New York Gov. Andrew Cuomo has excitedly announced his $1 billion plan to increase the Empire State’s solar power generation ten-fold over the next decade. But taxpayers might not be so excited when they see the price tag: more than $333,000 per megawatt hour.
Cuomo says the $1 billion would go towards helping households and businesses install three gigawatts, or 3000 megawatts, in the next decade. This means New York taxpayers will be paying more than $333,000 per megawatt of solar power over the next ten years, a hefty price tag for a state that sits on vast reserves of readily accessible natural gas.
The Cuomo administration has sold the plan as a way to grow the solar industry to a point where it no longer needs subsidies. The state will use the long-term funding to attract businesses from out of state — one of many such programs Cuomo has launched to attract outside investment into the state’s lagging economy.
“This $1 billion investment underscores New York’s commitment to growing the clean energy economy,” Cuomo said. “By providing long-term funding certainty, the State is attracting private sector investment, creating new economic opportunities and supporting sustainable development.”
The high price tag of solar power has kept it from gaining large market shares, despite generous federal and state subsidies to encourage households and businesses to strap solar panels to their roofs. Cuomo says that the state has more than 400 solar companies operating within its borders employing more than 5,000 people.
But the oil and gas industry has criticized the Cuomo administration for holding back New York’s economy by keeping a place a moratorium on hydraulic fracturing, or fracking.
A 2011 study by the conservative Manhattan Institute found that ending the fracking moratorium would create up to 18,000 jobs in Upstate New York sitting atop the Marcellus shale. Another 90,000 jobs could be created in Southeastern New York if the state allowed drilling on the Utica shale formation.
Across the border, in Pennsylvania, fracking has helped lower jobless rates and increase incomes, especially across rural parts of the state.
“The shale became a lifesaver and a lifeline for a lot of working families,” said Dennis Martire, regional manager for the Laborers’ International Union. “It has created more work for our business. There’s jobs here for the first time in many, many years. Legitimate, good-paying jobs.”
Cuomo, however, has continually delayed making a decision on whether or not to allow fracking in the state, instead doubling down on renewable energy as a way to lower utility bills for households and businesses. Cuomo’s administration is looking to “solarize” whole communities to help the environment and bring down costs.
Cuomo’s solar push has already resulted in the installation of 316 megawatts of solar power in the past two years. Despite this, New York had the fourth highest electricity prices of any state last year, according to the Energy Information Administration.
New York state law mandates that 30 percent of electricity be generated from renewable energy sources by 2015. Last year, the state got 23 percent of its power from renewables, mostly from hydropower.
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