Leaders in New York's power supply industry have doubts the state's electric grid can handle the demand of new mandates included in the 2024 budget intended to limit greenhouse gas emissions and transition to cleaner energy.

Gov. Kathy Hochul and the Legislature agreed to ban new gas hookups and fossil fuel-burning equipment in new buildings under seven stories after 2025 and other buildings after 2028. New York City implemented a stricter law in 2021 mandating new construction of small buildings to be all-electric starting in 2024.

Agricultural buildings, manufacturing facilities, hospitals, car washes, commercial restaurants and others are exempt from the electric buildings mandate.

The Public Service Commission can also permit exemptions when electric service cannot be provided in an area for such construction.

Critics are doubtful the state has adequate power supply for the new policies to be successful, or possible in the short timeframe.

"Tell me what we're going to use versus natural gas to keep the lights on?" Gavin Donohue, Independent Power Producers of New York President and CEO Gavin Donohue said. "And we don't have that answer. So, in the short term, I think it's a wonderful goal. But until we figure out what that fuel source is, I just don't think that feasible to do this."

The budget also directs the New York Power Authority to expand its supply of renewable energy and close its seven peaker plants — including six in New York City and one in Suffolk County by the end of 2030, which burn natural gas to meet the state's electric demands. The plants will be allowed to be used in emergencies or if needed for system reliability after that. 

"We need an all-of-the-above approach if we're going to meet our renewable goals," Senate Environmental Conservation Committee chair Pete Harckham said.

The mandates intend to keep the state on track to meet its carbon emission targets set under the Climate Act, or reduce greenhouse gas emissions 85% by 2050.

Harckham is pleased with the climate policies embedded in the $229 billion spending plan. He led the charge for greater legislative oversight of funds collected from large polluters under the state's new Cap & Invest program, which were included in the Senate's one-house and final budget signed into law this week.

"It's about checks and balances and it was vital we got that check. And the governor agreed," Harckham said.

About 30% of the money will reduce consumer costs, with two-thirds committed for rebates and renewable energy projects.

But the senator is confident in all-electric buildings that rely on geothermal and heat pumps, citing recent completion of zero-emission affordable housing units downstate.

Donohue praised the decarbonization of state buildings in the budget, but says money should be earmarked to attract zero-emission technology to the state to bolster its power supply.

Donohue served on the Climate Action Council that helped devise the state's scoping plan to meet the goals set under the Climate Act.

He argues more analysis is needed from the Independent System Operator the Public Service Commission to understand how much electricity New York has to implement the transition correctly.

"If everything that is on the table that has contracts gets built, and is permitted and financed, gets built, we can get to 70% renewable [energy] by 2030, however, that means everything," he said. "And I mean every project you've heard of has to get built on time. That, to me, is a difficult conclusion that that will happen. I'm not saying we can't get there. I'm trying to be positive about it, but there's always delays and there's always construction issues with these projects."

The Climate Act requires the state to have zero-emission electricity by 2040, or in 17 years.

"If you're going to tell me that in 17 years, we're not gonna have oil and gas in New York City, what is it that's going to replace that oil and gas keep the lights on?" Donohue asked. "And that's where the state has fallen down and not addressed that serious issue, and quite frankly, getting from 2030 to 2040, in my mind today, is just magic, because there is no pathway forward."

State Republican lawmakers have long echoed concerns about the reliability of the state's power supply and affordability for New Yorkers.

Assembly Member Phil Palmesano, the ranking member of the chamber's Energy Committee, says it could have a negative impact on consumers and businesses alike, and push them to states without the costly mandates.

"We're implementing an energy plan that doesn't do anything to address affordability or reliability, in fact, it jeopardizes it, and that's something I'm very much concerned about as we move forward for New Yorkers," Palmesano said.

Harckham and Assembly Environmental Conservation Committee chair Deborah Glick met this week to focus on passing a bill to reduce plastic waste in the state, and for legislation to ban neonics pesticides to pass in the Senate before session ends June 8.