A new pricing plan that upped some Hudson Valley electric rates by as much as 10 percent would be repealed under a proposed law that has made its way through the U.S. House of Representatives.
Hudson Valley businesses and residential ratepayers saw their electric bills shoot up in May due to the implementation of an electric capacity zone. The impact on local bills varied based on power company, location and type of use but some industrial companies saw increases of as much as 10 percent.
U.S Reps. Sean Patrick Maloney, a Putnam County Democrat, and Chris Gibson, a Columbia County Republican, sponsored repeal legislation that was approved in the House this month by a majority of 253-170. Maloney, in a conference call with reporters July 11, noted the price increase came after a winter in which average bills doubled and tripled.
“It”™s an unacceptable burden based on the winter we just had and the energy prices we pay,” he said. “We”™re going to pursue every avenue to stop this and roll the rates back, including recovering the profits.”
Under the zone, power-generating companies such as Entergy Corp., the owner of Indian Point Energy Center in Buchanan, can charge more to distributors within the zone, like Consolidated Edison Inc. By compelling local utilities to purchase energy from suppliers within the zone, the Federal Energy Regulatory Commission, or FERC, is hoping to spur construction of new power plants in the region.
Critics have said a better option than the zone would be to improve transmitter technology to distribute surplus energy from upstate suppliers to higher-demand regions downstate. There are a dwindling number of power plants in the downstate region, yet that part of the state consumes a majority of New York”™s power. Opponents of the zone also say it works against state initiatives to develop better wind and solar technology to generate electricity.
Central Hudson Gas & Electric Corp. and New York”™s Public Service Commission, which regulates utilities in the state, are in the midst of litigation in federal court trying to repeal the zone. Gibson said FERC should pre-empt the court action and any Senate action.
“I think what they should do today is decide they are going to cease and desist and withdraw these rate hikes,” he said.
Charles S. North, Dutchess County Regional Chamber of Commerce president, said in a statement the capacity zone was “misguided.”
“Our federal government should be doing everything in its power to help stimulate the economy and make it easier for hard-working employers to do business and raise their families in our region, not saddle them with undue burden,” he said.
Dutchess and Orange counties have filed affidavits in support of the legal effort to stop or alter the capacity zone, which was originally suggested by the New York Independent System Operator. Orange County estimated its residents are paying an additional $10 per monthly bill due to the zone.
Marcus Molinaro, Dutchess County executive, said the region couldn”™t afford the rate hikes. “This rate hike affects not only large employers like IBM but the families that make up the region”™s communities,” he said.
Gibson and Maloney also are pushing for FERC to reform their process for decision-making to include public hearings and the concerns of ratepayers.
The bill needs approval by the Senate, where it is expected to be sponsored by Sen. Charles Schumer, a New York Democrat who has vocally opposed the capacity zone. The Senate may not take up the proposal until fall. It would then need to be signed into law by President Barack Obama.
The Hudson Valley capacity zone is one of four in the state. It affects some, but not all, customers of Central Hudson, Con Edison, Binghamton-based New York State Electric & Gas Corp. and the Orange and Rockland power company.
Leif Skodnick contributed to this report.
