AARP Renews Call For Independent Consumer Advocate in NYS

Dec 8, 2014

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A non-profit group says consumers are being left in the cold when it comes to input about a proposed electric rate hike in the Hudson Valley. It says older consumers, in particular, can ill afford the possible two-digit hike. Meanwhile, the utility is aiming for a lower rate hike.

AARP, which advocates for consumers over 50, says utility consumers are being shut out of negotiations on Poughkeepsie-based Central Hudson Gas & Electric Corporation’s proposed 14.8 percent electric delivery rate increase as the utility company and regulators hold closed-door discussions. AARP and other groups are calling for consumers to have a seat at the table in the form of an independent consumer advocate. There has been legislation put forth to create the New York State Office of the Utility Consumer Advocate and AARP New York Legislative Director Bill Ferris says his organization will push again.

“The independent consumer advocate for utility rates has been passed by the Assembly two years in a row with bipartisan support,” says Ferris. “It has failed to pass the New York State Senate and AARP is going to make it a priority to pass that bill in the New York state Senate when they reconvene in January 2015.”

Democratic Assemblyman Kevin Cahill, whose district includes Central Hudson customers, has been supportive.

“Well there’s no question that the consumer has not been adequately represented in state proceedings since the dissolution of the Consumer Protection Board,” says Cahill. “The successor organizations, the [New York State Department of State] Utility Intervention Unit and the Public Service Commission themselves are ill-equipped to handle all of the needs of consumers in an objective and a zealous way.”

In July, Central Hudson filed with the New York State Public Service Commission a proposed electric delivery rate increase of 14.8 percent, or about an 8.44 percent increase in an average residential customer’s total monthly bill. Central Hudson also requested a gas delivery rate hike of about 7.4 percent, which would mean about a 2.69 percent increase in an average residential customer’s total bill.

Central Hudson Spokesman John Maserjian characterizes the proposed rate increase differently, combining delivery and supply and a hoped for application of financial benefits from new owner Fortis, bringing the increase to 4.4 percent for the average electric bill and less than 1 percent for the average natural gas bill. It’s up to the PSC to decide whether to apply those Fortis benefits to achieve the reduced rate hikes. Meanwhile, Maserjian says there are 12 industry and consumer groups participating in the Central Hudson/PSC rate hike discussions.

“The recent announcements by AARP do not acknowledge the multitude of groups advocating on behalf of customers, both large and small, during utility rate cases in New York,” says Maserjian.

He notes that there was an opportunity before the rate case began to become party to the discussions. Jen Metzger is with Citizens for Local Power, a consumer group at the table in confidential discussions. She says both the AARP and Central Hudson are right, partially.

“I can just tell you that that that is both are half-right or half-wrong in that we, there’s, we are participants but we could definitely use a lot more resources than we have,” says Metzger. “And that’s where a consumer, an independent consumer advocate would be very important.”

Metzger says her group is the only one without a utilities attorney, for example.  Again, AARP’s Ferris.

“The independent consumer advocate that exists in 40 other states has a proven track record of saving ratepayers money in rate cases at their regulatory agency,” Ferris says. “We think it’s time that New York have an independent consumer advocate to help our consumers who are already paying the highest utility bills in the country.”

He points to Connecticut and New Jersey as states with independent consumer advocates that have saved consumers money.

Ferris says an AARP survey found the following. 

“We found in a recent survey that the majority of the 50-plus population in the Hudson Valley are struggling to pay for their utility bill,” says Ferris.  “So we think an increase on top of people already struggling is probably not the best way to go.”

No rate hike would come before July 1, 2015. After the closed-door discussions are complete, the public will have a chance to comment on the proposed rate hikes that emerge.