Authorizes the public service commission to implement performance-based regulation of electric or gas corporations; requires that any such regulation shall provide performance standards and metrics by which such performance shall be measured.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A9640
SPONSOR: Barrett TITLE OF BILL:
An act to amend the public service law, in relation to authorizing the
public service commission to implement performance-based regulation of
electric or gas corporations
PURPOSE OF THE BILL:
To authorize the Public Service Commission to implement performance-
based utility regulations of electric or gas corporations and establish
desired outcomes for such regulations.
SUMMARY OF SPECIFIC PROVISIONS:
Section 1: Amends the Public Service Law by adding a new Section 66-x to
establish authorize the Public Service Commission to develop and adopt a
framework for implementing performance-based regulations of electric or
gas corporations. Such performance-based regulations may be used to
provide incentives and penalties.
§ 2: Effective Date
JUSTIFICATION:
As we see one request after the other for double digit rate increases
from utilities, it is abundantly clear that our current regulatory
framework for utilities is not working. It is time to explore alterna-
tives to the "cost of service" utility system which was designed nearly
a century ago and which encourages building more infrastructure. Perfor-
mance-based regulations award or penalize utilities based on how they
perform against stated goals.
This bill authorizes the Public Service Commission to develop and adopt
a framework for implementing performance-based regulations using incen-
tives and penalties while establishing the metrics by which performance
should be measured including: reducing greenhouse gas emissions; expand-
ing the use of distributed energy resources, community solar, micro-
grids, demand response, and energy efficiency programs; enhancing quali-
ty, reliability, and resiliency of service; offering flexible payment
plans to reduce disconnections and other programs that address the qual-
ity and affordability of service; and improving all aspects of utility
operations to reduce costs and pass savings onto ratepayers.
LEGISLATIVE HISTORY:
New Bill
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS:
To be determined,
EFFECTIVE DATE:
This act shall take effect immediately.
STATE OF NEW YORK
________________________________________________________________________
9640
IN ASSEMBLY
January 21, 2026
___________
Introduced by M. of A. BARRETT -- read once and referred to the Commit-
tee on Energy
AN ACT to amend the public service law, in relation to authorizing the
public service commission to implement performance-based regulation of
electric or gas corporations
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. The public service law is amended by adding a new section
2 66-x to read as follows:
3 § 66-x. Performance-based utility regulations. 1. The commission shall
4 be authorized to develop and adopt a framework for implementing perfor-
5 mance-based regulation of electric or gas corporations. Such perfor-
6 mance-based regulation may be used to provide incentives and penalties
7 to:
8 (a) reduce greenhouse gas emissions, as defined in section 75-0101 of
9 the environmental conservation law;
10 (b) expand the use of distributed energy resources, community solar
11 projects, microgrids, demand response programs, and energy efficiency
12 programs;
13 (c) enhance the quality, reliability, and resiliency of electricity
14 and gas service in the state;
15 (d) offer flexible payment plans that reduce disconnections of elec-
16 tricity and gas service for low-income customers and other programs that
17 address the quality and affordability of electricity and gas services
18 for all customers; and
19 (e) improve all aspects of utility operations to reduce costs and pass
20 savings on to ratepayers.
21 2. A framework that is adopted pursuant to subdivision one of this
22 section shall:
23 (a) provide for performance standards and a baseline from which
24 performance shall be measured;
25 (b) provide for performance metrics that are clear, objective, verifi-
26 able and achievable for measuring the performance of an electric or gas
27 corporation;
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD14479-04-6
A. 9640 2
1 (c) describe how such performance standards and metrics are to be
2 carried out;
3 (d) identify actions and mechanisms that an electric or gas corpo-
4 ration may carry out or implement to meet such performance standards;
5 and
6 (e) provide incentives or penalties based on the performance of the
7 electric or gas corporation. In developing such incentives and penal-
8 ties, the commission shall take into consideration the impacts of such
9 incentives and penalties on rates paid by ratepayers.
10 3. The commission may provide for performance metrics that are not
11 subject to incentives or penalties, but such performance metrics may
12 require each electric or gas corporation to file an annual report with
13 the commission on the performance of such electric or gas corporation,
14 as measured by such performance metrics.
15 § 2. This act shall take effect immediately.
