BILL NUMBER: S4158
SPONSOR: KRUEGER
 
TITLE OF BILL:
An act to amend the public service law, the public authorities law, the
transportation corporations law and the labor law, in relation to enact-
ing the NY Home Energy Affordable Transition Act; to repeal section 66-b
of the public service law relating to continuation of gas service; and
to repeal section 66-g of the public service law relating to the sale of
indigenous natural gas for generation of electricity
 
PURPOSE:
The purpose of the bill is to ensure that state regulation and oversight
of gas utilities provides for the equitable achievement of the climate
justice and emission reduction provisions set forth in the Climate Lead-
ership and Community Protection Act (the "CLCPA"). This bill provides
the Public Service Commission with the authority and direction to align
gas utility regulation and gas system planning with the CLCPA's
provisions while ensuring that customers retain access to safe and reli-
able energy. Specifically, the bill removes the legal basis and subsi-
dies driving the expansion of gas systems and requires the commission to
adopt rules to provide for the timely and strategic decarbonization and
right-sizing of the gas distribution system in a just and affordable
manner.
 
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Names the bill the NY Home Energy Affordable Transition Act.
Section 2: Legislative findings.
Section 3: Amends the public service law to add a new section 66-y to
require the Public Service Commission to create a Statewide Affordable
Gas Transition Plan to guide an orderly, affordable, and equitable
rightsizing of the utility gas distribution system. Further amends
public service law to add a new section 66-z to create Utility Home
Energy Affordable Transition (HEAT) Programs to require gas utilities to
implement Neighborhood Gas Transition Projects, in alignment with the
Statewide Gas Transition Plan, for the purpose of decommissioning
discrete segments of the utility gas system to provide for an orderly
gas system transition, including provisions ensuring reliability, safe-
ty, affordability, and continued access to energy services.
Section 4: Amends section 4, subdivision 1, of the public service law.
Provides that the public service commission has "all powers necessary
and proper" to facilitate achievement of the CLCPA climate justice and
emission reduction provisions.
Section 5: Amends subdivision 1 of section 5 of the public service law.
Adds gas and electricity used for cooling to the jurisdiction of the
public service commission.
Section 6: Amends section 30 of the public service law. Requires the
Public Service Commission to develop a plan to ensure that all residen-
tial customers be adequately protected from bearing energy burdens
greater than 6% of their household income. Permits the commission to
establish a reasonable per-customer cap on the amount of energy subject
to affordability protections, as well as a cap on collections from rate-
payers to fund energy affordability programs. Directs the commission to
regulate for the continued provision of gas service to existing residen-
tial customers unless such service is discontinued pursuant to a Home
Energy Affordable Transition Program. Clarifies that nothing in this
article or any other law of New York shall be interpreted as preempting
a municipality from adopting building codes or other regulations regard-
ing on-site emissions for new and existing buildings within their local-
ities.
Section 7: Amends section 1020-cc of the public authorities law to codi-
fy a goal that all residential customers of the Long Island Power
Authority be protected from bearing energy burdens greater than 6% of
their household income.
Section 8: Amends section 31, subdivisions 1,3, and 4, of the public
service law. Removes the 100 ft rule subsidy for gas, which provides
ratepayer-funded utility incentives for the expansion of utility gas
system infrastructure. Implements the policy established in section 6
with respect to applications for electric and gas services. Requires
utilities to provide clear, timely information on incentives and oppor-
tunities for installing energy-efficient equipment and other measures
that provide alternatives to gas use. Clarifies that nothing in this
subdivision shall be construed to prohibit existing gas customers from
reconnecting to the gas distribution system following a service inter-
ruption due to emergency repairs.
Sections 9 & 10: Amends section 12 of the transportation corporations
law and adds a new section 13. Removes the entitlement of non-residen-
tial customers to utility gas service and the 100 ft rule subsidy for
gas.
Section 11: Creates a new subdivision 12-e under section 66 of the
public service law. Requires the commission to review each gas utility's
capital construction plan and to establish a process to examine feasible
alternatives to construction of new gas infrastructure and alignment
with the affordable gas transition plan. Empowers the commission to
require the electric utility with a service area overlapping the service
area of the gas utility to participate in such process.
Section 12: Repeals section 66-b of the public service law. Removes the
entitlement to continuation of gas service following the demolition and
reconstruction of any structure owned by a customer.
Section 13: Adds a new section 66-x to the public service law. Prohib-
its gas utilities, after December 31st, 2026, from expanding gas
distribution infrastructure to new geographic areas where gas service
was not previously available. Case-by-case exceptions may be granted up
to December 31st, 2028.
Section 14: Repeals section 66-g of the public service law. Removes the
requirement that utilities enter long-term contracts to purchase or
wheel electricity produced from indigenous natural gas supplies when
economically reasonable.
Section 15. Amends section 224-d of the labor law and adds a new subdi-
vision 9. Adds covered neighborhood gas transition projects to the defi-
nition of covered renewable energy systems to ensure that such projects
performed by contractors directly hired by a public utility are subject
to the same labor standards as other covered renewable energy systems.
Section 16. Severability
Section 17. Establishes that the act takes effect immediately.
 
JUSTIFICATION:
New Yorkers are facing rising heating bills, spurred by utility invest-
ments in increasingly expensive gas pipelines, the costs of which are
paid by utility customers as delivery costs on their gas bills. Delivery
costs can be two or three times greater than the cost of gas itself. The
increasing heating bills contribute to an unaffordable cost of living
for too many New Yorkers, leading to high amounts of consumer debt to
utilities, increasing numbers of utility service shutoffs, and hardship
as families struggle to also afford housing, food, medicine and health-
care.
Heating our buildings through burning fossil fuels is the largest source
of greenhouse gas emissions in New York State. The climate crisis
threatens the lives and financial security of New Yorkers, as storms,
wildfires, and extreme heat threaten the health, wellbeing, and property
of residents, leading to high healthcare costs and other financial
damages.
To address these harms, New York urgently needs to align its regulation
and oversight of gas utilities with the climate and equity provisions
established by the Climate Leadership and Community Protection Act
(CLCPA). The CLCPA sets ambitious targets to achieve significant green-
house gas emission reductions across New York's economy, while prior-
itizing reductions in co-pollutant emissions in disadvantaged communi-
ties and requiring significant state investments to bring the
affordability and health benefits of energy efficiency and clean energy
to these communities.
Achieving New York's climate and equity objectives necessitates updating
the regulation of gas utilities. Current policies.create misalignment
between gas system investments and the CLCPA's 2030 and 2050 mandates,
increasing the risk of a costly and disorderly transition. Strategic
planning and investment are needed to decarbonize buildings, right-size
the gas system, and ensure coordinated enhancements to the electric
system, enabling equitable and affordable access to clean energy
solutions for all New Yorkers. Outdated public service laws are misa-
ligned with the state's energy affordability goals and CLCPA mandates.
The "utility obligation to serve gas" compels utilities to expand gas
infrastructure, making it challenging to redirect investments toward
insulating and upgrading homes and installing clean energy alternatives
like electrification and thermal energy networks that align with climate
goals while mitigating costs for ratepayers. Mandated system extension
allowances require existing ratepayers to subsidize gas hookups for new
customers, costing ratepayers hundreds of millions of dollars annually.
Utilities are projected to spend $150 billion to replace leak-prone gas
pipelines. Through the changes implemented in this Act, many of these
investments could be avoided by redirecting funds to neighborhood-scale
decarbonization projects. Neighborhood-scale projects offer the most
cost-effective pathway to transition gas customers to alternative heat-
ing and cooling solutions. These projects reduce costs, minimize strand-
ed investments in the gas system, and enable coordinated efforts among
utilities, customers, and other stakeholders.
The NY HEAT Act seeks to:
a. Reduce unjust and disproportionate energy cost burdens by avoiding
unnecessary, non-strategic, and expensive gas infrastructure invest-
ments, and improving affordability protections.
b. Ensure utility regulations do not work at cross-purposes with the
CLCPA.
c. Provide the Public Service Commission with clear authority and direc-
tion to align utility planning with CLCPA goals, proactively addressing
regulatory barriers and recommending necessary legislative changes.
d. Minimize the need for new gas infrastructure investments by redirect-
ing ratepayer funds to alternatives including electrification, thermal
energy networks, targeted energy efficiency, demand response, and market
transformation measures.
e. Facilitate a planned, neighborhood-scale transition away from fossil
fuels, avoiding stranded gas infrastructure costs and supporting coordi-
nated investments that reduce emissions, increase affordability, and
create good-paying jobs, while covering transition costs of customers
moving to non-gas alternatives.
f. Ensure equitable access to affordable, clean energy for heating,
cooling, and other building needs, protecting customers from undue
burdens during the transition.
The NY HEAT Act does not impose a ban on the use of gas. Rather, it
supports a gradual, long-term, and carefully planned transition for
existing gas customers to cleaner alternatives, ensuring affordability,
reliability, and equity throughout the process.
 
LEGISLATIVE HISTORY:
2021-22: S.8198/A.9329 Fahy - Died in committee
2023-24: S.2016/A.4592 Fahy - Passed Senate
 
FISCAL IMPACT ON THE STATE:
Undetermined.
 
EFFECTIVE DATE:
This act shall take effect immediately.

Statutes affected:
S4158: 4 public service law, 4(1) public service law, 5 public service law, 5(1) public service law, 30 public service law, 1020-cc public authorities law, 1020-cc(1) public authorities law, 12 transportation corporations law, 66 public service law, 66-b public service law, 66-g public service law, 224-d labor law, 224-d(1) labor law