New York Can’t Meet Its Ambitious Climate Targets. Maybe the Plan Was Doomed From the Start

It’s hot and humid in New York City. After a long, cold winter, the heat came suddenly—days after the official start of summer. Central Park hit its highest temperature—99 degrees—since 2012 and Con Edison, the area’s main electricity provider, issued blackout warnings. 

Between 2018 and 2022, an average of 525 deaths a year were attributed to heat stress, or due to an underlying illness that was exacerbated by heat, according to city data. Weather extremes are likely to become more frequent in the coming decades because of climate change. The state is no stranger to this—in the last two years, 49 high temperature records and 10 low temperature records have been broken. 

These increasingly frequent temperature extremes can be particularly harsh during hot summers in the most densely populated city in the country. Residents—who often already pay high rents in the city—have to choose between saving money and staying cool. 

The state is struggling to do its part to limit its contribution to these climate extremes. New York state policies set lofty goals for decarbonization with the 2019 Climate Act and the 2023 Build Public Renewables Act, among others. 

State legislators set a target of a 70 percent renewable-sourced electricity grid by 2030 and a net-zero emissions grid by 2040. But Gov. Kathy Hochul recently announced that the state would not meet these goals, confirming a possibility long feared by local environmentalists.  

The state is struggling to retire its fossil fuel plants on schedule due to a lack of renewable energy projects coming online to replace them. Changes in market forces over the last five years and inflation due to the pandemic contributed to this, but the problems run deeper.

The current regulatory landscape for renewable energy development means that it can take many years to get a project online. The Trump Administration’s opposition to clean energy, especially offshore wind, has complicated New York’s efforts to meet its climate goals. 

The looming fear of exceeding the capacity of the electricity grid persists, especially when demand is predicted to increase and there is limited infrastructure to accommodate it. 

This came as no surprise to Dennis Elsenbeck, a former member of the state’s Climate Action Council, which developed and voted on the draft scoping plan to meet these climate goals. Elsenbeck has 30 years of experience working at National Grid, a local gas and electric utility, and was one of three members of the 22-person council to vote against the current scoping plan in 2022. 

“From experience, I know that the transmission system and the distribution system—based on age and the lack of capacity—can’t achieve those types of objectives,” Elsenbeck said.

The state has also slowed progress on policies, such as the Cap and Invest program, which would help pay for new climate-friendly infrastructure. 

Retirement Requires Replacement—and It’s Not Happening Fast Enough 

The New York State Energy Research and Development Authority (NYSERDA) estimates that around half of the state’s electricity comes from zero-emission sources, like hydroelectric, solar, wind and nuclear generation. The rest largely comes from burning natural gas.

The electricity grid in New York is made up of transmission networks, which are equivalent to electricity highways that help it travel long distances, and distribution networks, which deliver the electricity to people’s homes and businesses. 

When a renewable energy project wants to connect to the grid, it must connect to the transmission system through the state grid operator—the New York Independent System Operator—which deals with generators of 5 megawatts or more. 

The process can take multiple years and incur significant costs due to the time it takes to assess the necessary grid system upgrades required for the new generator. The project developer covers the cost of these upgrades.

This delay impacts the ability of the state and private companies to bring renewable energy projects online, especially in time to meet a deadline that is now only five years out. Elsenbeck believes that the state’s climate plan focused too heavily on taking facilities that burn fossil fuels offline, and not enough on ensuring the electricity grid could support the energy transition through large-scale transmission and distribution system upgrades and changes to regulation. 

“We’re setting ourselves up to fail because we didn’t include the electric system when we wanted to transition,” he said. “It’s like ‘we’ll deal with that later.’ Well, later is here—we still haven’t dealt with it.”

In 2023, the Build Public Renewables Act was included in the annual budget. The policy aimed to empower the state public power authority, the New York Power Authority, to fill in the gaps left by the private sector to meet the state’s energy goals, as defined by its Climate Act. 

The state needs 15 gigawatts of additional generation capacity to meet its targets. But even with the policy in place, the power authority has fallen short, with just 7 gigawatts planned to be built. Earlier this year, the NYSERDA and the Department of Public Service admitted that they would likely need at least three extra years to meet the 2030 goal.

“While analysis indicates that a delay in achieving the 70 percent goal may be unavoidable, we remain committed to the State’s goals and will continue to facilitate the development of renewable energy resources,” wrote a NYSERDA spokesperson in an email. 

The limited number of New York Power Authority renewable energy projects will impact disadvantaged communities across New York City in multiple ways. Residents in these communities are more likely to live near one of the power authority’s six “peaker” power plants—polluting gas plants that operate at times of peak electricity demand, usually in the summer when everyone runs their air conditioners.

The pollution from these plants can impact surrounding air quality and lead to higher asthma rates, particularly when these communities are burdened by other polluting infrastructure such as last-mile warehouses and waste transfer stations. Multiple peaker plants in New York City are currently being kept online longer to ensure there are no blackouts.

The New York Power Authority was also tasked with establishing the Renewable Energy Access and Community Help (REACH) program, which would provide bill credits for low- and moderate-income ratepayers in disadvantaged communities, primarily paid for by the projects they can successfully undertake. 

The program could make a massive difference for New York residents—over 1.2 million of them are two or more months behind on their utility bills, according to a spreadsheet compiled from Public Service Commission data by the Alliance for a Green Economy.

“It isn’t just bad for the person who’s in utility debt—all rate payers have to pay for the cost of the utility to chase down those debts, to turn people’s utilities off, to turn them back on,” said Lisa Marshall, the advocacy and organizing director at New Yorkers for Clean Power, who have been tracking the issue for years. “I’ve equated it with the cost to society when people don’t have insurance and they use the ER because that’s the only access to healthcare they have.”

For Elsenbeck, the biggest problem with the state’s energy targets is that the policies that accompanied them did not prioritize economic development. For him, that means encouraging businesses with significant electricity demands and economic impacts, like manufacturing hubs or AI data centers, to build in New York, and power them using behind-the-meter generators like fuel cells—devices that generate electricity by feeding hydrogen and oxygen to two different electrodes. 

Then, the state and utilities could work on improving the grid’s transmission and distribution networks using some of the funds from the growth of large businesses. Once those upgrades are finished and renewable energy projects are brought online, a guaranteed large customer is waiting to be connected to the grid. 

Otherwise, Elsenbeck says, the average individual ratepayer will end up footing the bill for the energy transition. Currently, for most residents, a system benefit charge is calculated into their utility bills to help fund clean energy and public benefit programs.

“You can’t separate supply, demand and delivery, because when you do, it increases cost,” said Elsenbeck. “If you’re going to be aggressive, you’ve got to be aggressive on the economic side as well as the environmental side. We treat them as if they’re mutually exclusive when they’re dealing with the same infrastructure so you can’t separate the two.”

Utility Rates Continue to Increase

This year, Con Edison has warned that residential customers in New York City will see a 2.7 percent increase in their bills compared to last year. The company has invested $2.35 billion to upgrade its distribution system since last summer and has increased its delivery fee for customers following a 2023 agreement with the Public Service Commission to raise bills by around 11 percent over three years. 

The New York Independent System Operator (NYISO) estimates that electricity demand will increase in the coming decade due to transport and building electrification as well as data centers. To accommodate that, some of the cost of distribution upgrades is likely to be borne by ratepayers. For many city residents, affordability is front and center, and high utility bills can often be an added stress on households. 

Most city residents heat their homes using natural gas, provided by either Con Edison or National Grid—the price of this has also increased in the past few years. Some lawmakers are trying to limit the expansion of gas infrastructure and encourage developers to look into alternatives to gas hookups, like heat pumps and electric stoves. 

“[The current policy] doesn’t allow for the utility to provide heat pumps or a thermal energy network, and in many cases, that might be more beneficial to the customer and to the utility itself, because it might be a less expensive option than replacing a buried old gas line,” said Marshall. 

In the last legislative session, state lawmakers voted to repeal the 100-foot rule for gas hookups, a requirement that ratepayers subsidize the final piece of gas line infrastructure needed to connect new buildings to the system. This is just one component of the New York Home Energy Affordable Transition (HEAT) Act, which did not pass the Assembly this year. 

In addition to the repeal of the 100-foot rule, the act also called for the Public Service Commission to analyze how utility bills could be capped at 6 percent of household income and would have ended utilities’ “obligation to serve” gas to their customers, enabling them to provide ratepayers with alternative ways to heat their homes. 

The New York HEAT Act is not the only policy that could help ratepayers burdened with high utility bills. The Cap and Invest program would force polluters to buy “allowances” for their greenhouse gas emissions. The money from those sales would go towards energy bill rebates and re-investment in emission-reduction initiatives such as building electrification. 

Eunice Ko, the vice president of the New York City Environmental Justice Alliance, said her organization received a briefing on the program’s potential regulations and framework, and was told that Gov. Hochul would announce the plan for the program at her State of the State address at the beginning of the year. 

That did not happen. Instead, the state is taking public comment on the greenhouse gas emissions reporting rules, but not the caps or the reinvestment plan. 

“We’re slowing things down,” Hochul said on the Buffalo news station WGRZ in early July. She stated that she did not believe that New York could meet its objectives without hurting ratepayers.

“It all fell apart,” said Ko. “The official line that we’ve been given on the delay is that we need to first measure the pollution before we can reduce the pollution.”

Ko and her organization initially were not sold on the notion of a Cap and Invest program. A similar policy in California has been found not to meaningfully reduce air pollution in environmental justice communities. 

Once they realized that this would be the means through which the state planned to cap emissions to comply with the Climate Act, the Environmental Justice Alliance advocated for the Cap and Invest guardrails bill, which would limit polluting facilities’ ability to trade allowances. It didn’t pass the Assembly this session.

“If [Hochul] were to actually release all the regulations, not only is she going to make corporate polluters pay, but then she’s going to use that money and redistribute it to New Yorkers’ wallets and our communities to make sure that we are prepared for worse floods, heat waves, storms,” said Ko. 

In March of this year, multiple environmental groups sued the New York State Department of Environmental Conservation for its delays in implementing the Climate Act, specifically the regulations required to ensure the state meaningfully reduces its greenhouse gas emissions. 

Further Setbacks

The Trump Administration’s opposition to the clean energy buildout has also thrown a marked wrench into the Empire State’s ability to meet its targets. There has been speculation, fuelled by a May tweet by the Secretary of the Interior Doug Burgum, that Hochul “would move forward on critical pipeline capacity.” 

The implication was that this was a trade-off for letting an offshore wind project in Long Island, Empire Wind, go forward after the administration halted construction. The president has also signed an executive order that withdrew all parts of the Outer Continental Shelf from new or renewed offshore leasing activity and suspended the approval process for all new onshore and offshore wind projects—making it very hard to develop the rest of the large offshore wind projects needed to meet the state’s targets. 

Last month, National Grid submitted a request to the Public Service Commission to amend its long-term plan for operations to incorporate a potential new gas pipeline—the Northeast Supply Enhancement (NESE) pipeline. The pipeline had been rejected in 2019 due to concerns about its potential impact on water quality. 

The passage of the One Big Beautiful Bill Act will also have an impact on the state’s ability to meet its climate goals. The bill essentially phases out tax credits for clean energy projects like wind and solar. 

Ironically, two New York Republican lawmakers—Congressmen Nick LaLota and Mike Lawler—both signed letters to stop the phaseout of these tax credits. The rollbacks are likely to have a marked impact on jobs and the state’s economy.