N.Y. Comp. Codes R. & Regs. tit. 16, § 661.18 – Capital leases.

(a) the company receives approval from the commission to enter a long-term capital lease (see section 101 of the Public Service Law); and
(b) the company demonstrates in its filing that capital lease accounting is not detrimental to ratepayers.

The company may adopt capital lease accounting for transactions if two conditions are met for each financing arrangement: