NYRI Talking Points/Issues

NYRI’s Line Is Not Needed

NYRI’s line does not result from a regional or statewide planning process nor is it a
project required to address electric system reliability concerns.

NYRI is an “economic” project, proposed by a recently formed company funded by
Canadian investors with no existing or proposed customers and no experience
developing electric transmission infrastructure.

New York’s Independent System Operator (NYISO), undertakes an annual
planning process to identify and satisfy the reliability needs of New York’s electric
system. NYISO has a 10-year planning horizon. In 2007 and 2008, after NYRI
applied for a siting certificate in 2006, NYISO concluded that existing transmission
owners’ plans and proposed market-based solutions are sufficient to address the
system’s reliability needs for the next 10-year period without NYRI. NYRI’s
project is not considered one of the plans or market-based solutions that will
maintain the reliability of the system. Rather, NYISO considers NYRI’s project to
be an “alternative regulated solution” that does not need to be implemented in
order to satisfy the system’s reliability needs for the next 10 years.

NYRI’s “economic” project thus does not serve any identified reliability need and
NYRI has not shown that its project will result in any economic benefit other than
to its private investors.

NYRI Fails to Consider Programs to Reduce Demand and Conserve Energy

NYRI claims that its line is needed to satisfy increasing demand for power in
downstate New York. NYRI does not take into account the numerous State plans
and initiatives that are currently underway to reduce demand and conserve
electricity within the State and within New York City.

In 2007, the Governor announced a comprehensive plan for reducing electricity use
by 15 percent by the year 2015. Around that same time, New York City’s Mayor,
Michael Bloomberg, introduced his PlaNYC to reduce the City government’s
energy consumption by 30 percent within 10 years. Shortly after these initiatives,
the NYS Public Service Commission commenced a proceeding for the design of an
electric and natural gas Energy Efficiency Portfolio Standard (EEPS) to establish
targets for energy efficiency and to reverse the pattern of increasing energy use.

More recently, Governor Paterson directed the State’s two major power authorities,
the New York Power Authority (“NYPA”) and the Long Island Power Authority
(“LIPA”), to aggressively pursue energy conservation. LIPA is preparing a $1
billion, 10-year “Efficiency Long Island” initiative to reduce electricity demand and NYPA has committed to almost doubling its conservation budget to $1.4
billion through 2015 to reduce electricity use in government buildings and schools
throughout the State. Consolidated Edison has proposed to the Public Service
commission a set of energy efficiency programs that the Company projects is
capable of producing a 810,000 megawatt-hour saving.

NYRI ignores these numerous initiatives as it claims the public needs its project to
satisfy energy demand.

NYRI’s Project is the “Transmission Line to Nowhere”

NYRI claims it will solve an electric transmission congestion problem in downstate
New York. However, to solve the problem, the State needs transmission
reinforcement into Load Zone J, New York City, and Load Zone K, Long Island.
NYRI’s line falls far short of those load pockets. Two load zones, Zones H and I,
fall in between as do electrical interfaces critical to transmission into Load Zones J
and K. NYRI’s line ends in Orange County, in Load Zone G. NYRI does not
propose to connect Load Zone G with any substation in Load Zone J or K. Nor,
has any other company proposed to relieve congestion between the Rock Tavern
substation in Load Zone G where NYRI would deliver its power, and New York
City, in a way that would allow NYRI delivered power to get to where NYRI
claims it is needed. NYRI is thus, a “transmission line to nowhere,” that fails to
address the constraints related to delivery of power to Load Zones J and K.

NYRI’s Line Would Threaten the Existing Electric System

Existing transmission and generation owners within New York State oppose
NYRI’s proposed transmission line because its interconnection to their systems
threaten the reliability of the overall system, will affect their ability to transmit or
produce power or will require them to pay for improvements to accommodate
NYRI.

According to the Consolidated Edison Company of New York and its subsidiary
Orange and Rockland Utilities, NYRI’s proposed transmission line would
adversely affect the reliability of Con Edison’s system by decreasing the transfer
capability into the Con Ed service area. Similarly, according to the Central Hudson
Gas and Electric Corporation, NYRI’s line would have a direct and adverse impact
on Central Hudson’s Rock Tavern substation and would impose operational and
reliability impacts on other portions of Central Hudson’s electrical system. Certain
generation owners take issue with NYRI’s project because it would require them to
ramp down their power output to the system to make room for NYRI power
imported from elsewhere.

NYRI’s Line Threatens a Multitude of Sensitive Sites Within the State, Not Just in
Oneida or Herkimer Counties

NYRI’s proposed route would run through seven New York counties and 38
municipalities. NYRI’s application concedes that its line and connection stations
would cross or run along side approximately 170 streams, 87 mapped state
wetlands, more than 4,000 acres of potential federal wetlands, 240 archaeological
sites, 92 properties listed on the National Register of Historic Places, 582 locations
eligible for listing, a National Heritage Corridor as well as various state parks,
forests, and forest preserves, agriculture districts, scenic byways, recreational trails,
wildlife management areas, lakes, ponds, aquifers, and rivers, including a federally
designated wild and scenic river. And these are just the sensitive areas that NYRI
has acknowledged will be impacted by its proposed project.

Experts indicate that hundreds of other sensitive sites were not included or
analyzed in NYRI’s application since NYRI failed to conduct field surveys.

NYRI Impacts Scenic River

NYRI would cross or run parallel to the federally designated Upper Delaware
Scenic and Recreational River and within the boundaries of its protected
management area. This river corridor was designated by Congress in 1978 for its
exceptionally high scenic, recreational and ecological values and consists of the
river itself as well as the D&H Canal, a National Historic landmark, and the
Delaware Aqueduct, a National Civil Engineering Landmark. This 73.4 mile river
corridor is home to numerous threatened and endangered plant and animal species.
It supports a world-class trout fishery and is recognized by the Audubon Society as
an Important Bird Area. At least 300,000 fishermen, bird watchers and tourists visit
the corridor each year.

NYRI’s proposed route would add 65 to 135-foot high transmission support
structures every 300 to 1500 feet within the scenic viewshed of this scenic river.

NYRI Intrudes on Wildlife Management Areas

A portion of NYRI’s proposed line would be constructed in the Mongaup Valley
Wildlife Management Area, an area in Sullivan County known for hosting one of
the largest Bald Eagle wintering sites in the State, and which also supports several
active eagle nests. NYRI proposes building a transition station within this wildlife
management area and 1,200 feet of cable would be placed under the Rio Reservoir.
The Mongaup Valley Wildlife Management Area is home to rare wildlife species
or species of special concern, including the Red-Shouldered Hawk, Cerulean
Warbler, Timber Rattlesnake and Spotted Salamander. Mongaup Valley is also a
popular area for hiking, scenic viewing, boating, bird watching, cross-country
skiing, snowshoeing, hunting, fishing and trapping.

NYRI Proposed Route Runs Through the Forest Preserve

NYRI’s proposed route will also cross or run adjacent to other significant State
lands, including those in Forest Preserve counties, which are required to be
“forever kept as wild” under the State Constitution, and in non-Forest Preserve
counties, that are also protected under the Constitution from sale, lease or
development without special legislation. These areas are protected to conserve
natural resources for their beauty, wilderness character, and geological, ecological
and historical significance.

NYRI Would Raise Rates for Consumers Upstate

When NYRI first filed its application for a certificate from the NYS Public Service
Commission, it conceded that it would increase the rates of electric utility
ratepayers in those communities where the line will be sited, as well as other
upstate New York communities.

NYRI now claims that it will decrease New York electric rates. NYRI’s claim is
wrong for two reasons. First, as NYRI even now concedes, the project will
increase consumer rates for four upstate New York load zones during the first six
years of the nine-year period studied. For the Capital region – the project will
dramatically increase consumers’ rates after nine years.

Secondly, and more importantly, NYRI’s claim of cost reductions rests on
speculation that NYRI’s line will result in investment in new generating capacity in
upstate New York that would otherwise be located in the Capital region or
downstate and that the power produced by these assumed upstate projects will push
upstate electricity prices down. NYRI’s cost reduction claims are not based on
connection of existing generation in upstate New York with demand in downstate
New York. Rather, NYRI bases its cost reduction claim on the wishful thinking
that “if they build it [the transmission line], they [generation projects] will come.”

NYRI’s Proposed Line Threatens Economic Development in Upstate New York

NYRI’s line, which will likely result in higher electricity costs for Upstate
communities and lower property values for those living near the proposed
transmission line route, will further impede economic development in those upstate
communities already suffering from stagnant economies.

In addition, NYRI fails to recognize the impact its line would have on the State’s
tourism economy. NYRI focused on only three areas in its tourism analysis -the
Upper Delaware Scenic and Recreational River, the Delaware and Hudson Canal
Park and a proposed resort in Norwich. Numerous other tourist areas will suffer
from the proposed line, such as the Mongaup Valley Wildlife Management Area,
the Basha Kill Wildlife Management Area, the Shawangunk Ridge area, and others.

Even in those areas it did analyze, NYRI focused only on the summertime when a
“heavy forest cover” would purportedly hide the lines and towers. NYRI failed to
consider the line’s effect on tourism during late fall, early spring or winter when
leaves won’t hide its lines and towers and visitors will still look to enjoy these
scenic and recreational areas.