What is a Renewable Portfolio Standard ("RPS")?
An RPS is a policy that seeks to increase the proportion of renewable electricity used by retail customers. As of July 2008, 25 states (inclusing New York) and the District of Columbia have implemented RPS policies. In addition, six states have adopted non-binding renewable energy goals. A map of all the state RPS goals is available in a PowerPoint Slide. A PointPoint viewer is available here.
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What sources qualify as renewables in the New York RPS program?
Generally, generation from photovoltaics, Landfill Gas, Wind, Biomass, Hydroelectric, Fuel Cells, Anaerobic Digestion, Tidal Energy, Wave Energy, Ocean Thermal, Ethanol, Methanol, and Biodiesel are eligible.
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Why not let the market decide electricity sources and costs? Why do we need an RPS policy?
Fossil fuel sources have been operating for decades and are generally lower cost sources of electricity. Today, in the face of increasing environmental health problems and global warming concerns, we are looking to new sources of energy. Renewables offer some of the most environmentally friendly, sustainable forms of energy available, but the industry has many challenges to overcome. Like any new technology, renewables struggle to compete financially with “traditional” energy sources like fossil fuels. Renewables are disadvantaged by high capital costs, and the market’s failure to capture non-monetary benefits such as reduced air emissions, economic development benefits, and the increased national security that comes from using indigenous resources.
Policies like New York State’s RPS will help the renewable energy industry to develop infrastructure, reach market potential, and overcome the steep learning curve typical of new industries. The RPS program will not be permanent. Ideally, utilities and consumers will choose renewables not because of a policy mandate, but because renewables offer sustainability, environmental favorability, and economic benefits.
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What is New York’s RPS percentage and year target?
New York’s RPS goal is to reach 25 percent by 2013. The state RPS has two different pieces. First, is the mandatory piece administered by NYSERDA, which comprises 24 percent of the total electricity goal. Within that mandatory category are two classes of eligible renewables - large scale generators that sell power to the wholesale grid such as a large wind farm (Main Tier) and smaller, behind the meter applications such as a PV system on a residence (Customer-Sited Tier). The final piece of the RPS puzzle is the voluntary component, targeted at one percent of total energy used in the state. As consumers increase their use of renewable resources on a voluntary basis, mandatory purchases by NYSERDA will decrease.
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How is the RPS funded and how does it impact my energy bill?
In order to implement the RPS Program, NYSERDA receives funds collected from ratepayers by the State’s major privately-owned electric utilities such as National Grid or New York State Electric and Gas. These funds, collected as part of a transparent “System Benefits/RPS Charge,” on the delivery portion of electricity bills help to pay for energy efficiency, low income assistance, and the RPS. The RPS portion of this charge was approximately $2.87 in 2007 for a typical residential customer and $30.24 for a typical non-residential customer. For a homeowner, this comes out to just under 25 cents per monthly billing cycle to support the RPS program.
If you receive your electricity from a municipal utility, the New York Power Authority or the Long Island Power Authority, you are exempt from the System Benefits/RPS Charge. However, the Public Service Commission has encouraged these electricity utilities to adopt similar programs.
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What makes the New York State RPS unique?
Rather than require each utility to supply a certain percentage of renewable electricity to their customers, New York’s program uses a “central procurement administrator” (NYSERDA) to ensure renewable electricity is supplied to those consumers who pay the System Benefits/RPS Charge. This approach is funded through a transparent fixed charge on consumer’s electricity delivery bills and has successfully spurred investments in renewable generation within the State.
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How much electricity in New York is generated from renewable energy sources today?
Around 21 percent comes from existing renewables – that means more than one in five households in NYS is already powered with clean, renewable electricity. Here’s the detailed breakdown:
- Hydropower – 19.2 percent
- Wind – 0.5 percent
- Biomass – 1.4 percent
For more information, visit the Department of Energy, Energy Information Administration’s profile for New York State.
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Does the Public Service Commission (PSC) have plans to reassess the New York State RPS anytime soon?
Yes, the PSC will review the RPS program in 2009. This process will include an assessment of the costs and benefits of the RPS, and a consideration to increase or change the 25% target.
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What actions are needed to ensure that we meet our 25 percent target?
In 2008, New York’s Renewable Energy Task Force made a series of recommendations of how to move New York towards greater renewable energy development and greater energy independence The task force recommended everything from increasing solar PV output to developing and supporting a “green collar” workforce. Read the 16 recommendations and full report online here.
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Will achieving the RPS create jobs and positive economic impacts in the state?
Yes, the RPS will create significant positive impacts including jobs and increased income to New Yorkers. For more information on the economic impacts of the RPS and renewable energy visit our Economic Benefits Resources section of this website.
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How do I know what my current electricity sources are?
As of April 2000, all utilities are required to tell their customers twice a year exactly how their electricity is being generated. Take a look at your energy bill, and you’ll see details about your electricity's sources– including the percentage of your total energy consumption that comes from renewables. This information, known technically as an “environmental disclosure label” should confirm that your contribution really does make a difference. (The most current label is available on the DPS Web site. We’re moving closer to our target of 25 percent renewables every day. And you, as a ratepayer, help us get there.
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