Electricity shortages have stifled new housing developments from Henrietta to Brighton, and now Canandaigua.
“People need to know that this is a dire issue," said Canandaigua town Supervisor Jared Simpson. “This will put a halt to our ability to grow.”
The latest casualty is a 600-unit development on the north side of the city that Simpson said has been put on hold because of inadequate power supply.
Capacity issues and aging infrastructure are pervasive across upstate — complicating New York’s push to build more affordable housing and underscoring why Albany is now re-evaluating its commitment to achieving a zero-emission electrical grid by 2040.
Top executives for New York State Electric and Gas (NYSEG) and Rochester Gas and Electric (RG&E) laid out in stark detail recently how ill equipped the utilities are to absorb what they described as the “unforeseen and unprecedented demand” being forecasted for the region.
“Thirteen hundred breakers in poor, very poor condition. Twenty thousand poles requiring replacement,” said Patricia Nilsen, chief executive for NYSEG and RG&E.
And dozens of transformers and circuits at 90% capacity, officials said.
“This is actively hurting our customers reliability,” Nilsen said. “It's not to say that we're not working on it. It's just that there's so much of it that is aging out.”
$16 billion in electrical upgrades
Nilsen’s comments came during an online meeting with county leaders last week that was hosted by the New York State Association of Counties.
The purpose of the meeting was to discuss industry challenges as the utilities seek a double-digit, multi-year rate increase. When the moderator opened the meeting to questions, the response from Simpson and other government leaders was less than understanding.
The utility leaders faced question after question about why they didn’t act sooner, given that trends in growth and electrification have been evident for years. One of the submitted questions read simply: “It's 2025. The company should have transitioned into the 21st Century 25 years ago.”
The utilities serve a combined 1.3 million electric customers and 600,000 natural gas customers across 44 counties encompassing Western New York, the Finger Lakes, the North Country and the Southern Tier. In filings submitted to the state Department of Public Service last week, they sought rate hikes that would increase average residential bills by $52 a month for RG&E customers, and $67 for NYSEG customers.
Gov. Kathy Hochul has criticized the request as “unacceptably high.”
The utilities, though, argue the rate increase is necessary to accomplish $16 billion in electrical upgrades over the next five years — including in Canandaigua, where the supply problem extends across the city’s entire west side. The distribution system in that area has adequate capacity, officials said, but the transmission lines — or electric grid — feeding into the community does not.
It’s like having a functional city street network fed by a one-lane highway jammed with traffic.
These are the kind of issues that Nilsen said are key to the rate filing. An extensive review process now begins that is expected to last at least 11 months. RG&E’s last rate case took 16 months to reach a settlement.
Nilsen and her team want a five-year rate agreement, making for less dramatic annual increases and aligning with the extensive work plan that will require that amount of time to complete.
“I just want to be clear that we've made a lot of investments,” Nilsen said, including what she said was $1 billion in capital investment last year. “This is not something that's exclusive to us, and is probably a similar conversation that you'd be hearing from just about any utility, particularly in the northeast.”
'Not giving up’
New Yorkers along with New Englanders pay the highest electricity rates in the continental United States, according to a recent report by the non-partisan, nonprofit Empire Center think tank. And for all the talk of clean energy, the report found that the Empire State’s aging grid is increasingly dependent on fossil fuel plants for electricity production.
Senate Republicans wrote to Gov. Hochul last week warning that the push for electrification “risks overloading the grid at a time when demand is growing and reliable energy supply is increasingly constrained.”
“These realities point to a transition plan that is not only unsustainable,” the letter reads, “but one that risks creating an economic and energy disaster.”
The Democratic governor has said New York would be slowing down the transition. A phased-in ban on natural gas hookups to new buildings is set to start next year.
“I'm not giving up on the aspirations of ensuring that we meet these goals,” Gov. Kathy Hochul said Friday. “It just will not be on the immediate timeframe because of factors outside our control.”
Those factors also include inflation and supply chain issues, she said. And tariffs. Hochul laid blame on President Donald Trump, who she said is openly “hostile” to renewable energy sources.
“All the incentives to invest in those industries has dissipated,” Hochul said, as the Trump administration and Congressional Republicans have gutted clean energy tax credits. “I mean, I'm just dealing in reality here.”
‘We’re getting hit in the face’
Growth in electricity demand across NYSEG and RG&E’s service area had been modest for decades and offset by increased energy efficiency. That made it difficult to justify major capacity projects, officials said.
“We can’t follow the Field of Dreams analogy of, ‘If you build it, they will come,’” Nilsen said. “We have to wait till they're here, and then we can build it.”
The upswing in demand since the pandemic, though, has been dramatic. There is increased demand from data centers, and growth in the manufacturing sector, officials said. But electrification is a big part of the boom.
“What we're getting hit in the face with is (that with) a lot of this electrification, a lot of these electrification initiatives, the load required to power these facilities is ... orders of magnitude greater than traditional housing,” said Christopher Malone, senior director of integrated system planning for NYSEG and RG&E.
Consider: A bank of electric vehicle fast chargers has the equivalent draw of 150 to 200 traditional houses.
“So what we're trying to balance is all of the other system needs that we have,” Malone said, “in terms of trying to address aging infrastructure, system reliability, while also working to incorporate new housing load into the grid, as well as this electrification, which is taking off quite substantially.”
Earlier this year, the state stepped in with a $4.7 million grant to help RG&E upgrade a substation and relieve an electricity shortage in Henrietta that officials said was holding up housing and commercial development.
“The problem is, we have 300 Henriettas across our service territory,” said Tim Ellis, vice president of state and government relations at RG&E.
In Canandaigua and Ontario County, the problems go beyond the 600-unit Uptown Landing. Simpson, who also serves as chairman of the Ontario County Board of Supervisors, estimates another 900 housing units in the pipeline could be at risk.
“I get really frustrated when I hear that nobody could have anticipated this growth in Ontario, in this part of Ontario County, because ... for the last decade or more, Genesee Regional Planning Council has talked about the boom in growth in this area,” Simpson said of the Route 332 and Route 96 corridor.
“They had to have known,” the Republican leader continued, “but they just didn't plan for it, which is extremely, extremely frustrating.”
Faced with a lack of power for Uptown Landing, Simpson said, developers were told they’d need to front a multi-million upgrade, and were encouraged in meetings with RG&E and state officials to scratch electrification from their plans.
“The solution that they were given was take out the (electric vehicle) chargers, put in gas heat, put in gas stoves, put in gas dryers,” Simpson said.
Developer Jeff Cook did not return messages seeking comment. A spokesperson for RG&E said negotiations are ongoing to find a solution and no costs or other details have been decided.
Includes reporting by Jimmy Vielkind with the New York Public News Network.
