December 7, 2012 – National Grid electric and gas customers in upstate New York would see reductions in energy delivery rates in April, 2013 and stable prices into 2016 as part of a joint proposal with the New York State Department of Public Service Staff (DPS) and other parties submitted today. The proposal continues and expands on the 11 percent electric delivery cost decreases that took place in January, 2012.
“This settlement proposal delivers on the mutual goals of National Grid and other parties who represent our customers,” said Ken Daly, National Grid president, New York. “We believe the outcome will benefit our customers and meet the goals of our original proposal for rate stability, continued system investment, and expanded low-income and economic development programs.”
The agreement will provide electric and natural gas delivery rate stability to the more than 1.6 million upstate New York customers served by National Grid. The three-year proposal will mean that a typical National Grid residential electric customer will see their delivery bill go down approximately 10 percent in the first year. Even after modest increases in years two and three of the proposal, electric delivery bills at the end of the three year plan will remain lower than current bills today.
A typical residential gas customer will see delivery costs fall more than 9 percent in the first year. Modest delivery rate increases in the second and third years will result in gas bills approximately 4 percent higher than current levels, well below anticipated inflation levels.
The company does not control the cost of the energy itself and simply passes through that cost. Customers recently have benefitted from near historic lows in the price of electricity and natural gas for the past several years.
Rate impacts of the proposal vary for commercial and business customers, but all customer classes will see reductions in the first year of the proposal. The proposed settlement is the result of negotiations after a comprehensive review of the company’s April rate filing by the DPS and other parties. The proposal is now subject to administrative review, public comment, and final consideration by the Public Service Commission.
In addition to National Grid and the staff of the New York Department of Public Service, other parties to the settlement include: Multiple Interveners (an association of National Grid industrial customers), Utility Intervention Unit of the state Division of Protection, the New York Power Authority, and others.
Under the proposal, the company's electric and gas delivery revenue increases will be offset by the expiration of past costs and the application of expected savings, and will be phased-in over three years.
As part of the agreement, National Grid would continue its history of extensive capital investment in upstate New York with a $1.6 billion program to invest in the electricity and natural gas systems over the next three years. Increasing this investment in infrastructure upgrades and new technologies will help meet customer needs and help customers manage their energy costs.
The proposal would enable National Grid to investigate expansion of natural gas service in upstate New York to enable customers to take advantage of historically low natural gas commodity costs that have remained stable for the past several years.
About National Grid
National Grid (LSE: NG; NYSE:NGG) is an electricity and gas company that connects consumers to energy sources through its networks. The company is at the heart of one of the greatest challenges facing our society - to create new, sustainable energy solutions for the future and developing an energy system that underpins economic prosperity in the 21st century. National Grid holds a vital position at the center of the energy system and it ‘joins everything up’.
In the northeast US, we connect more than seven million gas and electric customers to vital energy sources, essential for our modern lifestyles. In Great Britain, we run the gas and electricity systems that our society is built on, delivering gas and electricity across the country.
National Grid delivers electricity to approximately 3.3 million customers in Massachusetts, New York and Rhode Island. It manages the electricity network on Long Island under an agreement with the Long Island Power Authority (LIPA), and owns over 4,000 megawatts of contracted electricity generation, providing power to over one million LIPA customers. It is the largest distributor of natural gas in northeastern U.S., serving approximately 3.4 million customers in New York, Massachusetts, and Rhode Island.
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