Letter to Cheryl LaFleur, Chairman of the Federal Energy Regulatory Commission - Undo Order that Would Unfairly Jack Up Electric Rates in Dutchess County

Letter

Dear Chairman Cheryl LaFleur,

As I am sure you are aware, the Federal Energy Regulatory Commission (FERC) has issued an order approving the New York State Independent System Operator (NYISO) proposal to create a new capacity zone (NCZ) on May 1st 2014, which will affect Dutchess, Orange, Ulster, Rockland, and Sullivan Counties in New York. The initial NYISO proposal, approved by FERC last year, raised the tariff on the new capacity zone by $350 million dollars annually. After a subsequent rehearing, FERC approved the order again, this time with an annual tariff of $230 million. This new order is also unacceptable to me, the New York State Public Service Commission (PSC), and to residents and businesses throughout the Hudson Valley who feel aggrieved for having to pay immediate rate hikes after a record winter of high energy costs. The New York State Electric and Gas Company -- one of the largest utilities in the Hudson Valley -- has estimated that its average February electric bill will be 12 percent higher than December's bill.

While the goal of this capacity zone is to attract new power generation, it unfairly raises utility rates on the backs of Hudson Valley residents in effort to attract new energy developers -- and there is no guarantee this will create more power generation. FERC, in their rehearing of this order, must undo these rate hikes. I urge you to restudy the need for a new capacity zone in light of the ongoing capacity upgrades that will be generated by the New York State Energy Highway Blueprint projects. Furthermore there are a variety of other alternatives to increase capacity in the Hudson Valley to create more power in the Hudson Valley without raising the rates of consumers: including energy conservation and efficiency efforts, like the retrofitting of existing properties, and further transmission and delivery upgrades.

We have received an outpouring of concern from local residents, the NYS Public Service Commission (PSC) and the New York Power Authority (NYPA), who all agree that this order does not adequately protect consumers and should be reheard. I am urging FERC in their rehearing to redo the order and undo these rate hikes.

As we both know, this winter has brought extreme low temperatures, and consequently high energy costs, to everyone in New York. Imposing an additional cost increase on Hudson Valley residents is unfair and will place an undue burden on many of my constituents. Given these conditions, I request that in the rehearing of the order for a new capacity zone, FERC considers prominently the burden they are placing on consumers with this additional tariff.

Thank you for your attention to this matter. Should you have any questions please do not hesitate to contact me or my staff.

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