ALBANY - A chorus of opposition from upstate consumers and advocacy groups made a difference as state regulators severely limited National Grid rate increases.

The new plan also sets the stage for expanded discounts for low-income households.

The state Public Service Commission, in a ruling issued Thursday, allowed the company to phase in higher rates beginning April 1.

At that point, a combined monthly gas and electric bill will climb $3.42 on average, the commission said.

Similar increases will go into effect in each of the following two years, with a typical monthly bill for both gas and electricity being $16 higher than current charges in the final year.

The estimates for residential customers are based on the usage of 1,080 therms of natural gas and 600 kilowatt hours of electricity per month.

FIRST PLAN REJECTED

Hundreds of consumers and numerous municipalities and advocacy groups cranked up the heat on the state's utility watchdog after the proposed rate hike was announced last year by National Grid.

It is one of New York's largest utility companies, with operations spread across some 25,000 square miles in the upstate region.

Public Service Commission staff turned down an initial National Grid proposal that would have sharply escalated rates.

OUTCRY

Such a spike would have been a budget buster for many upstate households, said Richard Berkley, director of the Public Utility Law Project of New York, a consumer advocacy group.

"There was input from all over upstate, and people were all saying the same thing: We cannot afford what the company is asking for," Berkley said.

Many senior citizens, for example, noted that minuscule cost-of-living increases in their monthly Social Security checks would have been dwarfed by the higher rates first sought by National Grid, Berkley pointed out.

While studies show the number of people living below the federal poverty line in the upstate has decreased, he said, about 20 to 40 percent of residents are struggling to make ends meet financially.

CUT 86 PERCENT

Public Service Commission Chairman John Rhodes said the settlement received broad support from environmental groups, organized labor and the utility's business customers.

"This decision is a win for the company's customers and for the future of cleaner and more resilient energy," Rhodes said in a statement.

The commission said its final order pared $351 million from the company's initial request, an 86 percent reduction.

Both state officials and Berkley said the plan commits National Grid to assist municipalities in updating street lighting with energy-efficient light-emitting diodes (LEDs), making them available at the lowest price possible.

AFFORDABILITY PROGRAM

The order also reflects the state's first implementation of a policy aimed at driving down utility costs as a percentage of household income for low-income people.

The commission said the program "will result in substantial bill reductions" - as much as 55 percent - for an estimated 160,000 electric customers and 60,000 gas customers.

National Grid will be expanding its investment in its energy-affordability program more than threefold, by about $70 million.

Under the commission's order, the utility will be allowed to take in 9 percent of its equity investment in profits. Customers would get a slice of any profits that top that level.

TRUMP TAX BREAK

Helping drive the settlement was the fact that National Grid, along with other utility companies, saw its tax obligations drop by about $76 million due to recent changes in the federal tax code.

"An unexpected benefit of the Trump tax cut is that ratepayers will get a tremendous amount of money back over the next one or two decades, and it will help hold down rates," said Berkley, whose commission insisted the tax savings be returned to customers.

In a statement, National Grid welcomed the conclusion of the rate case.

"This plan allows us to invest $2.5 billion over the next three years in our energy infrastructure while reducing the short-term impact on bills and providing customers a level of delivery price assurance," said spokeswoman Virginia Limmiatis.

Consumer and environmental advocacy groups weighing in on the rate filing also included the American Association of Retired Persons, PUSH Buffalo, Acadia Center, Alliance for a Green Economy and the Natural Resources Defense Council.

National Grid serves 1.6 million electricity customers in New York, and 600,000 households rely on the utility for natural-gas service.

 

Joe Mahoney covers the New York Statehouse for CNHI’s newspapers and websites. Reach him at jmahoney@cnhi.com.

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