New York State Assemblyman Fred W. Thiele, Jr. will submit a statement (attached) to the Department of Public Service-LI (DPS-LI) tonight in Riverhead opposing the proposed 3 year, 4% a year increase in the delivery charge that would cost ratepayers an additional $72 million per year each year from 2016 to 2018. The delivery charge represents about 50% of the electric bill. The other half is the fuel supply charge. Thiele will call upon DPS-LI to recommend that the rate proposal be rejected.

Thiele stated, “Andrew Cuomo, when he signed the LIPA Reform Act in the summer of 2013, stated: ‘You have to operate the utility better. LIPA’s answer to everything is more money. We don’t have more money. You can’t keep putting your hand in the pocket of the ratepayers. That’s not the answer. The answer is, use the money you have better.’ I fully agree with the Governor. The answer is not asking for more money. Use the money you have better. This rate increase should be rejected.”

PSEG-LI is proposing to increase the delivery charge by nearly 4% for the next three years. The plan would increase PSEG revenue by $72 million per year from 2016 to 2018. The delivery charge represents about 50% of the average LIPA bill. LIPA increased the delivery charge only twice over the last 16 years, both times by less than 2%. This proposal is the largest increase in the delivery charge in the history of LIPA.

The proposal would also increase indebtedness which every PSEG-LI customer will be liable to repay under this rate proposal. The Long Island Power Authority plans to borrow up to $400 million in each of the next four years, with an anticipated debt level of at least $8.26 billion by the end of 2018. LIPA debt in 2012 stood at $6.9 billion. This proposal would saddle Long Island with the highest debt level in the history of LIPA. PSEG-LI would again mortgage Long Island's future with debt.

Thiele stated, “What impact will this rate proposal have on Long Island jobs and the economy? PSEG-LI should be required to prepare an economic impact statement. The Long Island economy is just coming out of the Great Recession. According to the LIA Monthly Economic Report for February 2015, ‘recent economic news has been mixed…economic conditions, while perhaps favorable on the whole, remain fragile and uncertain.’ Clearly an electric rate increase will be a drag on the recovery. Further, it will negatively impact Long Island’s ability to compete economically, as we again send a message to the nation and the world that companies on Long Island will continue to face the highest utility rates in the nation as well as increased debt that will impact rates for decades to come.”

Thiele concluded that PSEG-LI should be subject to the same cap as local government and school districts face for property taxes, which would be 1.62% this year. Thiele stated, “PSEG-LI should be required to live with the same fiscal discipline as the state and local government. First, PSEG-LI must demonstrate that any increase is justified, which in my opinion they have failed to do. Regardless, no increase should be approved above the 1.62% that local governments and school districts must live with this year.”