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For Immediate Release: 03/20/2025 Rory M. Christian, Chair Contact:
James Denn | James.Denn@dps.ny.gov | (518) 474-7080 25035/24-E-0060; 24-G-0061 March 20, 2025
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PSC Cuts O&R’s Rate Request |
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Approved Electric and Gas Rates Much Less Than Initially Requested Commission Adopts Joint Proposal Supported by Company, Department Staff, and New York’s Utility Intervention Unit
Utility’s Electric Revenue Flat for the First Year
ALBANY — The New York State Public Service Commission (Commission) today adopted a three-year rate plan for electric and natural gas service provided by Orange and Rockland Utilities, Inc. (O&R) that will keep the utility’s electric revenue flat for the first year. The three-year rate plan was supported by the company, staff of the Department of Public Service (Department), and the Department of State’s Utility Intervention Unit. O&R serves about 233,000 residential and commercial electric customers in southeastern New York State and 140,000 natural gas customers in its New York territory.
“As a result of this negotiated settlement, we have been able to drastically minimize any rate increase for customers,” said Commission Chair Rory M. Christian. “With this three-year rate plan, the company will be able to continue to provide its customers safe and reliable electric and natural gas service, as well as continuing to develop a cleaner energy distribution system. Adoption of this rate plan ensures critical investments are made for the continuation of safe and reliable service.”
Instead of granting the full amount, the Commission importantly adopted no increase in revenues for the first year for electric, significantly less than the $18.1 million the company originally requested, and it adopted a first year levelized gas increase of only $10.5 million, nearly 30 percent less than the $14.4 million originally requested.
For electric, the joint proposal established shaped revenue increases over the three-year rate plan of $0 in the first-rate year and $17.7 million increase in each of the second- and third-rate years. For gas, the joint proposal established shaped revenue increases over the three-year rate plan of $10.5 million in each rate year. On a total revenue basis, these results yield increases of 0 percent, 2.3 percent, and 2.3 percent for electric and 3.4 percent, 3.3 percent and 3.1 percent increases for gas.
O&R initially requested an increase in annual electric delivery revenues of approximately $18.1 million (7.3 percent increase in delivery revenue, or 3.7 percent increase in total revenues), for the rate year ending December 31, 2025. The requested increase in electric delivery revenues would have resulted in a monthly bill increase of $8.81 (9.3 percent increase on the delivery bill, 6 percent increase on the total bill) for a residential customer using 600 kWh per month if O&R’s initial request was approved.
Further, O&R initially requested an increase in annual natural gas delivery revenues of approximately $14.4 million (11 percent increase in delivery revenues, or 6.3 percent increase in total revenues), for the rate year ending December 31, 2025. The requested increase in gas delivery revenues would have resulted in a monthly bill increase of $12.73 (11.9 percent increase on the delivery bill, 8.1 percent increase on total bill) for a residential gas heating customer using 100 ccf per month.
As noted above, the joint proposal approved by the Commission lowered the first year revenue request by the utility. However, due to the expiration of credits used to temporarily reduce the revenue O&R collected from customers and for the recovery of revenue not collected due to the new rates not going into effect January 1, 2025, typical residential electric customers will experience bill increases of 4.6 percent, 3.3 percent and 3.5 percent, and typical residential gas heating customers will experience bill increases of 10.9 percent, 3.5 percent, and 3.8 percent.
The company will begin billing the new rates effective April 1, 2025.
In addition to lowering the requested rate increase, the joint proposal includes key elements that provide funding for programs to ensure that the company will continue to provide safe and reliable electric and gas service, while increasing its resiliency efforts, increasing its funding for responding to damage caused by major storm events, and replacing and updating aging infrastructure. The Commission’s decision to adopt the terms of the joint proposal furthers the goals and targets in support New York’s goals because the joint proposal includes funding for programs and projects designed to support beneficial electrification, distributed energy resources, and the development of large-scale renewables and energy storage.
The Commission was able to substantially reduce O&R’s request through the transparent and comprehensive review of all cost drivers by Department staff and other parties. In evaluating the appropriateness of the joint proposal, the Commission also examined a voluminous record, including testimony of the parties and more than 60 public comments, received both directly and at the three public statement hearings that were conducted.
O&R has operated under a Commission-approved rate plan since 2022, making this the first rate proceeding for the company in three years.
Today’s decision may be obtained by going to the Commission Documents section of the Commission’s website at www.dps.ny.gov and entering Case Numbers 24-E-0060 or 24-G-0061 in the input box labeled "Search for Case/Matter Number". Many libraries offer free Internet access. Commission documents may also be obtained from the Commission’s Files Office, 14th floor, Three Empire State Plaza, Albany, NY 12223 (518-474-2500). If you have difficulty understanding English, please call us at 1-800-342-3377 for free language assistance services regarding this press release.
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