1. NYS Department of Public Service 1 New York State Renewable Portfolio Standard (RPS) Case 03-E-0188 Issued and Effective September 24, 2004

2. NYS Department of Public Service2 Renewable Goals: Target (25% of NYS energy sales from renewable resources by 2013) Target (25% of NYS energy sales from renewable resources by 2013) –24% from the Commission’s RPS Program –At least one percent from voluntary green market Increase energy resource diversity Increase energy resource diversity Reduce air emissions Reduce air emissions Support NYS economic development Support NYS economic development

3. NYS Department of Public Service3 Categories of RPS Eligible Resources Main Tier Main Tier –General Requirement: Commercially operational on or after 1/1/03 Customer-Sited Tier Customer-Sited Tier –General Requirements: (1) Commercially operational on or after 1/1/03, and (2) must be located in NYS Maintenance Resources Maintenance Resources –General Requirements: (1) In commercial operation any time prior to January 1, 2003, and (2) must demonstrate need to receive RPS financial support

4. NYS Department of Public Service4 Eligible Resources by Tier Main Tier Main Tier Biogas Biogas Biomass Biomass Liquid Biofuel Liquid Biofuel Fuel Cells Fuel Cells Hydroelectric Hydroelectric Solar Solar Tidal/Ocean Tidal/Ocean Wind Wind

5. NYS Department of Public Service5 Eligibility by Tier (cont.) Customer-Site Tier Customer-Site Tier –Typically behind the meter installations Fuel Cells Fuel Cells Solar Solar Wind Wind Methane Digesters for farm waste Methane Digesters for farm waste

6. NYS Department of Public Service6 Maintenance Tier Eligibility Maintenance Resources Maintenance Resources Hydroelectric (run of river, 5 MW or less) Hydroelectric (run of river, 5 MW or less) Wind Wind Biomass Direct Combustion Biomass Direct Combustion

7. NYS Department of Public Service7 Key Component of the RPS Central Procurement Model administered by NYSERDA Central Procurement Model administered by NYSERDA –Procurement of renewable attributes –Ongoing monitoring and evaluation of the program –Receiving and managing RPS funds from utilities –Developing a process for the 2009 Review Why Central Procurement Why Central Procurement –PSC’s long term vision: robust competition for retail functions –Most efficient way to jump start the program

8. NYS Department of Public Service8 First Procurement RFP circulated on December 20, 2004 RFP circulated on December 20, 2004 16 bids received in January 2005 16 bids received in January 2005 Results: Results: –7 contracts awarded – procured 821,611 MWh/yr –average price about $23/MWh A second procurement is likely in the first quarter of 2006 A second procurement is likely in the first quarter of 2006 There will be multiple procurements over the term of the program There will be multiple procurements over the term of the program

9. NYS Department of Public Service9 Further Information Public Service Commission website http://www.dps.state.ny.us Public Service Commission website http://www.dps.state.ny.us –Select “Whats New” –Select “Renewable Portfolio Standard” NYSERDA website http://www.nyserda.org NYSERDA website http://www.nyserda.org