PSC Rejects PULP’s Recommendations to Improve Niagara Mohawk Gas Interim Energy Efficiency Proposals

At its September 17th Meeting, the PSC approved a Joint Proposal crafted in Niagara Mohawk’s gas case regarding the continuation of energy efficiency programs for the next eight months, pending the outcome of the company’s pending rate case. The $4.89 million initiative was approved in the Commission’s Order despite the concerns raised by PULP’s comments that it was not sufficient and should be expanded to $8 million. See PULP Opposes Niagara Mohawk’s Interim Gas Efficiency Program.

The amount included in the Joint Proposal is equivalent to what had been in place last year, including the amount designated for low income customers, despite a steady increase in home heating costs during 2008. PULP contended that the static funding level — $3.33 million — allocated for residential low income programs did not match up with the assertions made by PSC Chairman Garry Brown in announcing the decision. Brown stated: “It is critically important to provide customers with cost-effective, energy conservation measures in advance of this winter when the cost of natural gas is expected to be high.” At the meeting announcing the decision, it was admitted that only about 800 households would benefit from the low income energy efficiency program and many of these may not see any benefits until towards the end of the interim period in May 2009, well past the upcoming heating season.

On top of this, it was estimated that the typical residential heating customer will pay about $6.85 more per year for these incentives, in addition to the anticipated increase in the cost of the natural gas itself. PULP had requested that low income customers who receive HEAP or public assistance be excluded from paying the additional fees, as this would greatly decrease any benefit even the lucky few who are able to participate in the program would receive. This proposal was rejected, based on claims that it would be too difficult to ascertain who would not pay the fees. Identifying which customers have received HEAP payment in the past year, has never been an issue with Niagara Mohawk before, and the company itself is proposing a meager $5 per month rate reduction for HEAP customers in the same case. The Commission did decide to include the low income customer exemption requested by PULP as a topic of discussion in its on-going marathon “Energy Efficiency Portfolio Standard” proceeding (Case 07-M-0548).

Now the primary portion of the Niagara Mohawk gas rate case can move forward, which includes the proposed $5 a month rate reduction for low income customers. While PULP supports this aspect of Niagara Mohawk’s proposal, we can not see how giving low income customers a $5 monthly credit helps in light of the existing and added energy burdens they face and when all low income customers are forced to pay more than $6 for a program which only 800 of them will receive any benefit. Much more needs to be done in order to provide real energy affordability for low income families this coming winter. The Commission should know that what they did on a warm September day may make for a nice press release headline, but will actually help slide low income customers even closer to the edge when the weather chills.

Lou Manuta

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