VIEWPOINT: A Warning for New York State’s Energy Policy

On June 24, New York State’s electricity grid nearly blew a fuse. That day was extremely hot, and air conditioning was working overtime. The New York Independent System Operator (NYISO), the entity running New York’s electricity grid, declared the so-called “Energy Warning.” How bad was it? According to NYISO, an energy warning is issued when operating reserves drop below 1965 MW. An energy emergency and cutting off electricity for some consumers begins when reserves fall below 1310 MW. Rather than arguing over why it was so hot, a reasonable policy response for the near future is to make sure New York does not run out of energy. We should treat June 24 as a warning. In fact, the people running New York’s electricity grid (NYISO) have been sounding the alarm for quite a while. According to the latest 2025 Power Trends Report, New York is losing capacity to generate electricity and relying on hardware that in some cases is more than 50 years old. Your phone or laptop might be running on energy produced by equipment made during the Iranian Hostage Crisis or the Reagan presidency. Rather than rectifying the situation, New York’s energy and climate policies are making things worse. Ever since 2019 when Albany passed Climate Leadership Community Protection Act (CLCPA) declaring that New York will run on green electricity, companies have been reluctant to invest in new gas or oil power plants —which would feel too much like trying to open a brewery during Prohibition. Even if companies were willing to invest in New York, there would be no guarantee that Albany’s bureaucracy would grant the necessary permits for a new power plant. Despite the “out with the old, in with the new” vibe among the politicians, new renewable-energy sources such as wind and solar provide less than 6 percent of the state’s electricity. Hydropower produces a lot of energy Upstate, but New York still runs on hydrocarbons, mostly natural gas and oil — especially Downstate. Since New York passed CLCPA in 2019, the share of hydrocarbon fuels in electricity production has gone up, not down. One could argue that so far New York State’s energy policy has produced more virtue signaling than clean and affordable energy. It scared energy companies and investors and added a whole lot of uncertainty to New York’s economy. Making matters worse, Albany is behaving as if New York has an endless supply of cheap electricity — enough to heat homes, electrify cars, buses, and trucks, and still power massive future demands from microchip factories, [AI] data centers, and other energy-hungry industries it is trying to attract to New York. If things do not change, one day New York’s electricity system is going to blow a fuse. How can we resolve this issue? First, Albany should stop pushing electrification of heating and transportation at least until New York has a lot of cheap electricity. Second, there are many reasonable ways to reduce energy use and help the environment with current fuel sources and technologies. Weatherization of homes and buildings reduces energy use, greenhouse gas emissions, and energy bills. NYISO pitched a similar idea: modernizing existing energy production facilities and hydrocarbon power plants. Newer generators could provide reliable electricity and reduce emissions at reasonable cost and timeframe. To put it simply, replacing a 50-year-old generator with a new one is faster and easier than building a brand-new offshore wind farm. Third, and more broadly, New York should be open to all energy sources. Hochul’s recent announcement to add one gigawatt of nuclear power is a step in the right direction. However, it is far from a silver bullet, and new nuclear plans could become hobbled by Albany’s red tape and cost overruns. The most recent reactor in Georgia, Vogtle Unit 4, took seven years longer to build — and cost twice as much money — as planned. New York’s leaders are getting things backward — pushing their citizens to switch to electric home heat and electric vehicles when the grid is not ready to handle the additional load. If the future is to be all electric — or even mostly electric — making electricity cheap and plentiful must be the first step.      

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Zilvinas Silenas is president and CEO of the Empire Center for Public Policy, Inc., an independent, non-partisan, nonprofit think tank based in Albany. The organization says its mission is to make New York a better place to live and work by promoting public policy reforms grounded in free-market principles, personal responsibility, and the ideals of effective and accountable government. This article is drawn from the Empire Center’s blog, where it was first published on July 17.