Transforming New York’s Power Grid for a Clean-Energy Future

In the past decade, New York State has cemented itself as a national leader on energy policy and environmental quality with initiatives like the Clean Energy Standard, Reforming the Energy Vision, and the Regional Greenhouse Gas Initiative. Combined with competitive electricity markets that drive efficiency and support the growth of renewable resources, these initiatives are improving air quality and expanding New York’s clean-energy industry.

But as the New York Independent System Operator (NYISO) looks to a cleaner-energy future in New York, we see the emerging story of our electric system as one of a grid characterized by stark regional differences that can be thought of as a tale of two grids. Not surprisingly, there are distinct differences between Upstate and downstate in terms of power resources and consumer demand.

We have an abundance of renewable-energy resources and generation capacity in upstate New York, yet relatively low demand. In contrast, the downstate region has a higher concentration of fossil-fuel generators and significantly higher demand, using 66 percent of the state’s electric energy annually.

In fact, nearly 75 percent of the electricity generated in the downstate region last year was produced by fossil-fuel resources, while about 85 percent of electricity generated Upstate came from nuclear, hydro, and wind resources with no carbon emissions. Our recently released Power Trends 2017 report highlights this fundamental problem for New York: longstanding transmission constraints between the two regions prevent more clean energy produced in Upstate from reaching the broader, statewide market.

This physical constraint on the grid is also giving rise to two markets. The low cost of natural gas to fuel generation and the continued growth of clean-energy resources Upstate are keeping market prices in this region low. As a result, other resources are finding it difficult to compete, raising concerns that price signals will deter investors from building new generation or upgrading existing plants to support reliable operations.

Power Trends also highlights the emergence of a much different grid with the growth of smaller, more distributed energy resources, typically located on a customer’s premises. While these resources usually supply the customer’s electricity needs, our “distributed energy resources roadmap” highlights how on-site electricity can also provide services to the “bigger grid,” and the larger wholesale market.

A cleaner, greener, integrated grid — one that includes both central power station and distributed resources will depend on a modernized, upgraded, and expanded transmission system. Upgraded transmission capability is vital to meeting the state’s renewable public policy goals and efficiently moving power to address regional power needs.

Transmission enhancements will also relieve constraints on the system, making more effective use of current and future renewable resources. Further, strategic transmission investments will enable upstate resources to better serve a broader market — providing benefits such as a more resilient grid, access to more diverse energy resources, and more efficient market competition.

The power grid has been described as the greatest engineering achievement of the 20th century, providing the foundation upon which our modern life and economy is built. Today, our main focus at the NYISO is ensuring this engineering marvel will meet the emerging challenges of the 21st century.

Working closely with utilities, generators, regulators, and industry stakeholders, we are transforming New York’s power grid for the better — both Upstate and downstate. At the NYISO, we’re proud to be a part of the change that will determine our state’s clean-energy future.

Brad Jones is president and CEO of the New York Independent System Operator (NYISO), an independent nonprofit company that operates New York’s high-voltage power grid and manages competitive wholesale electricity markets.