Cahill Advises Fortis: Heed PSC Instructions on Local Governance, Renewable Energy, System Hardening

June 13, 2013

Albany, New York – Assemblymember Kevin Cahill (D – Ulster, Dutchess) released the following statement today regarding the Public Service Commission’s (PSC) decision to unanimously approve the acquisition of Central Hudson by the Canadian holding company Fortis, Inc.:

“The decision by the PSC is both disappointing and of questionable legality. Though New York State has seen fit to destroy the consumer protection apparatus that could have guaranteed a means to appeal, I will consult with experts and citizen activists to proceed as fully as possible to reverse this ill considered administrative determination.

• The PSC did not follow administrative process when they refused to conduct an evidentiary hearing on the revised proposal.
• The negotiated labor agreement and the rate freezes promised are completely incongruous and will likely result in rate hikes at the end of the restricted period.
• The commitment to freeze rates over the next two years is contrary to the companies’ own prior analyses. Conversely, rates of return in excess of ten percent, such as those currently enjoyed by Central Hudson, are inconsistent with DPS staff recommendations in cases currently before the PSC.
• The Customer Benefit Fund to assist distressed customers, those in arrears or those who have already received shut off notices, demonstrates insensitivity to a primary obligation of a public utility in New York is the most miserly ever approved. The pittance offered here, a fraction of what those customers would need to bring even a single month’s bill up to date, couched in an overall ‘economic development program’ is an insult to all Central Hudson customers.
• Our communities are left vulnerable to the North American Free Trade Agreement. This could impact not only regulatory issues but a wide range of commercial and labor relationships including the possibility of the utility buying its own power.
• Central Hudson’s current credit rating is considerably stronger than the company taking over, and they already possess the expertise of dealing in a uniquely New York market. The Commission was given ample evidence regarding the potential instability of Fortis and the lack of serious rate payer protection from the negative impact that might ensue.
• The PSC ruled on this matter while operating with a vacant seat.

“The Legislature established the Commission in order to ensure the existence of an entity whose mission is to uphold the public interest and the only question before the Commission today was whether Central Hudson and Fortis met the public benefit test. They utterly failed and now so did the Public Service Commission. Today’s approval of Fortis’ takeover of Central Hudson is irrational, illegal and procedurally flawed.

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