Monday, July 26, 2010

PSC: National Grid’s Rates Should Come Down

Earlier this year, I published a piece arguing that the National Grid power company gouges upstate New Yorkers.

A piece in The Post-Standard offers some fresh evidence in that regard.

The Syracuse daily reports that the monopoly power deliverer is charging its Upstate New York electric customers for computers in New England, software licenses on Long Island and other corporate costs that have nothing to do with Upstate utility operations, auditors at the state Public Service Commission (PSC) say.

PSC investigators came across this information while looking at the multinational’s plan to raise electric rates on New Yorkers by $369 million a year, including $25 million a year in bonuses (apparently without any requirement that the employees reduce costs to pay for them).

So questionable are the power company’s procedures that PSC auditors concluded: “Transactions between the former Niagara Mohawk and other companies owned by National Grid are so loosely documented that Upstate utility customers likely are subsidizing other parts of National Grid’s business.”

The paper reported that in recent years, National Grid has justified purchasing several other utilities by arguing that the company would save money via efficiencies and consolidation. But PSC staff noted that such the cost of the shared services actually increased, far higher than the rate of inflation.

A PSC panel said the company’s plan to raise rates had “a number of serious problems” and had so many objections that it actually recommended National Grid DECREASE rates by $14 million a year.

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A nearly-lifelong resident of Glens Falls, Brian Farenell has been involved in writing and journalism since his high school days. After receiving a bachelor's degree from Clarkson University, he spent two years in the Peace Corps in the Republic of Guinea, West Africa. Although his traditional focuses have been international affairs (he's been published in Foreign Policy magazine) and media criticism, Brian maintains his own blog at Musings of a (Fairly) Young Contrarian, where he also offers insights and ideas about national and local issues.




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