Establishes a process for the siting of electric generating facilities and repowering projects

Summary of provisions

Section one of the bill would reestablish, with amendments, PSL Article 10, to provide a comprehensive process relating to the siting of major and repowered electric generating facilities. All new proposals to construct power plants in excess of 80 megawatts (MW) in net output to the electric system would be governed by this process. Unlike review under the State Environmental Quality Review Act, no "negative declarations" of potential adverse environmental impacts would be allowed.

Funding would be provided to stakeholder groups to participate in the process. Under the revised Article 10, applications for repowering projects would be subject to a mandatory 45-day public comment period and a public statement hearing In addition, if a dispute arises over issues of fact, an evidentiary hearing could be held. Each of these public participation steps would ensure a public review of potential environmental impacts of these facilities.

The bill would: (1) make the Office of Parks, Recreation and Historic Preservation and the Department of State parties to Article 10 proceedings; (2) require applicants to prepare a security plan to be

reviewed by the Siting Board, in consultation with the State Office of Homeland Security; and (3) require consideration of health impacts and environmental justice impacts as part of the Article 10 review.

The bill would also make technical changes to clarify the operation of Article 10. More specifically, section one of the bill contains the following provisions:

* PSL § 160 would establish the definitions of terms used in Article 10. The term "major electric generating facility" would be defined as a facility that is operated with a total net generating output of 80 MW or more. This section also would establish the makeup and membership of the New York State Board on Electric Generation Siting and the Environment.

* PSL § 161 would establish general provisions relating to the Siting Board, including eligibility for membership and compensation of Siting Board members.

* PSL § 162 would govern the circumstances in which Board certificates are required and exemptions from that requirement. Such exemptions would include: (1) electric generating facilities for which an application for a license, permit or other approval was sought before at least 180 days after the effective date of the new Article 10; (2) electric generating facilities over which the Federal Government has exclusive jurisdiction; (3) replacements, repairs and modifications to existing electric generating facilities, which do not result in an increase in capacity to the facility of more than 50 MW; and (4) electric generating facilities constructed on industrial lands and not exceeding 200 MW.

* PSL § 163 would describe procedures for pre-application for certificates and establish a new pre-application fee of $50,000 for use by intervenors. The bill also would require, for proposed facilities located in a coastal area, a preliminary analysis of the proposed facility in relation to the applicable coastal zone polices set forth in Executive Law Article 42, and the bill would require a description of environmental justice impacts of the proposed facility.

* PSL § l63-a would establish separate, expedited procedures for the review of repowering projects that would modify or partially or entirely replace an existing electric generating facility and that would result in substantial decreases in emissions to air and water and increases to electric generation efficiency. It would establish an application fee of $1,000 for a repowering project that results in an increased net generating output of 80 MW or more.

* PSL § 164 would establish procedures for applications for a certificate for a major electric generating facility. It would set forth the information to be included in such application, provide for public notice and input, and would require an application fee of

$1,000 for every MW of net generating capacity the proposed facility would produce.

* PSL § 165 would set forth the timetable for public hearings, once the Siting Board deems an application complete, and procedures for such hearings.

* PSL § 166 would establish the agencies that are parties to the proceedings, including the Department of Environmental Conservation, the Department of Economic Development, the Department of Health, the Department of Agriculture and Markets, the New York State Energy Research and Development Authority, the Department of State, the Office of Parks, Recreation and Historic Preservation, the City of New York (where the facility is proposed to be located therein) and the Adirondack Park Agency (where the facility is proposed to be located therein). Section 166 would also specify that interested individuals, municipalities and not-for-profit organizations may become parties and participate in the proceeding.

* PSL § 167 would set forth the procedures for the conduct of the hearings before examiners appointed by the Siting Board and the Department of Environmental Conservation.

* PSL § 168 would describe the decision-making process to be followed by the Siting Board, in reviewing and deciding an application, and would delineate the issues for consideration in reaching such decision. The Siting Board would have to find, inter alia, that the proposed facility is designed to operate in compliance with local laws and regulations, unless the Board finds that the local requirement is unreasonably restrictive in view of the existing technology or the needs of or costs to rate payers whether located inside or outside of the affected municipality.

* PSL § 169 would require the Siting Board to issue a written opinion setting forth the reasons for its determination on an Article 10 application.

* PSL § 170 would establish procedures for rehearing and judicial review of determinations by the Siting Board.

* PSL § 171 would establish the jurisdiction of the courts and the process for judicial review of a determination by the Siting Board granting or denying a certificate.

* PSL § 172 would prohibit any municipality or state agency from requiring any additional permits or approvals of a proposed facility beyond those expressly provided for under this legislation.

Sections two through five of the bill would reenact, with minor amendments, conforming provisions of the Environmental Conservation Law (ECL) to clarify that actions taken by the Siting Board under PSL

Article 10 are not subject to the requirements of the State Environmental Quality Review Act (ECL Article 8).

Sections six and seven would amend Public Authorities Law §§ 1014 and 1020-s, relating to inapplicability of the Public Service Law, to provide that PSL Article 10 applies to the siting of major electric generating facilities and repowering projects by the New York Power Authority and the Long Island Power Authority.

Section eight of the bill would amend the State Finance Law to enact State Finance Law §99-t establishing the intervenor account in the joint custody of the State Comptroller and the Commissioner of Taxation and Finance. The account would consist of all revenues received from pre-application and application fees.

Section nine of the bill would establish the severability of the provisions of the legislation.

Section ten would establish an immediate effective date for the legislation with no expiration.

Existing law

PSL Article 10, State Finance Law §97-tt and conforming provisions of the ECL expired on January 1, 2003, with the exception of applications filed on or before December 31, 2002. Public Authorities Law provisions, subjecting the New York Power Authority and the Long Island Power Authority to Article 10, also have expired. In the absence of these provisions, the siting of major electric generating facilities and the repowering of existing facilities is subject to environmental review pursuant to State Environmental Quality Review Act (SEQRA (ECL Article 8).

Justification

PSL Article 10 was designed to implement an expedited, fuel diverse, and technology neutral review process for the siting of major electric generating facilities and the review of repowering projects, while recognizing the importance of and providing for citizen involvement in the siting process. The bill would retain this emphasis on communication between the applicant and parties affected by the construction and operation of the facility.

The bill would extend the application of Article 10's intervenor funding and public involvement procedures to major facilities and repowering projects. Toward this end, the bill would continue the use of application fees as sources of funds for intervenors and would establish a new pre-application fee for use by intervenors at an earlier stage of the Article 10 process. These fees would help defray expenses by municipalities and other parties to the proceeding for expert witnesses and consultants. This intervenor funding provision would provide municipalities, and other parties potentially affected

by the construction and operation of the facility, with resources to evaluate the highly technical information submitted in connection with an Article 10 application and would enable the parties to participate meaningfully in proceedings before the Siting Board. The bill also would integrate environmental justice policy into the procedures and determinations relating to the siting of electric generating facilities, in a manner consistent with the Department of Environmental Conservation Commissioner's Policy 29, Environmental Justice and Permitting (issued March 19,2003).

The New York Independent System Operator (NYISO) has released its report, Power Trends 2010: New Yorks Emerging Energy Crossroads, which is its annual analysis of the New York bulk power systems achievements and challenges. The NYISO notes that, currently, the bulk power grid is operating reliably and should continue to have sufficient resources to maintain such reliability through 2018. Given that it takes about five years for new baseload power plants to actually come on line, including time for permitting, construction and interconnection, reenactment of Article 10 is needed. The reestablishment of the Article 10 statute's familiar and successful siting process would establish the means of maintaining reliable supply of electricity to the State, consistent with protecting the environment.

Interestingly, New York State power producers already are reducing the impact facility operations have on the environment. Since the expiration of Article 10 in 2003, the DEC has adopted its Clean Air Interstate Rule to reduce significantly emissions of sulfur dioxide (S02) and nitrogen oxides (NOx). In addition, to reduce NOx emissions even further, the Department of Environmental Conservation has adopted its Best Available Retrofit Technology (BART) Determinations Rule and approved its Reasonably Available Control Technology for the Control of Nitrogen Oxides (NOx RACT) Rule. The Department also has promulgated its Clean Air Mercury Rule and Regional Greenhouse Initiative (ROGI). The Department has policies on fine particulate matter (PM 2.5), environmental justice, and GHG Emissions and the State Environmental Quality Review Act, and the agency has proposed for public review a policy on Climate Change and DEC Action. Additionally, the New York State Public Service Commission and the New York State Energy Research and Development Authority (NYSERDA) are implementing the Renewable Portfolio Standard to increase the use of renewable energy sources and the Energy Efficiency Portfolio Standard to reduce electricity consumption. Also, NYSERDA adopted a spending plan for the use of RGGI allowances auction proceeds to reduce greenhouse gas emissions across all economic sectors and fuel types. Furthermore, Governor Paterson's Executive Order #24 establishes an ambitious goal to reduce greenhouse gas emissions in New York State by 80 percent below the levels emitted in 1990 by the year 2050. The order creates a Climate Action Council, with a directive to prepare a draft Climate Action Plan by November 1,2010. Compliance with the governor's climate change directive and other state

requirements will lead to the siting and construction of additional electric generating facilities and the repowering of existing power plants. The Article 10 process will facilitate these power project activities.

Construction of new power plants, in addition to enhancing the overall reliability of the State's electric system, also may have a net positive effect on the environment, and new state-of-the-art power plants also are efficient. Broad support exists among environmental and industry groups that repowering projects should be encouraged. Toward this end, the bill creates a process for repowering existing electric generating facilities.

Legislative history

This bill is new legislation.

Fiscal implications

The costs of the Department of Public Service are recovered from its regulated utilities pursuant to PSI, § 18-a. The State authorizes, in its annual budget, amounts for expenses incurred by state agencies participating in the Article 10 siting process. Funds from the intervenor account also al"e subject to annual appropriation.

Effective date

Immediate.