Freezing Delivery Rates is Just a Shell Game

Thursday, 28 July 2016 16:19
By Phil VanHorne CEO, BlueRock Energy 

In May, National Grid announced that it would freeze natural gas delivery rates for the next two years. In exchange, they said they will not raise Upstate utility rates. However because they are being ‘so generous’ they will be permitted to keep the $152 million they owed customers that would have been used to lower rates, and in exchange will upgrade the pipes and wires that they use to deliver your utilities.

They call this a “significant benefit’ for customers. “Our decision will preserve base rate stability while allowing the company to continue modernizing its electric and gas distribution systems,” PSC Chair Audrey Zibelman said in a PSC press release.

But who does this rate freeze actually benefit? Let’s break it down: National Grid received $152 million in debt forgiveness from their own customers. The delivery rates they boast that they will freeze are SUBSIDIZED. Repairing infrastructure is also SUBSIDIZED. So in other words, they have a $152 million head start, thanks to their customers. Yet we’re supposed to be grateful that they didn’t raise our delivery rates.

This is the same utility company that our government has decided will be the only choice for low income customers because they want to protect them from ‘unscrupulous actions’ by a few bad apples in the energy service companies (ESCOs) world. Perhaps we should be questioning the scruples of National Grid.

The $152 million that National Grid overcharged customers was, according to National Grid, spent on transmission costs, pollution control bonds, stray voltage repairs, etc. This may also explain why delivery fees have been nearly double the cost of the energy they are delivering. But a freeze on that delivery rate isn’t going to stop them from overcharging customers going forward. They’ll just keep on doing what they’ve been doing. Only now they are working from a blank slate of debt.

This kind of unscrupulous action by our public utility company should be the focus of review by the Public Service Commission (PSC) yet all they seem to be focused on is going after ESCOs. We want nothing more than for the PSC to crack down on fraudulent ESCOs, but we’re not one of them. We save New Yorkers money, provide them with real value, protection from price fluctuation, the assurance of budget certainty.

We watch after your best interest when purchasing your energy supply for you. What we can’t protect you from is the delivery fees to get the natural gas and electricity to you. National Grid controls that service—and they can and are charging you a pretty penny to provide it. They will continue to overcharge you and promise it will be reimbursed to you when utility rates are higher in the form of a refund. Then they will find a way to take back that promise (and their money) and make themselves look like a hero in the public eye. I’m here to tell you, they aren’t doing New Yorkers any favors. It’s all just one big shell game.

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