The New York Independent System Operator (NYISO) has issued its annual update on the challenges facing New York State’s electricity supply and delivery system, Power Trends 2010: New York’s Emerging Energy Crossroads.

“A series of energy crossroads are emerging,” NYISO President & CEO Stephen G. Whitley said. “To build a smarter, greener and more reliable grid, our state will need to work through an array of key issues.”

The report identifies the major factors expected to influence the future outlook for electricity in the Empire State. These issues include the pace of economic recovery, the impact of energy efficiency initiatives, the advent of smart grid technology and the continued development of renewable power resources.

In addition to detailing the challenges, the report enumerates the various efforts currently underway to improve the electric system. These include collaborative efforts between New York and its neighboring systems, as well as a larger effort among grid operators in the Eastern Interconnection.

“The most effective use of renewable resources will require a combination of innovative technology and progressive collaboration among power systems,” Whitley said.

Taking full advantage of wind power and other variable renewable resources will require both new technologies, such as advanced energy storage systems and the removal of barriers to trade among regional power markets. Improved coordination will strengthen the ability of grid operators to adjust to the dynamic changes in system conditions, such as the ebb and flow of wind power, according to the report.

One of New York State’s major energy initiatives is the “45 x 15” program, which aims to increase renewable power production and have it account for 30% of New York’s total electricity supply, while also reducing consumption by 15% of forecast levels by the year 2015. The progress of these programs will play a key role in New York’s energy future.

Other factors relating to state policy are a myriad of current and proposed environmental programs that affect the electric system. These include carbon controls, nitrogen oxide emissions limitations, ozone standards and water quality protections.

“The cumulative effect of this array of regulations on the electric power system will require continued analysis and assessment,” the report stated.

Electricity consumption has been trending lower than anticipated due to the recent economic downturn. However, power demands are expected to increase as the economic recovery builds.

The report also notes the recent growth in wind power and identifies various efforts that are underway to develop and integrate it into the power system.

“We can’t rest on our laurels when it comes to renewables,” Whitley said. “New York’s power supply is still predominantly fossil-fueled.”