[Theme song] [Theme song] Welcome to this week's edition of New York Now.

I'm Shantel Destra.

New Yorkers are set to receive energy rebate checks as early as next week.

The rebate checks go up to about $200 per check, and are projected to help about 8 million households across the state.

Per Governor Kathy Hochul's office the checks are intended to assist New Yorkers with the rising cost of living amid federal and geopolitical events impacting gas prices.

The checks were part of this year's enacted state budget and will cost the state about $1 billion.

To understand the journey to getting the rebate checks approved during the legislative session this year and the overall tone in the state right now regarding utility rates, we are joined in the studio by Samuel King of WXXI and the New York Public News Network.

Here's that conversation.

Thank you so much for joining us back on the show, Samuel.

Yeah.

Thanks, Shantel.

Nice to be here.

Of course.

Now, this week, Governor Kathy Hochul announced that New Yorkers are set to receive utility rebate checks.

Of course, this was a measure that was included in this year's enacted state budget.

So can you walk us through the process that legislative leaders had in the governor in terms of budget negotiations and getting this over the finish line?

Well, this started with the Assembly one House proposal.

They floated this as part of their budget deal.

The state Senate wasn't on board at first.

They were sort of looking at more long range things, but they later came on board.

And then when it came to the sort of three way negotiations, we finally got to the budget deal.

They decided to the governor went along and agreed to go with that.

So that was sort of that.

So this sort of idea has been in the works, you know, since March.

And also, of course, last year the governor also provided income tax rebates in the fall.

So it wasn't sort of a new idea, but it was sort of this tension of like, do we do something, you know, short term, provide relief to people, but also sort of that sort of long term, let's find some relief, you know, or find some structural relief for, for high utility bills.

Yeah, that's a good point that you mentioned that it started in the Assembly.

So from your purview, is this a win for the governor?

I mean, she's been going around touting that, you know, this is part of her affordability agenda.

So is it a win for the governor for your from your purview, or is it sort of the legislature's opportunity to take credit for this measure?

Well, you know, they came up with this idea first.

So I guess in that sense they can take credit.

But the governor is certainly touting this idea.

As you mentioned, she's been across the state, you know, down in New York City and out in western New York to, you know, tout this as real relief to people at a time of sort of, you know, rising costs, you know, energy costs, cost of gas, you know, grocery store things.

So in terms of that, you know, at this point, we're not seeing as much of of sort of the legislature out there, but we are seeing the governor really touting this as well.

But as you mentioned, you know, a lot of you know, governor, of course, is on the ballot for reelection.

But, you know, a lot of lawmakers are also on about for reelection or putting out there things.

I'm sure you've gotten the mailers from, from some of our elected officials, and they are touting some of these things as well.

Yeah.

And the governor's office is saying that these rebate checks will help around 8 million households in the state.

But when we look at the long term sort of issue of utility affordability, how does this support their long term efforts?

Because this is a one time rebate check.

Right.

And so that was sort of the balance.

And that's been the debate this whole time.

It's like, you know, you have this sort of we need to help people in some form or fashion.

Is it is it a rebate check?

You know, some Republicans of course, have questioned the timing because it's so close to the election.

But, you know, the governor says, look, the budget was delayed this year.

So it's just how the timing worked out.

It just happens to be late September.

But balancing that with sort of, okay, what can we do to sort of do this and work with the utility companies or more?

Probably more aptly, use the power of the government regulation to extract some more things from the utility companies and some longer term things that people feel will cut energy prices in the long run.

And in terms of this year's state budget, it also included expanded authority for the state's Public Service Commission.

In terms of the way that utility companies have to go about reporting rate hikes, and also gave the commission the ability to implement an affordability monitor at these different utility companies.

So given that expanded powers of the commission, how does that work with, you know, the governor's efforts in terms of addressing utility affordability and providing those rebate checks to New Yorkers?

Where does the commission fit into that?

Yeah, it's also a big part of what the governor is trying to do.

Just on their Thursday meeting, their September meeting, the Public Service Commission approved this sort of energy affordability index or getting that going.

So what is that?

You might ask?

Well, it's sort of taking a look at what a utilities rates are, how affordable that is to consumers.

The state has this target of 6% for energy costs.

Like if you're going above 6%, that sort of starts to create problems for people.

So they're going to use this index.

And if the utilities let's say, you know Shantel Destra utilities goes above 6%, you would never do that.

But if you did then the state can appoint an affordability monitor and you would be in debt monitor would come from the state and come in and say, hey, I'm going to take a look at your books.

I'm going to take a look at why your rates are so high.

And so that's how this so you're going to get this sort of number and they're going to have to sort of, you know, come up with the calculations for that.

And they're going to be working on that over the next few months.

They have a tight timetable on this.

They want to sort of establish this by February, have that first report by July.

So, you know, sometimes government can work a little slowly.

And that was one question at the meeting this month.

But they, you know, are on track to do that with that.

So this is what the governor is saying.

I'm not just providing these one time checks.

I'm directing the PSC and the state government to really do some long term things.

Another thing on the affordability part two with that is it's going to factor in executive compensation now.

So the thinking is like executives and management at some of the state's public utilities are going to have to or going to factor that in if they want to keep getting some of these bonuses and the like.

Yeah.

Very fair.

And in terms of next session, what are some of the most pertinent utility initiatives that advocates and state lawmakers are going to be pushing for?

I know that you've been doing some incredible reporting about the use of AI in the operation of public utilities.

Can you tell us about that?

Yeah, that's another thing that the Public Service Commission is going to be looking at.

This had been sort of in the works, but with some of the news we've had about sort of like, okay, is the is artificial intelligence getting out of sort of human control.

And what that can mean like for cybersecurity will sort of, you know, and other things sort of like that of privacy and operations of the grid, sort of.

That's one concern about artificial intelligence.

Could that cause issues?

So they are going to, for the first time, sort of ask the utilities to say, hey, how are you using AI?

Is it for customer service?

Is it to monitor outages?

Is it for inspections, as some of the uses that utilities in New York and across the country are doing?

So no real regulations yet.

This will be a chance for the PSC to collect data on that and then come up with regulations if needed.

So those first reports will be due within about 60 days.

I also think lawmakers want to do more on the power bills.

They want to do more in the utility bills.

We'll see how things shake out with the election in the legislature.

You know, we had the rebate checks.

We have this sort of step of like, okay, trying to hold utility companies accountable for sort of for, of high rates.

But whether, you know, lawmakers go, no, if you, you know, do we tighten some of these things, do we sort of tighten some of those requirements about high rates and CEO pay and sort of capital investments and things like that, whether that's, you know, put, you know, more teeth into that.

That's something that we'll have to look out and see next year as well.

Fascinating.

Well, thank you so much for your incredible reporting, Samuel.

Unfortunately, that's all the time we have for today.

Well, thanks for having me.

And we were speaking with Samuel King of WXXI and the New York Public News Network.

New York is one of 11 states participating in the Regional Greenhouse Gas Initiative, also known as RGGI.

This is a collective effort to essentially cap greenhouse gas and power emissions and invest in energy affordability efforts.

In this next segment, David Lombardo of WCNY's the capital Press room sat down with John Binder of the Model Climate Loss Initiative to understand the impact and the latest changes of the veggie program.

Here's that conversation.

Well, John, thank you so much for taking the time.

I really appreciate it.

Thanks so much for having me.

It's a pleasure to be here.

So this summer, state energy and environmental officials announced an update to the Regional Greenhouse Gas Initiative, known more commonly by the acronym RGGI l .

It's an 11 state compact designed to cap greenhouse gas emissions from the electricity sector.

Before we get into the tighter rules, can you talk about their track record over the last two decades now?

Well, yeah, as you say, this has been a program that's been in place for just about two decades now, and it was actually the first mandatory program in the country for cap and invest.

So it helps to has a record of reducing emissions, but it also has a record of generating savings for households.

And I think that's one of the amazing parts about RGGI is that it's been able to do both so that we can actually make progress on climate change and see affordability progress for households.

And then I think the other thing to keep in mind is just how it has been working for so long in the background.

Sometimes people forget that it's there, but it's been doing so much of this work on a bipartisan basis across those 11 states.

And it's no matter what's happening at the federal level, RGGI has been staying and doing its work.

Well, what is the significance, then, of this latest update to the program?

What is the agreement among the states, and what do you see as the potential impact of it?

Well, one of the hallmarks of RGGI has always been its commitment to continual improvement.

And that's something called a program review process.

So the changes that you're referring to are came out of the third program review.

So that means that the states have gone through this process and said this program is great.

How can we make it even better?

So that's what they did last year and came to an agreement where they're going to continue to extend the program all the way out, reducing emissions through 2037.

So emissions will continue to go down.

That's the cap.

At the same time, the program has built in additional affordability protections.

So a pressure relief valve, a circuit breaker, so that if demand for allowances, that's the demand for emissions, right.

If that is higher than expected then there's the ability to control for costs.

And so this is a really a good way for the states to show they're still committed long term to continuing to reduce emissions.

And at the same time, again have that commitment to affordability.

Well, let's talk about that cost side of the equation, because it seemed like, at least to some observers, there was a higher than expected cost with this latest round.

So when you think about the pros and cons of this, what do you think about that argument that, hey, maybe we are adding to the overall cost in a way that other states aren't, and other states might also be getting environmental benefits just from energy and efficiency projects and other green initiatives that they might be championing on their own that don't come with this type of price tag.

Well, all of those benefits that you're referring to also come from RGGI.

So energy efficiency savings, investments in renewable energy, those things are actually funded by the RGGI program.

So that price that you're referring to is coming from the polluters, the polluters and the power plants that are emitting carbon dioxide greenhouse gas pollutant.

They're the ones that are paying this price that you're referring to, which is then being utilized to reinvest into the system.

And that is what actually creates those benefits to save households money.

And so I think that's really what we should be focused on is the benefits that the program is providing.

Not to mention the fact that the cost of the program in terms of the cost of allowances is not even close to what the actual cost of these greenhouse gas emissions are in terms of their impact on the climate.

And so I think we're going to continue to see this program drive emissions down, but more importantly, continue to drive those investments.

And then I think the last point to keep in mind is how the market is intended to work this way.

The prices are going to fluctuate.

It is a market based program.

And so supply and demand is what dictates the price of that allowances, not the state.

And so that is able to fluctuate depending on various factors whether that's how much, how hot it is or how much power is being utilized on the grid.

And that's how it's designed to work.

You mentioned sort of the societal health benefits of something like that in the two decades that this has been up and running.

Is it the case that we've already realized some of those benefits, or is this something where we're talking about benefits down the road, and we might not necessarily have experienced them yet?

It's both right.

So over the course of two decades, the emissions have gone down about half from power plants across the region thanks to this program.

And that has resulted in a huge amount of public health benefits in terms of savings on impacts to hospital visits and premature deaths and things like that, because we have less air pollution that's benefiting people going forward.

We're going to continue to get further emission reductions by 2037 will be about almost 90% below where we are now in terms of emissions from this program.

So that will have additional public health benefits.

And that's in addition to all those investments that will have additional benefits in terms of getting more people, heat pumps and energy efficiency and weatherization of their homes, which will have them save on their energy bills as well.

And we're all obviously feeling those kinds of impacts right now.

So that's particularly important.

You mentioned the idea of a pressure valve relief in case of emergency brake glass.

I'll keep the metaphor going as long as we have time.

Where does that come into play.

And is that something that's been part of the equation in the past, or is there something unique about the energy landscape now that warrants that type of potential for relief?

So this is something in the program called the Cost Containment Reserve or CCR.

And it's the concept that if prices reach a certain level then we'll put additional supply of allowances into the system.

So again by having more supply the price will go down.

What they what the states have done with this most recent update is they are agreeing to a second pressure relief valve.

So whatever your metaphor here is you're going to break the glass, maybe break the glass a second time.

Right.

And so the idea is we have a good sense of where the energy market is going, but we don't have a perfect sense.

And so we can't always predict exactly where the price may be.

And obviously there's lots of things happening out there, whether that's all the federal government's decisions or poor decisions that they are making that might be impacting the power sector, whether that's what's happening in Iran and how that impacts fossil fuel in the United States.

All of those things have impacts that we can't perfectly predict.

And I think that's why there has been this idea of having this cost containment reserve.

And now a second one, to make sure that the states are sort of prepared for any outcome.

But at the same time, emissions will continue to go down and the states will continue to generate revenue from those polluters to continue to invest in these kinds of great programs.

And in terms of this experience with just the electricity sector and the broader economy, which is this idea of a cap and invest program for New York, what sort of roadmap can the RGGI experience provide for New York policymakers if and when they ever get things up and running here?

Or is it an apple's and oranges situation?

And the fact that we're only talking about the electricity sector when we talk about RGGI makes it kind of a unique case, and we need to think about a broader economy, wide cap system, something completely different.

Well, I think that RGGI has shown how successful a cap and invest program can be, how it's not true that we have to make a choice between affordability and climate action, how it's a false choice to present those as competition with each other, how we can both reduce emissions and save money for households, and what we would be able to do on an economy wide basis if we had a New York cap and invest program or a clean air initiative, and for for all sources of greenhouse gas emissions, we would be able to expand all of these benefits.

So RGGI has generated $3.5 billion just for the state of New York to invest in all of these affordability and renewable energy and energy efficiency things.

If we had a New York State Capital Invest program for other sectors, we would be generating billions of more dollars, and we'd be doing that from the polluters that would be paying for this, and we would be having even more benefits and savings and public health benefits for households.

So yes, it is.

It is overdue.

And I hope that the state does move forward, even if it is on a delayed time frame after this year's budget, in terms of where those dollars for investing would come from, the state's Cap and Invest program.

You talked about coming from the polluters, but I don't imagine they're going to dig into their own pocket set of their own charitable nature.

So is there something about the way a system like this is constructed that could guarantee the cost doesn't get borne by ratepayers or businesses or municipalities?

Or is ultimately that going to be a cost that trickles down?

And it's the case that from your perspective, the benefits of how it might be invested, the environmental benefits of reduced emissions make it all worthwhile.

Well, it's certainly all worthwhile.

But also it's the case that most of these polluters do have.

They might not do it out of the greatness of their hearts, of course, but they will do it because it is a legal requirement under the program.

They will have to purchase these allowances to cover emissions, and most of them do have the ability to do that in terms of if it affects households.

That's why the program is designed or would be designed in such a way to continue to invest in things that will actually save households.

So so people will save money on their electricity bills and on their gas bills once the benefits of this program are up and running.

And also the program was designed to have some direct payments back to households so that some of the money that is coming in would go directly back to households in the form of a credit or something like that, or rebates.

That acknowledgment, though, of the fact that some things might become more expensive, you might pay more at the pump under this model.

And thus there is a recognition that we need to provide some sort of relief to the lower end income scale.

I think it's an acknowledgment that it's possible that there could be some immediate impacts from the program, but on the long term, it's going to have a huge amount of benefits for everybody.

And this is the way to preserve and ensure that we don't have outsized impacts on households, particularly low and moderate income households.

But all of the state's own projections show that this program would have a huge amount of benefits for the majority of households, particularly low and moderate income households.

They would come out ahead.

And so I hope that the program does get up and running as soon as possible, because again, it is it is overdue.

Well, what about those projections that were quote unquote, leaked by the administration earlier this year, which painted a very bleak picture of a program that the administration just a few months earlier had been championing.

What is it about the way that they laid out those numbers that you think is not reflective of the way a holistic program could actually be rolled out and might not necessarily have those economic fallout that they were predicting.

Well, without necessarily relitigating the infamous memo, as some folks refer to that.

I think the fact of the matter is, well, was unfortunate about that memo was it was presenting, again this false choice between affordability and climate action.

And I think, again, the reality is that we can do both.

RGGI has proven that we can do both, and we would be able to do both on a broader scale if we were doing cap and invest across the board.

What that memo did was it projected a version of the program that was never going to be adopted by the state, and it was never a plan for the state to adopt it.

And so it really kind of exaggerated what those near term impacts would be without taking full account of what the benefits would be from the reinvestment that I was referring to earlier.

Well, I want to come back to something you alluded to earlier, which is that states like New York and say the other RGGI partners that are interested in reducing their greenhouse gas emissions, their overall carbon footprint, are kind of on their own right now.

And I think that speaks to work you're doing, which is trying to help states who are interested in navigating this sort of uncharted terrain without the help of federal government.

So can you talk about the expertise that you're looking to provide and sort of the guidance that you're looking to provide to states?

Yeah, I work on a project called the Model Climate Laws Initiative, and that's really a joint project of environmental advocates in the York and Columbia Law School, the Saban Center at Columbia Law School.

And we're all about providing resources to states.

And so we know that state level legislatures, oftentimes there's lawmakers that want to do this kind of climate work, particularly now in this second Trump administration, where the federal government is not taking any action on climate change and actually making it more difficult for states.

So states need those legal resources.

They need assistance with bill drafting, they need legal analysis and support.

And that's what we provide with the Model Climate Laws initiative.

And that's partly because of the law.

I did work for New York State for quite some time, and I know the power and the influence that states can have on climate change, whether that's through a program like RGGI or other efforts to reduce emissions and how that can be replicated by other states, and especially when the federal government is maybe going back and forth.

Unfortunately, we know the states can continue to move forward.

And that's what we do with the Model Climate Laws initiative.

We provide those kinds of resources to lawmakers and states across the country.

Well, what are the states that you envision helping?

Are they states like New York that theoretically have a robust collection of state health and environment and energy officials who should be able to navigate this?

Or are you thinking about smaller states that might not have the expertise in house?

I think it's both.

I think a state like New York, yes, has lots of experts that work in the legislature and in the agencies that are capable of implementing these laws.

Other states, smaller states might not have the same kind of staff.

They might be a part time legislature that don't work full time, like our friends in Albany do.

And so those folks often do need some additional resources.

And it's it's not a question of their commitment.

It's a question of making sure that they have the ability to do what they want to do.

And that's where we want to come into play.

And so that's going to be in a variety of states across the country.

And what we're hearing across the country is states still want to move forward on climate, but and they also want to be addressing affordability at the same time.

And we've been telling them you can here's an example with something like RGGI, and we can do more policies like this, and we can give you those resources to put those into place.

Is the issue though having policy expertise or having the political will to have these potentially tough conversations, because New York theoretically has everybody who could roll out a cap and invest system.

But there was a calculation in an election year that, no, I'd rather hit pause because the narrative is scary and not one that I want to wade into right now if I'm the governor.

Well, it was a miscalculation based on an unfortunate narrative.

But in any case, I think the fact of the matter is we need we need both, right?

We need the policy expertise and the technical legal expertise and assistance for folks.

We also need the political commitment.

We need the political commitment to pass these laws at the state level.

But I think, just as importantly as we have sometimes seen in states like New York, we also need the political commitment to follow through.

So it's great to pass laws, but it's even more great to see those laws get implemented and become effective, which requires continued political commitment and follow through.

And hopefully that will continue here in New York and in other states as well.

Was it a tough decision for you to leave the state or based on the way things were trending, which was kind of in a different direction from, say, 2019, when New York was passing the most ambitious climate leadership language in the country that maybe made you want to look for new opportunities.

It was a very difficult decision to leave the state, because the D.C., where I worked for 17 plus years, is a place where there are tons of people that are doing amazing work.

They're committed to protecting the environment.

I have lots of friends and colleagues there and really believe that, really believe in the mission as I did and as I do.

So it was very difficult to leave.

At the same time, this opportunity to do the same kind of work in other states and try to advance progress, not just here in New York, but climate action in states across the country, and kind of further show the power of states when the federal government is going in the wrong direction, was was a great opportunity.

So but of course, it's I miss all my colleagues there at DC and I know they're doing great work.

Well, John, thank you so much for taking the time.

I really appreciate it.

Pleasure to be here.

Thanks for having me.

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