Climate law mandates could cost New Yorkers $4,000 in higher energy bills, state analysis shows

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. 

At an unrelated press conference in Manhattan, Hochul defended her decision to revisit the 2019 Climate Leadership and Community Protection Act. “The world has changed dramatically since 2019 – I wish it hadn't,” she said. “I wish all the circumstances and metrics that were looked at back in 2019 had remained consistent.” Hochul’s comments came a day after her budget director Blake Washington all but confirmed that the governor would seek to make changes to the law, while citing estimated cost burdens on everyday New Yorkers.

In both instances, the source for the numbers was not immediately clear. But a memo NYSERDA sent to Hochul’s office provides some insight into her new cost talking point as she prepares to battle the state Legislature over rollbacks to climate mandates. 

The memo on the “likely costs of CLCPA compliance” – dated Feb. 26, a day after Washington’s initial comments – lays out average costs to New Yorkers by 2031 under a hypothetical cap-and-invest system that would be necessary to meet the emissions benchmarks laid out in the climate law. (Hochul was expected to release rules for a cap-and-invest program last year, but she has continued to delay them.) According to NYSERDA’s analysis, upstate gas and oil households could see over $4,100 in gross cost increases if the state makes no changes to the law with current energy equipment. In New York City, gas households could see $2,300 of added costs. And gas at the pump could jump by an additional $2.23 per gallon.

The memo provides additional breakdowns, including the impacts of affordability measures. For current equipment, upstate households could still see a net cost increase of about $2,500, while those in New York City could see a net cost increase of about $1,500. Cost burdens were estimated to be slightly lower for households that switch out to more energy-efficient fossil fuel equipment.

“If fully implemented with regulations to meet the 2030 targets, CLCPA’s original design – differing accounting standards from the internationally-accepted approach and inflexible near-term targets – would combine to yield high costs to New York households and businesses,” the memo reads. “Addressing this cost escalation is essential to deliver a policy that supports affordability and economic competitiveness and is necessary to ensure continued progress on decarbonization policy.”

However, it wasn’t entirely bleak. The memo actually predicts net savings for “high efficient electrification” households that have converted to nearly all-electric power. Accounting for affordability benefits, “high efficient electrification” households upstate could save about $1,500, while those in New York City could save $800.

To perform the analysis, NYSERDA operated under hypothetical cap-and-invest regulations that would not include limits to the cost of allowances companies could purchase in order to exceed their emissions caps. In this instance, the authority started in the ballpark of $120 per ton of carbon emission, rising to $179.80 per ton in 2031. Per the memo, such rules would be needed in order to fully comply with the requirement to reduce New York’s emissions by 40% by 2030. 

NYERSDA also argued in the memo that the necessary acceleration in clean energy deployment in order to meet climate goals is “infeasible today.” Hochul on Thursday cited unexpected federal resistance from the Trump administration, which has taken steps to hobble New York’s and other states’ offshore wind development. “I did not expect Donald Trump to cut down some of the major resources of renewable power – wind and solar – like that, just end them, and then I'm supposed to still make up for that somehow,” she said. “I just need people to understand what this challenge is.”

Environmental advocates immediately blasted the memo. Justin Balik, Evergreen Action’s vice president for states, 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. “The answer here is, again, leaning into clean energy and not buying into some of these false claims from the fossil fuel community and the business lobby that somehow renewables are why people's bills are going up,” Balik said. “And it's troubling that those assertions are being entertained by the state right now.”

Advocates also criticized the use of hypotheticals in the analysis since no regulations are actually in place yet to examine. “There can't be cost estimates that are sound for a program design that hasn't been released yet,” Balik said. Liz Moran, New York policy advocate for Earthjustice, called it the “concepts of math” in a text message, referencing President Donald Trump’s somewhat infamous reference to the “concepts of a plan” to replace the Affordable Care Act. “The governor failed to implement the climate law for years, (and) New Yorkers are already paying for her procrastination,” Moran later added in a statement. 

Lawmakers also responded negatively to Washington’s initial comments  on Wednesday that appeared informed by NYSERDA’s analysis. “Yes we can address climate change, reduce costs for ratepayers, increase generation and create tens of thousands of good-pay jobs in the process,” state Sen. Pete Harckham, chair of the Senate Environmental Conservation Committee, said in a statement. “What we need is the political courage to do so.”

On the other side of the aisle, Republicans jumped on the analysis immediately as vindication their warnings were correct. “They’re finally admitting what we have known and said all along,” former Rep. Marc Molinaro, who is now running for Assembly, wrote on X. “This isn’t climate policy. It’s unaffordable and reckless.” The state Senate Republican conference, meanwhile, wrote on X that the state is “admitting” that climate policies from Democrats will cost you money.

Read the full memo here: