PSC approves upstate New York rate case
By Ken Daly, National Grid New York President
New delivery prices effective in April
Three-year plan mitigates bill impacts, calls for $2.5 billion in infrastructure investment
I am pleased to report that the New York Public Service Commission today approved our three-year upstate New York rate proposal. The plan mitigates the impact for upstate customers by phasing in delivery price increases over three years, beginning April 1, and allows us to continue substantial investment in our electricity and natural gas networks.
With approved rate and infrastructure investment plans now in place both upstate and downstate, combined with recent debt refinancing for our downstate operating companies, our New York business is solidly on track to deliver on the commitments that are vital to our customers now and in the future. Our entire New York business stands ready to meet the challenges of investing to modernize our infrastructure, working to enhance safety, reliability and resiliency across our system, and continuing to deliver the economic and environmental benefits that make such an important difference to the communities we serve.
Impacts for customers: Following more than a decade of bill stability
Under the three-year rate plan, which includes the dollar-for-dollar benefits of the new federal tax cuts, typical monthly residential electricity bills will increase by about 3 percent, or $2, in year 1. Typical residential gas bills will increase by less than 2 percent, or $1, the first year. Subsequently, increases for residential customers’ total monthly gas and electricity bills will range from $3 to $3.25 for each commodity in year two and year three of the agreement.
The plan also enhances our new Energy Affordability Program, which has the potential to provide more than $70 million in annual low-income benefits. As a result, the majority of eligible customers will see a decrease in their typical average bill beginning in January 2018. We have set a goal to increase enrollment in affordability, efficiency and gas safety programs by more than 50,000 customers.
Investing and innovating on our customers’ behalf
Today’s approved agreement, which was reached with 20 parties to the case, supports our plan to invest $2.5 billion over three years to modernize our electricity and natural gas networks, promote economic growth across upstate and improve customer service. Our ongoing infrastructure investments upstate and downstate are critical to ensure that we have safe, reliable and resilient energy systems. This includes programs specifically designed to harden our networks to maintain service and power quality in the face of increasingly frequent and severe storms. Most recently, the critical nature of this need was illustrated by the damaging heavy, wet snow and high winds of back-to-back nor’easters. Thanks to the incredible determination and resiliency of our people, more than a million customers in upstate New York and New England were safely and quickly restored to service.
Laying groundwork for a strong future
Our three-year upstate agreement authorizes a return on equity of 9 percent each year – a crucial target for the investment community – and allows the company to access financial markets at the lowest possible cost. It also calls for 250 new National Grid jobs to support electricity and gas operations, grid modernization and customer programs, and we will be continuing and adding new natural gas and electricity training academies through Erie, Hudson Valley and Onondaga community colleges.
Additionally, the company will continue to support the state’s comprehensive REV clean energy strategy, launching new demonstration projects including initiatives to test smart home technologies, a gas demand response program and a distributed generation cost-recovery model.
Thank you to the extended team that worked many long hours over the last 18 months – sometimes through weekends and holidays – to deliver this successful outcome. This was the most complex and challenging rate case we have ever undertaken. Now that it is approved, each of us will have a role in fulfilling our commitments ahead – investing and innovating on our customers’ behalf to build a stronger, smarter, more resilient energy grid, to prepare for the next generation of clean energy, and to further improve our safety, reliability and customer service for years to come.
Click here for details on our approved rate plan.
UNY Rate Case series: