The Honorable Kathy Hochul
Governor of New York State
NYS State Capitol Building
Albany, NY 12224
October 16, 2023
Dear Governor Hochul,
We the undersigned 219 organizations, representing tens of thousands of New Yorkers, thank you for your leadership in committing to 2 million climate-friendly homes by 2030, working with the legislature to pass the first-in-the-nation zero emissions new buildings law and the Utility Thermal Energy Network and Jobs Act, and creating funding programs to decarbonize the building sector.
Our organizations are, however, deeply concerned about the rising cost of energy driven by irresponsible fossil fuel investments, and we call on you to lead New York toward a more affordable energy future. Gas utilities are increasing their profits by saddling New Yorkers with the costs of extending the lifespan of antiquated pipeline infrastructure and dangerous technology, all while making New York more expensive and polluted. As a result, 1.2 million households and 127,000 small businesses are behind on their energy bills. After suffering the hottest summer on record globally, millions of New Yorkers will soon face freezing temperatures without adequate insulation or affordable energy. We need your leadership to implement New York’s nation-leading Climate Leadership and Community Protection Act (CLCPA), protect New Yorkers from unnecessary energy costs, and ensure safe, comfortable homes year-round.
We urge you to ensure your upcoming State of the State and Executive Budget accomplish the following priorities:
- Put money back in New Yorkers’ pockets by ending wasteful spending of customer funds used to subsidize new fracked gas hookups by finally eliminating the ‘100-foot rule’
- Improve access to cost-saving energy efficiency measures and heat pumps by directing your agencies to create a retrofit readiness fund to fully achieve your Climate Friendly Homes commitment
- Enable utilities to opt for cleaner, more cost-effective options rather than unnecessary gas pipelines by amending the obligation to serve gas so that utilities can pursue neighborhood-scale building decarbonization projects
- Make energy bills affordable and fair for low and middle-income New Yorkers by ensuring no residential customer pays more than 6% of their income for energy
- Hold gas utilities accountable for reducing climate and air pollution by directing your agencies to set and enforce CLCPA-compliant building sector emission limits
While the cost of living has been rising across the economy, recent rate hikes approved for utilities push energy bills up faster than the rate of inflation. The cost of gas utility pipeline expansion and maintenance is a major driver of these gas rate hikes. These costs continue to burden us at a time when we know we need to rapidly reduce fossil fuel use to meet our climate goals. Without your intervention, this problem will worsen because current laws, energy policy, and incentives favor utility investments in unnecessary infrastructure over more cost-effective programs, energy sources, and technologies. Thankfully, the Final Scoping Plan approved by your Climate Action Council provides a roadmap to the changes and investments that will set New York on the responsible path to lower costs for both individual energy bills and the system as a whole.
Our Building Electrification and Equity Platform for 2024, many provisions of which are included in the NY HEAT Act, provides the pathway for necessary climate action that creates more affordable energy bills, cleaner air, and more comfortable, livable homes for New Yorkers:
1. Put money back in New Yorkers’ pockets by ending wasteful spending of customer funds to subsidize new fracked gas hookups. Outdated Public Service Law requires utilities to use our money to subsidize the cost of new gas hookups within one hundred feet of an existing gas line (the ‘100-foot rule’). This policy costs New Yorkers hundreds of millions of dollars per year and is not aligned with our climate mandates. For example, the recently filed rate request from National Grid calculates the cost of subsidizing new customer connections and reinforcing the system to serve those new customers at $210 million for 2024. You can free us from these unnecessary costs by ending the 100-foot rule. This statute change is called for in the Final Scoping Plan on page 357.
2. Fund retrofit readiness to improve access to cost-saving energy efficiency and heat pump installations. We commend your commitment to 2 million climate-friendly homes by 2030, including 1 million electrification-ready homes, 800,000 of which would be for low-income households. While many programs are available to help weatherize and electrify homes, New York’s most vulnerable households are locked out of these cost-saving measures. They are being forced to battle extreme heat and cold, plus high energy bills, because their homes are not “retrofit-ready.” They need pre-retrofit investments (i.e., structural upgrades, electrical upgrades, and lead, mold, and asbestos remediation) to address deferred maintenance and health hazards that block weatherization and electrification projects from moving forward. The Final Scoping Plan, page 199, calls for a “Retrofit and Electrification Readiness Fund for LMI households, affordable housing, rent-regulated housing, public housing, and residential buildings in Disadvantaged Communities.” We are counting on you to identify the funds for these necessary improvements and to direct your agencies to incorporate these measures into their weatherization and electrification programs.
3. Enable utilities to opt for cleaner, more cost-effective options rather than unnecessary gas pipelines. Outdated Public Service Law saddles New Yorkers with wasteful spending on the antiquated gas system rather than investing in building improvements and the clean heating and cooling technologies called for in the Final Scoping Plan, including heat pumps and thermal energy networks. We urge you to amend the obligation to serve gas so that utilities can pursue the union-friendly neighborhood-scale building decarbonization projects called for on page 205 of the Final Scoping Plan, which will improve health, safety and comfort.
4. Ensure no residential customers pay more than 6% of their income for energy by making rates more fair. Your administration has taken important steps to improve energy affordability by providing utility debt relief, expanding the utility energy affordability program, and piloting an energy affordability guarantee for customers who electrify through NYSERDA’s Empower+ program. Nevertheless, too many households still struggle to afford their bills because utility rates are rising so dramatically. The policies described above, along with important changes in your Public Service Commission’s energy efficiency programs through the New Efficiency New York proceeding, will help reduce system-wide energy costs. More relief is needed, however, to protect the lowest-income New Yorkers, who pay an average of 10% of their income on energy (as compared to higher-income households who typically don’t pay more than 2% of their income on energy). By guaranteeing residential customers pay no more than 6% of their income on energy, you can save the average low-income household $75 per month.
5. Hold utilities accountable to New York’s nation-leading climate law. New York’s gas utilities, which represent a significant opportunity to reduce building sector emissions, are continuing to pump money into their gas pipeline networks – including billions of dollars of customer money on expanding and extending the life of their gas infrastructure – without viable plans to reduce fossil fuel usage and corresponding emissions to levels commensurate with CLCPA mandates. The gas utilities need clear direction to rein in fossil fuel spending and guide their long-term planning efforts. We therefore call on you to direct the Department of Environmental Conservation to set sector specific GHG emission limits for the buildings sector, and to direct the Public Service Commission to set declining emission limits, in line with the CLCPA, for each gas utility and to enforce these limits through the gas planning process.
Prior commitments and actions have set you and your administration up for success in achieving these goals. The Final Scoping Plan describes a transition to well-insulated homes and buildings, powered by clean energy, that will result in lower bills and cleaner air that drives a healthier, more prosperous New York for all. But profit-seeking investments by gas utilities stand in the way of that transition being implemented equitably and affordably. We celebrate the progress that has been made with the passage of all-electric new construction, funding for the EmPower+ program, expanding the Energy Affordability Program, and your commitment to two million climate-friendly homes by 2030. But now New Yorkers need you to take the next steps outlined in the Final Scoping Plan and stop utilities from dumping money into short-sighted investments in fracked gas pipelines that we no longer need.
New York has set the standard for transitioning to clean energy in buildings nationally, as demonstrated by your leadership with 24 other Governors in calling for quadrupling heat pump deployment by 2030. New York must continue to lead by enacting the cutting-edge policies that will deliver the energy savings, comfortable homes, and a livable planet promised by your Final Scoping Plan. Passing these policies will build on your legacy of leadership and make meaningful progress toward a better New York.
Thank you for your consideration of these recommendations. We look forward to continuing this work with you toward improving living conditions, health, economy, and climate for all New Yorkers.