New York, N.Y. — Today, Acadia Center, Alliance for a Green Economy, Natural Resources Defense Council, Vote Solar, and 41 other organizations joined to support a common set of principles to address one of New York’s most regressive charges for utility service: the unavoidable monthly fee that all residential customers must pay regardless of the amount of electricity consumed. “Joint Principles on Residential Fixed Charges in New York” calls on New York utility regulators to lower these inefficient and regressive rates. The 45 organizations come from many different perspectives, including low-income and consumer advocates, environmental and clean energy public interest organizations, solar advocates, and clean energy industry groups, and span national organizations as well as community organizations across New York.
“In order to achieve a cleaner, more modern and consumer friendly energy system, New York needs to reform and lower fixed charges. The current regressive approach was adopted in the 1990s and places barriers in the way of consumer adoption of modern technologies like solar and energy efficiency” said Daniel Sosland, president of Acadia Center, which has successfully advocated for lower residential fixed charges in Connecticut. “The diverse array of groups who have endorsed lowering fixed charges show that this would be a win for ratepayers, clean energy, and communities across New York.”
New York has very high fixed customer charges compared to other states. For example, National Grid has a residential fixed charge of $17 in New York, but only $5 in Rhode Island and $5.50 in Massachusetts. Central Hudson has even higher fixed charges at $24, which it is seeking to increase to $25, as well as an additional tiered “service size charge” for many customers. Acadia Center found that current average residential customer charges for major investor-owned utilities are higher in New York than all of its neighboring states. New York’s fixed charges are even higher than Wisconsin, a state that has been widely criticized for approving large fixed charge increases since 2014.
Mark LeBel, Attorney and Associate Director of Acadia Center’s Grid Modernization and Utility Reform Initiative, said: “Most states across the country use a definition for residential fixed charges that is much narrower than New York’s approach. Our testimony in the National Grid rate case demonstrated that residential fixed charges are currently far too high and that reform would benefit the majority of residential ratepayers. Large consumers would pay more, but 61% of monthly bills would go down with lower residential fixed charges.”
“We see no reason why utility customers in New York should be paying fixed charges that are three times higher than those paid to the same company by customers in other states,” said Jessica Azulay, program director of Alliance for a Green Economy. “It’s high time to reduce these charges so that low-income customers, low energy users, and people who want to invest in energy efficiency and renewables are no longer overburdened with these regressive and unfair costs.”
“High unavoidable charges on electricity bills have a disproportionate impact on lower income customers who use less energy and decrease the incentive for customers to make energy efficiency improvements or invest in clean energy through actions like participating in a community solar project or installing solar panels,” said Miles Farmer, a Clean Energy Attorney at Natural Resources Defense Council. “New York utilities should reduce fixed charges and instead focus on designing rates that empower customers.”
“Vote Solar is proud to stand with dozens of organizations working for customer rights, community health, environmental justice and clean energy progress in the call for lower fixed charges,” said Nathan Phelps, program manager of DG regulatory policy at Vote Solar. “In order for New York to succeed in its ambitious and laudable clean energy vision, it must empower families and businesses to take control of their own electric bills. Lowering fixed charges is a critical step to achieving that vision.”
Cullen Howe, Acadia Center’s New York Director, noted, “Acadia Center supports the overall vision that has been laid out by the Public Service Commission and Cuomo Administration over the last several years. Lower residential fixed charges will help enable the goals of Reforming the Energy Vision, including increased energy efficiency and vibrant markets for clean energy.”
Cullen Howe, Senior Attorney & New York Director
Mark LeBel, Attorney & Associate Director, Grid Modernization and Utility Reform Initiative
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Krysia Wazny, Communications Director
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