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Three utility rate hikes to increase New Yorkers' monthly bills by $53

New York City

Utility Rate Hikes

Con Edison has promised not to cut off anyone's electricity when the temperature tops 90 degrees.

June 18, 2024

As the summer's first blistering heat wave descends, New Yorkers, including residents of co-ops and condos, are getting hit with a triple-whammy of rate hikes that will add $53 to the average monthly utility bills.The three culprits, according to Gothamist, are: water, natural gas and electricity. Here's a breakdown:

Water. Last week the city Water Board grudgingly passed an 8.5% hike in water rates — the biggest jump since 2011 — while noting that the board was forced to impose the hike due to a budget maneuver by Mayor Eric Adams. As Habitat reported in May, Adams, in an effort to plug budget gaps, resurrected a defunct funding mechanism that calls for the city to charge its own Water Board more than $1.4 billion in rent over four years to lease the city-owned water and sewer systems. The funding gimmick had been used by New York City for decades but was discarded in 2017 by then-Mayor Bill de Blasio, who said the city was “righting a wrong.”

Perhaps worse, this "backdoor" tax in the form of a water rate increase will pay for only a portion of the rent charges. Some of the rest is likely to come from funds that typically finance capital upgrades to the water and sewer system, potentially leaving the city more vulnerable to critical breakdowns just as an unusually bad hurricane season is expected to unfold amid concerns of global warming and rising sea levels.

“This is a ripoff, a backdoor tax of epic proportions,” said Councilmember James Gennaro (D-Queens), who chairs the council's environment committee. “This is the most regressive taxation that one can imagine."

Natural gas. National Grid, which supplies natural gas to Brooklyn, Queens and Staten Island residents, is in the process of asking the state’s Public Service Commission for a rate increase that will raise the average natural gas bill by roughly $30 per month. The new charge could take effect as soon as July.

National Grid is an investor-owned utility that paid investors $922 million in dividends last year, according to its most recent annual report.

A company spokesperson said the utility needs to raise rates because of “federal and state safety mandates, as well as increased property taxes and the costs to deliver expanded energy efficiency.”

Kim Fraczek, director of the environmental group Sane Energy Project, disputed the company's claim: “They’re saying, ‘Oh, this is about safety and reliability’ when it's really not. It's about them making deep investments in fossil fuels so their stock prices go up.”

Electricity. Last summer Con Edison, which provides electricity in all five boroughs and natural gas in Manhattan and the Bronx, won approval for rate hikes. The third and final increase will take effect next January 2025 at a rate of 4% for electricity and 6% for gas.Con Edison is also an investor-owned utility and paid investors $1.1 billion in dividends in 2023, according to its last annual report. The company said it needs the extra revenue to pay for upgrades, including measures to meet New York state’s ’s climate laws.During last summer's rate-increase negotiations with regulators and advocates, Con Edison agreed to not shut off anyone’s electricity during extreme heat emergencies, when the temperature is above 90 degrees.

Rejoice! Barring a blackout, fans and air conditioners will continue to function as the mercury climbs toward triple digits.

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