MI, IPPNY Seek To Avoid "Double Payments" To Some Resources Under NY Carbon Pricing
Multiple Intervenors and the Independent Power Producers of New York, Inc. filed a petition at the New York PSC, to "protect New York consumers, and the State’s competitive wholesale electricity markets, from potential double-payments for the same attribute," noting the PSC's various current (and potential) renewable energy obligations placed on LSEs, and proposals for carbon pricing at NYISO
MI and IPPNY noted that, "Based on a recently-issued proposal under consideration in the IPPTF (hereinafter, the 'Straw Proposal'): (a) the cost of carbon emissions would be incorporated into NYISO-administered wholesale energy markets using a carbon price in dollars per ton of CO2 emissions; and (b) suppliers would embed those additional carbon charges in their energy offers and thereby incorporate the carbon price into the commitment, dispatch and price formation through the NYISO’s existing processes. The costs associated with possibly integrating carbon pricing into NYISO-administered wholesale energy markets would be borne indirectly (i.e., via commodity charges from LSEs) by retail consumers."
"Under the Straw Proposal, wholesale energy prices would be expected to rise to reflect the effective carbon charge whenever a carbon-emitting facility sets the LBMP," MI and IPPNY noted
"Within the IPPTF, a concern has been advanced by many stakeholders that the implementation of carbon pricing would or could create double-payments to ... non-emitting suppliers who are being or would be compensated for their non-carbon-emitting attribute pursuant to these Commission proceedings (i.e., involving the CES, VDER, and OSW) and again, for a second time, under a possible carbon pricing regime. Ultimately, New York consumers would bear the cost of such double-payments," MI and IPPNY said
"This Petition advocates no position as to whether carbon pricing should be implemented by the NYISO and incorporated into the State’s competitive wholesale electricity markets. The Petition also does not seek relief with respect to existing CES or RPS REC contracts. Rather, this Petition seeks relief from the Commission, on an expedited basis, to prospectively protect New York consumers, and the State’s competitive wholesale electricity markets, from potential double-payments related to retail and wholesale compensation for the same or similar non-emitting attribute in the event that carbon pricing is implemented," MI and IPPNY said
"It is incumbent upon the Commission to identify and mitigate such potential overlapping recovery to safeguard consumers and the wholesale markets. Specifically, the Commission must take action to protect New York consumers, and the relative competitiveness of the State’s wholesale electricity markets, by, inter alia, eliminating, or at least minimizing, the possibility of double-payments in the event that carbon pricing is implemented by the NYISO sometime in the future," MI and IPPNY said