Upgrade New York's Power Grid

Section 1. Short title. This act shall be known and may be cited as the "New York grid modernization act".

§ 2. Legislative findings and purpose. The legislature finds that the widely acknowledged bottlenecks in the state's aging infrastructure have resulted in high delivery costs for the downstate region and struggling power plants upstate. This outdated transmission system is leading to unnecessary congestion costs. Additionally, increasingly frequent traumatic weather events have highlighted the unreliability and uncertainty of our current system. Investments to modernize the state's infrastructure are needed to reach our energy goals as society's growing reliance on electricity along with advancements in smart grid technology have made the old model obsolete.

The legislature further finds and recognizes that as the available resources and technologies evolve, the design of the smart grid must be capable of adapting to shifting conditions and priorities to meet utility and customer needs. In the short term, utilities should pursue established and reliable technologies that can provide a relatively certain return on investment.

In the longer term, federal investment has provided for smart grid projects nationwide, which will generate a significant base of knowledge that will help identify technologies that are most effective.

The legislature also finds that half of the current workforce involved in the production and delivery of our electricity will be retired or no longer in that workforce by 2017. Workforce recruitment campaigns developed by utilities, in conjunction with training facilities that provide certification for skilled positions and offer tuition assistance, will

EXPLANATION--Matter in italics (underscored) is new; matter in brackets

[ ] is old law to be omitted.

LBD03147-01-9

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attract knowledgeable workers who will be instrumental in the implementation of a modernized electric grid.

§ 3. Section 6-102 of the energy law is amended by adding a new subdivision 7 to read as follows:

7. The board shall take an active role in advising the public service commission in the development of, and any subsequent revisions to, the grid modernization order required pursuant to section sixty-six-p of the public service law.

§ 4. The public service law is amended by adding a new section 66-p to read as follows:

§ 66-p. Establishment of grid modernization program. 1. Definitions. As used in this section: (a) "Electric transmission and distribution company" or "transmission and distribution company" shall be known as an investor-owned utility having annual revenues in excess of two hundred million dollars that transmits and distributes electricity within this state or a municipality that distributes electricity and receives less than its entire electric supply from the power authority of the state of New York and is subject to the jurisdiction of the commission with respect to the regulation of the price of electricity.

(b) "Full load municipal electric customer", shall be known as a municipality that distributes electricity and receives its entire electric supply from the power authority of the state of New York;

(c) "Cooperative" shall have the same meaning as such term is defined in subdivision (a) of section two of the rural electric cooperative law.

(d) "New York transmission and distribution coordinating council" or "transmission council" shall be known as a consortium which shall be formed pursuant to this act for the purpose of identifying areas of electrical congestion within New York's high voltage transmission system comprising:

(i) Consolidated Edison, Orange and Rockland Utilities, Central Hudson Gas and Electric, Niagara Mohawk d/b/a National Grid, New York State Electric and Gas and Rochester Gas and Electric;

(ii) Public power authorities; and

(iii) the New York state energy research and development authority;

(e) "New York's high voltage transmission system" or "high voltage transmission system" shall mean electric transmission lines as such term is referred to in paragraph (a) of subdivision two of section one hundred twenty of this chapter, provided that electric transmission lines shall also include electric transmission lines located wholly underground in a city in excess of one hundred twenty-five thousand persons or a primary transmission line approved by the federal energy regulatory commission in connection with a hydro-electric facility and other equipment necessary for electric transmission.

(f) "Public power authorities" shall be known as the power authority of the state of New York and the Long Island power authority.

(g) "Smart grid" shall be known as investments and policies that together promote one or more of the following goals:

(i) Increased use of digital information and controls technology to improve reliability, security and efficiency of the electric grid;

(ii) Dynamic optimization of grid operations and resources, with full cyber security;

(iii) Deployment and integration of distributed resources and generation, including renewable resources;

(iv) Development and incorporation of demand-response, demand-side resources, and energy efficiency resources;

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(v) Deployment of "smart" technologies, real-time, automated, interactive technologies that optimize the physical operation of appliances and consumer devices for metering, communications concerning grid operations and status, and distribution automation.

(vi) Integration of "smart" appliances and consumer devices;

(vii) Deployment and integration of advanced electricity storage and peak-shaving technologies, including plug-in electric and hybrid electric vehicles, thermal-storage air conditioning and renewable energy generation;

(viii) Provision to consumers of timely information and control options;

(ix) Development of open access standards for communication and interoperability of appliances and equipment connected to the electric grid, including the infrastructure serving the grid;

(x) Identification and lowering of unreasonable or unnecessary barriers to adoption of Smart Grid technologies, practices, services, and business models that support energy efficiency, demand-response, and distributed generation; and

(xi) Advanced metering infrastructure.

(h) "Advanced metering infrastructure" or "AMI" shall be known as the communications hardware and software and associated system software that is designed to create a network between advanced meters and electric transmission and distribution company systems and allow for collection and distribution of information to customers and other authorized parties in addition to providing information to transmission and distribution companies.

(i) "Smart grid advisory council" means the group of stakeholders formed pursuant to paragraph (a) of subdivision two of this section for purposes of advising and working with the public service commission to determine the feasibility of the development and implementation of a Smart Grid Advanced Metering Infrastructure Deployment Plan.

(j) "Workforce development" shall mean training initiatives and curriculum sponsored by transmission and distribution companies and public power authorities that will ensure sufficient staffing to implement the grid modernization programs. Such workforce development programs shall be undertaken through partnerships with state universities, community colleges, boards of cooperative education and other entities accredited by the American National Standards Institute for the purposes of implementing grid modernization programs.

2. Smart grid advisory council. (a) Within one hundred eighty days of the effective date of this section the smart grid advisory council ("council") shall be established. The council shall be composed of seven voting members, with each member possessing either technical, business or consumer expertise in smart grid technology. Five members shall be appointed by the governor, one member shall be appointed by the temporary president of the senate and one member shall be appointed by the speaker of the assembly. The governor shall appoint the chairperson of the New York state energy research and development authority to serve as chairperson of the council. Members of the council, except those that are employees or officers of the state, its authorities or agencies, shall not receive a salary or other compensation, but shall be allowed the necessary and actual expenses incurred in the performance of duties under this section. Any reasonable costs associated with functioning of the council shall be borne by the New York state energy research and development authority.

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(b) Within six months of the establishment of the council, the smart grid advisory council shall submit a report to the commission on the feasibility of establishing a statewide smart grid system. Such report shall analyze the potential for the statewide development of a smart grid system that would:

(i) utilize digital information technology and communications networks to gather and submit information on electricity usage, real time wholesale and retail electric prices, voltage level, and disruptions on local electric distribution networks;

(ii) allow for the integration of AMI to measure and transmit data on consumer electric usage;

(iii) incorporate consumer products, including household appliances and electric plug-in vehicles;

(iv) promote the use of distributed generation, including renewable technologies; and

(v) protect the privacy of consumers and consumer usage data.

3. New York transmission and distribution coordinating council. Within one hundred eighty days of the effective date of this section the New York transmission and distribution coordinating council shall be created. Any reasonable costs associated with the functioning of the committee shall be borne by the New York state energy research and development authority. Within one hundred eighty days of the creation of such council, the council shall submit to the commission a report identifying areas of concern within the state's high voltage transmission system. Such report shall:

(a) locate and identify and propose upgrades or replacement of high voltage transmission lines and/or components of the high voltage transmission system that are in service as of the effective date of this section;

(b) Identify equipment upgrades or installations that are necessary to relieve areas of congestion within the high voltage transmission network; and

(c) Provide a cost analysis of proposed high voltage transmission line component upgrades or replacement over a ten-year period, which such cost analysis shall include:

(i) a proposal for the cost sharing of proposed transmission upgrades or replacement projects that directly or indirectly benefit customers in the respective service territories of two or more electric transmission and distribution companies;

(ii) strategies for attracting private investment for proposed transmission upgrades or replacement projects identified in the report;

(iii) an analysis of the financial and other impacts of proposed transmission upgrades or replacement projects on electric ratepayers; and

(iv) any other information, studies, maps or analyses the transmission council deems necessary.

4. Commission review of smart grid advisory council report. (a) The commission, thirty days upon receiving the "smart grid advisory council" report pursuant to subdivision two of this section, shall determine the reasonableness, efficacy and expense of the development of a ten year statewide smart grid deployment by transmission and distribution companies and public power authorities. In making its determination the commission shall consider whether smart grid deployment would serve the public interest, with consideration of the impact on the safety and reliability of local distribution networks, the retail cost of electricity to residential, commercial and industrial customers and the security and privacy of customer energy usage information and data.

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(b) If the commission determines that smart grid deployment meets the public interest it shall require, in its grid modernization order, made pursuant to subdivision five of this section that transmission and distribution companies invest in smart grid deployment.

(c) If the commission determines that smart grid deployment would not meet the public interest for reasons specified in paragraph (a) of this subdivision it shall provide a statement in its grid modernization order, made pursuant to subdivision five of this section detailing the reasons that smart grid deployment would not serve the public interest.

5. Commission grid modernization order. No later than two years following the effective date of this section, the commission, after consultation with the state energy planning board, established pursuant to article six of the energy law, the New York transmission and distribution coordinating council and the smart grid advisory council, shall approve an order approving a ten year grid modernization program to be undertaken by transmission and distribution companies.