By Tom Grace
Cooperstown News Bureau
NYSEG, a subsidiary of Energy East, has petitioned the state Public Service Commission to raise electric rates 18.6 percent and natural gas rates 17.4 percent.
If the PSC approves the increases, the higher rates would likely take effect next summer, agency spokesman Jim Denn said.
Denn said Wednesday that because the request was made just last month, the PSC has not yet scheduled evidentiary hearings to take testimony on whether the rate hike is warranted.
Following the evidentiary hearings, the PSC will hold public statement hearings meant to gauge opinions on the proposed new rates, he said.
The rate-hike request, made Sept. 17, pertains to another Energy East subsidiary, Rochester Gas & Electric, as well as the New York State Electric & Gas Corp. Energy East is a subsidiary of the Spanish energy giant, Iberdrola.
In a statement issued Sept. 18, Michael Conroy, senior vice president and chief operating officer of NYSEG and RG&E, said the rate hike is needed.
``While our electricity service rates have declined and our natural gas rates have remained essentially flat since 1996, the expenses necessary to provide safe and reliable service to our customers have climbed year after year," Conroy said.
``These ever-increasing operating and maintenance costs make this rate request essential for us to continue providing the level of service our customers expect and deserve,'' he said.
Money from the rate hike would be invested in infrastructure, according to the firm.
Energy East estimates the proposed new rates will increase the typical NYSEG residential electricity bill $12.39 per month and the typical NYSEG residential natural gas heating bill $25.34 per month.
The firm noted in its statement that NYSEG's rates are less than those charged by many other New York state utilities.
According to information posted on the Internet by the PSC at
http://www.dps.state.ny.us/typical_bills/util_elec_res_bills_Jan_2009.pdf, electric costs vary widely in the state. For example, residential bills for use of 500 kilowatt hours range from $66.36 charged by Orange & Rockland Utilities to $120.13 charged by Consolidated Edison Company of New York, with NYSEG currently charging $77.08.
Energy East's proposed rate hikes have been criticized by political leaders, including state Sen. James Seward, R-Milford, who said Wednesday: ``I hope the PSC will look at this very closely because in my view it's going to hurt businesses and residents. It's coming at a bad time, and it's going to dampen our economic recovery.''
Seward noted that in the present state budget, which he voted against, there was a provision to increase taxes on electricity.
U.S. Sen. Charles Schumer, D-N.Y., has asked the PSC to reject the rate-hike request. Schumer said the agency should make sure Iberdrola uses reserve funds established when it to took over Energy East to stabilize rates rather than raise them.
"The bottom line is that this rate hike is premature, not in the spirit of the agreement that led to the merger and must be promptly rejected by the PSC,'' Schumer said in a statement.
Joyce Boyd, Otsego County's Department of Social Services commissioner, said the rate hike would probably force more people to seek help from the government in paying their utility bills.
``If they come in here for emergency help, there is a county cost for that,'' she said.
James Powers, chairman of the Otsego County Board of Representatives, said: ``It would be one thing if NYSEG got a rate hike and businesses could pass it on, but that won't work here. We have farmers, workers, people on fixed incomes who can't pay more.''
Susan O'Handley, executive director of the Cooperstown Chamber of Commerce, said Chamber members are looking for ways to spend less, not more, on electricity. Toward that end, the Chamber has formed the Cooperstown Energy Alliance and is working with Energy Next to deliver cheaper power, she said.
``18.6 percent?'' she said. `That's an incredible hike.''
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