At a July 10, 2025 meeting, Commissioner Judy Chang of the Federal Energy Regulatory Commission (FERC) argued that the United States needs to rapidly build more transmission capacity to bring new sources of electricity online. She explained that “transmission is the network that needs to support both generation and load, and whether it’s load growing, whether it’s wind and solar growing — it doesn’t matter, we have to build the highways to connect them.”
In New York, a lack of adequate transmission and distribution infrastructure, as well as the high cost of upgrading that infrastructure to allow new wind and solar projects to be connected, have been a major bottleneck to renewable energy deployment. Developers of renewable energy facilities have recently experienced challenges related to a lack of transmission capacity in areas that would otherwise be suitable for development; a dramatic increase in interconnection costs; unexpected retroactive scope modifications for distribution upgrades; and long interconnection queues.
These and other challenges were highlighted during an event hosted by the Sabin Center for Climate Change Law on May 12, 2025. The event featured a panel discussion moderated by the Sabin Center’s Matthew Eisenson with Elizabeth Grisaru of the New York State Department of Public Service (DPS); Noah Ginsburg of the New York Solar Energy Industries Association (NYSEIA); Marguerite Wells of the Alliance for Clean Energy New York (ACE-NY); and Randy Satterfield of NextGen Highways.
As discussed in this blog post, the experts offered several recommendations for addressing challenges related to transmission, distribution, and interconnection in New York, including: (1) innovating with Grid-Enhancing Technologies (GETs) and flexible interconnection; (2) regulating the costs of distribution upgrades; (3) investing in proactive upgrades to energy infrastructure; and (4) co-locating utility infrastructure on already disturbed land.
Background
To understand the urgency of resolving New York’s challenges related to electricity transmission, distribution, and interconnection, it is important to have some context concerning: (1) the state’s climate goals, including statutory mandates to connect renewable energy generation facilities to the grid; and (2) projections of high load growth over the next few decades.
First, New York’s climate goals, established in the Climate Leadership and Community Protection Act of 2019 (CLCPA), include an ambitious target of obtaining 70 percent of the state’s electricity from renewables by 2030. New York’s official tracker, however, projects that the state is likely to achieve just 50 percent renewables by 2030, far short of the target. It’s not all bad news, though. The CLCPA had also set a target of installing 6 gigawatts (GW) of distributed solar by 2025, which the state achieved ahead of schedule at the end of 2024. On April 14, 2022, the New York State Department of Public Service (DPS) had set a new goal of 10 GW of distributed solar by 2030.
Second, New York is anticipating rapid growth of demand for electricity over the next few decades. Importantly, load growth is a relatively new phenomenon in New York. From 2002 to 2016 demand for electricity grew by less than 2% in total. Last summer, however, New York’s Independent System Operator (NYISO) estimated that load will increase by 90% by 2042. While there are several causes of load growth, efforts to electrify the transportation and building sectors are significant contributors. There are concerns that New York’s existing energy infrastructure and regulatory framework may not be prepared to bring new sources of electricity online fast enough to meet the growing demand.
The Challenges
At the Sabin Center’s May 2025 event, panelists identified various challenges to meeting the state’s climate goals and anticipated load growth. These include transmission and distribution bottlenecks, rising interconnection costs, local opposition, and siting delays, which have been exacerbated by supply chain challenges and, more recently, tariffs. Below is a summary of some of these challenges.
Lack of transmission capacity: The state’s existing transmission lines have insufficient capacity to bridge the gap between the upstate regions where electricity is generated and the downstate regions where demand is concentrated. There are many areas in the state with open land that would be suitable for wind and solar projects but that have no access to the grid. Projects are not even proposed in these regions due to the lack of access to transmission or distribution capacity. Building new transmission and distribution lines in those areas, however, can be difficult due to (i) the cost of construction; (ii) the need to secure agreements and permissions from the individuals and entities who own the land on which the lines would be built and (iii) local opposition from neighbors.
Increasing interconnection costs: In the past five years, interconnection costs for community-scale solar projects have risen precipitously. One of the panelists estimated that, in some instances, these costs have increased by a factor of five times. The lack of affordable localized interconnection for community-scale solar projects is requiring substation upgrades of up to $20 million on distribution lines, which developers must pay for upfront before being allowed to build their projects. Another panelist estimated that over the last five years, costs of interconnecting utility-scale projects have increased by an average of $30 million to $45 million, doubling or tripling in cost.
Unanticipated retroactive costs for distribution system upgrades: Many developers have incurred unanticipated, retroactive expenses for necessary upgrades to distribution infrastructure when utilities have reevaluated interconnection studies. Utilities conduct these studies, in accordance with the Standardized Interconnection Requirements (SIR), to assess the feasibility of connecting to the grid, to assess the impact on the system by the new generator, and to estimate the costs of necessary upgrades. However, there have been instances in which the interconnection cost estimates have proved to be inaccurate, and utilities have later revised their studies and imposed retroactive costs on developers. Last year, for example, one utility informed developers and other stakeholders that the actual costs of implementing upgrades to distribution systems had increased by 71% compared to estimates generated in 2022 and that developers would be required to pay the difference. The imposition of these retroactive costs has effectively forced the cancellation of projects, even after substantial investments, and prevented upgrades from occurring.
Long interconnection queues: Excessively long interconnection queues can delay projects by months, or even years, and delays can be costly. Proposed projects can take to up 10 years to complete the interconnection process. During that waiting period, land contracts or permits may expire, preventing the project from moving forward. Lengthy delays can also result in “deal fatigue” as the host communities lose faith that the project is ever going to get built. Participating landowners get frustrated if developers re-engage several years later when they are finally ready to proceed with the proposal.
Recommendations and Potential Solutions
The panelists offered recommendations for potential solutions to address the challenges that are slowing down the deployment of clean energy projects in New York State. Some of those potential solutions include:
(1) Innovating with Grid-Enhancing Technologies (GETs) and flexible interconnection: GETs optimize the hosting capacity of the existing infrastructure by using sensors, power flow control devices, and analytical tools, which reduce the need for extensive upgrades. Flexible interconnection is an approach that allows new renewable energy resources to connect to the grid and dynamically adjust their generation based on real-time grid capacity. These technologies improve grid reliability, decrease interconnection costs and allow the system to respond to urgent load growth.
(2) Regulating the costs of distribution upgrades: To eliminate uncertainty about the costs of distribution upgrades and avoid imposing retroactive costs on developers, the state could take a more assertive role in regulating the costs of distribution upgrades. In particular, the state could create a framework where (i) cost estimates are accurate and (ii) once a developer signs a contract with the utility to perform an upgrade, the cost estimate is locked in, with some reasonable allowance for inflation. This could help to prevent excessive utility cost-overruns.
(3) Investing in proactive upgrades to energy infrastructure: Proactively building out the current transmission and distribution infrastructure to accommodate future generation facilities would drive down the costs of interconnection that are currently borne primarily by individual developers. These proactive investments would help reduce the backlog of renewable energy projects in the interconnection queue and avoid the significant financial loss caused by delays.
(4) Co-locating utility infrastructure on already disturbed land: Developing transmission lines within existing linear corridors, such as along highways, could, in the words of one panelist, offer a “trifecta of benefits” – (i) reducing environmental impacts, (ii) avoiding complex landowner negotiations, and (iii) expediting permitting processes. Though this approach is common in some states, such as Wisconsin, co-location has not been adopted at scale in New York for various reasons including old federal prohibitions banning utility assets on interstate highway rights of way, the state Department of Transportation’s practice of not actively engaging with utilities, and concerns about traffic disruption and safety.
One of the panelists, Noah Ginsburg, advocated for the Accelerate Solar for Affordable Power (ASAP) Bill, introduced on March 17, 2025, which he argued would advance reforms to reduce interconnection costs. The Bill would also amend the Environmental Conservation Law to raise the distributed solar target from 10 GW by 2030 to 20 GW by 2035. The Bill (S6570) remains in the Senate Finance Committee as of this writing.
The recording of the expert panel discussion can be accessed here.
Ivonne is the Legal Network Manager at the Renewable Energy Legal Defense Initiative (RELDI) of the Sabin Center for Climate Change Law.
Great Job Ivonne Norman & the Team @ Climate Law Blog Source link for sharing this story.
