Res 0162-2022

Whereas, The New York Public Service Commission (PSC) regulates the State's electric, gas, steam, telecommunications and water utilities; and Whereas, The Commission also oversees the cable industry; and Whereas, The Commission is housed within the Department of Public Service (DPS) and the Chair, designated by the Governor, also serves as the Chief Executive Officer of the Department; and Whereas, A key responsibility of the PSC is approving rate increases, proposed by the various utility companies, and ensuring that New Yorkers are receiving adequate service; and Whereas, In New York City, Consolidated Edison of New York (ConEd) holds a virtual monopoly over the electricity market, serving all parts of New York City (except for Rockaway, Queens), and Westchester County; and Whereas, Although there are alternative electricity suppliers, all of these Energy Service Companies (ESCOs) still rely on existing utilities' infrastructure to deliver the electricity; and Whereas, Therefore, most New York City residents are at the mercy of ConEd's billing practices; and Whereas, The PSC exists to offer some protection to consumers - being a check on superfluous rate increases and ensuring a consistent and reliable delivery of utilities; and Whereas, However, over the past few years, the PSC has approved rate case increases for ConEd, and New Yorkers have had their electricity bills soar; and Whereas, This is despite the fact that New York City residents have experienced numerous blackouts and decreased services, even during heatwaves; and Whereas, In fact, while investigating ConEd's preparation for tropical Storm Isaias and its ability to restore power after the storm hit, the DPS threatened to revoke its franchise; and Whereas, Despite these demonstrated failures in service, the PSC continues to approve rate case increases; and Whereas, According to advocates such as Susan Lerner from Common Cause NY, the PSC Commissioners are typically plucked from private industry and are more concerned with industry profit than consumer wellbeing; and Whereas, ConEd is proposing an 11.2 percent increase in electric rates and an 18.2 percent increase in gas rates starting in January 2023; and Whereas, According to ConEd, annual increases in utility rates are needed for ConEd to operate its energy system, invest in energy efficiency and public improvement projects and advance NYS's clean energy transition; and Whereas, ConEd also pays $2.5 billion in property taxes annually to municipal and state entities, the majority of which goes to the City of New York; and Whereas, According to ConEd, "the costs of taxes are socialized across our customer base"; and Whereas, ConEd has therefore acknowledged that part of its annual rate case is for City residents to pay for ConEd's property taxes; and Whereas, ConEd reported over $11.716 billion in operating revenues in 2021, up from $10.647 billion in 2020; and Whereas, City residents have meanwhile struggled to recover from the economic impact of the pandemic; and Whereas, The NYC Independent Budget Office predicts that New York City will not recover all of the jobs lost in 2020 until 2025; and Whereas, As ConEd proposes another rate case increase for January 2023, City residents struggling to pay their bills will enter even greater debt; and Whereas, ConEd is a member of the industry group Edison Electric Institute, which spends millions of dollars annually on state and federal lobbying efforts; and Whereas, Given its near monopoly status as a utility in NYC, ConEd has near assurance that it will continue to generate profits in future years; and Whereas, Beyond the PSC rejecting a rate case proposal, there are no mechanisms to prevent a utility from proposing an exorbitantly high rate case; and Whereas, To enhance consumer protections and hold ConEd and other utilities more accountable, there should be a percentage cap that an annual rate case cannot exceed; and Whereas, This regulation would prevent utilities from proposing excessive rate case increases, therefore requiring utilities to invest more of their own money to pay taxes or public improvement projects instead of passing these costs on to City residents; now, therefore, be it Resolved, That the Council of the City of New York on the New York State Legislature to pass, and the Governor to sign, amendments to article 4 of the Public Service Law to prevent a utility's case rate from exceeding a certain percentage each year. NM LS #8424 4/20/2022