AARP, Consumers Union, and PULP Oppose Reallocation of Cheap Niagara Hydropower from Residential Customers

AARP, Consumers Union, and PULP have joined in a statement opposing legislative reallocation of the portion of low cost hydropower now targeted by law for the benefit of residential and rural customers. Business groups are proposing to shift the benefit in order to subsidize selected businesses in the name of job creation, i.e., “Power for Jobs.”

Reallocating the benefit of residential hydro power would raise electric bills significantly for large numbers of consumers, making matters worse for them and would harm local economies. As stated by a representative of NYSEG/RG&E to a legislative commission on hydropower:

In addition, and just as important, a loss of this power to residential customers in the NYSEG and RG&E service areas would significantly increase rates, severely impacting customers at a time when the upstate economy continues to struggle. Absent the Niagara Project allocation, residential electricity rates would increase 7.2% to 8.7% for NYSEG customers and 10.8% to 14.2% for RG&E, depending on the type of service a customer has chosen. If St. Lawrence allocations, which are covered by the same contracts that cover the allocation of Niagara Project power, were also lost, the rate increase climbs to between 12% and 14.5% for NYSEG customers and 19.6% to 25.7% for RG&E customers. These dramatic increases at a time when the upstate economy continues to struggle would cause a true hardship for our customers.
**** Suggesting that these savings are meaningless to a residential customer and that the residential customer allocation would be better spent on economic development programs is irresponsible. The commission should resist an arbitrary shifting of this allocation to programs that may not add significantly to the regional economy. It cannot be assumed that the transfer of low-cost power from residential customers to a business creates an automatic, substantial win for the economy.

See Raiding Niagara, PULP Network, June 2, 2010. The consumer groups are supporting an Assembly alternative that would provide customers an opportunity to trade their low cost hydro benefits for energy efficiency assistance, and thus have an opportunity to choose whether to forego the benefit of their low cost hydro power.

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