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LIPA Moves Ahead to Diversify its Energy Resources and Manage Costs to Meet Long Island’s Energy Needs

LongIsland.com

The staff of the Long Island Power Authority (LIPA) today presented the LIPA Board of Trustees with an update of steps being taken to implement the 2010-2020 electric resource plan approved by the LIPA Board ...

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Uniondale, NY – July 25th, 2013  The staff of the Long Island Power Authority (LIPA) today presented the LIPA Board of Trustees with an update of steps being taken to implement the 2010-2020 electric resource plan approved by the LIPA Board in February 2010. The updated electric resource plan is to ensure that LIPA is able to continue to provide safe and adequate long-term energy supply for Long Island in keeping with reliability standards set by the New York State Independent System Operator and the New York State Reliability Council. LIPA is implementing the plan through a multi-pronged approach, including a competitive procurement of base-load electric generation providing the back-bone of the system, continued significant investment in energy efficiency and demand response resources and more renewable energy resources to complement and add to LIPA’s very successful and award-winning renewable energy programs.
 
“Continuing down the path of this comprehensive energy plan will ensure that we will be able to meet our future energy needs using a diverse mix of energy resources and efficiency measures that are reliable, economic, and environmentally friendly,” said LIPA Chief Operating Officer John D. McMahon. “While LIPA continues to plan for its energy future by aggressively investing in renewable energy and energy efficiency, the reality is that in order to meet our reliability obligations set forth by the state there is still a need for fossil fuel plants on Long Island for the foreseeable future.”
 
In October 2012, LIPA staff recommended the designation of two finalists in a competitive procurement seeking up to 2,500 megawatts (MW) of supply that attracted competitive bids from over 45 companies. The LIPA Board of Trustees authorized staff to negotiate with both finalists and to select the project that provides the best overall value to LIPA.
 
Today LIPA staff announced that it had selected Caithness Long Island II, LLC (Caithness) as the preferred project sponsor with whom staff is moving forward to finalize a power purchase agreement for consideration by the LIPA Board in the fourth quarter, 2014. A full environmental review of the project under the State Environmental Quality Review Act must be completed by Caithness, prior to authorizing the execution of any resulting Power Purchase Agreement (PPA). The PPA to be considered separately by the LIPA Trustees when completed would be subject to review and approval of the New York State Attorney General and the Office of the New York State Comptroller.
 
The long range plan adopted by the LIPA Trustees is thoroughly balanced, to the point where renewable energy projects and energy efficiency, either underway or planned, are expected to total over 1,000 MW by 2022, making non-fossil energy a material component of the Long Island electric resource profile. LIPA is already among the state leaders in energy efficiency and renewable energy.
 
As part of its long-term energy plan, LIPA has already initiated the process to bring online 100 MW of solar energy through its Clean Solar Initiative-II (CSI-II) program. The CSI-II program builds off the success of its first Clean Solar Initiative feed-in tariff and provides significant enhancements to the existing program such as targeting a portion of the 100 MW on the South Fork on the East End in order to reduce load on constrained areas. Consistent with its utility-scale, customer-sided, and first feed-in tariff solar programs, all 100 MW will be generated on Long Island, further advancing the development of solar energy and the growth of clean energy jobs. LIPA’s Efficiency Long Island program and significant solar and other renewable projects are planned make up the remainder of LIPA’s substantial non-fossil-fired electric resource plans. LIPA’s solar programs offer a mix of residential-based solar panels, solar farms and commercial applications, incentivized by a mix of rebates, feed-in tariffs, and large scale competitively bid projects.
 
As part of LIPA’s strategy to meet Long Island’s future electricity needs, the Authority is also considering replacing inefficient peaking units, and continuing its repowering study. In addition, LIPA is exploring other actions and investments, including emerging technologies and increasingly promising distributed generation that might be necessary and or feasible to reliably and economically meet future load.
 
“The process leading up to today’s announcement has been robust, reflecting LIPA’s deep experience in managing competitive procurements and including consideration of a wide variety of innovative and thoughtful approaches to addressing future capacity needs,” McMahon added.
 
LIPA, a non-profit municipal electric provider, owns the retail electric Transmission and Distribution System on Long Island and provides electric service to more than 1.1 million customers in Nassau and Suffolk counties and the Rockaway Peninsula in Queens. LIPA is the 2nd largest municipal electric utility in the nation in terms of electric revenues, 3rd largest in terms of customers served and the 7th largest in terms of electricity delivered. In 2011, LIPA outperformed all other overhead electric utilities in New York State for frequency and duration of service interruptions. LIPA does not provide natural gas service or own any on-island generating assets. More information about LIPA can be found online at http://www.lipower.org.