Power prices continuing to rise

Commercial power customers will see prices continue to rise in the coming year, but there are government and National Grid programs to help reduce prices for users, company officials said Wednesday.

National Grid held an informational meeting for commercial and industrial customers in Watertown.

Dennis Schafer, lead analyst with the program and policy administration department in Syracuse, said increased prices will come from two primary sources.

All electric and gas customers in the state are paying the "incremental state assessment" that was passed as part of the state's 2008-09 budget.

The charge, which is supposed to collect 2 percent of each utility's total revenues for the state's general fund, will include $83 million from National Grid's electric customers and $26 million from its natural gas customers.

The fee was collected by customer classification. Some large manufacturing customers are exempt because of their contracts with the utility, so up to this point, the other customers in that class have been paying their share.

"The very largest customers have been paying $1.45 per kilowatt," he said.

The Public Service Commission, which wrote the rules for collecting the charge, recently changed that collection system so the other customers in the same class would not have to pay those charges.

Mr. Schafer said residential and small commercial customers will see their fee payment increase about 40 cents per month, while the largest class of customers will see a 30 percent drop in their fee payment.

"It's substantial," he said.

The fee will be re-evaluated each July and is scheduled to end March 31, 2014.

Part of the delivery charges, the competitive transition charge, will increase for the next two years. The actual amount of the increase must be approved by the PSC.

The charge is reset every two years based on expected commodity prices and unpredictable expenses from the past two years, including storm recovery costs and pension payments.

"Commodity prices are very, very low right now, which is good news," Mr. Schafer said. "But the bad news is we can't imagine they're going to stay low."

Last December, a large ice storm hit Albany, which cost $47 million to clean up, Mr. Schafer said. And two below-market-cost power contracts with the Nine Mile nuclear plants are ending or losing value, which will push up the charge, too.

But to help save on energy costs, commercial and industrial customers can take advantage of several programs, from both National Grid and the state.

National Grid has grant programs for expansion projects called the Capital Investment Incentive Program, for energy efficiency and capacity expansion projects called the Manufacturing Productivity Program and for installing equipment and controls to decrease outages at manufacturing, research and development and health care facilities, called the Power Quality Enhancement Program.

The Manufacturing Productivity Program is the most recent; it was finalized in March.

"It has been very popular," said Joe Russo, lead economic developer in the economic and community development department in Syracuse. "We've done at least 20 application approvals."

National Grid also is finalizing the details for energy efficiency programs.

Several of the programs are through the New York Power Authority, including Power for Jobs, Preservation Power and the recently finalized Temporary North Country Power Discount Program.

The discount program gives an automatic discount to medium and large commercial and dairy farm customers in Jefferson, St. Lawrence and Franklin counties.

The state also recently extended net metering of renewable energy sources to businesses.

Thus, if a company installs a photovoltaic or wind energy system and it produces more power than the business uses, that electricity can be sold on the grid. The sale will appear as a credit on the following month's bill.

Dexter Deputy Clerk Charlene C. Mannigan attended the session, looking for information on the cost-reduction programs.

"I had questions about the incremental state assessment, so it was good that they just explained that," she said. "And it's important to know the increases coming."

ON THE NET

National Grid: www.shovelready.com/sr_2005/s_

incentives.asp