New budget legislation contains some utility cost measures

ALBANY | Gov. Hochul has signed new legislation as part of the FY27 Enacted Budget to hold the line on rising utility bills and make investments in New York's sustainable future. With the budget passage, there will be $1 billion in one-time energy rebates, strict accountability measures on utility companies and aggressive measures to increase New York's clean energy supply to help keep the lights on and costs down. As the Governor enacts measures to combat skyrocketing utility costs, she continues making record investments in New York's nation-leading environmental protection initiatives, flood mitigation efforts and community preparedness amidst frequent extreme weather events. $1 BILLION IN ONE-TIME ENERGY REBATE CHECKS With New Yorkers struggling with high energy costs and record gas prices at the pump, the new budget includes one-time $1 billion Protecting Our Wallets Energy Rebate (POWER) checks to help provide needed relief. The POWER program will provide $200 to joint filers with incomes under $150,000 and $150 to joint filers with incomes between $150,000 and $300,000. Single filers with incomes under $150,000 will receive $100. The rebates will be issued as advanced credit checks and will be mailed out between September and December. WHO'S ELIGIBLE FOR A POWER CHECK? You are eligible for a rebate credit check if, for tax year 2024, you: Filed a timely New York State Resident Income Tax Return for Tax Year 2024 Were a full-time resident for New York State for Tax Year 2024 Reported income within the qualifying thresholds Were not claimed as a dependent on another taxpayer's return RATEPAYER PROTECTION PLAN At the heart of the effort to modernize the State's approach to regulating utilities is a commitment to ensuring energy remains affordable. Energy profits will be tied to a company's ability to perform where it matters most: people's wallets. Utilities will be prohibited from passing the costs of lobbying, glossy PR campaigns, political donations, and luxury travel to New York ratepayers. Utility CEOs will have their salaries benchmarked to achieving energy affordability goals set by the Public Service Commission (PSC). And if a utility makes excess profit, that money will be returned to ratepayers. To stop disruptive price hikes before they take effect in the first place, Gov. Hochul is demanding unprecedented fiscal discipline and transparency from utility companies. When requesting a rate increase, utilities will have to prove that their capital projects are absolutely necessary and that they've left no stone unturned in the pursuit of zero-emission options. They'll also have to present a budget-constrained option that keeps their operating costs below the rate of inflation. To ensure a fair fight, the State and other parties will now have 14 months to examine rate requests by utility companies and the PSC will be able to set multi-year rate cases when they make sense for consumers. And the State's regulators will also heavily scrutinize the fees that utilities run up during the process of determining new rates. The goal: ensure customers aren't shouldering any costs associated with utility rate cases that aren't legally required. The Governor is also requiring the establishment of a new energy affordability index that will expose the true impact of utility rates on everyday New Yorkers, benchmarking utility performance here against those in the rest of the nation. Going forward, utilities will be required to demonstrate exactly how any proposed rate hike will impact this index – and if a rate case pushes the average household energy burden above 6 percent, the State will be able to deploy an independent Affordability Monitor directly into the utility's boardroom. EXCELSIOR POWER: ADVANCING A MORE FLEXIBLE AND AFFORDABLE GRID Gov. Hochul's Excelsior Power program will create a new, statewide platform to make better use of smart technologies to increase grid flexibility by shifting when and how electricity is used across the system. Excelsior Power will enable utilities to treat grid flexibility as a core system resource and expand consumer-facing incentive programs that encourage households and businesses to participate in energy flexibility programs. This program is being kickstarted by a $33 million allocation this year that will provide $25 per month for the first year for consumers who sign up for Excelsior Power. By harnessing grid flexibility tools such as demand response and smart technologies, the State will avoid hundreds of millions of dollars in system costs each year while reducing the need for costly upgrades and backup power plants – averting costs that will otherwise be shouldered by rate payers and enabling utilities to share that financial benefit directly with their customers. ACCELERATING SOLAR POWER AND UPGRADING THE GRID AFFORDABILITY Transitioning to clean energy shouldn't mean unpredictable costs and lengthy delays for connecting solar power to our communities. The Accelerate Solar for Affordable Power (ASAP) Act will modernize how utilities upgrade their systems, requiring cost tracking, greater transparency, and the use of smart-grid technology whenever it makes sense to prevent project cost overruns. By streamlining the interconnection process and mandating proactive grid upgrades, Gov. Hochul is accelerating New York's solar expansion while ensuring ratepayers aren't unfairly burdened by the costs of the clean energy transition. ESTABLISHING THE RATES COMMISSION TO COMBAT RISING UTILITY BILLS New Yorkers are facing real pressure from the rising costs of energy, and addressing these price spikes requires a clear, independent examination of how energy prices and costs are passed onto consumers. The newly established RATES Commission will bring together consumer advocates and energy experts to investigate the root causes of surging utility bills, evaluate utility profits, and review energy market designs. By including this legislation in the FY27 Enacted Budget, Gov. Hochul is taking a critical step to lower energy costs and ensure a fairer, more affordable energy market for all New Yorkers. $1 BILLION EXPANSION OF THE SUSTAINABLE FUTURE PROGRAM The FY27 Enacted Budget includes another record $1 billion investment in the Sustainable Future Program, reinforcing New York's historic commitment to clean energy and greenhouse gas mitigation. This comprehensive investment drives climate action across multiple sectors, allocates $500 million for building emissions reductions, $300 million for renewable energy projects, up to $75 million for zero-emission transportation, $50 million for methane mitigation, and more. As a cornerstone of this strategy, the EmPower+ program will receive a $200 million boost – combining $150 million directly from the Sustainable Future Program with an additional $50 million included in the NYSERDA capital budget. This program has been extremely successful in helping people keep their homes comfortable, affordable, and environmentally friendly while generating new clean energy jobs for local contractors. SUPPORTING SOLAR DEPLOYMENT IN PUBLIC SCHOOLS BY ALIGNING STATE BUILDING AID WITH CLIMATE GOALS Looking towards a more sustainable future, many school districts are choosing to invest in solar and other renewable energy systems, which will support the state's transition long-term. However, current Building Aid rules can limit their ability to undertake these crucial projects. Gov. Hochul is updating how State Building Aid is applied so school districts have greater flexibility to install the most effective renewable energy systems, including ground-mounted solar where appropriate. This change will make it easier for schools to reduce energy costs, cut emissions, and invest in cleaner infrastructure without increasing overall Building Aid. HISTORIC COMMITMENT TO CLEAN WATER INFRASTRUCTURE The FY27 Budget makes a $750 million investment in Clean Water infrastructure as a first installment of Gov. Hochul's bold, five-year, $3.75 billion investment. New York's aging water infrastructure poses a significant threat to public health and economic vitality. The staggering cost – projected at $80 billion – to upgrade the state's drinking water and wastewater systems underscores the necessity of sustained, large-scale investment. Legacy issues, such as lead service lines, and the rise of emerging contaminants such as PFAS (per- and polyfluoroalkyl substances) continue to threaten drinking water supplies. This increased investment will ensure substantial funding is available for communities to affordably build the sewers and infrastructure they need to build housing; and continue to tackle legacy threats like lead service lines and address "forever chemicals" such as PFAS, ensuring that New York remains a national leader on protecting our residents and environment, while providing clean safe drinking water. This historic funding level will also continue to uplift and support New York's premier water programs, such as the Water Infrastructure Improvement (WIIA) program, the Water Quality Improvement Project (WQIP) program, and the Lead Infrastructure Forgiveness and Transformation (LIFT) program. Central to this initiative is the new Smart Growth Water Grant Program, which will fund the essential sewer and water infrastructure required to build housing and support the state's growing economy. As part of Gov. Hochul's commitment to ensuring New Yorkers have access to safe, clean drinking water, she is continuing to invest in removing and replacing lead service lines. The state is creating new funding opportunities to support even more communities in the vital work of identifying and replacing lead service lines. To further safeguard our youngest residents, water filter replacements in schools are now classified as reimbursable expenses. INVESTING IN THE ENVIRONMENTAL PROTECTION FUND (EPF) TO SAFEGUARD OUR NATURAL RESOURCES The FY27 Budget appropriates $425 million to the EPF, and using $25 million from the Sustainable Future Program (SFP) to provide a record $450 million for important environmental programs, including: $47.2 million for Climate Change Mitigation and Adaptation across agriculture and environmental sectors; $216.6 million for Open Space; $124.7 million for Parks and Recreation; and $61.4 million for Solid Waste. This historic investment reinforces the state's role as a national leader in conservation and environmental protection, helping preserve New York's environment for generations to come. SUPPORTING RESILIENT, ADAPTIVE COMMUNITIES The FY27 budget includes $667 million for state matching funds and advances of local shares for four United States Army Corps of Engineers (USACE) projects: $28.35 million advance for local share of Mamaroneck and Sheldrake River; $10 million state share for South Shore Staten Island; $350 million for East Rockaway; and $195 million state share and $84 million advance of local share for Long Beach. These four projects, when completed, will provide protection to some of New York's residents most vulnerable to flooding and severe weather, exacerbated by climate change. As climate change drives more frequent and severe weather events, many of New York's lower-income communities are at higher risk during storm events. Residents in these communities often lack reliable ways to stay connected, safe, and functional during emergencies, especially when power or communications are disrupted. To address this, Gov. Hochul secured $10 million for a new competitive grant program in the budget to support community-based organizations in environmental justice and disadvantaged communities to strengthen local preparedness and response capabilities. The program will prioritize the development of Community Resiliency Hubs, which are trusted neighborhood locations equipped to support residents during extreme weather and other emergencies. Grants will also help local organizations secure essential response equipment needed to protect public health and safety in the critical hours following a disaster. COMMON-SENSE REFORMS TO THE CLIMATE LEADERSHIP AND COMMUNITY PROTECTION ACT The FY27 Enacted Budget changes the required timeline to 2028 to put regulations tied to emissions targets in place. The Budget amends the CLCPA to ensure regulations are still tied to achieving the State's 2050 reduction mandate while tying them to a new interim emissions reduction target of 60 percent by 2040. This change is necessitated by federal and macroeconomic headwinds and will ensure that the energy transition does not come at the cost of eroding energy affordability for New Yorkers. The changes also: Update the methodology by which New York State measures emissions to adopt the Intergovernmental Panel on Climate Change's emissions accounting, aligning New York with 48 other states and global standards. Put affordability first by requiring the development of regulations to meet stipulated climate goals must consider feasibility and affordability. Increase funding for disadvantaged communities, requiring they receive 40 percent of the benefits of investment funding to meet climate goals, up from 35 percent.

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New budget legislation contains some utility cost measures

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