WASHINGTON — A new public power utility may be created in New York for the first time in over 10 years if a measure introduced in the state Legislature is approved. It would serve the far upstate counties of St. Lawrence and Franklin, and kick off with an initial bond deal of around $90 million.
The proposed North Country Power Authority would be the first new public power utility in the state since the Long Island Power Authority was created in 1998. It would be the first new public power utility in the country since the Winter Park, Fla., created its own municipal electric utility in 2005.
The NCPA could issue up to $175 million of bonds, notes, or other obligations annually, according to the bills that would authorize it.
Operations would be financed through revenue bonds, said Stephen J. Weinstein, public finance counsel to the group of 24 towns and villages that are proposing the power authority.
In its initial years the NCPA would buy electricity through the open market. Over time, the authority would negotiate power-purchase agreements with public electricity generators, the largest of which is the New York Power Authority, Weinstein said.
A measure sponsored by Sen. Darrel J. Aubertine that would create the NCPA was approved March 8 in the state Senate by a vote of 56 to 3. Companion legislation sponsored by Assemblywoman Addie J. Russell is still pending in the Assembly.
If the NCPA is created, its initial bond issuance is expected to be about $90 million, “depending on market conditions and needs,” according to Weinstein.
The power authority likely would spend one or two years organizing and negotiating the purchase of distribution facilities, then could go into operation in 2012, he said.
“There has not been a lot of creation of public or municipal power organizations in the last decade or two,” Weinstein said.
According to Nick Braden, spokesman for the American Public Power Association, which represents about 2,010 public power systems in the U.S., there were only 17 new public power systems created in the last 10 years.
About one-third were created between 1880 and 1910, according to the association.
More than one-half of the systems in the country serve communities with 10,000 or fewer residents. The towns and villages in in northern New York hoping to create the new power authority include about 75,000 people.
Public power is “very much an established model that this new North Country Power Authority would be joining,” Weinstein said. “These organizations consistently have lower rates, higher reliability, and very widespread customer satisfaction ... and have local control over a vital community service.”