Roger Caiazza
Rebecca Lewis posted two City and State articles that cited evidence that the Hochul Administration recognizes that the Climate Leadership & Community Protection Act (Climate Act) is so expensive that the Governor appears ready to propose changes to the Climate Act to reduce the costly clean energy transition.
In the first article Lewis explains that state budget director Blake Washington described the cost burdens of the green energy requirements at the Citizens Budget Commission breakfast on 2/25/26. Lewis stated:
Blake Washington called the Climate Leadership and Community Protection Act “well-intentioned,” but said circumstances had changed since former Gov. Andrew Cuomo signed the law in 2019. “Sometimes you can change governmental rules to just fit the times and actually adapt to the realities, the realities before us, not how we wish them to be,” Washington said. He added that the estimated average cost to New Yorkers of the energy transition under current rules comes to roughly $3,000, a number the governor finds “unacceptable.”
In the second article Lewis described the contents of a NYSERDA memo from President and CEO of the New York State Energy Research & Development Authority Doreen Harris to Jackie Bray, Director of State Operations outlining “likely costs of CLCPA compliance” under hypothetical cap‑and‑invest regulations needed to hit the statutory 40% by 2030 GHG reduction target. This appears to update some of the numbers that Washington quoted the day before. Lewis notes also that Hochul commented on the cost issues in an unrelated press conference at the same time the memo was “leaked”.
Gov. Kathy Hochul suggested on Thursday that the cost of fully complying to the state’s climate law could cost average New Yorkers up to $3,500 each. A new memo shared with City & State from the New York State Energy Research and Development Authority places the estimated cost for upstate gas and oil households even higher.
Lewis quoted the NYSERDA memo:
Absent changes, by 2031, the impact of CLCPA on the price of gasoline could reach or exceed $2.23/gallon on top of current prices at that time; the cost for a MMBtu of natural gas $16.96; and comparable increases to other fuels. Upstate oil and natural gas households would see costs in excess of $4,000 a year and New York City natural gas households could anticipate annual gross costs of $2,300. Only a portion of these costs could be offset by current policy design.
The memo explicitly frames the current Climate Act structure as leading to “high costs” if implemented as‑is, and says addressing this “cost escalation” is essential for affordability, competitiveness, and continued decarbonization progress. What is not so clear is why it was written now.
Leaked Memo Motives
The article by Lewis suggests that the memo was leaked. My friends with NYSERDA experience quashed that idea. They said that anyone at NYSERDA who leaked the memo would be dismissed on the spot. Management has full access to all computers and would easily identify who the culprit was. We think it was “leaked” as a test balloon. If it makes important people react the way they want, then they can say the memo is a draft in progress and was released prematurely. Then they will get their models to crank up the black box magic to come up w a modified set of numbers that supports their end game. If, on the other hand, the reactions are judged to be politically unacceptable, they will just explain it away in the “never mind” file.
Usual Suspect Response
Unsurprisingly, environmental advocates immediately blasted the memo.
Lewis quotes Justin Balik, Evergreen Action’s vice president for states, who said rather than running away from clean energy, Hochul should expand initiatives and programs she has already deployed, and seek opportunities for innovative clean energy solutions.” Balik went on to criticize the “the use of hypotheticals in the analysis since no regulations are actually in place yet to examine” stating: “There can’t be cost estimates that are sound for a program design that hasn’t been released yet.” I do not know what part of energy system modeling projections Balik thinks don’t rely on hypotheticals for a range of possible actions because that is the basis for all such work.
Vanessa Fajans-Turner, Executive Director, Environmental Advocates NY released a statement in response to the NYSERDA memo:
The figures leaked today don’t reflect reality. They don’t describe the policies our environmental agencies were building and that Gov. Hochul should be implementing — they’re a political tactic meant to scare legislators into giving her a way out of obeying the law. The Governor should know better.
The administration has chosen to turn away from years of its own modeling and research, give in to fossil fuel interests, and follow the Trump Administration’s lead by denying the real costs of climate change. Weakening the CLCPA will not lower utility bills; it will deepen New York’s exposure to volatile fossil fuel prices, and leave us choking on emissions, saddled with expensive generating plants and gas pipelines, and unprepared for a secure energy future.
Lewis also quoted a statement by state Senator Pete Harckham, chair of the Senate Environmental Conservation Committee that said: “Yes we can address climate change, reduce costs for ratepayers, increase generation and create tens of thousands of good-pay jobs in the process.” He went on to say: “What we need is the political courage to do so.”
In short, the usual suspects want to double down using the same talking points that got New York into the Climate Act mess. That is what I expect you get when you turn energy planning over to ideologues with no knowledge of energy systems or economics.
But Wait There’s More
To sum up, we have a range of average New York costs to fully comply with the Climate Act ranging from $2,300 to in excess of $4,000 from the Governor, Budget Director, and head of the agency responsible for planning the Climate Act transition plan. In my opinion, all these numbers quoted by Lewis are underestimated.
I compared the memo numbers with my previous work. Using data from the December 2025 State Energy Plan I compared costs for an Upstate New York moderate income household that uses natural gas for heat for replacement with conventional equipment and electrification equipment consistent with Climate Act goals. The difference in monthly energy costs and levelized equipment costs necessary to comply with the Climate Act would be $594 a month greater as shown in Table 1. Table documentation is available here. I believe that the cost of Climate Act compliance is the difference between replacement of conventional equipment and the highly efficient electrification equipment. Row 10 shows this difference. It lists the $594 increase in costs necessary for Climate Act compliance. On an annual basis the total is about $7,200.
Table 1: Upstate New York Moderate Income Household That Uses Natural Gas for Heat Projected Monthly Costs and Costs Necessary to Comply with the Climate Act
The articles and NYSERDA memo cost estimates are inconsistent with my evaluated cost of $7,200 per household. My costs are by household and the other average New Yorker numbers may be by person not household so that may explain some of the difference, but I think the difference is because the memo included the economy wide cap-and-invest program proposed by the Scoping Plan for the Climate Act.
A Perplexity AI query response found the “entire Energy Affordability Impacts Analysis section of the adopted 2025 Energy Plan confirms zero mentions of cap-and-invest, carbon pricing, allowance costs, or the Clean Air Initiative anywhere in the affordability chapter.” This means that my estimate of Climate Act costs do not include the cap-and-invest costs described in the NYSERDA memo. For the Upstate natural gas household in the NYSERDA State Energy Plan analysis including the costs of equipment necessary for Climate Act compliance and the cap-and-invest costs raises the total costs to $11,200 a year per household.
New York Cap-and-Invest
My first reaction was that this might signal the potential for a wholesale reconsideration of the Climate Act but I now think that these numbers are only associated with the New York Cap-and-Invest program. I have described the New York Department of Environmental Conservation (DEC) New York Cap-and-Invest (NYCI) regulations in many articles. Currently DEC has only finalized the Mandatory GHG Emissions Reporting Rule. There have been no suggestions when the two other necessary regulations will be proposed. The Cap-and-Invest Rule will define affected sources, binding caps, and allowance allocations. DEC also needs an auction rule that implements the auction that will be used to distribute allowances.
The lack of regulations is a problem. On 3/31/25 a group of environmental advocates filed a petition pursuant to CPLR Article 78 alleging that DEC had failed to comply with the timeframe for NYCI because DEC missed the January 1, 2024 date. I explained that the decision on the petition stated: DEC must “promulgate rules and regulations to ensure compliance with the statewide missed statutory deadlines and ordered DEC to issue final regulations establishing economy-wide greenhouse gas emission (GHG) limits on or before Feb. 6, 2026 or go to the Legislature and get the Climate Act 2030 GHG reduction mandate schedule changed. On 11/24/25 DEC appealed the decision to the Appellate Division. This means that the deadline of Feb 6 is suspended until the Appellate Division rules. Therefore, the State has no risk of being held in contempt and can safely ignore the deadline — which appears to be what is happening. However, the decision was clear: either promulgate the regulations or change the law.
I think that this gambit by the Hochul Administration is a test of how to proceed with NYCI. Hochul’s gubernatorial campaign is stressing affordability. It will be extremely difficult to argue that the Climate Act will reduce consumer costs if the NYCI regulations increase the price of gasoline by $2.23/gallon on top of current prices when they are enacted. If on the other hand, the legal deadlines are pushed back, then the costs will not impact consumers in this election cycle.
Conclusion
The Climate Act mandates an electric system that relies on wind, solar, and energy storage. Wind and solar are diffuse, intermittent, and correlated resources that never will reduce costs for ratepayers, but clean energy advocates refuse to acknowledge facts. Diffuse resources require additional transmission and ancillary service investments, intermittent resources require costly energy storage, and correlated resources require DEFR technologies that are not proven so costs are unknown.
It is encouraging that the Hochul Administration is finally acknowledging that the Climate Act is unaffordable, but disappointing that other politicians do not. More importantly, this does not seem to suggest that Hochul recognizes the whole law is never going to work. It is not at all clear why the Administration is doing this now. What is clear, however, is that this is all related to politics and does not necessarily address the unavoidable reality of the mandated Climate Act energy system.
Roger Caiazza blogs on New York energy and environmental issues at Pragmatic Environmentalist of New York. This represents his opinion and not the opinion of any of his previous employers or any other company with which he has been associated.
