Provides incentives for energy conservation through voltage regulation

BILL NUMBER:S3219

Title of bill

An act to amend the public service law, in relation to providing incentives for energy conservation through voltage regulation

Purpose

To amend the Public Service Law to provide incentives for energy conservation through voltage regulation.

Summary of provisions

This bill adds a new section 66-m which defines "voltage regulation device" and states that electric utilities may recover the capital and operating costs and earn a 15% rate of return in the utility's rate bases on investments and installations of voltage regulation devices.

Justification

Energy conservation devices are now available that make it possible for electric utilities to reduce a building's energy consumption by six to eight percent by installing a voltage regulation device on the building's meter box. Utilities send out power to customers from substations, and customers closest to the substation receive higher voltage numbers (i.e., 124 volts) than those further away (no fewer than 114 volts). Because power is lost over distance on a utility's transmission lines, a utility has to send out more power than some of their customers need to assure that the customers at the end of the line get at least 114 volts delivered to them. By installing a voltage regulation device on a customer's meter box, utilities can regulate the voltage that the customer draws off the line to assure that the customer only pulls 114 volts off the line. The six to eight percent savings in conserved and no behavioral changes by the consumer are necessary.

This legislation would fix the anomaly in New York law that provides a disincentive for utilities to conserve power. Utilities generate revenue from power sales; and conservation of power - despite the clear benefits of reducing dependence on foreign oil and greenhouse gas emissions - reduce a utility's revenue. This bill solves the disincentive by allowing utilities to recover the lost revenue that would result from utilizing the conservation device. This recovered revenue would be used to pay for the cost of the device and a rate of return would be allowed to encourage utilities to install them. The bill, however, merely sets up the framework to use voltage regulation devices but does not require utility companies to do so. Passage of this legislation will conserve energy, reduce carbon emissions, and improve the efficiency of the electric grid.

Legislative history

2010: A.9451 Referred to Energy

Fiscal implications

None.

Effective date

Immediately.