Nebraska Energy Office Shows New York Electricity Prices Second Highest in Continental U.S.

One might search all day but ultimately in vain at the New York Public Service Commission (PSC) or the New York State Energy Research and Development Authority (NYSERDA) websites for a comparison of the electric rates New Yorkers pay with those paid by consumers in other states.

Perhaps the PSC and NYSERDA are not proud of the impact on consumers after a decade of relentless state deregulation efforts. See Disconnected Policymakers.

The Nebraska Energy Office prepares a user friendly chart comparing electricity costs in all 50 states. It reveals that the prices New Yorkers paid for electricity were the second highest in the continental United States. The Nebraska chart is based on the year-to-date data from EIA for 2008, through November.

New York’s rates ducked under several states in the New England ISO region in the month of November 2008, the most recent month for which EIA data is available. Apparently the NYISO summer price spikes – see New Shocker from Con Ed: Forget 13% Hike, Now It’s 22%, – which occurred when customer usage and bills are highest, and market gaming costs shifted by the NYISO to consumers – see Shocking Power Scam Jolt$ NY Consumers – outweighed the New England ISO prices during the year-to-date period.

It is true that some of the lowest cost states rely heavily on lower cost coal to produce electricity, such as the lowest cost state, West Virginia.

However, New York has generous amounts of hydropower and nuclear power that is even cheaper to produce than coal power. As a result of the PSC deregulation regime, the value of this low cost power shifted from consumers to producers. New York utilities sold their power plants, and now must they pay what the most expensive deregulated seller can obtain in the flawed NYISO wholesale markets. The NYISO has a cartel-like market design in which all sellers are paid the same, no matter whether the power is produced by cheap hydropower, or by expensive natural gas. See It Was the [NYISO] Market.

This did not occur in states that did not adopt the deregulated system that was heavily promoted by Enron, and so the gap between New York and other states’ electricity prices has spread. See the Comparison of New York rates with rates in traditionally regulated states prepared by Power in the Public Interest. Also, see Why Are Electricity Prices in RTOs Increasingly Expensive? and Connecticut Energy Policy: Critical Times – Critical Decisions, by McCullough Research, a group that led the investigation and exposure of Enron’s spot market manipulation in the West.

Pin It

Leave a Reply