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Thiele thrashes electric rate hike

COURTESY PHOTO Assemblyman Thiele rails against a proposed rate hike by the power company.
COURTESY PHOTO | Assemblyman Thiele rails against a proposed rate hike by the power company.

The Long Island Power Authority Tuesday approved a $325 million three-year rate increase that has been the focus of objections at public meetings for more than a year.

The increase, affecting 1.1 million customers, affects the delivery charge to bring the fuel to Long Island communities and represents about half the total utility bill customers will receive from PSEG-LI. The fuel charge itself accounts for the remainder of the bill.

Under the LIPA Reform Act, the board claimed it could only vote on inconsistencies in the state-recommended rate hike, said Assemblyman Fred Thiele Jr. (I-Sag Harbor), who has been a constant opponent of the increase.

He has called for a new look at the Reform Act that would:
• Create an elected LIPA Board of Trustees.
• Restore oversight by the State Comptroller and Attorney General.
• Provide regulatory authority by the State Public Service Commission over LIPA rates.
• Give the LIPA Board discretion to consider the impact of rate increases on ratepayers and the regional economy.

Some LIPA Board members voiced displeasure with the increase, but were blocked from adjusting the hike up or down, Mr. Thiele said.

LIPA will officially adopt the budget reflecting the rate hike in December.

While delivery charges have been raised only twice during the last 16 years, this hike is the largest ratepayers have ever had to absorb, Mr. Thiele charged.

Governor Andrew Cuomo called on LIPA to operate more frugally when he signed the Reform Act in 2013.

“You have to operate the utility better. LIPA’s answer to everything is more money,” Mr. Cuomo said at the time. “You can’t keep putting your hand in the pocket of ratepayers.”

But PSEG-LI, LIPA and the Department of Public Service on Long Island ignored the governor, Mr. Thiele said.

The proposal to be adopted in December includes more indebtedness for the utility company that will borrow substantially during the next four years, creating an anticipated debt of more than $8 billion by the end of 2018, Mr. Thiele said. LIPA debt in 2012 was at $6.9 billion.

The proposal would saddle Long Island with the highest debt level in the history of LIPA, the assemblyman warned. He predicted it would have a “substantial negative effect on Long Island jobs and the economy” adding that PSEG-LI should have had to prepare an economic impact statement to accompany the proposal.

It sends a message to businesses that Long Island will continue to face the highest utility rates in the nation and increased debt that will slow down Long Island’s ability to compete economically.

“It is clear to all that the LIPA Reform Act is not about reform but guaranteeing the financial interests of a private utility company,” Mr. Thiele said.

PSEG-LI Director of Communications Jeffrey Weir declined comment.