public authorities and public benefit corporations

Title of bill

An act to amend the state finance law, in relation to authorizing the aggregate purchases of energy for state agencies, institutions, local governments, public authorities and public benefit corporations; and providing for the repeal of such provisions upon expiration thereof

Purpose

The purpose of this bill is to expand the authority of the Office of General Services (OGS) to purchase and deliver electricity and renewable energy as centralized services to state agencies.

Summary of provisions

Section 1 of the bill would amend State Finance Law § 97-g(4} to authorize OGS to purchase and deliver renewable energy and renewable energy credits or attributes on behalf of State agencies; to authorize OGS to make such purchases, along with the purchase of electricity, from suppliers in addition to the power Authority of the State of New York. Section 1 would also clarify OGS authority to purchase fuels that include alternative fuels as well as gasoline and diesel fuel on behalf of State agencies.

Section 2 of the bill would require OGS to prepare a report to the Governor, Speaker of the Assembly and Temporary President of the Senate on its aggregate electric procurement program and submit it on February 15, 2011.

Section 3 of the bill would provide for an immediate effective date, and expiration on July 31, 2011.

Existing law

State Finance Law § 97-g authorizes OGS to procure and provide certain services and commodities to state agencies. Existing law does not expressly authorize the provision of renewable energy or renewable energy credits or attributes.

Legislative history

A similar bill, S.5730, was introduced in 2006 but did not advance out of committee.

Statement in support

This bill would authorize OGS to purchase and deliver, as centralized services, renewable energy and renewable energy credits and attributes, along with electricity, from the New York Power Authority and other suppliers. Rather than relying on the delivered price for such services from a servicing utility, the bill would allow OGS to leverage the value of aggregated purchasing by the State. OGS would effectuate these purchases through specific annual internal service fund appropriations. The benefitted State agencies that receive such centralized services would continue to reimburse the internal service fund. Similarly, the bill would clarify that OGS may supply to State agencies alternative fuels, such as biodiesel and compressed natural gas, for motor vehicle fleets. This allows the benefitted agency to avoid expending resources on duplicative infrastructure to service alternative fueled vehicles. This bill is expected to result in significant savings for the State and for public benefit corporations and public authorities. For example, during one recent 12-month period ending in November 2008, OGS alone avoided over $1.24 million in electric commodity costs (approximately 4 percent of the value) by purchasing electricity directly through the New York Independent Systems Operator rather than from the local electric utility.

Budget implications

Cost containment and potential savings would accrue to State agencies that receive centralized services with annual avoided costs approaching $4 million.

Effective date

This bill would take effect immediately and would sunset on July 31, 2011.