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Legislative Memo

BILL:

A.6005 (Part U) Assembly Budget Bill

Support

SUBJECT:

Creates the State Office of the Utility Consumer Advocate

 

DATE:

March 10, 2015

 

The Business Council of New York State opposes the following legislation, which creates an “independent” office of utility consumer advocate within the Department of Public Service, as it is unwarranted, without merit, and will immediately increase the cost of energy in the State for all consumers.

The public advocacy for this legislation is predicated on either intentionally misleading or misinformed information regarding the cost drivers of energy in the State of New York.

If the sponsors of the legislation are truly interested in addressing the affordability of energy in New York, they should review the significant state imposed taxes, fees and assessments on energy rates, and take immediate steps to oppose them.

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.

New York's staggering energy taxes create a host of negative consequences, but the creation of a State Office of the Utility Consumer Advocate will do nothing to address the numerous energy fees, taxes, and assessment imposed by New York. Assessments and hidden fees like 18-a, which have cost consumers billions, can only be addressed by elected officials. Those interested in real energy cost savings should start by support measures to end hidden energy taxes.

At best, this legislation fails to address the root problems of high energy cost in the state and at worst, and is a veiled attempt to divert attention from the true cost drivers of energy in New York.

Moreover, consumer interests and impacts are already aggressively addressed through the Department of Public Service’s Office of Consumer Policy, which focuses on consumer policy matters of concern to the Commission, including those issues raised in rate cases and proceedings – a key program feature not found in many states with a CUB.  Creating an additional consumer advocate function will largely replicate existing efforts, and add to existing PSC costs.

For these reasons, The Business Council of the State of New York opposes this legislation.