One would think New York’s leaders had learned the importance of a functioning electricity market after the city was darkened by the Northeast Blackout of 2003. Yet a recently released report from the New York Building Congress warns that within the next 20 years, demand for electricity will stretch the system to the limit. As early as 2010, New Yorkers could start feeling the pinch, paying skyrocketing electric bills at home while working in offices with the lights dimmed between periodic brownouts.

The numbers tell the story. Population projections put the number of New Yorkers at 9.4 million by 2025, 16% higher than the population in 2002. The number of jobs in the city is expected to increase to 4.46 million in 2010 from 4.15 million in 2002; by 2025, the city is projected to house 5.03 million jobs, a 21% gain over 2002. That population boom will lead to the construction of ever more housing in all five boroughs, the Building Congress notes, and many of those new jobs will involve working in at least 44 million square feet of office space that is expected to be completed in the next two decades.

Then come the other ancillary developments, like the 90 schools the city expects to build by 2009. And not only will there be more homes and offices, but each household and office will consume more juice. As the Building Congress notes in its report, the proliferation of computers and their accoutrements, as well as conveniences like air conditioning, have helped to drive up demand for electricity by 1.5% a year since 1990 even as individual appliances have become more efficient.

The Building Congress report points out that 23 high-profile projects in particular will drive up demand significantly. New construction on the World Trade Center site and the Atlantic Yards, Columbia’s expansion, the Goldman Sachs and New York Times buildings, the Fulton subway hub and the Second Avenue Line, and the Croton water filtration plant are just some of the developments that are expected to consume 175 megawatts a year by 2010 and another 500 megawatts on top of that by 2025.

The report estimates that the city is going to need to build a total of 6,000 to 7,000 megawatts of generating capacity before 2025, including refurbishment or replacement of aging infrastructure. Plants producing 3,500 megawatts will turn 60 years old in the next two decades, while plants producing another 6,000 megawatts will turn 45. About 3,000 megawatts of that capacity will need to be replaced in the next 20 years. To account for population and job growth, the city will need a net gain of between 2,400 and 3,000 megawatts. But where that electricity will come from is anyone’s guess.

The new generators will need to be built somewhere within the five boroughs or their immediate vicinity. Current regulations require that the city provide 80% of its peak demand from within its own borders. That’s not an arbitrary bureaucratic fiat but recognition of an ugly truth – the current grid of transmission lines into the city is not capable of importing large quantities of electricity, even from western New York, which is relatively electricity-rich.

Yet “siting” power plants within the city, or anywhere else in New York, for that matter, has grown only more complicated since early 2003. On January 1 of that year, a provision in state law that previously streamlined the permitting process for new plants expired. Article X, as the regulation was known, had limited individual communities’ ability to block power plant construction and dramatically shortened the amount of time builders had to wait for permission to break ground. When it came up for legislative review in 2002, however, the two chambers of the assembly and the governor failed to agree between themselves on whether to renew it. It lapsed.

As a result, power plants are now subject to the same onerous environmental review process as other development projects. But because of their size and the inevitable pollution concerns, that process can drag on even longer than the red tape for a standard big-box retailer. Gavin Donohue, the president of the Independent Power Producers of New York,a trade group, estimates that were one to start the ball rolling today, it would, even without community opposition, still take between five and seven years to start turning the turbines.

Other disincentives stand in the way of increased generation capacity. The director of energy and telecommunications at the Business Council of New York State suggests that the state’s Renewable Portfolio Standards, designed to shift 25% of the state’s energy consumption to electricity produced from renewable sources by 2013, discourages investment in traditional generators, as does the current expense of fuels like natural gas. And investment has suffered the past few years during a recession and a post-Enron shakeout in the business. Siting, however, remains the primary obstacle. Albany still purports to support reinstating Article X in principle, but while the parties haggle over the wording the city is walking a high (voltage) wire.

New York City is running out of time to address the problem. As early as 2008, the city will need reinforcements – additional generators or better transmission lines from outside the five boroughs – of 500 megawatts because the city will be bumping up against the 80% rule. That might not hearken immediate problems, but as the system approaches capacity it will be more vulnerable to small problems that can snowball. In August 2003, New Yorkers witnessed firsthand the havoc that one faulty switch can wreak during a period of heavy demand. The next few years will determine whether blackouts become a way of life.