State lawmakers are making progress in their efforts to revive the lapsed Power for Jobs program that provided low-cost electricity to more than 500 businesses across the state.

Gov. David A. Paterson and State Senate leaders have agreed on a plan to make the program permanent and double its size by absorbing a block of cheap power that now cuts residential electric bills across upstate by $2 to $4 a month.

But the Assembly has not signed on to the deal, leaving the fate of the Power for Jobs program, which expired on Saturday, still in limbo.

In the short term, the Senate and Assembly have passed legislation that would extend the program through June 2, and Paterson, who previously has resisted short-term extensions, plans to sign the two-week extension for a program that has existed on a year-to-year basis since 2005.

The agreement between Paterson and the Senate leaders would set aside slightly less than a third of the electricity — at least 300 megawatts of the 910 megawatts available through the expanded Power for Jobs program — for upstate businesses served by National Grid, New York State Electric & Gas Corp. and Rochester Gas & Electric.

“That’s a floor,” said Thomas Congdon, the deputy secretary for energy, who noted that the eligibility criteria favor manufacturers and companies that use large amounts of power, which are common upstate. “We’ve gone a long way in dealing with the concerns we’ve been hearing from upstate.”

Customers of those three utilities, under the current law, are the exclusive beneficiaries of the 455 megawatts of rural and domestic power that would be reallocated under the new plan to the larger statewide pool of less expensive electricity reserved for economic development.

State Sen. George Maziarz, R-Newfane, chairman of the Senate’s energy committee, is backing the agreement with Paterson after previously expressing fears that a larger statewide Power for Jobs pool would result in upstate getting fewer benefits from the cheap power generated here.

“We are making sure that a special emphasis is placed on upstate New York businesses and ratepayers,” Maziarz said. “There are a lot more protections in this for upstate than there are in the Assembly version of the bill.”

The deal between Paterson and the Senate would double the size of the Power for Jobs program by adding the 455 megawatts of electricity that now is used to shave a few dollars off residential electric bills upstate. State and business officials, including the Business Council of New York State and the Buffalo Niagara Partnership, contend that using the residential power for economic development will have a bigger impact on the state’s economy.

The agreement also would set aside at least 200 megawatts for business attraction and expansion, and as many as 100 megawatts for non-for-profit entities and small businesses.

Applicants will be selected based on their payroll and the number of jobs that will be created or retained, as well as the risk of the business leaving the state and the impact that electricity costs have on their operation. Commitments that the applicant makes to become more energy efficient also will be considered. Companies selected for the program would receive seven- year contracts to get the low-cost power.

The deal also would try to mute the impact on residential customers by setting aside $100 million for current recipients of rural and domestic power in the first year of the agreement, more than the current value of the residential power discounts. That amount would eventually be trimmed over a five-year period to $30 million a year, with farmers singled out to receive $5 million a year in electricity discounts.

The plan would continue the Power for Jobs program under the current rules for the first year while the New York Power Authority works out formal eligibility guidelines. Companies would be able to reapply next January, with current recipients that are not selected under the new guidelines phased out over a five-year period.

A total of 72 companies with nearly 14,400 employees in Erie and Niagara counties receive more than 36 megawatts of low-cost power through the program, which typically costs 5 percent to 20 percent less than market rates.

This is the second straight year the Power for Jobs program has expired. Last year, it was revived 10 days after it expired.

Drew Blum, president of Allied Frozen Storage, is hoping the warehouse operator will keep its allocation of 400 megawatts of less expensive power.

“It’s definitely something we’d be interesting in keeping,” said Blum, who added that losing the power would have a negative impact on the company.

“We’d have to analyze the impact. We’d have to pass a rate increase on to our customers. Then we’d have to see how they would react,” he said.