New York's ReCharge NY program down to its last 34 megawatts of cheap electricity
From left, Bradley Cohn, owner and president of Precision Label Corp., guides Lewis M. Warren Jr., NYPA trustee, and Justin Driscoll, NYPA CEO, on a tour of his company's facility in Hauppauge Friday. Credit: Barry Sloan
Helping small businesses is a priority of the state Power Authority as it seeks to maximize the impact of the remaining low-cost electricity that it has to allocate, the authority’s chief told Newsday.
Justin E. Driscoll, CEO and president of NYPA, said its economic development program, ReCharge NY, has 34 megawatts remaining to distribute to employers across the state. One megawatt can power about 1,000 homes.
The program began in 2012 with 910 megawatts authorized by then-Gov. Andrew M. Cuomo and the State Legislature.
NYPA is focused on “small- and mid-sized companies where we can have a significant impact,” said Driscoll, an attorney who has led the authority since October 2021.
WHAT TO KNOW
- Small businesses are the focus of efforts by the New York Power Authority to allocate the remaining low-cost electricity in a statewide economic development program, called ReCharge NY.
- The program began 12 years ago with 910 megawatts but only 34 remain to be distributed, officials said.
- Nearly 220 local employers have won power allocations and together they employ more than 71,000 workers.
“We want to be able to move the needle for these companies…With 34 megawatts left, we’re not going to be able to power a major facility, such as a [computer] data center,” he said in Hauppauge, referring to hubs filled with computer servers that use a lot of electricity
The ReCharge NY program has 217 customers on Long Island — by far the most among the state’s 10 regions, with the Buffalo area being No. 2 with 94 customers, according to NYPA records.
Driscoll said businesses and nonprofits receive low-cost electricity for up to seven years in return for job creation and investment in their operations. Half of the power is generated by the authority’s giant hydroelectric dams along the St. Lawrence River and north of Niagara Falls.
“That discounted hydropower makes a big difference here on Long Island where energy costs are higher…So, the impact of [ReCharge NY] allocations is greater” than in areas with lower electric rates such as Buffalo, he said.
On the Island, nearly 71,350 jobs are tied to power allocations and $2.2 billion has been pledged in equipment purchases, building construction and other capital investments, the records show.
“We regularly audit the businesses that are in the program to make sure they’re keeping up with their job commitments and their capital [investment] commitments,” Driscoll said. Some customers “are far exceeding them…[But] for one reason or another [some customers] might fall a little behind and we sometimes have to proportionately reduce the power that we’ve allocated to those companies."
Some of the largest employers in Nassau and Suffolk counties have won power allocations, including Northwell Health hospitals in both counties; NYU Langone’s Winthrop hospital in Mineola; vitamin maker Nestle Health Science, formerly Nature’s Bounty, in Bohemia; financial transactions processer Broadridge Financial Solutions in Edgewood, and generic drugs manufacturer LNK International in Hauppauge.
But nearly half the recipients are small businesses with 100 or fewer employees.
At Precision Label Corp., a manufacturer of labels in Hauppauge, two power allocations — totaling 176 kilowatts — generated savings that helped with the purchase of a larger building and equipment to handle more orders. The Hauppauge company turns out labels for bottles of vitamins, cosmetics and wine, with half its customers from the metropolitan area.
“When you have extra cash to reinvest [in the business] that’s significant,” said Brad Cohn, president of Precision Label. The low-cost power “makes a dent in my electric bill…Those little things all add up, especially when you’re a small business that’s trying to get ahead,” he said.
Cohn gave NYPA officials a tour last week of Precision Label's 40,000-square-foot office, factory and warehouse at 50 Marcus Blvd. As the printing presses rolled, he recalled being courted by officials from North Carolina and Georgia to move the company to their state.
That didn’t happen, Cohn said, because Precision Label was able to lower its costs, thanks to the power allocations, plus tax breaks from the Suffolk County Industrial Development Agency that will total $332,750 over 10 years.
In return, Precision Label promised in 2017 to more than double its space by moving from East Farmingdale to Hauppauge, and to add seven jobs to its workforce of 30. The workforce now hovers around 60 people.
The company also spent $15 million on building renovations and equipment compared with the promised $6 million in expenditures, according to Cohn and IDA records.
After walking through the label-making operation and speaking with employees, NYPA trustee Lewis M. Warren Jr., a commercial banker who lives in Nassau, said, “This is a testament to what we can do together in the community. Economic development leads to jobs, and jobs lead to better communities, safer communities, more inclusive communities,” he said.
Warren joined the NYPA board in June after serving as vice chairman of the Nassau IDA board in 2018-2022.
“I’m a kid from a small business in Virginia, so I understand firsthand how important it is to create jobs and how ReCharge NY is an opportunity to help do that,” he said, adding most of Long Island’s employers are small businesses.
James T. Madore writes about Long Island business news including the economy, development, and the relationship between government and business. He previously served as Albany bureau chief.
