NY regulators catch an earful from consumers on utility rate hikes
ALBANY — Advocates for consumers and senior citizens are leading the fight against National Grid’s proposed boost in electricity and gas rates while pro-business groups say a hike is necessary to fortify the upstate economy.
Since late April, when the rate requests were filed, the state Public Service Commission has been flooded with more than 600 comments — most of them arguing the higher prices sought by the company are excessive.
The company says it plans to use the additional revenue from higher rates to invest $2.7 billion into its electricity and natural gas networks across the upstate region.
It also says it plans to equip its residential and commercial customers with two million new smart meters and increase assistance to an additional 50,000 customers who are struggling to pay their bills.
But scores of consumers are asking New York regulators to pull the plug on the requests.
“I’m retired and my wife is retiring this year,” a resident of Constantia, Robert W. Timerson, wrote to the utility regulators. “We cannot afford these increases. And please don’t tell me to apply to some assistance program.”
National Grid’s request — revised in July when it shaved more than $70 million from the initial application — would allow the company to collect an estimated $261 million more for electricity delivery and an additional $70 million for gas delivery.
The increases, according to the company, would result in total monthly bills for both supply and delivery to rise by 11 percent, or $8.93 per month, for a residential customer using 600 kilowatt hours. The increase on delivery alone would be 17.5 percent.
For residential gas customers, based on 77 therms of consumption, the monthly increase would be $8.70, or 12.5 percent overall, with an increase of 20.5 percent for delivery.
Opponents of the increase include the Public Utilities Law Project, the New York chapter of AARP, which advocates for people age 50 and older, and an array of organizations advocating for low-income residents.
But the company has forged alliances with some influential business and community organizations, including the Eastern New York branch of the American Red Cross, whose chief executive officer, Gary Striar, gave the proposed rate increase his blessing.
Striar, in a letter to the PSC, noted National Grid has supported his agency’s blood donation drives and helped it distribute smoke alarms in upstate communities.
“Obviously, a safe and reliable supply of energy is critical to our region,” Striar said in his comment to PSC commissioners.
Another endorsement came from Kate Fish, executive director of the Adirondack North Country Association, based in Saranac Lake. She said the proposed changes in delivery rates “are aligned with our strategies to drive cleaner and more efficient energy systems” across northern New York.
But opponents say higher National Grid rates will cause pain in communities that have not yet recovered from the Great Recession and where many people are already hard-pressed to pay existing bills. Some 66,000 customers in National Grid’s service territory were hit with shut-off notices last year, and that number will escalate if rates go higher, said Richard Berkley, the Public Utility Law Project director.
In places such as Niagara County, where customers of National Fuel Gas saw a 2 percent boost in their gas bills in May, a jump in electricity delivery rates will exacerbate the pain among those who can least afford the higher prices, Berkley said.
“The reason why so many individuals are getting involved is that rate cases are when the company’s operations become transparent and accountable,” Berkley said. “The rest of the time the company is doing its thing and John and Jane Q. Public don’t have any way of knowing whether the company is spending their money prudently. A rate case allows you to make sure your community gets benefits, not just the company.”
Several elected officials have weighed in against National Grid’s application, among them Syracuse Mayor Stephanie Miner, who is exploring a run for governor next year.
“The PSC must reject the rate increases as proposed and put customers first,” Miner said.
A National Grid spokesman, Stephen Brady, said the delivery portion of the company’s bills have been “remarkably stable for the better part of the past decade” and a rate increase would strengthen the company’s ability to maintain and improve the grid.
Brady also noted the company hopes to attain a settlement with regulators that would allow it to gradually phase in the higher rates, so bills would not suddenly spike higher in the first year.
National Grid’s request for higher rates comes on the heels of the Cuomo administration’s effort to increase the state’s reliance on renewable sources of energy such as wind and solar power to 50 percent by 2030. That goal is known as REV — Reforming the Energy Vision.
James Denn, a spokesman for the PSC, said: “Part of the rate case process is to ensure that it is not business-as-usual for utilities and to obtain, consistent with REV, more capital efficiency and energy efficiency as part of utilities’ plans to modernize the grid and ensure reliability affordably.”
He said the rate review is designed to ensure that National Grid’s rates “remain just and reasonable.”
The commissioners will have the final say in setting the rates, he noted. A decision is expected in early 2018.
Joe Mahoney covers the New York Statehouse for CNHI’s newspapers and websites. Reach him at jmahoney@cnhi.com