The Power Authority gives subsidies in the forms of discounted power to municipalities, industrial customers, and through various means to residential customers. Until recently, power leftover after sales to industrial customers went to National Grid, a private entity, which then passed on some of the savings to residential customers. Now the Power Authority keeps that leftover power that they can sell at normal rates elsewhere

Berardi, Chris

English

The Power Authority gives subsidies in the forms of discounted power to municipalities, industrial customers, and through various means to residential customers. Until recently, power leftover after sales to industrial customers went to National Grid, a private entity, which then passed on some of the savings to residential customers. Now the Power Authority keeps that leftover power that they can sell at normal rates elsewhere.EconomicDevelopment__The_New_York_Power_Authority.pdf: 11 downloads, before Oct. 1, 2020

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The New York Power Authority

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10-3-2008 
The New York Power Authority 
Chris Berardi 
University at Buffalo School of Law 
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The New York Power Authority 
Abstract 
The Power Authority gives subsidies in the forms of discounted power to municipalities, industrial 
customers, and through various means to residential customers. Until recently, power leftover after sales 
to industrial customers went to National Grid, a private entity, which then passed on some of the savings 
to residential customers. Now the Power Authority keeps that leftover power that they can sell at normal 
rates elsewhere. 
Keywords 
Buffalo, Economic Development, Policies and Programs, Fact Sheet, PPG, PDF 
This article is available at DigitalCommons@ILR: https://digitalcommons.ilr.cornell.edu/buffalocommons/60 
     
 
 
 
 
 
FACT SHEET                                                                      October 3, 2008 
The New York Power Authority 
By Chris Berardi 
University at Buffalo Law Student 
 
 
1. What is the agency’s website and contact information? 
The Power Authority’s website is located at http://www.nypa.gov/. 1  To reach 
departments or individuals at the Power Authority, call (941) 681-6200.  The Power 
Authority also welcomes suggestions, comments, and technical feedback at the email 
address info@nypa.gov and at:  
Communications and Marketing Services/Web   
New York Power Authority   
Mailroom - 10-B  123  
Main Street, White Plains, NY 10601-3170 
2
 
 
2. What geographic area does it serve? 
The Power Authority serves the state of New York, with 18 power-generating 
facilities across the state. 
3
  However, the Niagara Falls Hydro plant produces a lion’s 
share of the energy. 1950’s legislation still in effect earmarks one-third of the Niagara 
Power Project’s energy generating capacity to a region within 30 miles of the plant. 4  
However, much of that earmarked power is sold at higher prices outside the 30-mile 
radius.  For more, see Q. 17. 
 
3. Who runs the agency? 
A board of trustees and a chairman run the Power Authority.  On a day-to-day level, 
the Power Authority also has an extensive executive management team. 
5
 
 
4. How are the directors appointed? 
The Directors of the Power Authority are the board of trustees and the chairman of 
the board of trustees.  The governor has a committee who searches for and vets 
potential candidates.  After the governor nominates a candidate for trustee-ship, the 
selection is sent to the state legislature for affirmation proceedings.  The energy 
committees in the state legislature then engage in their own vetting process and either 
confirm or deny the governor’s selections.  However, this system is largely a 
formality at the moment, with the governor’s choices generally being acceptable to 
the legislature. 
6
   
 
5. How is the agency staffed? 
The Power Authority has over 1600 employees state-wide.  Because of the nature of 
running what is essentially a state-controlled utility, the Power Authority employs a 
large cross section of engineers, analysts, accountants, managers, and more.
7
 
 
6. What is the annual budget? 
The Power Authority’s annual budget for 2008 is $140.4 million.  This is forecasted 
to be $216.4 million in 2009.  The Power Authority’s largest expenses are purchased 
power, fuel oil and gas, and wheeling expenses.  Their largest sources of income are 
customer-generated revenues, which make up 66% of the Power Authority’s total 
revenues.  
8
 
 
7. How is the budget funded? 
The budget for the Power Authority is mostly funded through customer revenues, be 
they industrial, municipal, or residential.  Another large segment, nearly 30%, is 
gained from the NYISO Market, which manages bulk energy grids and wholesale 
energy.  They take an amount of Power Authority energy and manage and distribute it 
essentially as a subsidiary. 
9
  The Power Authority does not use tax money or state 
credit, but instead sells bonds to raise additional funds.   
 
8. How is the budget spent? 
Much of the spending of the Power Authority goes into purchased fuel and power.  
These serve largely as operation/maintenance expenses.  The Power Authority also 
spends a great deal on the transmission of electricity, as they do not control the state-
wide energy transmission infra-structure.   
 
9. What type of subsidies does the agency give? 
The Power Authority gives subsidies in the forms of discounted power to 
municipalities, industrial customers, and through various means to residential 
customers. 
10
  Until recently, power leftover after sales to industrial customers went to 
National Grid, a private entity, which then passed on some of the savings to 
residential customers.  Now the Power Authority keeps that leftover power that they 
can sell at normal rates elsewhere.   
 
The Power Authority is statutorily responsible for two large state energy 
subsidization programs:  
 The Energy Cost Savings Benefit program subsidizes electric bills of over 
100 companies statewide, three of which are in the Erie/Niagara region.   
 The Power For Jobs program costs the Power Authority $505 million and 
operates on a ratio that allows for the distribution of low-cost energy if the 
target company has enough employees that fit within certain guidelines 
(unfortunately, the criteria for deciding which jobs qualify for this 
program tend to be geared towards older-style industrially focused 
businesses).  In the end, the Power Authority allocates 12% of its subsidies 
based on Power For Jobs in the Erie/Niagara region.  
11
 
 
10. What other services does the agency provide? 
The Power Authority also provides energy-efficiency programs to public entities. The 
Power Authority’s energy-efficiency programs have resulted in 1500 projects at over 
2,650 county and state government facilities, public schools, and state universities in 
total.  These projects have reduced greenhouse gas emissions by over 830,000 tons, 
and reduce oil consumption by 2 million barrels per year.  This saves taxpayers over 
$100 million.  Another Power Authority project is their refrigerator replacement 
initiative, which has met with great success in New York City and in 2002 began 
expanding into Buffalo.  More than 1,600 refrigerators of Buffalo Municipal Housing 
Authority tenants were traded for newer energy-efficient models that help save nearly 
300 kilowatt-hours a year and promote a corresponding drop in greenhouse gases.   
 
11. How does the agency measure its success? 
“The [Power Authority] measures its success in terms of its ability to supply cheap 
power in general, and to me, more specifically, to provide cheap power to spur 
economic development”12—Louis Ciminelli, former Chairman of the Power 
Authority.  The Power Authority also wants to provide this energy in a clean and 
energy-efficient manner while continuing an extensive commitment to safety.  
13
 
 
12. How does the agency report to the public? 
The Power Authority has an annual report that it publishes online and have available 
in paper form on request. 
14
 Additionally, it has an Office of the Secretary that serves 
as a public liaison.  The Office is very helpful in provided requested information. The 
Power Authority is subject to the Freedom of Information Act, and has a separate 
office to deal with FOIL requests.   
 
13. What policy issues does the agency’s work raise? 
 One policy issue is the ability of NYISO (the entity that manages the state 
power grid and gets energy from the Power Authority) to properly distribute, 
transport, and allocate energy.  This is especially important in the face of 
energy traders’ recent circumventing of traditionally lower cost energy 
transportation routes, thereby increasing price for energy consumers in the 
state.  This happens because traditional avenues are deprived of fees they 
would normally be due for energy transmission. 
15
   
 Another policy issue is the relationship in the state energy industry between 
private entities like National Grid and public utilities like the Power 
Authority.  The debate between whether energy utilities should be state 
controlled or privately controlled has been raging since 1907 but remains 
prevalent today.  These arguments are further influenced these days by laws, 
contracts, and licensing agreements that prevent the public utilities from 
usurping market share and activity from co-existing private entities. 
16
   
 
14.   What is the difference between NYSERDA and NYPA? 
Similar to NYPA, NYSERDA is a state corporation.  However, NYSERDA focuses 
more on growing energy efficiency technology for widespread use to improve the 
State’s energy, economic, and environmental wellbeing.  The two agencies 
sometimes have overlapping or competing projects, such as refrigeration replacement 
initiatives.  
17
 
 
15.  What companies receive benefits from NYPA, and how? 
Some of the companies that receive power subsidies from NYPA were former 
customers of the failed private power plant in Niagara Falls.  Others are primarily 
manufacturing or chemical companies like Delphi, Ford, General Motors, Du Pont, 
Moog, Goodyear-Dunlop, General Mills, Praxair, American Axle, Outokumpu 
American Brass, Olin, Occidental and the International Steel Group.   Many of these 
subsidies are awarded by criteria based on jobs and expansion power: Delphi gets 
$7.8 million which equates to $1,340 per job and General Motors gets $7.1 million at 
a rate of $1,914 per job.
18
  
 
However, due to license agreements with the private power corporations, NYPA can 
really only offer cheap baseload power to companies like Olin, Occidental, and 
International Steel--who were all customers of private plants that were closed to make 
way for the NYPA plant in Niagara Falls.  This means that former customers of the 
private power plants are not afforded cheap power as they may need it.
19
  The 
licensing agreement, along with industrially geared “power for jobs” criteria leads to 
relatively few companies receiving an inordinate share of the current power being 
allocated to Western New York.  This is because the “power for jobs” criteria are 
outdated in the sense that it is geared towards the old-style, heavy manufacturing style 
of business that once ruled Western New York.  It does not base distributed power on 
need, but rather job levels that are significantly less applicable in today’s economy.  
 
16. Who benefits from NYPA’s work?   
The Power Authority, being an employer of 1600 people, benefits itself in its work.  
Additionally, companies that qualify under the rather strict state standards for cheap 
power benefit from the Power Authority’s subsidies.  A limited amount of cheap 
power reaches residential customers, who benefit from decreased power costs. 
20
  The 
public itself also benefits from the work of the Power Authority by its safe 
maintenance of power generation within the state.  The public also benefits by the 
energy-efficiency programs that reduce greenhouse gases and help our environment, 
thereby enhancing that public good.  
21
 
 
17. Who is harmed or left out by this agency’s work? 
Some existing businesses get left out of the subsidized power system because they do 
not qualify under the dictates of the state legislature and Governor.  These businesses 
largely are forced to operate paying more for power than their competitors elsewhere. 
22
  The state rules and regulations concerning the Power Authority can be accessed 
here: http://www.nypa.gov/Trustees/NYPARegs.htm. 
 
18. What sort of input does the public have on the agency’s decisions? 
The public is welcome to attend/speak at re-licensing hearings between the Power 
Authority and private energy utilities. 
23
 The Power Authority would welcome public 
opinion during these hearings to expand awareness that it could be doing more than it 
is permitted under state regulations and energy licenses currently.  The feeling is that 
the more the public is aware of how NYPA’s hands are tied, the more outcry there 
might be, and the better chance that NYPA’s resources could be distributed on a more 
local scale.  
24
  
 
19. Can I attend the agency’s meetings? 
Yes, the agency holds open meetings.  
25
 
 
20. How do I learn more about this agency? 
The best way to learn more about the Power Authority is to view their website: 
http://www.nypa.gov/ or call the Office of the Secretary at (914) 287-3092  
 
21. What community groups are interested or involved in this agency’s 
work? 
 Business groups like the Buffalo-Niagara Partnership/Enterprise 
 A statewide advocacy group for cheap power for low-income consumers 
called the Public Utility Law Project, whose website is located at 
http://www.pulp.tc/.   
 
 
 
 
 
                                               
1
 http://www.nypa.gov/ (9-17-08) 
2
 http://www.nypa.gov/about/contact.htm (9-17-08) 
3
 http://www.nypa.gov/ (9-17-08) 
4
 http://www.buffalonews.com/powerfailure/story/365785.html (9-17-08) 
5
 http://www.nypa.gov/about/officers/officers.htm (9-17-08) 
6
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
7
 http://www.nypa.gov/Careers/HTMLS/mihwan.html (9-17-08) 
8
 
http://www.nypa.gov/financial/budgetreports/20082011appoved/approved20082011budg
etandfinancialplan.htm#NYPA%92s_Four-Year_Projected_Cash_Budgets (9-17-08) 
9
 
http://www.nypa.gov/financial/budgetreports/20082011appoved/approved20082011budg
etandfinancialplan.htm#NYPA%92s_Four-Year_Projected_Cash_Budgets (9-17-08) 
10
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
11
 http://www.buffalonews.com/powerfailure/story/365785.html (9-17-08) 
12
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
13
 http://www.nypa.gov/about/mission.htm (9-17-08) 
14
 Phone Call to NYPA (9-15-08) 
15
 http://nl.newsbank.com/nl-
search/we/Archives?p_action=doc&p_docid=122D7D0AC14D9A58&p_docnum=9 (9-
17-08) 
                                                                                                                                            
16
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
17
 http://www.nyserda.org/About/default.asp (9-24-08) 
18
 http://www.buffalonews.com/powerfailure/story/249910.html (9-24-08) 
19
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
20
 http://www.nypa.gov/presscenter.htm (9-17-08) 
21
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
22
 http://www.buffalonews.com/powerfailure/story/365785.html (9-17-08) 
23
 Phone Call to NYPA (9-15-08) 
24
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
25
 Interview with Louis P. Ciminelli, former Chairman of the Power Authority (9-15-08) 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Partnership for the Public Good 
237 Main St., Suite 1200, Buffalo NY 14203 
www.ppgbuffalo.org 
 
 


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