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Residents across the Hudson Valley are facing higher living costs as of Aug. 1, as Central Hudson Gas & Electric Corporation has increased rates for both gas and electricity.
The rate hikes, effective through June 2025, will result in electric bills rising by 7.85%, adding about $12.65 per month for the average consumer, and natural gas bills increasing by 9.19%, or approximately $12.25 per month. However, in Pine Plains, the utility provides only electricity.
The Public Service Commission, the state agency responsible for regulating utilities, established the rates on July 18 after a 12-month analysis. This process included eight virtual and in-person public statement hearings and testimony before administrative law judges. The PSC’s decision concluded with the approval of a one-year rate plan aimed at covering the costs of critical investments in the energy system, ensuring compliance with New York’s climate laws and reliability mandates.
“The forward-looking plan we have adopted benefits customers and includes provisions that further important state and commission objectives,” PSC chair Rory M. Christian said in a statement. “Central Hudson is required to pursue important energy-efficiency initiatives among other progressive policies, to advance the goals of New York state’s nation-leading climate change targets, while mitigating bill impacts for low-income customers, as part of New York’s energy affordability policy.”
In a statement, Central Hudson said the increase will help to cover the costs of making critical investments in the energy system to continue to safely serve customers while also supporting the state’s climate laws and reliability mandates. According to Central Hudson, these investments include replacing aging electric and natural gas infrastructure and upgrading systems to support locally produced renewable resources; enhancing preparedness and response to severe weather events, including improved vegetation management and tree trimming, as well as increased funding for personnel and resources during severe weather; upgrading technologies to improve the customer experience; and addressing economic impacts following the COVID-19 pandemic, including inflationary pressures and employee turnover.
Credit: Central Hudson Gas & Electric Corp.
Central Hudson’s initial filing sought a $139.5 million electric revenue increase and a $41.5 million gas revenue increase. Instead of granting the full amount, the commission approved an electric rate increase of $58 million (5.5% increase in total revenues) and a gas rate increase of $21.2 million (7.3%). The total increase approved for electric and gas companies was $79.3 million, well under the $181 million originally sought.
“If the company’s original proposal was granted, Central Hudson’s total revenues would have increased by 13.3% for electric and 14.2% for gas,” said Christian. “The significant reduction in the rate increase requested by the company was made possible by the transparent and thorough review of all cost drivers by staff and other parties. In developing this decision, the commission reviewed a detailed record that included the testimony of parties, the judges’ recommended decision and well over 400 public comments received, both directly and at the eight public statement hearings that were held.”
Lawmakers at both the state and federal levels have voiced their discontent over the rate increases by Central Hudson Gas & Electric Corporation, citing concerns about the financial burden on their constituents.
Assemblymember Didi Barrett, chair of the Assembly’s Energy Committee, highlighted the impact of the increase despite it being lower than initially proposed by the utility company. “While this is significantly less than the double digit rate increase that Central Hudson had requested, it will still be a burden for too many people in our community,” she stated.
Federal representatives echoed these concerns in their comments to the Herald. “I’m a Central Hudson customer myself, and it’s incredibly frustrating,” Rep. Marc Molinaro told the Herald. “We need to do more to bring down the cost of living and support those struggling to get by.” Rep. Pat Ryan also told the Herald that “with Hudson Valley families feeling the economic pressure, allowing any rate increase is completely unacceptable. We’re all still reeling from years of systemic failure by Central Hudson – while their profits continue to grow at our expense.”
State Senator Michelle Hinchey criticized the rate increase and emphasized the need for greater accountability and affordability. “Since Central Hudson’s billing debacle started, over 1,000 constituents have called my office for help, with many suffering severe financial stress,” Hinchey said. “That’s proof enough that Central Hudson should never have been allowed a rate increase. I’m extremely disappointed in the PSC’s decision. This year, we finally passed my bill to ban estimated billing through both the Senate and Assembly. We now need the Governor to sign it into law. Making life more affordable for Hudson Valley residents is my priority, and that includes cracking down on utility companies that consistently fail to provide affordable and reliable service.”
On Thursday, Central Hudson announced a new rate plan. If approved, it will take effect next summer after the current rate increase expires in June 2025. “We know that a higher utility bill is something no customer wants to see,” said Steph Raymond, president of Central Hudson, in a press release. “Although we received approval for a one-year rate plan this summer, we must have a new plan ready to continue investing in replacing aging infrastructure and maintaining safe and reliable service.” According to the release, the proposal would result in residential electric bills increasing by about 30 cents per day and residential natural gas bills by approximately 29 cents per day, based on market supply prices as of May 2024.