Electric bills would be lower if it weren’t for the Federal Energy Regulatory commission’s capacity zone established last May, according to Central Hudson.
The capacity zone has increased electric supply rates because it requires utilities to purchase a greater portion of energy from local producers rather than seek less expensive alternatives outside the area. The goal is to reduce the need to transport electricity over long distances; in this case, bottlenecks have developed in the transmission of electricity from the north to our area and the New York metropolitan area and some producers may go offline. Central Hudson estimated last year that electric rates would increase by 6 percent for residential consumers. The company is appealing the establishment of the capacity zone and suggests investing in improved transmission lines as the better alternative.
Central Hudson said the first three weeks of January 2015 were colder than the same period in 2014 and natural gas usage locally has been higher, but rates were lower. In a release, it credited, “higher inventories of stored liquefied natural gas in New England, more robust hedging strategies and other factors.” The average rate a consumer paid on a bill sent out the first week of the month was 60 cents per 100 cubic feet vs. 64 cents the previous year. That rate includes the previous billing period.
The same can’t be said for electric supply rates, which are higher this January than last — 9 cents per kWh vs. 7.3 cents for the bills that went out earlier this month. About 35 percent of New York State’s electrical power comes from natural gas.
Natural gas and electric bills include delivery, taxes and supply. While delivery prices and taxes are fixed and set by state and federal authorities, supply prices fluctuate with the energy markets.