New Report Asks & Answers the $19 Million Question: Why Are Consumers Losing NY’s Utility Price Game?
Consumers Pay for Rate Hikes – and for Utility Companies’ Costs to Push Those Hikes; ‘Intervenor Funding’ Bill Before Governor Would Help Level Playing Field
ALBANY, N.Y. — New York’s utility customers footed a nearly $19 million bill for their utility companies’ expenses in pushing the latest round of rate hikes – on those very same customers.
Essentially, consumers pay for their utility company to increase their own utility rates.
“And that is why, in a large part, consumers are losing New York’s Utility Price Game,” according to The Great Utility Ratepayer Divide, a new analysis by AARP New York in consultation with the Public Utility Law Project (PULP).
AARP is urging Governor Kathy Hochul to sign a bill (S.3034-A/A.873-A) to help level the playing field and empower everyday consumers. Intervenor Funding would allow groups of individuals or not-for-profit organizations that represent residential or small business customers to apply for the reimbursement of costs to fight proposed rate hikes before state regulators, just as the utility companies do in every rate case. AARP recently joined over two dozen other organizations that sent a letter to the Governor urging her to sign the bill.
New York’s investor-owned utility companies piled up a combined $18.975 million in expenses for lawyers, consultants, and expert witnesses to make the case for their last respective rate hike proposals before the state Public Service Commission (PSC), according to the companies’ annual reports.
That money is added on to the companies’ expenses when the PSC sets new rates – which are paid by customers.
“The deck has been stacked against residential and small business utility consumers for years,” said AARP New York State Director Beth Finkel. “Those consumers need and deserve an independent voice to counter the well-funded cases pushed by the utility companies – especially since it’s the consumers who pay the bill for their companies’ cases. This legislation would take a step toward leveling the playing field, and Governor Hochul should sign it into law now.”
“Regulators depend on vigorous external stakeholder participation in their complex proceedings to develop facts and arguments that will be included in the evidentiary record upon which decisions must ultimately be based,” the report says.
“In New York, there is no shortage of such participation from utility companies or from large commercial and industrial customers. However, there’s a great divide between them and residential and small business consumers. Such smaller customers who need to power their homes and businesses would focus regulatory attention far more on the impact of high and rising rates. The proper functioning of the regulatory process depends on full participation by all parties to create an equal playing field. But the current field tilts significantly in favor of utility companies and large commercial interests.”
Here is how much each of the major New York utilities passed onto its ratepayers for its last gas and electric rate case:
AARP is the nation’s largest nonprofit, nonpartisan organization dedicated to empowering Americans 50 and older to choose how they live as they age. With nearly 38 million members and offices in every state, the District of Columbia, Puerto Rico, and the U.S. Virgin Islands, AARP works to strengthen communities and advocate for what matters most to families with a focus on health security, financial stability and personal fulfillment. AARP also works for individuals in the marketplace by sparking new solutions and allowing carefully chosen, high-quality products and services to carry the AARP name. As a trusted source for news and information, AARP produces the world’s largest circulation publications, AARP The Magazine and AARP Bulletin. To learn more, visit www.aarp.org or follow @AARP and @AARPadvocates on social media.