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$6.4 billion
in
reduced fuel costs due
to system efficiency
improvements that
exceeded national
efficiency gains by 300%
$540 million
NYIS
has achieved
in savings from
reduced reserve
requirements
25 million tons
of carbon emissions
avoided in 2013
versus 1999
Integrated enough
wind generation to
power 490,000
homes each year
Overview
After many decades of buying electricity from utilities that produced and delivered electricity to their customers, New
Yorks 19 million consumers today enjoy powerful and under-appreciated benefits made possible by New Yorks bold
decision to reinvent the states energy marketplace.
The market transformation dates back to the mid 1990s, when federal and state policymakers revolutionized New
Yorks approach to buying and selling electricity. With little fanfare, the change, which sought to make New Yorks
energy markets more competitive and efficient, has produced significant benefits, including:
$6.4 billion in fuel cost savings due to increases in electricity generation efficiency from 2000 through 2013.
$540 million saved due to reduced reserve requirements.
Nearly 25 million tons of carbon emissions avoided in 2013 compared to 1999a 41 percent reduction equivalent
to taking 4.8 million passenger vehicles off the road.
2013 electricity commodity costs are only 2 percent higher than electricity commodity costs in 2000, while inflation
grew by more than 35 percent over that same time frame.
Electricity generated by wind power in New York increased from 103 gigawatt-hours in 2003 to 3,541 gigawatt-hours
in 2013, enough electricity to power 490,000 New York homes each year.
These gains reflect New Yorks 15-year-old commitment to competitive electricity markets that produce real
benefits to consumers, the environment, and the economy. Through competition, New York State is achieving
its goals of cleaner energy, improved efficiencies, and economic development.
The New York Independent System Operator (NYISO) is an independent and not-for-profit organization that
manages the flow of electricity across New York so it is produced and transported where it is needed in exactly
the right amount at exactly the right time.
The NYISO balances the supply and demand for electricity throughout the state. To provide the lowest-cost power
available to reliably meet consumer needs, we conduct and monitor competitive auctions of wholesale electricity
every five minutes, every day of the year.
GENERATE
TRANSFORM
TRANSMIT
TRANSFORM
DISTRIBUTE
CONSUME
Electricity is produced
by local power plants.
Transformers ramp
up electricity to
high voltage to be
transmitted.
High-voltage power
lines move electricity
through the grid.
Transformers lower
the voltage for use in
homes and businesses.
Electricity moves
to low-voltage
distribution lines run
by local utilities.
Electricity is delivered
via local utilities to
consumers.
Improved fuel efficiency benefits consumers as the reduced fuel requirements lower the cost of supply. It also benefits
the environment in terms of avoided emissions. Improved fuel efficiency translated into an estimated $6.4 billion
in fuel savings from 2000 through 2013. During that same time frame, carbon emissions associated with electricity
generation declined by more than 40 percent.
300%
drove up the cost of typical consumer goods by 35 percent from 2000 to 2013, the
wholesale cost of electricity in 2013 was only 2 percent higher than in 2000.
Environmental gains
40%
IN SYSTEM-WIDE
CARBON EMISSIONS
4.8
MILLION PASSENGER
VEHICLES
Demand-reduction programs
Since New York restructured the electricity market, efficiencies made possible through competitive markets have
changed the way in which we address peak electricity demand periods, ultimately saving resources and money.
Prior to competitive wholesale markets, New Yorks utilities and regulators typically addressed growth in peak
demand by increasing generating capacity or expanding transmission. Today, demand-response resources can be
used to shave the peak during periods of high demand, supporting system reliability while providing incentives or
revenue to businesses that reduce energy consumption during periods of high demand.
Large power customers and aggregated sets of smaller consumers participate in several demand-response programs
developed in NYISO markets. When a new all-time peak was recorded on July 19, 2013, demand-response programs
helped to shave peak demand by approximately 1,000 megawatts.
4,000
3,500
2,533
Gigawatt-hours
3,000
2,500
1,500
873
1,000
3,060
2,108
2,000
500
2,787
1,282
528
103
112
103
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
NYISO successfully
integrated New York
wind energy facilities
capable of producing
enough electricity to
power 490,000 homes.
FPO
1965
1966
1967
19701990s
1992
1996
1997
Congress passesand
the president signs into
lawthe Energy Policy
Act of 1992, aimed
at improving energy
efficiency.
Responding to state
and federal actions, the
NYPP files a proposal
with the FERC to form
an independent system
operator (NYISO), which
is then approved.
1990s
(December)
1999
NYISO assumes
operational control
of the states power
grid and begins
the operation of
competitive wholesale
electricity markets
statewide.
A nationwide movement to restructure the electricity industry emerges, driven by the need to
address rising electricity prices by encouraging efficiencies through greater competition.
518.356.6000 | www.nyiso.com
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