The president of the New York Independent System Operator characterized the state’s electricity supply outlook this summer as “tight, but marginally acceptable,” and prices as stable compared to a year ago.

New York’s in-state supply could fall somewhat short of demand in June, according to William J. Museler, but supply within New York City is projected to just keep up with demand through September. Current projections are based on this summer’s weather being hotter than normal but not as hot as in 1999 when the region sweltered under a heat wave.

Museler said the number of cooling-degree days this summer is expected to be above the 10-year, 20-year, and 30-year normals, but still “well below” 1999 levels. The forecasted temperature-humidity index could increase the state’s peak load 600 Mw or by 2% of the 30,620 Mw peak expected, Museler said.

Last summer was unusually cool throughout the Midwest and Northeast.

He was somewhat more pessimistic about the future, noting the 2-5 year outlook is “serious” because electric generation isn’t being built fast enough to keep up with rising demand. He called siting decisions and demand response proposals made this year “crucial for the future.”

If New York doesn’t add new generating capacity and programs to encourage conservation, he said the results are inescapable. Higher electricity rates and declining reliability will be the result. In addition, the state will have missed an opportunity to achieve “significant” environmental improvements, Museler said.

Alternately, if the state moves aggressively to site significant amounts of new generating capacity and implements demand response initiatives, Museler predicted reserve margins will approach 30% and wholesale prices could be reduced 20-25%. He said sulfur dioxide emissions could be reduced 28% and nitrogen oxide emissions by 43%.

Comparing the level of additions in New York to surrounding areas, Museler noted there is no new generation under construction in the New York ISO control area. In comparison, 6,419 Mw is being built in New England and 3,763 Mw is under construction in PJM Inc., which includes parts of Pennsylvania, New Jersey, and Maryland. More than 3,000 Mw is scheduled to come on line in New England this year and more than 2,500 Mw in PJM. Even more is on the books for 2002 and 2003 in those areas.