Natural Gas

The CPB actively participates in proceedings concerning the availability, pricing and quality of natural gas service in the State. Agency experts testify on behalf of consumers before the Public Service Commission (PSC) in proceedings involving proposed natural gas delivery rate increases by major utilities. The agency also makes formal filings regarding proposals by utilities or regulators that affect the price, reliability and quality of natural gas service in the State. Agency activities have helped save consumers hundreds of millions of dollars on their gas bills in recent years.

Detailed information regarding the CPB’s recent efforts regarding natural gas utilities can be obtained from the links below.


Central Hudson Electric & Gas Corporation - Gas Operations
•	Response to Central Hudson's Petition for Rehearing - In this filing dated September 13, 2006, the CPB responds to Central Hudson's request that the PSC authorize a higher profit rate than the Company accepted in July 2006. The CPB demonstrates that there is no legal or factual basis for the Company's request to withdraw its previous commitment.

•	CPB Petition for Rehearing - On August 30, 2006, the CPB filed a Petition for Rehearing regarding the PSC's July 24, 2006, Order approving a three-year rate plan for Central Hudson. The CPB explains that the PSC's Order, which approved the largest rate increase for any New York State utility in more than a decade, should be modified to provide residential and small business customers the opportunity to purchase electricity and natural gas from the utility at a fixed price, since such options are not available from unregulated companies at a just and reasonable price. We also recommend that ratepayer funds being held by the utility, which total approximately $20 million, be used to mitigate the rate increase.

•	Brief Regarding Joint Proposal - The CPB explains in this Post-Hearing Brief dated May 12, 2006, that the Joint Proposal to resolve all rate and regulatory issues for three years should be modified in several important respects to provide additional consumer benefits. We also address the response of other parties to our recommendations.

•	Testimony Opposing Joint Proposal - On May 1, 2006, the CPB filed this testimony demonstrating that the Joint Proposal involving the Company, Staff of the Department of Public Service and other parties, should be modified to provide additional consumer benefits. That Joint Proposal would increase natural gas delivery bills by 19% and 12% in the first two years. CPB witnesses explain that the Company should be required to offer natural gas at fixed prices to help consumers manage their energy bills. CPB also demonstrates that the Joint Proposal should be revised to require the Company to return more than $20 million of its customers' money that it is currently holding, and in several other respects to reduce the rate increase to manageable levels.
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Consolidated Edison Company - Gas Operations
•	Letter Regarding Energy Efficiency Program - In this letter dated June 3, 2008, the CPB recommends that the PSC take action to ensure that an expanded gas energy efficiency program is available for Con Edison’s customers by October 1, 2008. We propose that the Commission expand funding for this initiative by approximately 20% to $17 million, maintain NYSERDA’s responsibility for administering the current gas efficiency programs in Con Edison’s territory, and preserve its flexibility to modify this effort for consistency with its upcoming decision in the generic energy efficiency case. We also encourage Con Edison to submit a detailed proposal for a gas energy efficiency program that it would administer beginning October 1, 2008.

•	Statement Regarding Joint Proposal - Con Edison and other parties submitted a Joint Proposal on June 1, 2007, to resolve all matters in the company's pending rate case and to establish a three-year rate plan. The CPB is not a signatory of that document. In this filing dated June 19, 2007, we explain that the proposal reflects many of the CPB's recommendations, including rate increases that are much lower than proposed, a new gas energy efficiency program, elimination of subsidies for competitive energy suppliers and an enhanced low-income program.

•	Testimony Regarding Policy Issues - The CPB submitted this testimony on regulatory policy issues applicable to Con Edison's gas operations on March 16, 2007. It explains that a new gas efficiency program should be established to provide the benefits of energy efficiency to Con Edison's gas customers. The testimony also demonstrates that new regulatory policies should be established to eliminate utilities' disincentive to promote conservation, eliminate ratepayer subsidies of competitive energy companies, and encourage appropriate infrastructure investment.

•	Testimony Regarding Accounting Issues - Con Edison proposed to increase delivery rates by approximately $200 million. In this testimony, the CPB explains that numerous adjustments to the company's proposals are required to accurately measure its need for rate relief. In particular, substantial adjustments are necessary to the company's projections of pension expense, capital expenditures, and operations and maintenance expense. Overall, no more than one-half of the company's rate increase proposal should be approved.

•	Testimony Regarding Profit Rate - In testimony filed March 16, 2007, the CPB demonstrates that Con Edison's proposed return on equity of 11.25% is excessive. We show that a fair return on equity for the company is 9.05%.

•	Testimony on Low-Income Assistance Programs - Con Edison proposed to maintain its low-income assistance programs and to impose a reconnection fee of approximately $200. In this testimony, dated March 16, 2007, the CPB explains that the Company's low-income assistance programs should be enhanced and that a reconnection fee should not be applicable to Con Edison's low-income customers.

•	Comments Regarding Gas Efficiency Program - In these comments submitted April 20, 2007, the CPB explains that a gas efficiency program should be available in Con Edison's service territory in the 2007 - 2008 heating season. We propose that the PSC approve a cost-effective gas efficiency program with target expenditures of $14 million, to provide low-income, residential and commercial customers access to services to help reduce their gas usage. We also recommend several reporting requirements to ensure that the program is providing anticipated benefits to consumers.
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KeySpan Energy Delivery of New York and Long Island
•	Statement in Support of Joint Proposal - In this filing dated October 12, 2007, the CPB explains its full support of a Joint Proposal regarding the rates, terms and conditions of service by KeySpan Energy Delivery New York and KeySpan Energy Delivery Long Island, filed on October 11, 2007, which we helped negotiate. We explain that the Joint Proposal fairly resolves several important issues for consumers, including a new energy efficiency program sponsored by the utilities, additional funding for low-income assistance programs and an opportunity to review the level of actual site investigation and remediation costs in 2010 to determine if changes in rates are required

•	Testimony Regarding Policy Issues - The CPB submitted this testimony on regulatory policy issues applicable to KeySpan's gas operations on January 29, 2007. It explains that a new gas efficiency program should be established to provide the benefits of energy efficiency to KeySpan customers, utilities' disincentive to promote conservation should be eliminated, and ratepayer subsidies of competitive energy companies should be terminated. This testimony also shows that changes are required to the company's gas cost incentive mechanisms and to the methodology for determining its gas supply requirements.

•	Testimony Regarding Accounting Issues - In this testimony, the CPB shows that KeySpan has substantially overstated its need for a rate increase. We demonstrate that substantial adjustments are necessary to the company's projections of pension expense, productivity, tax expenses and incentive compensation.

•	Testimony Regarding Profit Rate - In testimony filed January 29, 2007, the CPB demonstrates that KeySpan's proposed return on equity is excessive and that a fair return on equity for the company is approximately 9%.

•	Testimony on Low-Income Assistance Programs - The CPB proposes in this testimony, to strengthen the service quality standards applicable to KeySpan and to enhance its low-income assistance programs.

National Fuel Gas
•	Request for Investigation Regarding Potential Acquisition - In this filing dated January 9, 2008, the CPB formally requested that the PSC investigate whether an entity known as New Mountain Vantage GP ("NMV"), is acquiring control of National Fuel Gas Distribution Corporation, a utility operating in New York. Evidence was presented by the utility that NMV directly controls 9.7% of the shares of the utility's corporate parent, and that NMV intends to control the management of the Company. Because of NMV's stated interest in focusing corporate attention on the utility's unregulated activities, the rates and service of the utility's regulated gas operations may be impacted negatively. The CPB recommends that the Commission investigate whether NMV has violated the Public Service Law by acquiring more than 10% of a utility without PSC approval.

•	Brief Opposing Exceptions - In this November 2, 2007 filing, the CPB responds to certain arguments made by other parties regarding the Administrative Law Judge's September 28, 2007 Recommended Decision. We oppose National Fuel Gas Distribution's position regarding the fair profit rate as well as other parties' concerns with the Judge's recommended changes to a measure to promote retail competition through subsidization by customers.

•	Brief on Exceptions - The Administrative Law Judge issued a recommended decision regarding National Fuel Gas Distribution Corporation's request to increase delivery rates, which adopted the majority of the CPB's recommendations in this case. In this brief dated October 18, 2007, the CPB identifies our concerns with the Judge's recommendations regarding a fair profit rate for the company, whether all customers should fund the utility's energy efficiency program, the benefits that ratepayers should obtain from off-system gas sales, and whether consumers should fund certain retail competition promotion policies.

•	Reply Brief Regarding Rate Case - In a reply brief dated August 27, 2007, the CPB responds to several issues raised by other parties concerning National Fuel Gas (NFG) Distribution Corporation's rate increase request. We explain that NFG should commence an energy efficiency program rather than wait as some other parties had proposed, and that consumers should obtain the benefit of additional revenues from off-system sales than is being proposed by other parties. We also respond to other parties' concerns about our proposal to eliminate a measure that promotes retail competition through subsidization by customers, as well as our proposal to limit the increase in the minimum charge for residential customers.

•	Initial Brief Regarding Rate Case - In this brief dated August 15, 2007, the CPB explains the reasons why the PSC should substantially modify National Fuel Gas Distribution Corporation's request for a rate increase of approximately $52 million. We explain that the PSC should reject the company's proposed new depreciation rates, thereby saving customers $9 million annually. It should also use approximately $15 million of insurance proceeds for site investigation and remediation of former manufactured gas plant sites for the benefit of the utility's customers instead of the benefit of the Company's unregulated affiliates, use an overall inflation rate for health care costs, and apply additional revenue from off-system sales to the benefit of ratepayers. We recommend that the PSC reject several company proposals to recover more costs from customers in winter and increase the minimum charge paid by residential customers. Additionally, the CPB proposes a new conservation program and a measure to eliminate the company's disincentive to promote conservation.

•	Testimony Regarding Proposed Rate Increase - National Fuel Gas Distribution Corporation proposed to increase delivery rates by approximately 20% effective January 1, 2008. The CPB submitted testimony on June 7, 2007, opposing that rate increase and recommending several regulatory policy changes. We demonstrate that the company's proposed new depreciation rates, which would increase annual costs to customers by approximately $9 million, should be rejected. We also propose a new gas efficiency program and elimination of the company's financial disincentive to promote conservation. In addition, the CPB explains why the utility's proposals to substantially increase the minimum charge applicable to residential customers and recover more costs from customers in winter, should be rejected.
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National Grid - Gas Operations
•	2008 Rate Case Testimony on Profit Rate - The CPB submitted testimony on October 27, 2008, regarding the fair rate of return on equity for Niagara Mohawk Gas Coroporation, a subsidiary of National Grid. We recommended a return of 9.55%. We also demonstrated that the Company's request for an 11.0% return is overstated. Our proposal would save customers approximately $13.6 million over Niagara Mohawk's recommendation.

•	Comments Regarding Low-Income Gas Customer Energy Efficiency Program - In a letter dated August 4, 2005, the CPB explains that Niagara Mohawk’s proposal to use $5 million of ratepayer-contributed resources to fund expanded energy efficiency services for up to 1,655 low-income natural gas customers over a two-year period, should be adopted with modifications. We explain that the PSC should modify the proposal to provide benefits to far more low-income customers than the estimated 830 that would benefit annually under the Company’s proposal. We also recommend additional changes to ensure that the program is cost effective.
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New York State Gas & Electric Corporation - Gas Operations
•	2009 Request for Expedited Rate Increase – Support for Motion to Dismiss – The CPB filed a response supporting the motion of the Department of Public Service to dismiss the rate filings. We agreed that the companies failed to provide adequate information to justify a need for increased rates. We pointed out that it appeared that the sole reason for the rate increase request was to pay $400 million in dividends to its corporate parent.

•	2009 Request for Expedited Rate Increase – Post-Hearing Brief – The CPB explained that the evidence in the record shows that the companies have adequate financial reserves and access to the capital markets to ensure that service remains safe and reliable. We also objected to the budgeted cost of the companies’ filing, $8 million, explaining that ratepayers should not have to pay for such a flawed filing. In addition, the CPB urged the Public Service Commission to direct the companies not to pay dividends to their parent just to be certain that the companies do not cause a liquidity problem by their own behavior.

•	2008 Gas Rate Case – Testimony on Consumer Issues – The CPB explained that the evidence in the record shows that the companies have adequate financial reserves and access to the capital markets to ensure that service remains safe and reliable. We also objected to the budgeted cost of the companies’ filing, $8 million, explaining that ratepayers should not have to pay for such a flawed filing. In addition, the CPB urged the Public Service Commission to direct the companies not to pay dividends to their parent just to be certain that the companies do not cause a liquidity problem by their own behavior.
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Orange and Rockland Utilities - Gas Operations
•	2008 Gas Rate Case – Testimony on Consumer Issues – The CPB submitted testimony on March 27, 2009, addressing service quality incentives and low-income program issues. We oppose the utility’s request for financial rewards if it exceeds specified levels of service quality, explaining that the main purpose of a utility is to provide quality service and ratepayers are already paying for service. We also propose an increase in the low-income credit and a waiver of the reconnection fee for low-income customers.

•	2008 Gas Rate Case – Testimony Regarding Profit Rate – In testimony submitted on March 27, 2009, the CPB demonstrates that Orange & Rockland’s proposed return on equity of 11.60% is excessive. We show that a fair return on equity for the utility is 10.00%.

•	Statement Regarding Joint Proposal - The CPB explains in this submission dated July 7, 2006, that a Joint Proposal submitted by the Company and other parties should be modified in several important respects to protect consumers. The Proposal is not consistent with the PSC’s Settlement Guidelines, since it is not supported by representatives of consumers, permits the utility to earn excessive profits and requires ratepayers to continue to subsidize competitive energy service providers more than 9 years after barriers to competition were removed.

•	Testimony Regarding Profit and Rate Issues - In this testimony filed March 30, 2006, the CPB explains that the Company's request for a 22% increase in gas delivery rates is excessive. The CPB shows that numerous adjustments to the Company's proposals are required, particularly concerning its proposed return on equity. We also explain why customers should not be paying the utility when they migrate to competitive suppliers and recommend that customer funds used to subsidize those competitive suppliers be reduced substantially.

•	Testimony Regarding Accounting Issues - In testimony dated March 30, 2006, the CPB demonstrates that numerous adjustments should be made to Orange and Rockland's rate increase requests. The CPB explains that the Company's calculation of pension expense, payroll additions, manufactured gas plant site remediation costs, property taxes, uncollectibles and late-payment revenues, should be modified, thereby substantially reducing the amount of the requested rate increase.

•	Testimony Regarding Low Income Program - The CPB explains in this testimony submitted March 20, 2006, that several changes to the Company's existing and proposed program to assist low-income customers are required to ensure that the program provides benefits in a cost effective manner.
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Rochester Gas & Electric Corporation (RG&E) - Gas Operations
•	2009 Request for Expedited Rate Increase – Support for Motion to Dismiss – The CPB filed a response supporting the motion of the Department of Public Service to dismiss the rate filings. We agreed that the companies failed to provide adequate information to justify a need for increased rates. We pointed out that it appeared that the sole reason for the rate increase request was to pay $400 million in dividends to its corporate parent.

•	2009 Request for Expedited Rate Increase – Post-Hearing Brief – The CPB explained that the evidence in the record shows that the companies have adequate financial reserves and access to the capital markets to ensure that service remains safe and reliable. We also objected to the budgeted cost of the companies’ filing, $8 million, explaining that ratepayers should not have to pay for such a flawed filing. In addition, the CPB urged the Public Service Commission to direct the companies not to pay dividends to their parent just to be certain that the companies do not cause a liquidity problem by their own behavior.

•	2009 Request for Expedited Rate Increase – Support for Motion to Dismiss – The CPB filed a response supporting the motion of the Department of Public Service to dismiss the rate filings. We agreed that the companies failed to provide adequate information to justify a need for increased rates. We pointed out that it appeared that the sole reason for the rate increase request was to pay $400 million in dividends to its corporate parent.

•	2008 Gas Rate Case – Testimony on Consumer Issues – The CPB explained that the evidence in the record shows that the companies have adequate financial reserves and access to the capital markets to ensure that service remains safe and reliable. We also objected to the budgeted cost of the companies’ filing, $8 million, explaining that ratepayers should not have to pay for such a flawed filing. In addition, the CPB urged the Public Service Commission to direct the companies not to pay dividends to their parent just to be certain that the companies do not cause a liquidity problem by their own behavior.

•	Comments Regarding Retail Access Plan - RG&E submitted a plan to facilitate competition in its service territory. In comments dated June 27, 2005, the CPB explained our general support for that plan, particularly provisions providing customers with the opportunity to purchase electricity at a fixed price and ensure that consumers are provided information necessary to make an informed decision regarding their energy purchases.