New York Energy Deregulation

Energy Deregulation in New York

Outdated equipment, spotty supply, greater demand, and outdated infrastructure caused New York to have some of the highest energy rates for residential and commercial customers in the county.

Because different companies had a monopoly in specific areas, this led to companies charging as much as people were willing to pay for power. At the same time, their services remained inadequate at best. The poor service and inefficient electricity grid were the cause of the rolling blackouts in the state in 1965.

This led the state residents to demand deregulation, and the first step to this was the state introduction of Independent Power Producers into the market in 1997. The IPPs produced and sold electricity, which helped take away the local utilities’ market power. Now, New York consumers have over 200 choices for electricity providers, each of whom may set its own default price.

In 1996, the New York Public Service Commission passed the Competitive Opportunities Case legislation. This opened up the residential energy markets to competition.

Thanks to this legislation, residents of New York can now enjoy their choice in which retailer to buy their energy. The legislation was also good for the utility companies as it forced them to upgrade their outdated systems to help keep up with the demands of the public. Since deregulation was implemented, the state of New York has generated over 1700 MW of renewable energy, which many consumers prefer.