Submitted Testimony for the City Council Environmental Protection Committee Oversight Hearing re: Building Electrification
- Con Edison is committed to climate action and to leading the orderly transition to the clean energy future that our customers deserve and expect.
- We support changes to building codes that reduce the use of fossil fuels in buildings. Below, we propose some improvements to Intro. 2317-2021 that we believe will foster such a reduction.
- We also support Intro. 2091-2020 that would require the City of New York to study building electrification as part of its Long-Term Energy Plan.
Con Edison’s expanded Clean Energy Commitment sets forth our vision to facilitate a net zero economy by 2050. Our commitment builds upon our past successes as a climate leader and boldly expands on that work by providing actionable metrics and targets. It is supported by five pillars – including one tied to decarbonizing and reducing the use of fossil natural gas specifically - which we will discuss in more detail as an example of how we can support the intended goals of this legislation.
We will continue to seek support for our investments in advancing electrification and ensuring an inclusive and accessible clean energy transition leaves no one behind. To secure an orderly transition we believe that strategically deploying the gas system in support of wide-spread electrification can provide several benefits while meeting City and State emissions reduction goals.
Building the Grid of the Future
The first pillar of our commitment is to build a resilient 22nd century electric grid that delivers 100% clean energy by 2040. This is the keystone to decarbonizing New York City’s economy.
Our company’s efforts are focused on building and maintaining the grid of the future and we have managed many successful energy transitions throughout our long history. Con Edison does not anticipate any issues in meeting our customers’ energy needs as we transition to the clean energy future.
We are making significant investments in our energy infrastructure to meet our society’s net zero goals. These investments include the development of distributed energy resources like energy efficiency and energy storage, proposed “clean energy hubs” to facilitate delivery of 6,000 MWs of offshore wind to New York City, new substations, local transmission projects (e.g., Reliable Clean City projects), and peak demand reduction strategies.
Our electric grid is well-poised to support the transition to heating electrification. Because our system is built to serve our customers’ energy use during the hottest summer afternoon (about 13,000 MW) and energy use is currently lower in the winter (about 8,000 MW), many parts of our system can easily support the growth of heating electrification for the coming years. We are already looking ahead to future winter peak demands driven by heating electrification as well as higher summer peak demands driven by electric vehicle adoption, electric hot water heaters, dryers and stoves, and economic growth, and are planning system investments that will support that growth. We are also preparing for more extreme weather – and are acting today to begin investing more than $2 billion over the next 10 years to increase resiliency and reduce future peak demand through energy efficiency, battery storage, and managed electric vehicle charging, among others. We are also investing today in the tools, technologies, and processes that will allow us to anticipate and manage future demands so that we are able to continue to offer the safe and reliable electric service that New Yorkers deserve and expect.
Reimagining the Gas System
Our Clean Energy Commitment sets forth a vision for a reimagined gas system. We will decarbonize and reduce the utilization of fossil natural gas and explore new ways to use our existing, and resilient gas infrastructure to serve our customers’ future needs. We are working with customers to consider cleaner alternatives to natural gas for their heating and cooking needs and exploring a low-carbon fuels portfolio to serve hard-to-electrify customers. Notably, the recent Pathways to Carbon-Neutral NYC report jointly published with the City of New York, identified role for 24-38 tBtu of low-carbon fuels by 2050. To that end, the final text of this legislation should not preclude the use of such low-carbon fuels, which can be a part of an “all of the above strategy” we need during this transition.
Maintaining the gas system provides various benefits, such as lowering costs of the overall clean energy transition while also providing resiliency to the entire energy system and individual buildings. Resiliency benefits include the following:
- Enabling dispatchable low carbon generation when there is no or limited wind and solar output due to weather conditions
- Lowering peak electric demand, which reduces stress on the electrical system on peak heating days
- Providing a secondary source of heating for buildings with dual heating configurations
- Emergency backup power generation for critical functions (e.g., hospitals, elevators) with a longer available run time than on-site battery storage.
Con Edison has a responsibility to provide service to millions of people who depend on our gas system every day. We are legally obligated to serve our customers, right up until there is only one customer on that system. To that end, we have a few suggestions to improve the legislation itself as well as issues to contemplate regarding implementation:
- Clarity for power generating facilities
Our understanding of the legislation is that it is intended for individual buildings not an industrial facility primarily used for the generation of electric power or steam. This legislation should make clear that it does not include buildings under the exclusive control and use of electric, steam, and gas utilities regulated by the New York State Public Service Commission that are used exclusively for the purpose of generating, storing, transmitting, regulating, and delivering these energy commodities. Con Edison operates steam generating plants, fueled by natural gas -- some of which produce electricity. The Con Edison steam system – the largest district steam system in the world - provides significant environmental benefits by reducing the need for on-site boilers and chimneys at customer premises and aligns with the spirit of this legislation by avoiding approximately 1 million tons of building CO2 emissions per year through the use of cogeneration. As part of our Clean Energy Commitment, we are aiming for net zero emissions by 2040, focusing on decarbonizing our steam system and other company operations.
- Clarity regarding who is covered by the legislation
The bill as currently written is unclear who is covered by the mandate. Also, the provision of exceptions may be problematic and does not provide the clarity that utilities, business owners, and customers need. Exceptions to the bill that maintains low volume customers on the system make planning and operating the gas system difficult and costly for those customers that are left on the system. It also makes non-pipe alternatives more difficult to identify and execute. We strongly encourage that the final law is simple, understandable and does not leave the process left to future rulemaking and an advisory committee.
- Coordination with stakeholders is key
As our society continues to electrify, we need to assess various existing policy and regulations that will support its success. We want to collaborate with interested stakeholders, including local municipalities and the real estate community, to identify key changes needed to foster a more “electrification ready” environment so that infrastructure investments, planning, land use, building code, and other policies are in place to ensure a seamless energy transition. Intro 2091-2020 may help identify some of these changes needed and we stand ready to support the City’s study should the legislation be passed.
- Ensure equitable access to the clean energy transition
Related to the above but important to spell out separately, the clean energy transition must include disadvantaged communities. We are committed to increasing access to the benefits of clean energy in underserved communities and support the Climate Leadership and Community Protection Act’s goals of providing benefits of investments to disadvantaged communities. We are currently working with housing agencies and other stakeholders to develop protections for low- and moderate-income renters so that heating electrification does not disproportionately increase their housing and energy costs. The company supports the development of new regulatory and policy measures that will help enable electrification in low- to moderate-income buildings. Continued availability of customer incentives and new strategies, such as an electrical “make ready” program for distributed energy expansion, will be critical to offset the costs for customers to transition to electrification.
We look forward to working with the Council and other stakeholders, please do not hesitate to reach out to us.