Legislative Memo

Darren Suarez
Director of Government Affairs
T 518.465.7511


A.2708 (Simotas) / S.690 (Avella)



PSC Study of Consumer Protections



May 30, 2013


The Business Council of New York State opposes the following legislation as it is unwarranted. The legislation directs the PSC to complete a report on the effectiveness of existing consumer protection policies by November 15th, 2014.

New York State energy consumers are afforded a suite of statutory protections enumerated by the Home Energy Fair Practices Act (HEFPA). HEFPA established as state policy that the continued provision of gas, electric and steam service to residential customers without unreasonable qualifications or lengthy delays is necessary for the preservation of the health and general welfare and is in the public interest. HEFPA provides consumers the following protections:

If the sponsors of the legislation are interested in addressing the affordability of energy in New York, they should review the significant state imposed taxes, fees and assessments on energy rates. A 2010 report by the Public Policy Institute (PPI), the research affiliate of The Business Council of New York State, entitled "Short-Circuiting New York's Recovery-How Energy Taxes Contribute to High Electric Rates in New York," demonstrates that State and local gross receipt taxes, sales taxes, assessments, income taxes, taxes on capital and, above all, property taxes help make New York's electricity prices the third highest in the US. These staggering energy taxes create a host of negative consequences.

Most concerning is if the study pursuant to section one of this act is not received by November 15, 2014, the commission shall institute a moratorium preventing utility corporations from terminating electric, gas or steam service to any residential customer in arrears with whom it has entered into an agreement for the provision of such services. The moratorium shall last for the period beginning December 1, 2014 and ending on March 31, 2015. If this provision were enacted, it would adversely impact ratepayers' relationship with their energy provider. Additionally, this provision would affect both ratepayers and energy providers while neither could produce the report. Traditionally, a penalty provision adversely affects a party that could affect an outcome not a powerless third party.

For this reason the above stated reasons The Business Council of the State of New York opposes this legislation.