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Legislative Memo

Darren Suarez
Director of Government Affairs
T 518.465.7511
www.bcnys.org

BILL:

A.3005-B (Part HH) Assembly Budget Bill

Support

SUBJECT:

Creates the State Office of the Utility Consumer Advocate

 

DATE:

March 20, 2017

 

The Business Council of New York State opposes the following legislation 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.

There is currently no shortage of advocates for residential customers. Under current law, the Utility Intervention Unit (UIU) of the Department of State looks after residential and small C&I customers in rate cases. There is also the (state supported) Public Utility Law Project, that, when it participates, only represents low-income residential customers. In addition, various other groups participate periodically on certain issues on behalf of residential customers, such as AARP which has ample resources.

These customers are protected more than adequately under current PSC rate cases. Business ratepayers, on the other hand, have to fend for themselves.

Although the proposed changes to UIU and the creation of a board is not nearly as bad as the establishment of the intervenor accounts, there also is no need for a selected class of people to “advise” the UIU. The UIU is not lacking advice; if anything, it could use additional staff resources to do its work. Instead of seeking to benefit a limited class of utility customers, or pit groups of customers against each other, the UIU would be better served focusing on ways to reduce utility costs to all customers, starting with discretionary surcharges that are exorbitant (particularly for large, high-load-factor customers).

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.

The New York's staggering energy taxes create a host of negative consequences, but the creation of a State Office of the Utility Consumer Advocate can do nothing to address the numerous fees, taxes, and assessment. Assessment 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 supporting measures to end hidden energy taxes.

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

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