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New York Power Authority Issues Request for Additional Power Supplies for New York City Governmental Customers

Michael Saltzman

November 8, 2007 


NEW YORK—The New York Power Authority (NYPA) announced Thursday it has issued a Request for Proposals (RFP) for additional power supplies to meet the future electricity requirements of its New York City governmental customers, for schools, hospitals, municipal buildings, the subways and commuter trains and other essential facilities and services.

“This Request for Proposals by the New York Power Authority is part of my administration’s overall approach for spurring construction of new clean power plants to meet growing power demand while helping to lower energy bills and climate-changing greenhouse gas emissions,” said Governor Eliot Spitzer. “We want to encourage long-term supply contracts to facilitate the financing and construction of new generation by offering predictable and stable revenues to potential power plant developers. Infrastructure improvements are crucial for the reliability of the electric power system, along with a major push in energy efficiency to lower demand for power by 15 percent from forecasted levels by 2015.”       

“New York City’s growth and continued pre-eminence is in part dependent upon securing newer, more efficient sources of power,” said Mayor Michael Bloomberg. “We applaud the Authority’s actions to increase power supplies and replace the aging Charles Poletti Power Project, and we appreciate that the RFP reflects the economic and environmental priorities established in PlaNYC, our blueprint for a sustainable future.”

“Growth in electricity demand, combined with the scheduled retirement by early 2010 of our Charles Poletti Power Project in Queens, is going to tighten the supply margins for our New York City governmental customers and the thousands of facilities they operate,” said Roger B. Kelley, NYPA president and chief executive officer. “We have an obligation under long-term agreements to ensure economical and reliable electricity supplies for these customers, necessitating the kind of planning process that is at the heart of this formal request for bids.”  

The Power Authority issued its RFP after close consultation with the New York City governmental customers, whose peak summer demand for power amounts to more than 1,800 megawatts (mw), which would be enough electricity to serve about 1.5 million homes.

(The RFP can be downloaded from the NYPA website at

The RFP seeks proposals for up to approximately 500 mw of in-city capacity, along with optional energy, from bidders who have projects that are far enough along in the siting, engineering, procurement and permitting processes to have a strong likelihood of being in service in the 2010-2012 time frame. Bids are due by Dec. 20 and a final decision will be made by April 2008, subject to approval of the NYPA Board of Trustees. 

Evaluation criteria will include the probability of timely completion, enhancement to the reliability of the electric power system, improvement to regional air quality and reduction in electricity costs.   

The RFP seeks capacity that is determined to be “electrically located” in New York City in accordance with reliability rules of the New York Independent System Operator (NYISO), a not-for-profit organization that administers the state’s wholesale energy markets. Under this designation, the capacity can be provided by power plants in the city or from facilities outside its borders via dedicated transmission lines to Con Edison’s electricity system in the city. Both qualify as in-city capacity.

The Request for Proposals follows a winning bid from a 2005 RFP in which NYPA selected a jointly submitted proposal by Hudson Transmission Partners, LLC and FPL Energy, LLC for 500 mw of in-city capacity, involving construction of a new 345-kilovolt line under the Hudson River. The capacity from both the earlier and latest RFP is necessary to meet the increased electric load of the New York City governmental customers and to replace the 885-mw Poletti project, a natural gas- and oil-fueled facility that is scheduled to be shut down by Jan. 31, 2010.     

Besides meeting electricity-supply needs of the governmental customers, the Power Authority has financed nearly $655 million in completed energy-efficiency projects and other energy services at 1,380 public facilities across the city as part of its ongoing statewide efforts to reduce power demand and improve air quality. The initiatives have lowered peak electricity use in the city by nearly 100 mw, saving the tax-supported facilities more than $63 million a year and reducing annual greenhouse gas emissions by 525,000 tons and yearly oil use by more than 1.2 million barrels.

Statewide, NYPA has invested more than $1 billion in energy efficiency and clean energy projects since the late 1980s. It plans to increase its financing of such initiatives in support of Governor Spitzer’s aggressive 2015 target (“15 by 15” goal) for reducing electricity consumption throughout the state by 15 percent from projected levels. 


About NYPA:

■    NYPA uses no tax money or state credit.  It finances its operations through the sale of bonds and revenues earned in large part through sales of electricity.  ■    NYPA is a leader in promoting energy-efficiency, new energy technologies and electric transportation initiatives.  ■    It is the nation’s largest state-owned electric utility, with 18 generating facilities in various parts of the state and more than 1,400 circuit-miles of transmission lines.

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