Last Updated: February 2016
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For FY 2014, New York's major electric and gas companies allocated $120.4 million for low-income rate assistance programs that assisted 1, 075,000 households. For FY 2015 programs, utility companies budgeted nearly $136 million to assist over 1.1 million households.
All the of regulated utilities - Consolidated Edison, National Grid, New York State Electric and Gas, KeySpan Energy New York, KeySpan Energy Long Island, National Fuel Gas, Central Hudson, Orange and Rockland, Rochester Gas and Electric, Corning, St. Lawrence and PSEG Long Island - have some form of rate assistance. Most assistance consists of discounts off the basic monthly service charge for electricity and/or gas that is funded through utility rates and administered by the utilities. Funding is recovered from all customer classes.
Monthly discounts range from $2 to $24 off the monthly fixed customer charge. The largest program, totaling $59.4 million in 2015, is operated by Con Edison, and provided a $9.50 monthly discount to 407,249 electric customers. Some gas companies provide discounts on consumption up to a specified level. Con Edison provided a $7.25 discount on the monthly minimum charge, as well as a discount based on usage to about 169,900 customers in 2015.
For most programs, households in receipt of, or eligible for, LIHEAP are automatically enrolled in the discount program. Under the Con Edison program, recipients of SSI, TANF, SNAP and Medicaid are also automatically enrolled.
All of the major utilities have arrearage forgiveness programs except Con Edison and Orange and Rockland. Many of the utilities waive reconnection fees for qualified low-income program participants.
In New York, the Public Service Commission (PSC) has spearheaded and directed the creation and expansion of low-income energy programs. Unlike most other states, the New York legislature has had little involvement.
Because energy services are considered essential to the safety and well-being of all New Yorkers, the New York PSC since 1989 has approved targeted low-income rate assistance programs. In its rate orders, the Commission has repeatedly recognized that rate discounts to qualified, income-eligible customers can be an efficient way to maintain economically-distressed households on the utility system. Keeping them on the system provides benefits to all customers using the utility system by retaining these customers' contribution to fixed costs.
The low-income discount programs offered by utilities vary by eligibility and benefit levels and do not conform to a consistent set of goals or objectives. In January 2015, the PSC conducted a review of all utility low-income discount programs, to identify best practices, and to develop a set of recommendations for how to optimize the implementation of the programs.
The resulting report, released in June 2015, proposed a statewide approach to utility low-income programs with recommendations for defining eligibility, enrollment processes, benefit structures and discount levels. The report recommended that utilities develop a four-tiered approach for determining heating and non-heating electric and gas discounts. The discount levels, based on average usage and income, take into account LIHEAP benefits and would be set at a level sufficient to achieve an energy burden of six percent.
In 1998, through Case 94-E-0952, the Electric Competitive Opportunities Proceeding, the New York PSC created a broad-based, multi-utility system benefits charge (SBC) to fund for energy efficiency, including low-income energy efficiency programs.
The EmPower New York program offers no-cost energy services for households with incomes at or less than 60 percent of state median income.
The program is administered by the New York State Energy Research and Development Authority (NYSERDA) under an agreement with the PSC. Services may include: replacement of old, inefficient appliances; installation of high-efficiency lighting, insulation and other home efficiency measures and tips on how to save energy.
EmPower New York recipients must be an electric customer of Central Hudson, Con Edison, National Grid, New York State Electric and Gas, Orange and Rockland, or Rochester Gas and Electric, and be responsible for payment of the utility bills. Or participants must be a natural gas customer of Keyspan Long Island, Keyspan New York or National Fuel Gas and live in a building with 100 residential units or less. They must also be LIHEAP eligible or participate in a utility low-income rate assistance program. Customers heating with oil, propane and kerosene can receive EmPower services with funding through the Regional Greenhouse Gas Initiative.
For 2014, the electric program had a budget of $18.9 million and helped about 10,146 households; the gas program had $17.9 million and served about 5,168 households. Electric and gas low-income multi-family programs had budgets of $7.7 million and $14.8 million respectively in 2014. Empower programs for 2015 were budgeted at $18 million for electric and $38 million for gas households in 2015. Multi-family programs for 2015 had budgets of $7.7 million for electric and $17.6 million for gas households.
The SBC and the efficiency programs it funds were created to ensure that certain public benefit energy efficiency and energy research programs were adequately maintained during the state's transition toward a more competitive electric market. After its original authorization in 1998 for five years, the SBC was reauthorized three more times; the latest authorization funded programs through 2015.
From 1998 through 2008, most low-income energy efficiency programs were funded through the SBC on electricity bills only and administered by NYSERDA.
Low-income programs funded by the SBC include EmPower New York. Also funded are multi-family low-income energy efficiency programs, free workshops on energy use and financial management for the general public, and technical support to the state LIHEAP office for its heating oil buying program, which began as a pilot and is now operating statewide.
In 2004, EmPower was expanded to provide natural gas efficiency services to low-income customers of National Grid, National Fuel Gas, and Consolidated Edison using non-SBC funds. NYSERDA administers most of these as well.
With the adoption of an Energy Efficiency Portfolio Standard (EEPS) in 2008 and 2009, the PSC continued the SBC-funded programs, while authorizing the creation of new programs, expanding SBC surcharges and creating a natural gas SBC. The current authorization also shifted various residential energy efficiency programs that existed under the Energy $mart program to the EEPS.
In 2008 the PSC issued several orders adopting efficiency targets through 2015, expanding efficiency programs administered by the state's electric utilities and NYSERDA, and increasing the SBC from electric customers in order to fund expanded programs. The expansions were designed to meet a state goal of a 15 percent reduction in electricity use by 2015. New and expanded programs began in 2009
A year later the PSC issued an order establishing efficiency targets for gas utilities, with subsequent orders approving expanded efficiency programs and authorizing a gas SBC from natural gas customers in order to continue and expand existing natural gas programs, including EmPower.
An order issued in October of 2011 set SBC/EEPS funding levels for 2012-2015. It provided EmPower New York with $73.7 million through the electric EEPS and $97.9 through the gas EEPS. This is a considerable increase for the low-income programs, amounting to 30 percent of SBC collections attributable to residential customers, compared to a pre-2011 level of about 19 percent. The PSC chose this level based upon recommendations from its staff and comments from key stakeholders, and in recognition of the fact that low-income customers represent approximately 30 percent of total residential customers.
New York is also one of ten Northeast and Mid-Atlantic states participating in the Regional Greenhouse Gas Initiative (RGGI), a coalition working to limit carbon dioxide pollution through a cap and trade system, whereby the participating states limit the amount CO2 that can be emitted by their power plants. The participating states have agreed to implement RGGI quarterly auctions where they will sell the region's annual emissions "budget" of approximately 188 million allowances. Auctions began in September 2008.
For the period from 2012 through 2014, EmPower New York was to receive about $13 million in RGGI funds, most of which are for efficiency programs targeting oil and propane heated single- and multi-family residences. (These residences aren't eligible to receive SBC/EEPS funds.) Participants receive efficiency measures such as insulation, blower-door assisted air sealing, and heating systems repair and replacements. All households meeting the income eligibility requirements, regardless of electric service provider, will be eligible to apply for heating efficiency assistance and the program will coordinate closely with the WAP.
For more information
NYPSC information page on the SBC: includes history, opinions, rulings, comments by interested parties, etc.
NYPSC information page on EEPS: includes history, funding, opinions rulings
NYPSC Staff Program Review White Paper, details EEPS history, funding and suggestions for improvement
NYPSC Staff Report, June 2015, summary of rate assistance programs, recommendations for improvement and comments