PURSUANT TO THE PROVISIONS OF THE State Administrative Procedure Act, NOTICE is hereby given of the following action:
Action taken:
Addition of section 85-2.9 and amendment of sections 86.8 and 88.4 of Title 16 NYCRR.
Statutory authority:
Public Service Law, sections 4(1), 20(1) and 122(1)(f)
Subject:
Electric transmission facilities.
Purpose:
To clarify and streamline the rules so that applications for certificates to construct and operate electric transmission facilities in national interest electric transmission corridors may be acted upon within one year of their filing because they contain all the information necessary for prompt environmental and engineering review to occur, thus avoiding preemption by the Federal Energy Regulatory Commission.
Substance of final rule:
The Commission adopted amendments to 16 NYCRR Subpart 85-2 and Parts 86 and 88 by adding a new section (§ 85-2.9) and revising others (§§ 86.8 and 88.4) to clarify and streamline the rules so that applications for certificates to construct and operate electric transmission facilities in national interest electric transmission corridors may be acted upon within one year of their filing because they contain all the information necessary for prompt environmental and engineering review to occur, thus avoiding preemption by the Federal Energy Regulatory Commission.
Final rule as compared with last published rule:
Nonsubstantive changes were made in sections 85-2.9(f) and 88.4(a)(4).
Text of rule and any required statements and analyses may be obtained from:
Elaine Lynch, Public Service Commission, Bldg. 3, Empire State Plaza, Albany, NY 12223-1350, (518) 486-2660
Regulatory Impact Statement, Regulatory Flexibility Analysis, Rural Area Flexibility Analysis and Job Impact Statement
Changes to the last published rule do not necessitate revision to the previously published Regulatory Impact Statement, Regulatory Flexibility Analysis, Rural Area Flexibility Analysis or Job Impact Statement.
Assessment of Public Comment
Four Comments were submitted on behalf of nine organizations: The City of Utica (Utica); Hudson Transmission Partners, LLC (HTP); Niagara Mohawk Power Corporation d/b/a National Grid (National Grid); and, Central Hudson Gas & Electric Corporation, Consolidated Edison Company of New York, Inc., New York Power Authority, New York State Electric & Gas Corporation, Orange and Rockland Utilities, Inc., and Rochester Gas and Electric Corporation (Transmission Owners). Late comments were submitted by Assemblymen Ruben Diaz, Jr. and Paul D. Tonko and by Noble Environmental Power (NEP). We will exercise our discretion and consider the late-filed comments.
DISCUSSION
Additional Regulatory Changes
Utica asks for adoption of a pre-filing procedure that would require applicants for electric transmission lines in NIETC to consult with State Agencies, Elected Officials and affected property owners, providing them with detailed information concerning their proposed projects before filing their applications. Utica suggests that, at a minimum, 16 NYCRR § 85-2.8(c) should be amended to require applicants to provide a summary and description of all environmental studies required or recommended by the Staffs of the Department of Environmental Conservation (DEC) and Department of Public Service (DPS).
Utica requests that § 85-2.8(e) be revised to require applicants to explain why their proposed transmission lines are superior to generation or demand side management alternatives. Moreover, it suggests that § 86.4 be amended to require applicants to consider all feasible alternatives to their proposed transmission lines. In addition, Utica urges us to require applicants to follow the Department of Environmental Conservation's (DEC) Program Policy: “Assessing and Mitigating Visual Impacts” (GEP-00-2, July 31, 2000), demonstrate their technical competence and financial capability, discuss the health and safety impacts associated with their proposed projects, provide a comprehensive cost-benefit analysis, and describe the property rights applicants hold on their preferred and any alternative routes. Furthermore, Utica asks that we require that documents in certification proceedings be served by e-mail and that applicants host a Web site where all project documents will be posted.
Transmission Owners and National Grid urge us to revise proposed 16 NYCRR § 85-2.9 to make its provisions applicable to all Article VII applications for electric transmission facilities. Moreover, National Grid asks that we streamline our regulations as they apply to electric transmission lines undergoing refurbishment.
Assembly members Diaz and Tonko request that we require that applications contain information (including demographic data on communities in the path of proposed transmission lines and any identified alternative routes) sufficient for us to determine whether any issues of environmental justice are involved.
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Utica's request that we specify a pre-application procedure, as well as its suggested language concerning environmental impact studies, seeks relief beyond that authorized in PSL Article VII. That statute does not require pre-application consultation;1 nor does PSL § 122(1)(c) explicitly require that environmental impact studies be conducted.2
The changes Utica suggests regarding alternatives, health and safety, e-mail service and Web site hosting are unnecessary. The requirements of §§ 85-2.8(e) and 86.4, taken together, already accomplish Utica's goal of requiring applicants to describe reasonable alternatives as well as other alternatives they considered. According to PSL § 126(1)(f), all applicable State laws and regulations (including those on health and safety) are binding; moreover, our opinions regarding electric and magnetic fields are in force. Our regulation at 16 NYCRR § 3.5(g)(4) already specifies that parties to any proceeding who agree to be served by electric means may be so served. Our Web site provides electronic access to a significant number of documents in certification proceedings.
The changes proposed by Transmission Owners and National Grid, as well as the request by Utica that we require compliance with DEC's visual impact policy, would result in substantial revisions to our proposed regulations. Given the desirability of putting regulations into effect promptly, to promote timely and efficient consideration of NIETC-related applications, we will not take time now to consider proposing further major changes. Similarly, while we will not add language to our proposed regulations regarding environmental justice, we note that applicants bear the burden of proving we can make the statutory findings required by PSL § 126(1). Those findings include that the facility represents the minimum adverse environmental impact, given pertinent considerations, and that it will serve the public interest, convenience and necessity. Moreover, according to 16 NYCRR 85-2.5, we may require the provision of additional information deemed necessary or desirable.
NIETC Regulations
Utica expresses concern that the proposed regulations, in § 85-2.9(c), (d) and (e), reduce the information required to be provided by § 86.3. It claims that elimination of archeological site identification, as well as specific information concerning the relationship between the proposed facilities and near-by facilities, is not justified. Utica also asserts that the elimination of the requirement that aerial photographs of urban and urbanizing fringe areas be taken within six months of the date an application is filed will leave the parties and Commission unable to determine whether aerial photography reflect the current situation.
Utica is concerned that the proposed regulations, at § 85-2.9(f), eliminate the requirement that applications for transmission facilities whose costs will not be reflected in regulated utility rate base contain a detailed estimate of the total capital costs of proposed facilities. It contends that the parties, particularly those who have tax assessment and collection responsibilities, will be hampered in evaluating the potential tax revenues that would emanate from proposed projects.
Transmission Owners also opine that the proposed subdivision is overly broad. They claim that we should limit the cost reporting exemption to developers that certify that they will recover their costs only through contracts negotiated with their customers, and not through any other regulatory mechanism at either the State or Federal level. To assure adequate consideration of project cost data where the project switches from merchant to regulated status while the Article VII case is still pending, Transmission Owners believe the letter provided for in § 85-2.9 should state that, in the event of such a switch, the recognized date of receipt of the application will be reset to allow review and consideration of the cost data. They opine that the approvals of Article VII applications for merchant projects should be conditioned on the continuation of merchant status and should provide for the reopening of the record to consider project cost data in cases where the project changes from merchant to regulated status after the application is approved. Moreover, according to Transmission Owners, we should retain the right to require cost information on our own initiative.
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The elimination of the requirement that applications identify archaeologic sites near the routes of proposed transmission lines ensures that such sites will not be disturbed because their location would be readily ascertainable from the application. DPS Staff and others with legitimate reasons for possessing such information can readily obtain it. The elimination of the specific information identified as § 86.3(a)(2)(i)-(iv) from required maps ensures that such maps will not be cluttered. According to § 86.3(a), such information must be provided in explanatory text. The automatic waiver of the requirement that certain aerial photographs be provided no less than six months before an application is filed will not hinder the ability of parties to evaluate whether such photographs reflect current conditions because the source and date of such photography must still be specified.
The requirement that applicants provide a detailed estimate of the total capital costs of their proposed facilities was included in § 86.10 at a time when applicants were subject to our rate regulation. Now, however, some applicants do not propose that the cost of their facilities be included in utility rate base. In such instances, capital cost information is not necessary for our regulatory purposes.
We will adopt the suggestion of Transmission Owners that the application contain a certification that rate base treatment of project cost will not be proposed (if that is the case), as an improvement to the specificity to the regulations. It is not necessary, however, to change the proposed regulations to provide for the circumstance where a proposed facility switches from merchant to regulated status, since we have the ability to respond appropriately in that event. Moreover, § 85-2.5 enables us to seek any additional information (including cost information) deemed necessary or desirable.
Local Legal Provisions
HTP argues that we should not expand the requirement in § 86.8 to include resolutions and other legal provisions in addition to local laws and ordinances because such provisions are difficult to obtain, particularly if they have been promulgated improperly. National Grid claims that we should only require applicants to describe local ordinances that are impractical or impossible to meet. By contrast, Transmission Owners recognize that proposed § 86.8(a) simply conforms our regulations to the language of PSL § 126(1)(f).
Transmission Owners assert, however, that proposed § 86.8(b)(1)-(3) should not be adopted, contending that compliance with it may not be reasonably achievable in certain instances, and indeed, in some instances could establish a preference for an underground transmission facility. They allege that the proposed requirement that adverse impacts be mitigated “to the maximum extent practicable” is so broadly stated that it may be difficult or impossible to comply with. They opine that the proposed requirements appear to envision an inflexible and detailed justification process for every requested waiver, which may compel applicants to incur significant expenses. The requirements, argue Transmission Owners, also could be interpreted as compelling an applicant to make a different justification for each of similar waivers requested from multiple municipalities.
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As Transmission Owners note, the language proposed to be added to § 86.8(a) conforms our regulations more closely to the statute. PSL § 126(1)(f) refers specifically to applicable resolutions or other actions issued pursuant to local laws.
The concerns of Transmission owners that the requirements proposed in § 86.8(b) are too narrowly tailored are misplaced, because they merely provide guidance to applicants on how to provide justifications for refusing to apply a local legal requirement that we can find compelling. It is better for applicants to know how to meet their burden of proof before filing their applications, rather than waiting until late in a certification proceeding to find that they had not carried their burden. Furthermore, we expect all applicants, municipalities and other parties to act in good faith in their consideration of the applicability of local legal requirements.
Transmission Studies
According to HTP, the proposed requirement that a system reliability impact study (SRIS) approved by the transmission planning advisory subcommittee (TPAS) of the New York Independent System Operator (NYISO) be included in applications will produce unnecessary delay in the siting of new electric transmission lines. It therefore urges that 16 NYCRR § 88.4(a)(4) be amended to require that applications contain the Interconnection Feasibility Study that is required by the NYISO before the SRIS is conducted.
For similar reasons, NEP suggests that the regulations be amended to require applicants to provide Staff and interested parties copies of their SRIS when filed with TPAS and subsequently to file and serve on active parties the complete documentation regarding their SRIS. NEP alleges that, even without action by TPAS and approval by the NYISO Operating Committee, Staff and other interested parties will have information sufficient to start reviewing and analyzing the application. Transmission owners note that it is the Operating Committee, not TPAS, that approves SRIS, and § 88.4(a)(4) should be revised accordingly.
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Requiring applications to contain only Interconnection Feasibility Studies, as HTP requests, is inappropriate because such studies do not consider the “effects on stability of the interconnected system,” as we have required since 1970. Requiring that applications contain SRIS submitted to, but not yet considered by, TPAS might well necessitate the filing of supplemental information should consideration by TPAS require the SRIS to be changed. By contrast, requiring applications to contain a SRIS approved by the NYISO's Operating Committee might involve delay without any corresponding benefit. Given the roles of TPAS and the Operating Committee, we will clarify our regulations by requiring that applications contain the SRIS forwarded by TPAS for approval by the Operating Committee of the NYISO.
1 Our regulation at 16 NYCRR § 85-2.6 encourages such consultation.
2 PSL § 122(1)(f) provides that applications must contain such information as the Commission may by regulation require and 16 NYCRR Part 86 implements this statutory provision regarding appropriate environmental studies.
