Hold on to your wallets

Times/Review Newspapers Editorial

November 8, 2007

Think your utility bills are killing you now? Well, get ready to dig even deeper into your pockets this winter, if the state Public Service Commission staff has its way.

The PSC staff is recommending that National Grid, which bought out KeySpan in August, be allowed to recover from ratepayers 100 percent of the cost of cleaning up the 83 contaminated manufactured gas production sites it got from KeySpan. Estimated price tag for the cleanup: over $1 billion. (See Times/Review story by North Shore Sun reporter Anna Gustafson, "Rate payers to foot the bill?") This could raise our utility rates — including the already sky-high cost of electricity — as much as 30 percent, according to local lawmakers. Even if you're not a primary natural gas customer, you're still going to pay. LIPA buys natural gas from National Grid to generate the electricity it sells you. LIPA passes its fuel cost increases directly to ratepayers by way of fuel surcharges, recently renamed "power supply charges," that have effectively doubled your electric costs by adding almost 10 cents per kilowatt to your bill — on top of per-kilowatt-hour charges that are already among the highest in the nation.

Legislators, including First District Assemblyman Marc Alessi, warned us this might happen when the National Grid deal was before the PSC for approval this summer. They implored the PSC to address the cleanup costs in the buyout agreement. Once again, the PSC proved itself more interested in preserving the utilities' profitability than in protecting ratepayers. It ignored the legislators' demands and approved a buyout agreement that was mum on the MPG remediation cost. The ink was barely dry on the deal when National Grid asked PSC for permission to pass the remediation cost on to us, and PSC now appears poised to give the giant utility exactly what it wants.

We urge the commissioners to put the public interest before special interests for a change. Don't make ratepayers pay for the utility's neglect or malfeasance. With crude oil prices hitting $100 a barrel this winter, driving heating and electric costs even higher, Long Island ratepayers simply can't bear this additional spike in utility charges, especially in an economic climate of grave uncertainty. The reverberation effect of this increase could shatter the local economy.

With history as our guide, it's clear the remediation cost pass-through is probably as good as done. National Grid, whose lobbyist is the former chairman of the PSC, has more sway with the commission than does the public whose interest it's supposed to serve. No surprise there. The real question is whether our state Legislature has the independence (from the utility/energy lobbies) and principle to enact meaningful legislative reform, putting the public interest in the forefront of utility regulation, where it belongs. Time will tell. Meanwhile, turn off the lights, bundle up and open your wallet. It's going to be a long, cold, costly winter.

Copyright 2007 Times/Review Newspapers Corp.