NY HEAT Passes State Senate; Budget Negotiations Continue

In a 40-22 vote last week, the State Senate passed the NY Heat Act, which will push gas utilities carefully in a new direction, enabling them to comply with New York’s Climate Act while helping customers switch to affordable and reliable zero-emissions heating and cooling. The bill will ensure energy affordability by capping costs for low-income customers, and by avoiding billions of dollars in costly new infrastructure investments.

The NY HEAT Act, which passed 40-22, had been approved by the state Senate last year but the Assembly and Gov. Kathy Hochul have yet to find agreement on all variables of the legislation. 

The Assembly has yet to take up the measure. Hochul included the Affordable Gas Transition Act – which aligns closely with the NY HEAT ACT – in her 2025 state budget. 

In addition, gas customers are facing double-digit rate hikes to pay for expensive pipeline replacement programs, and New Yorkers left on the gas system could see their monthly bills reach more than $8,000 per month by 2050 if state leaders do not intervene.

Sen. Liz Krueger, the lead sponsor  of the bill in the Senate, said,  “We are living in the beginning of a crisis that will only get worse unless we act immediately,” adding, “we are so far behind. We are literally in a race for our own lives and the planet’s life.”

“NY HEAT clears a path for utilities to build renewable thermal energy networks instead of replacing and expanding the gas network,” wrote Assemblymember Patricia Fahy, the bill’s sponsor in the Assembly, in an editorial last year in the Gotham Gazette. “Doing so will create thousands of new clean, green energy jobs for union pipefitters and electrical workers for decades to come. It could also prevent the billions of dollars of spending on replacement pipes that gas utilities are planning by 2040 and gas customers would get stuck paying for in the decades to come.”

[Tell lawmakers to support the NY HEAT Act.]

Specifically, the NY HEAT Act would save gas customers more than $200 million annually by ending the ‘100 foot rule,’ which charges existing gas customers for the cost of new gas pipeline hookups. It would create opportunities for additional savings by retiring old pipeline systems when they can be replaced with more cost-effective neighborhood-scale alternatives, such as thermal energy networks and high efficiency heat pumps.

The bill also guarantees energy affordability for those who need it most. Currently, lower-income New Yorkers spend an average of 10% of their income on utility bills. The NY HEAT Act would cap the energy bills of low- and moderate-income households at 6% of their income – saving these families up to $75/month.

The NY HEAT Act – which was an NYLCV Scorecard bill in 2023 and is among the League’s top priorities in 2024 – is essential to delivering energy affordability across the state, and we urge the Assembly to pass this measure as well. 

Other key measures NYLCV is working to get included in the final budget include the RAPID Act, because we need to ensure the state has the transmission capacity to deliver clean energy to homes and business.  We are encouraged that the governor and both houses have included versions of this measure to ensure we can reach our goal of 100% clean energy by 2040. \

We are also working to ensure school districts across the state can pay for electric school buses with state funds without impacting school aid.  and that the State Senate funding unionized thermal energy network projects at the University at Buffalo and SUNY Purchase. 

Finally, we applaud the State Senate and Assembly for restoring funding for the Clean Water Infrastructure Act in their one house budgets. Now we need the governor to join them so that number remains at or above $600M, and that the EPF is fully funded without raiding it to pay for staff. 

As we work with the governor and state legislature toward a final budget, we will push hard for policies to significantly reduce greenhouse gas emissions in every corner of the economy while shoring up our renewable energy production and transmission capacity and  ensuring the Clean Water Infrastructure Act and the EPF receive full funding so they can function as intended.   

03.25.24 // AUTHOR: Devin Callahan //