A new survey from the Independent Power Producers of New York (IPPNY) found that New Yorkers continue to support competitive electricity markets because competition keeps prices low. This reaffirmation of support for competition comes at a time of uncertainty: electricity demand is increasing, costs are rising, and policymakers are debating how to respond.
Most New Yorkers say Affordability Is the Top Priority
When New York voters were asked what matters most for the state’s electricity policy, 56% identified affordability and cost as the top priority. Respondents from across the state and political affiliations see rising electricity prices as a real problem, which is not surprising given that 71% of New York voters report their electricity bill increased in the past 12 months, and 44% said it increased significantly.
Despite affordability concerns, New Yorkers are not seeking significant changes to the system and recognize the best way to keep costs in check is to continue using competitive markets for generation and have state regulators continue overseeing utility transmission and distribution costs. While power generation relies on competition and market forces to keep costs low, ratepayers count on state Public Service Commissions to keep utility spending in check.
Independent power providers help keep electricity prices affordable because they don’t pass the investment risk of new generation facilities onto ratepayers. If power plant construction goes over budget or demand is lower than forecasted, it’s the investors—not ratepayers—on the hook. By contrast, if monopoly utilities overbuild transmission or distribution infrastructure or have projects with ballooning costs, state regulators can still allow utilities to collect guaranteed profits on that spending, which further raises bills.
Support for Competitive Markets Is Bipartisan
The survey found that support for New York’s competitive electricity system received bipartisan support among respondents. The majority of self-identified liberals (66%), moderates (62%), and conservatives (60%) all agreed.
Affordability was a key reason why people said they support markets, with 52% of supporters citing affordability as the primary driver. Voters understand what the data has shown for years: competitive markets deliver lower prices and better outcomes for residents.
The survey also showed that 79% of voters believe New York’s government should prioritize increasing competition in the energy market, if it could lead to more pricing options and a wider variety of energy choices.
These results echo findings from a report conducted by FTI Consulting for New York’s Affordable Clean Power Alliance. That study analyzed the benefits of competitive power markets in New York and found that competition protected ratepayers from cost overruns, has led to more rapid deployment of renewables and emission reductions, has supported thousands of jobs, and generated billions in state and local taxes.
It’s clear to voters that competitive markets can shield ratepayers from the risks of building new generation, all while continuing to deliver reliability and innovation.
Utility T&D Costs: The Real Driver of Bill Increases
A recent study from the Lawrence Berkeley National Laboratory showed that investments in transmission and distribution infrastructure are the “primary drivers” of higher electricity bills. This is not surprising when considering utilities, which earn a guaranteed rate of return on infrastructure investments, are incentivized to spend more and build more on grid upgrades.
When asked about perceived cost drivers, New York voters correctly identified transmission and distribution costs as significant factors, alongside taxes, fees, and fuel costs. Notably, competition among providers was rated lowest (14%) in terms of perceived cost influence, indicating that voters don’t see competition as the problem.
The Bottom Line:
The IPPNY survey reaffirms that New Yorkers support competition because they understand it can deliver affordable prices. They also recognize that transmission and distribution investments are the real cost drivers. As policymakers consider New York’s energy future, they should listen to what voters are saying loud and clear: keep competitive generation markets strong and focus regulatory scrutiny on keeping utility spending in check.
