The New York State Public Service Commission (NYSPSC) jas approved new electric and gas rates for Orange and Rockland Utilities, Inc.
The new electric rates will take effect November 1, 2015 and continue through October 31, 2017.
The new natural gas rates will take effect November 1, 2015 and continue through October 31, 2018.
O&R filed both rate increases requests on November 14, 2014. That began an intensive public review process with the New York State Department of Public Service and interested parties, including energy industry representatives, consumer advocacy groups and local governments, which resulted in the settlement agreements. Two public hearings were also held to receive comments on the proposals.
Under the new electric rates, O&R’s electric delivery revenues will increase by $9.3 million in the12-month period beginning November 1, 2015, and $8.8 million in the 12-month period beginning November 1, 2016. Under the approved electric rate plan, the overall bill for a typical residential electric customer using a monthly average of 677 kWh will increase an average of $1.85 per month, from $135.86 to $137.71 or approximately 1.4 percent effective November 1, 2015.
Under the new natural gas rates, the first O&R natural gas delivery increase in four years, O&R’s natural gas delivery revenues will increase $16.4 million in each year of the gas rate plan. The overall natural gas bill for a typical residential gas full service customer using a monthly average of 100 ccf will increase an average of $9.67 per month, from $132.96 to $142.63 or 7.3 percent.
These new rate plans only cover the cost of delivering electricity and natural gas to O&R’s customers. The other components that affect the monthly electric bill are the cost of the electricity itself — the largest portion of the bill — which is set by largely unregulated market activity, taxes and government fees.
To ease the rate impact of the increase resulting from costs associated with the recovery from Superstorm Sandy and increased property taxes — both of which were substantial — O&R has agreed to recover both those costs over a five-year period instead of the customary three-year period.
The new rates provide for significant investment in the communities O&R serves in Rockland, Orange and Sullivan counties in New York for energy efficiency and for building and upgrading infrastructure, including transmission and distribution lines and facilities, to provide reliable service.
The new electric rates also include funding for the Company’s plans to install the first phase of an Advanced Metering Infrastructure (“AMI”) system. AMI is an integrated system of meters, communication networks, and data management systems. Among other benefits, it will reduce operating costs and facilitate quicker restoration of service after a storm event by communicating the precise location of service interruptions. AMI will allow customers to better control their energy costs and participate in various energy-efficiency and/or demand response programs.
As part of O&R’s efforts to reduce future costs to customers and use technology that will enhance customer participation in shaping their energy future, the proposed new electric rates plan provide for a demonstration program that will feature an array of targeted energy management initiatives. Those efforts, developed in concert with the NYSPSC’s Reforming the Energy Vision (REV) initiatives to modernize the state’s energy utility industry, would be aimed at reducing electric demand in the Pomona area of Rockland County. That project, which O&R would administer in partnership with industry technology leaders, including NYSERDA, would enable O&R to postpone a major capital investment of $56 million for a new substation and underground transmission line.