Assembly Spikes Biggest Climate Proposal in New York Budget

“The Assembly, by my understanding, basically refused to negotiate this in the budget,” said Patrick McClellan, policy director of the New York League of Conservation Voters, which has spent the last several months lobbying for the HEAT Act along with dozens of other climate and environmental groups. “My understanding is they never put a counteroffer on the table, they never got into the weeds on negotiating NY HEAT in budget negotiations.”

On Thursday, the legislature published its main environmental budget bill — and NY HEAT was left out. Given the notorious secrecy of budget negotiations, there has been little public debate on the measure, and Assembly leadership has not given a reason why the most substantial climate legislation on the table this year was killed. Advocates and lawmakers point to the lobbying efforts of National Fuel, an upstate gas utility, as a key culprit.

Assemblymember Patricia Fahy, who sponsors the HEAT Act, said she was surprised and disappointed by this year’s budget outcome. She said that opposition from unions and most utilities had waned, and that as recently as Sunday, she thought a deal on the HEAT Act could still be struck.

But those hopes quickly unraveled this week.

The Assembly did not include the HEAT Act in its budget proposal last month. Two Assembly sources told New York Focus that Democrats in the chamber did not discuss it in detail during the internal budget deliberations that followed, despite requests from some members.

This isn’t the first time the chamber has held up major climate legislation under Speaker Carl Heastie. Last year, a carveout sought by the Assembly nearly derailed the state’s plan to ban gas in new buildings — a policy the chamber eventually embraced. In 2022, Heastie declined to hold a vote on the Build Public Renewables Act, which supporters insisted had more than enough votes to pass. (A version of that bill ultimately passed in last year’s budget, too.)

“We do sweat the details here,” said Fahy, when asked about the chamber’s reticence on major climate proposals.

While the HEAT Act could still pass during the legislative session after the budget is finalized, the odds of passing major bills outside of the mammoth spending proposal tend to be slimmer, and advocates fear postponing the debate to regular session will kill the measure.

“The fact that the Assembly is willing to kill a deal on this really raises questions about how serious they are, how serious leadership is about addressing the relentlessly increasing energy bills New Yorkers are facing,” said Liz Moran, Northeast policy advocate at Earthjustice.

National Fuel has spent tens of thousands of dollars so far this year on lobbyists in Albany, plus more on ads spanning a wide range of media. New Yorkers for Affordable Energy, an industry group co-led by National Fuel, spent another $100,000 on ads and other communications against the bill, Politico reported last week.

The group argues that the HEAT Act would cut off a critical source of energy during blizzards and other storms that regularly pummel the electric grid.

“Governor Hochul and her radical allies want to leave YOU out in the cold!” read one ad from New Yorkers for Affordable Energy last month.

National Fuel is now alone among New York’s major utilities in its steadfast opposition to a gas transition plan. There may be a business reason for that: It is the only utility in the state that drills for gas on top of distributing it, meaning a shift to electricity could deliver an especially large blow to its bottom line.

Con Edison, which mainly serves electricity, has publicly backed pro-electrification policies for the last couple of years. This year, ConEd voiced its broad support for Hochul’s clean energy plans and, more recently, issued a memo stressing the urgency of repealing the 100-foot rule.

Another major player has come around to the HEAT Act in recent weeks: National Grid. The UK-based utility, which serves mostly gas in New York, earlier this month circulated a joint memo with three climate groups, outlining a proposed deal on the bill. The memo, first reported by Politico and reviewed by New York Focus, maintained core provisions of the bill, notably the six percent affordability goal and a rollback of the obligation to serve gas.

The two other major gas utilities in New York — Avangrid and Central Hudson — did not respond to repeated inquiries about the HEAT Act. Neither has publicly weighed in on the legislation this year.

Unions, which have broadly opposed the HEAT Act, also softened their opposition during budget talks, Fahy told New York Focus. (The AFL-CIO declined to comment on its position in the negotiations.)

But that wasn’t enough to get the bill over the finish line.