Dive Brief:
- The New York Public Service Commission on Thursday approved large three-year rate increases for Avangrid utilities New York State Electric & Gas and Rochester Gas and Electric, along with billions of dollars of investments in reliability, resiliency and customer service.
- The average NYSEG residential electric customer will see monthly bills rise more than 10% in the first year and more than 31% over three years. Average RG&E residential electric bills will rise 7.4% in the first year and more than 22% over three years.
- The approval of the utilities’ Reliable Energy New York plans “is an investment in the future reliability and resiliency of the New York grid,” Avangrid CEO Pedro Azagra said in a statement. Consumer advocates called the decision “unaffordable and outrageous.”
Dive Insight:
Regulators approved the rate increases unanimously but some commissioners were reluctant, according to local media. The PSC’s announcement stressed that the decision cut the utilities’ rate request by almost 50%.
Commissioner John Maggiore called it “an unusually high rate increase" during the PSC’s meeting, according to the Democrat & Chronicle.
NYSEG had requested a first-year electric revenue increase of $274 million, or 16.8% increase in total revenues. RG&E had sought a first-year electric revenue increase of $93.8 million, representing an 11.3% increase in total revenues.
Regulators instead approved a levelized electric rate increase for NYSEG for the rate year beginning May 1, 2023 of $137.3 million, followed by $160.7 million for 2024 and $200.6 million for 2025. For RG&E, the increases are $50.9 million, $56.6 million and $65.3 million. Gas rates will increase as well.
The decision “will allow us to make critical investments in our gas and electric infrastructure to improve reliability, expand our energy efficiency offerings, execute on important pilots to test new technologies to support our green energy future, and provide additional assistance to those who need it,” NYSEG and RG&E President and CEO Trish Nilsen said.
The approval includes $5.2 billion in total investments for the two utilities, including $1 billion “to focus on serving our customers, with increased bill assistance and expanded protections during extreme temperature events,” the utilities said.
Infrastructure investments include a circuit breaker replacement program, efforts to repair or replace transmission line infrastructure, a distribution load relief program to address power transformer capacity overload, substation rebuilds and more.
NYSEG serves more than 905,000 electricity customers and RG&E serves approximately 389,000 in the upstate region of the New York.
Consumer advocates say the rate increases stand in contrast to poor customer service and will hurt vulnerable customers most.
“Even now, before these rate hikes are imposed, 13% of NYSEG and RG&E customers are more than 60 days in arrears, and 5,500 had their service terminated in August alone,” Irene Weiser, the coordinator of Fossil Free Tompkins, said in a statement.
“These rate hikes will put more people in debt, make housing more unaffordable and will strain small businesses still recovering from COVID,” Weiser said.
Heading into Thursday’s PSC meeting, state lawmakers called for regulators to reject the utilities’ rate hike.
“Families and small businesses across Upstate New York are struggling to pay high utility bills and cannot afford another double-digit rate hike,” state Sen. Lea Webb, D, said in a statement. “These increases will continue to disproportionately impact low-income and marginalized residents in our communities.”
