Utility Ownership of New Renewables in New York State
Prepared at the request of Con Edison
In a new white paper prepared for Con Edison, Brattle experts examine the potential impacts on electric customers as New York works to add large amounts of renewable resources in the next decade to achieve the state’s energy and climate goals. They compare the pros and cons of supplementing the state’s current private ownership model for renewable energy with utility ownership of resources.
The authors find that utility ownership of renewables could accelerate the build-out of renewable resources in New York by allowing the state to access capital for renewables from utility investors; this could create benefits for customers under certain circumstances.
Findings from the report include:
- The utility ownership option could provide up to 14% customer cost savings relative to the private ownership option, particularly in scenarios with high wholesale power prices and high cost of capital for private owners.
- Allowing regulated utilities to own new renewables would offer several potential other benefits for electricity customers, including a demonstrated history of effective project execution and risk management.
- Utility ownership does come with potential downsides, however, including likely shifting many risks currently borne by private owners to electricity customers with respect to cost overruns.
The white paper, “Utility Ownership of New Renewables in New York State: Potential Benefits and Risks for Customers,” is available below.
