Con Ed blames Sandy for 'hurri up' rate hike

Jan 28 - The New York Post

The company filed for a rate increase yesterday that will boost New Yorkers' residential electric bills by about 3.5 percent starting next January, from $82 to $85 for an apartment using 300 kilowatt hours of power each month.

The utility also sought a gas-rate hike that will add up to about 1.4 percent for people who use Con Ed gas to heat their homes. A typical customer using gas to heat their homes will pay $190 under the plan instead of $188.

Con Ed - which already charges the highest electric rates of any major US utility outside of Alaska and Hawaii - wants the rate hikes even as wholesale prices of natural gas and electricity hit record lows.

The wholesale price of electricity charged to residential Con Ed customers last month was half of December 2010's price. Wholesale gas prices are down by more than 20 percent since December 2010.

But Hurricane Sandy has boosted what Con Ed must spend to maintain gas lines and its wires, transformers and other equipment, the company says.

Those equipment-maintenance charges appear on customers' bills as separate items from wholesale gas and electricity prices.

Much of the Sandy cleanup expense was covered by insurance, Con Ed told the state Public Service Commission.

But uninsured costs - as well as the expense of preparing for future giant storms - have pushed up its expenses so much, Con Ed says, that it needs another $375 million from its electric customers and another $25 million from its gas customers.

Con Ed says it plans to spend $1 billion on "storm-hardening" upgrades over the next four years.

Because those costs are spread over several years, they'll have a long-term impact on customer bills. Con Ed's rate request yesterday only covers 2014.

Con Ed was overdue to seek a rate hike.

It could have filed last April, just after its most recent rate hike kicked in. The company decided to wait until November - only to have its plans upended by the giant storm.

The company admits its electric rates are among the nation's highest - but at an investors' conference last year, Con Ed CFO Robert Hoglund suggested New Yorkers can afford them.

Because New Yorkers live in small spaces, Hoglund said, their bills are in line with national averages, "$85 to $100 per month."

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You're gonna pay for it!

Con Ed yesterday filed for increases in its gas and electric rates, to take effect next January.

ELECTRIC

Residential NYC customers (300 kilowatt hours per month)

Current rate: $81.64

Next year: $84.55

Typical small-business customers

Current rate: $157.55

Next year: $169.31

GAS

Typical home customers with gas heating

Current rates: $187.68

Next year: $190.35

Typical small-business customers

Current rates: $349.24

Next year: $351.88

bsanderson@nypost.com

Originally published by Bill Sanderson.

http://www.energycentral.com/functional/news/news_detail.cfm?did=27373482