On January 1, 2003, Article 10 of the Public Service Law, which provided a fast track regulatory system for the siting of major electrical generating facilities (i.e., those with a rated capacity of 80 MW or more), lapsed.  Prior to that, to avoid having to go before a Siting Board and the extensive public review process required by Article 10, which included review of environmental impacts and required applicants to put up money to help the public intervene with expert help, private companies that wanted to construct so-called peaker plants (whose output would be used primarily during peak hours), would propose facilities which purportedly had a rated capacity of 79.5 MW.  Exempt from the Article 10 Siting Board practice, LIPA’s approval of the peaker plants was subject to the State Environmental Quality Review Act (“SEQRA”).  Invariably, LIPA would declare itself to be the lead SEQRA Agency, and would always issue a negative declaration (meaning that the project could be approved without first having to prepare a Draft Environmental Impact Statement).  Much to the consternation of the public, LIPA would approve the location of these peaker plants wherever LIPA felt was a convenient location for LIPA, without any meaningful environmental review.

Because local municipalities could now directly control applications for the siting of electrical generating facilities, few if any base load power plants (which provide electricity 24-hours a day) were approved after Article 10 lapsed.  On August 4, 2011, the Governor approved the Power New York Law of 2011, which he had proposed to provide one-stop review of any electrical generating facility with a rated capacity of 25 MW or more. New Article 10 is power neutral, meaning it applies to any electrical generating facility rated at 25 MW or more, regardless of the source of the proposed power (petroleum based, solar, wind; are all covered).

A little known provision of the Power New York Law is Section 173, which defines the applicability of Article 10 to Public Authorities like LIPA. Article 10 fully applies to all “major electric generating facilities which any such authority builds or causes to be built.”  However, “For generating facilities which are not major electric generating facilities, none of the above named authori­ties shall be permitted to serve as lead agency for purposes of environ­mental review pursuant to the provisions of the environmental conserva­tion law.”

Why did the Legislature declare that LIPA could no longer serve as lead SEQRA agency for minor facilities (i.e., those with less than 25 MW rated capacity)?  The Assembly Committee debate (June 22, 2011) makes clear that the Legislature did not want LIPA to do what it did previously with regard to siting of peaker plants – declare itself lead SEQRA agency and approve them wherever LIPA wanted without requiring meaningful environmental review.

Does this mean that the Legislature exempted LIPA from SEQRA altogether when it adopted Section 173 in 2011?  Clearly, it did not.  Article 8 of the Environmental Conservation Law (SEQRA) was not amended to limit LIPA’s SEQRA obligations. Nor did the Department of Environmental Conservation (DEC) amend its SEQRA regulations (6 NYCRR Part 617) to change whatever LIPA’s SEQRA obligations may be.

Published elsewhere in this CMM Newsletter is the author’s Blog:  “The Towns Must Step Up Environmental Review of Commercial Solar Projects in Suffolk County Because They Can’t Rely on LIPA to Do It [and LIPA Must Stop Approving Power Purchase Agreements In Violation of SEQRA]”.   Briefly, even though LIPA cannot serve as lead SEQRA agency when commercial solar electric projects with a rating less than 25 MW are proposed, it remains an involved SEQRA agency.  As such, LIPA may not approve Power Purchase Agreements for any such solar facility (a SEQRA action) until the Town, as lead agency, completes its SEQRA review and either requires preparation of a DEIS, or determines that a DEIS need not be prepared.

Unfortunately, LIPA ignores its SEQRA obligations, and approves Power Purchase Agreements for commercial solar electrical facilities without waiting for the lead agency to complete SEQRA review.  As convenient as LIPA and the developers may find ignoring SEQRA to be, if anyone challenges the approvals by means of an Article 78 Petition, they run the risk that the approval will be declared null and void, and the application process will have to begin all over again.