National Grid Proposes New Rate Plan

Press statement:
After more than a decade of stable energy bills and $6 billion in infrastructure investments, National Grid has filed a proposal to reset electricity and natural gas delivery prices beginning in April 2018. The new delivery prices will allow the company to modernize its electricity and gas networks to further enhance reliability and resiliency, improve customer service – including programs to assist the most vulnerable customers – and promote economic growth. The proposal must be reviewed by the New York Public Service Commission and, if approved, would take effect April 1, 2018. The current delivery price freeze for National Grid’s upstate electricity and natural gas customers will remain in effect through March 31, 2018. Adjusted for inflation natural gas delivery prices have held steady for more than a decade and electricity delivery prices are lower than they were in 2004. The proposal would result in total monthly bill impacts of $11.23, or 13.9 percent (21.8 percent on delivery) for a residential electricity customer using 600 kilowatt-hours. Total bill impacts for residential gas customers would be $10.38, or 14.9 percent (24.8 percent on delivery) a month, based on 77 therms used. While regulations require the company to file a one-year plan, National Grid is open to phasing in new rates through a multi-year agreement to mitigate customer impact. Spreading the increase over three years, for example, could reduce the first year customer bill impacts by more than half. The company’s filing would impact only energy delivery prices. Supply prices are set by the market, not National Grid. “After more than a decade of rate stability, we fully understand the near term bill impact of this proposal on our customers and will look to phase in that impact while providing enhanced energy efficiency programs and bill management tools, and significantly increasing our support for our most vulnerable low-income customers,” said Ken Daly, National Grid’s New York president. “The proposal is focused on efficiently delivering the investments needed for the long term to achieve our primary object – the safe and reliable delivery of energy for our customers. This includes preparing for and responding to severe storms, which are increasing in both frequency and intensity. It also will allow us to lay the foundation for a sustainable and clean energy future by developing networks capable of serving the next generation of customers.” As part of the request for new delivery prices, the company is proposing:

• Investment of approximately $2.7 billion over the next three years in its core electricity and gas networks across upstate New York. This includes investments that will allow the company to seamlessly connect distributed generation, especially renewable resources. These investments will begin transitioning the traditional utility model t_o a platform that accommodates a two-way flow of energy and enhances market dynamics.
• Deployment of advanced metering infrastructure for both electricity and gas service that will provide customers enhanced energy consumption data, and more products and services for managing their energy use. Over time, this represents more than two million new smart meters being placed into service.
• New demonstration projects, including initiatives to test smart home technologies and a distributed generation cost-recovery model.
• Investments in the natural gas systems that will mitigate regional capacity constraints, expand availability of gas service, and improve the safety and reliability of the distribution network. This includes the retirement of 150 miles of leak-prone pipe over three years.
• Increased customer assistance and energy affordability programs for those having difficulty managing their energy costs, including a new initiative to increase enrollment in energy affordability, energy efficiency and gas safety programs by more than 50,000 customers.
• Continued deployment of economic development and energy efficiency programs that help grow the upstate economy.
• Adding more than 280 jobs over the next three years to support electric and gas operations, grid modernization and customer programs. These will be local employees who live and work in the communities we serve and support the regional economy.

Since 2008, National Grid has increased its annual capital investment in its electricity networks by 70 percent and for its gas systems by 110 percent. During that same period, overall customer bills have declined and delivery prices have remained stable when adjusted for inflation. The company also has maintained and enhanced its extensive energy efficiency and low-income assistance programs that help consumers manage energy usage and bills and take advantage of new energy technologies. National Grid’s electricity business serves 1.6 million customers in more than 450 cities and towns across 24,000 square miles. The gas distribution business serves more than 600,000 customers across portions of central, northern and eastern New York. Under New York public service law, rate cases are an 11-month process that will include a number of opportunities for public input. As part of its preparation for this case, National Grid conducted extensive outreach with more than 250 key stakeholders who represent different types of customers and other interest groups. This was done to help the company align its goals with those of the customers and communities it serves.