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Steam is still used for some power and heating in New York, the bigger steam plants can send their 'excess' steam to smaller plants via underground pipes - the steam rising up from the streets is just some of it escaping on it's travels - that's the answer I got anyway when I asked Google the same question! it's also because of rainwater etc. falling onto the hot steam pipes, thus creating more steam that you can see from the manhole covers.

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Q: Why do the manholes steam in New York?
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