Settlement reached in Con Ed rate case

By MARTIN WILBUR

A consortium of 40 municipalities last week that challenged Con Edison’s proposed double-digit rate increases for electricity and gas reached a settlement last week that provides a level of cost assurances for the next three years.

The Westchester Municipal Consortium announced Nov. 7 that its agreement with the utility and the state Public Service Commission calls for a 2.8% annual increase on electric rates from 2026 through 2028 and a 2% increase on gas rates in the same time frame.

Con Edison had sought electricity rate increases of 13.4% and 19% on gas.

“While the reductions do not go as far as we had proposed, they are a substantial move in the name of affordability, and the requirements for more disclosure and transparency on capital projects and the costs of overhead versus underground systems are major gains for the county,” said Joel Dichter, the counsel for the Westchester Municipal Consortium.

In addition to the rate reductions, other main points negotiated in the agreement require Con Edison leadership to meet annually with representatives from the municipalities to review capital project plans and compare investment levels between Westchester and New York City. Among the topics to be addressed are storm preparedness, removal of double poles, street lights and how data centers are affecting the local grid.

The settlement also will see Con Edison agree to conduct an informational analysis comparing the costs of its underground system, which is in most of New York City, and its overhead system, which comprises most of Westchester County. The study will be shared with the parties before the utility’s next rate filing.

The proposal culminates an 11-month process led by the PSC that engaged all stakeholders and attempted to balance affordability with the needed investments to maintain a reliable and resilient system, Con Edison spokesman Allan Drury said.

“Con Edison is acutely aware of the issue of affordability, which is why last year we provided more than $300 million of discounts to income eligible customers in our energy assistance programs,” Drury said. “This year, we advocated for the recently approved expanded energy affordability program, which will raise the income thresholds and allow for more customers to become eligible for bill discounts.”

The next step is for the PSC to hold an evidentiary hearing Dec. 3 on the settlement before three administrative law judges in Manhattan, said County Legislator Erika Pierce, District 2. 

The PSC will eventually vote on the agreements, formerly called a Joint Proposal, at one of its future monthly commission meetings.

However, in a statement put out late Wednesday afternoon, Westchester County Executive Ken Jenkins and the Board of Legislators announced that they “strongly reject” the proposed rate increases and urged the PSC to reconsider the proposal. Under the agreement, actual electricity bills would rise by 4.3%, 5% and 3.3% each of the next three years while gas would decrease by 0.3% in 2026 and then increase in 2027 by 7.2% and 3.7% in 2028.

“Families are already being stretched to the breaking point,” the joint statement read in part. “Utility bills are skyrocketing while wages remain flat. We are hearing from seniors on fixed incomes, families juggling multiple jobs, and business owners barely staying afloat. A rate hike of this magnitude will force too many to choose between paying their utility bills and affording necessities like food, medicine, or childcare.”

Pierce said she hopes the county and the consortium could have done more for the public, since the rates will be compounded but Westchester Con Edison customers are being asked to help cover the large real estate taxes due from New York City and the higher cost of delivering electricity in an urban environment. Since the city and Westchester are in the same rates region, the costs are shared equally by all, she said.

“I’m glad it’s nearing the end,” Pierce said. “I really wish we had gotten it to an even better place, but I think the remaining issues are bigger than any one rate case. They’re going to take legislation at the state level to fix.”

Assemblymember Chris Burdick, District 93, cautioned that the agreement only concerns the delivery rate portion of a customer’s energy bill from Con Edison, which the PSC can regulate. The commission does not have jurisdiction over the supply rates, so increases on a resident’s or business owner’s bill are likely to be effectively higher than the announced rates, he said.

“My view, and I think that many people share this view, is that it advertised the process in what the Public Service Commission has the authority to control, and that’s the delivery rates. It’s the delivery rates,” Burdick said. “The supply rates are determined by the market, and there’s no control over that.”

Despite the questions about the supply rate and other issues, local officials applauded the agreement, and stated that energy bills would have spiked even more without the challenge.

“I do feel that the delivery rates that are proposed would have been higher had we not been involved,” Burdick said.

“I am pleased that by our Town Board agreeing to join the other municipalities in this effort, we have helped to move the needle on rates and residents will benefit from additional terms to require Con Ed to be more transparent and responsive to its Westchester County customers going forward,” Bedford Supervisor Ellen Calves said in a statement.

Although the state Legislature has no role in the hearings and approval of the rates, Burdick said he was opposing the settlement in principle, because without some regulation on the supply charges, electricity will continue to be increasingly unaffordable for many households.

How the settlement affects the challenge of NYSEG proposed increases for more than 30% remains to be seen, Burdick said. NYSEG filed its rate requests on June 30, nearly five months after Con Edison, likely pushing any agreement into next year.

Nearly all Westchester municipalities serviced by Con Edison joined in the rate case, except for Mount Kisco, which relied upon the county’s challenge. Locally, Mount Kisco and portions of Bedford are serviced by Con Edison while the towns mainly in the county’s northeastern corner, including Lewisboro and Pound Ridge, are covered by NYSEG.