Utility Rate Increases

She is doing what she is required to do by law.

The issue isn’t NYSERDA or the PSC, it’s the science and economics devoid CLCPA that was passed by the government.  Short of getting that repealed,  this will be the norm.

What is she supposed to say in her tweet?  “We’re screwed and everyone knows it  but we can’t admit it because it’s politically inexpedient.  But as a result, we won’t be able to adhere to the law.”

That would not go over well, to say the least.

It can’t work but they have no options except to follow the law.  That’s their job, even if it means running into a brick wall at top speed.  If you’re feeling sympathetic, send them a bottle of Advil for the ensuing headache.  I feel a great deal of sympathy for them.  How do you execute a policy that can’t mathematically or economically be achieved, but that’s the legacy of the CLCPA ?  That’s made even more complex by having to navigate public opinion.

Look at what happened to Driscoll when he told the truth at the hearings on the Build Public Renewables Act (BPRA).  They tried to hang him.   The BPRA says that all of NYPA’s power has to come from renewables by 2030.  It’s one thing to write it in a bill on a piece of paper.  It’s an entirely different issue when they have to execute it on the ground.   That’s why there is a huge loophole in it.

If the recent UK bids (early September) are any indicator, the new OSW  bids are going to come back very high.  At least 72% higher than the existing NY State wholesale costs.  Possibly more because of all of the logistical issues unique to US offshore wind.   That plus the falling stock prices of the Wind Installers may drive up their borrowing costs, increasing their bids even more.   Are the wind installers going to include inflation escalators in their buds, based upon their recent experiences?  That will cause the PSC an enormous conundrum.  Do they refuse to accept the bids and face a backlash from the Environmental Movement, or do they accept the bids and face a backlash from everyone who’s utility bills are about to skyrocket?   Their only out may be to set a low ceiling the way that the UK did and then none of the installers will bid. The politicians in Germany recently took a beating over the exact same issue.  It basically boils down to the fact that people are angry about their utility bills and are blaming the German Green Party that they feel caused that.  By recently, I mean last week.  I’m not sure if you saw the price increases for “Delivery” for the different utilities that were approved by the PSC, but I expect that the backlash from upstate will be forthcoming.  Even worse if the “Supply” costs go up also because of the high costs of the renewables and OSW.  

  • Rochester Gas & Electric  > 22% over 3 years
  • NYSEG   31% over 3 years
  • Con Ed   15% over 3 years

Central Hudson is looking for similar increases.  See the following links.

New York PSC approves big rate increases, $5.2B investments for Avangrid utilities

Why Your Energy Bills Are Going Up

Even if the increases are needed to replace aging infrastructure, as in the case of gas pipelines, it is going to be viewed as being a result of the energy transition.  NY State already has some of the highest utility rates in the country and they’re about to go significantly higher while  1.2 million ratepayers already can’t pay their utility bills, breadlines are getting longer, and a significant portion of the downstate population is spending half of their salary on rent.  Are they going to have to turn off everyone’s lights for non-payment of their utility bills?  Local Law 97 in NY City is going to start penalizing buildings that don’t lower their carbon footprint.  For many buildings, it is cost prohibitive or there is insufficient space to comply with the mandates so they will just pay the fines.  That will be passed along to the tenants of those buildings with no improvement in GHG emissions.

In the interim, NY State is going to spin its wheels and stand in place.   It will be a Climate Leader on the paper in Albany only.  It can’t install OSW, it takes four years to get a large solar array approved, let alone installed.  It takes 5 – 15 years to get a large transmission line built.  All the while, the old fossil fuel plants are belching pollutants and there is little to no decrease in emissions.  The CLCPA precludes implementing alternatives that don’t meet the ideological purity of requiring all zero emission sources by 2040.  The entire situation is unworkable but this was the inevitable result of a policy that doesn’t adhere to math and physics.

What will be really scary is if they do something incredibly short sighted and pass “NY Heats”.  Then, you will have a lot more load and no way for them to add any generation.  

That’s why we need to change public opinion.  Until the politicians get pressured by their constituents,  nothing will change and that will only occur when the public demands it.

That’s why I’m going to start renting out movie theaters and presenting the reality of this to the public.  It may take a while, but the farther this policy goes and the more that people’s utility bills go up, the more receptive the public is going to be to the argument.  Public perception may be turning a corner already.


NYSERDA discovers that it is about to hit a brick wall….so steps on the accelerator. Twitter LInk

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