Monday, April 04, 2005

Budget language threatens SBC, RPS funds

Subj: Budget language threatens SBC, RPS funds
Date: 4/4/2005 11:47:42 AM Eastern Daylight Time
File: sbcfacts.wpd (14824 bytes) DL Time (TCP/IP): < 1 minute
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Budget language threatens SBC, RPS funds

As many of you know, the legislature has passed a budget on time for the first time in 20 years. A worthy accomplishment. However, the NYS Senate and Assembly included language in that budget which requires the Governor to submit SBC and RPS funding to the legislature for appropriation. This action is rife with problems and threatens the efficiency and stability of
existing energy efficiency, R&D and renewable energy programs. Attached is an action alert which we ask our key stakeholders to distribute to as large an audience as practical. We take great pride in the effectiveness, accountability and inclusiveness of the programs we offer. Our goal is to maintain and improve those programs with your help. Your immediate attention to this matter is appreciated. RG

(See attached file: sbcfacts.wpd)


State Budget language requires System Benefit Charge and Renewable Portfolio Standard funds be appropriated by Legislature.

The Assembly and Senate inserted language in this year’s State Budget to require that the funds which NYSERDA receives to administer the System Benefits Charge and the Renewable Portfolio Standard will have to be appropriated by the Legislature. This action will have dire consequences for both programs.

Yearly appropriation by the Legislature, even if done timely, will severely impact the delivery of energy efficiency services, and R&D and renewable energy projects. New York’s program is recognized as one of the finest in the country because it uses the marketplace to deliver services, and in so doing has successfully leveraged private sector dollars at a 4-1 ratio. Once the program is subject to year to year appropriations with no multi-year planning function due to budget uncertainties, and we can no longer guarantee our market participants that the programs are solid and available over the long term, that investment will stop. The program in it’s current form has a proven record of producing energy and environmental benefits, along with stimulating economic opportunities through job creation and retention. Why change that?

* $194 million in Annual Energy Bill Savings
* 4,200 jobs created and retained
* Environmental benefits that equate to removing 203,000 cars from New York roadways

NYSERDA’s Energy Star® products, low-income, small homes and multifamily building performance programs are recognized as national models of innovation and private sector partnership. They depend upon long-term, market-based strategies unencumbered by political whim. Creating consumer demand for energy efficiency while supporting a professional infrastructure to deliver the products and services has proven to be extremely cost effective, accountable and sustainable on a large scale. Even more can be accomplished , but not if these low-income and market strategies are interrupted.

An even more serious concern is the State’s Renewable Portfolio Standard program which is just underway and would be essentially dismantled by the budget language. Renewable Energy generators are just entering the market and need long term contracts to be viable in the financial community. The current program can do that since the funds are assured by a revenue stream that is dedicated to the program. Under a yearly appropriation status, the certainty and dedicated nature of these funds could change. That would effectively kill the program since investors would not be as willing to make the long term commitment necessary.

New York’s current program is nationally recognized for its success. Why jeopardize that? It is truly what every program operated by government should be, open and accountable. Other states with similar Public Benefit funds like Connecticut, Wisconsin and Texas have seen their energy programs fall victim to Legislative fund raids for other purposes such as filling budget shortfalls.

Please work with your local Assembly and Senate representative, as well as State Legislative leadership, to permanently strike that language from the budget. This is bad public policy. Please don’t let this Article VII language stand, our energy and environmental future is too important.

Article VII Language:

S. 3669 16 A. 6843

31 § 2. Commencing with the 2006-2007 state fiscal year, and each fiscal
32 year thereafter, the governor shall, in his or her executive budget, as
33 submitted pursuant to article VII of the state constitution, provide
34 appropriations for currently non-appropriated moneys received by the New
35 York state energy research and development authority, under the direct
36 oversight of the department of public service, related to assessments,
37 collected for the purpose of funding public policy energy programs.
38 § 3. This act shall take effect immediately and shall be deemed to
39 have been in full force and effect on and after April 1, 2005.

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