NYPA board approves $600M credit line for efficiency projects as utility targets double
The New York Power Authority's Board of Trustees on Tuesday approved a $600 million revolving credit facility to support NYPA's issuance of commercial paper notes, which in turn supports its energy-efficiency offerings.
The credit facility — for short-term borrowing — will be available through January 2022, with two possible one-year extensions. NYPA's energy efficiency offerings target some of its largest customers, including New York universities, municipalities, school districts and large cities.
The state's Public Service Commission last week approved an acceleration of New York's energy efficiency goals, including doubling targets for investor-owned utilities through 2025. NYPA's new credit facility will support those efforts, the board said.
New York's aggressive greenhouse gas reduction goals have led to increased targets for energy efficiency and other clean energy resources. With projects aimed at the state's largest electricity customers, NYPA's new credit facility will be important to keeping the energy savings going.
New York Gov. Andrew Cuomo, D, earlier this year called for raising the state's efficiency targets. Last week's PSC decision set stricter utility goals and adopted a subsidiary target of a 3% annual reduction in electricity sales by 2025.
The changes are expected to put New York on a path to achieve its energy savings goal of 185 TBtu by 2025.
"Having access to this revolving credit facility will enable NYPA to expand our range of energy efficiency programs for our customers," NYPA President and CEO Gil Quiniones said in a statement.
The new credit facility will replace an existing revolving credit agreement that will expire in January. NYPA said it currently has $531 million of Series 1, 2 and 3 Commercial Paper Notes outstanding to support numerous projects across New York.
The bank syndicate, which is facilitating the credit, is led by JPMorgan Chase and includes TD Bank, State Street Bank and Trust Company, and Wells Fargo Bank. NYPA said the syndicate was chosen to meet requirements that banks offering the credit must have a short-term credit rating of A-1/P-1/F1+ or comparable from Standard & Poor's, Moody's Investor Services and Fitch Ratings.