The American Planning Association-New York Metro Chapter Comments to the New York State Public Service Commission (PSC) on Phase One Straw Proposal for Reforming the Energy Vision (REV)
We are a local chapter of the 41,000-member American Planning Association (APA), a national organization dedicated to creating livable communities of lasting value. On behalf of our 1,200 members involved in the planning and design of the region’s communities located throughout the City, Long Island, and Hudson Valley, we thank you for the opportunity to comment on the Phase One Straw Proposal of the REV initiative. We especially appreciate your open planning process and encouragement of broad public participation with these public hearings throughout the State. We understand there was a preference that commentary be submitted prior to February 10, 2015, but we hope our comments may be submitted to the record and considered by the Commission. We offer our input to the public discussion of Track One of the REV initiative to insure that this very valuable transformation will be as effective as possible.
The APA Policy Guide on Planning and Climate Change, amended in 2011, emphasizes that planners have both the opportunity and obligation to address the challenge of global climate change. Our profession and the process of planning are uniquely suited to help communities rise to this challenge. We work with communities to develop strategies to both mitigate and adapt to climate change so we appreciate the adaption and mitigation tools suggested in the REV.
For close to two decades, APA has promoted smart growth and sustainability in planning to encourage a more effective and efficient use of resources, to promote sound fiscal policy, and to achieve infrastructure, economic development, social equity, and environmental objectives. Recommendations on land use, community, housing, economic development, transportation, public health, and environmental plans consider the impact of energy use and carbon creation but, today, energy impact must be front and center for planners and their clients.
The APA Policy Guide on Energy includes the essence of four of the REV’s six policy objectives to: enhance customer knowledge (in how they use and can better manage their energy use); increase fuel and resource diversity; reduce carbon emissions; and enhance system reliability and resiliency.
We appreciate New York City and State’s recent strides towards these objectives with revised building and Green zoning codes, “clean heat” regulations, and
requirements for benchmarking and audits to increase end user awareness of their energy use. The rate payer funded incentive programs, System Benefit Charge programs (SBC), Renewable Portfolio Standard (RPS), Energy Efficiency Portfolio Standard (EEPS) and New York Sun, set the stage for REV’s implementation of a cleaner, more integrated and market based energy system. Both New York City and New York State call for a 50% reduction in carbon emissions by 2030 and 80% by 2050. Great leaps in renewable generation, demand response and energy efficiency suggested in REV, must occur to meet these goals. Below are our comments.
APA views the first policy goal of REV—“to enhance customer knowledge and tools to enable customers to manage their energy bills and provide more choice in how they use energy”—as most critical to the success of the initiative.
We agree with your statement that the commercial and industrial sectors are motivated towards energy savings for competitive reasons and a greater focus must be placed on increasing participation of residential customers, and particularly lower income clients. Our remarks are primarily focused on the residential sector.
We are encouraged by your findings that 44%-46% place high value on easy access to information on energy costs and increased ability to better control energy use, with approximately a third interested in varied Distributed Energy Resources (DER) products, but feel substantial outreach is still needed as only 21% of customers surveyed characterize themselves as very knowledgeable of home energy use. Some good news is that recent national polls show increased awareness and concern over the human causes of global warming and the need to mitigate them across the political spectrum.
We suggest “de-mystifying” the energy industry with a large scale public information and education campaign, beginning with energy system “basics” and on to the current challenges and proven tools and solutions. Your February 5th, 2015 REV presentation provides some basics but greater detail and specificity are needed as many consumers are not aware of the varied DERs and energy management products.
Publicizing the successes of DER applications offered in SBC, RPS and EEPS programs in energy savings and greenhouse gas (GHG) reductions should increase consumer confidence that DER technologies will provide them value. Individual case studies targeted at the different consumer groups should set the stage for greater engagement. PSC-sponsored efforts could be coordinated with the Mayor’s Office of Long Term Sustainability and Planning and other New York City (NYC) agencies, as well as other counties and municipalities engaged in these efforts.
NYC’s multifamily housing poses greater challenges to REV and require innovative approaches to engaging the end users in DER to address split incentives, billing and
engagement and limited access to some DERs. Some utility programs address split incentives with free in-unit energy efficiency and demand response measures that may be furthered by allowing owners to benefit from demand reductions from these in-unit energy reductions. NYSERDA posits that increased demand by residents for the safety, comfort and health benefits of energy reductions will drive property owners to increase use of DER.
Customer engagement requires transparency, clarity and substantial and varied educational offerings. It is crucial that end users understand their important role in this reform that, if successful, should lower their electricity costs, with savings from energy use reduction as well as in actual rate reduction as stated in the plan. But for most consumers, energy is one of many elements to be addressed as they go about meeting the primary goals in their lives. Our members that work in this field have shared that their clients cite time as the major constraint to enacting energy saving measures, so keeping engagement processes clear and simple is key.
Participation in solar PV systems, encouraged and tracked by New York Sun, shows great results in Westchester and Long Island in comparison to NYC. Efforts should be made to address technical and financial barriers to solar development and increase marketing in New York City of affordable solar programs and community solar. The Community Choice Aggregation Model should be pursued for its ability to address some barriers for DER in NYC.
Micro-grids, particularly those with combined heat and power, storage and renewable generation, offer efficient, reliable and resilient energy often at lower cost. Our members with international experience witness the benefits of micro- grids to satellite communities in developed urban areas as well as first provider of power in developing countries. Governor Cuomo’s recent announcement of the New York Prize competition and support for microgrid development will provide interesting demonstration projects. We look forward to learning how the PSC addresses some of the existing regulatory, tariff and rate barriers to ease micro-grid development.
Determining the appropriate roles for DSP, service and generation providers, particularly the utilities, should consider the most expedient methods to grow a healthy and competitive DER market quickly, attract private capital and transfer risk of failure away from the rate payers and on to the market participants. Transparent consumer data, DPS system information, and DER pricing should be available to all consumers and qualified DER providers.
The straw plan discusses a data exchange to provide suppliers with consumer data and a level playing field to “facilitate multiple competing enhanced energy product
and service offerings that improve people’s lives.” We also encourage the development of an informational and eventual purchase exchange for consumers where commodities, energy management devices, and DERS are explained and offers may be analyzed and compared.
Benefit Cost Analysis (BCA)
The APA NY Metro Chapter commends the Commission on plans to include the societal factors of resiliency, reduced carbon and other air pollutant emissions in the Benefit Cost framework that will be designed for utilities to plan their distribution systems, Distribution Platform System investments, and DER as well as for the pricing of market DER products. With low fossil fuel prices, these factors are necessary to show the complete benefits of renewable DER.
Clients have cited that a major barrier to engagement in energy savings programs is the complexities and variations in both competing and complementary programs offered by different utilities and government agencies that tend to change incentives and guidelines frequently. One suggestion is to encourage utilities and other program implementers serving the same geographic areas to create uniform programs and standardization of DER that will aid both DER providers and consumers.
Similarly, transition from the EEPS program to REV must be well planned to avoid any negative impact on growing customer engagement and market transformation. As the REV requires utilities to now develop Energy Efficiency Transition Implementation Plans as “early components” of their ultimate Distributed System Implementation Plans, care should be taken to create a seamless transition.
Energy costs in New York City are the highest in the country. As most salaries have not kept pace with increased costs of living, the burden of utility costs as a percentage of income has grown for all New Yorkers. In this year’s State of the Neighborhoods, the NYU Furman Center estimated that utility costs may consume as much as 25% of a low income household’s budget. For this reason, we ask that special educational and incentive programs be provided to aid this population in reducing its energy usage and costs as well as to participate as energy providers. An important consideration is how to overcome the lack of capital for pre-development planning by low-income clients.
The ability to obtain financing, without traditional underwriting requirements, using projected savings as collateral could be very beneficial in increasing DER in lower income buildings. We hope that on-bill financing will be able to be offered in the near future for smaller projects. The value of provider financing options such as
Power Purchase Agreements and leasing arrangements should be marketed as well as information on comparative financial offerings.
The APA NY Metro Chapter commends the PSC for this innovative and transformative effort and the opportunity to share our thoughts on how best to achieve the REV goals.
James Rausse, AICP
American Planning Association- New York Metro Chapter