After LIPA rate hike, LI lawmaker plans bill to repeal reform act

A maze of power lines emanates from LIPA's A maze of power lines emanates from LIPA's Port Jefferson power plant. (Aug. 5, 2013) Photo Credit: Newsday / John Paraskevas

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A Long Island state assemblyman Wednesday said he plans to introduce a bill to repeal the recently signed LIPA reform act after revelations that LIPA hiked rates 4 percent this month.

Assemb. Al Graf (R-Holbrook) said he would introduce legislation repealing the act and include language that frees LIPA from repaying debt from unfunded state mandates, namely the debt from the never-opened Shoreham nuclear power plant.

The LIPA overhaul bill was approved by the State Legislature in June and signed by Gov. Andrew M. Cuomo on July 29. It gives PSEG of New Jersey, a utility that had been scheduled to take over management of the Long Island electric grid in January, nearly total control of the system.

Meanwhile, a ratepayer who previously took issue with LIPA's estimated billing system said this month's increase in the power supply charge could leave LIPA customers at a further disadvantage because it follows a month of near-record usage.

Peter Manger of Lake Grove said that because LIPA reads most customer meters once every two months, some of last month's high usage could get billed at this month's higher rate.

Newsday reported Tuesday that LIPA's power supply charge would increase 8.6 percent this month, a week after Cuomo signed the overhaul bill. The law didn't include language to freeze rates, but Cuomo said a three-year rate freeze, starting this year, was a goal.

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The power supply charge represents about half the bill, meaning total bills will increase about 4 percent, or $5.71 on average.

A Cuomo administration spokesman said the freeze applies to the delivery charge, not the power supply charge.

"There has been no change to or impact on the governor's plan for a three-year rate freeze," said spokesman Richard Azzopardi.

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Manger urged fellow LIPA customers to call in their meter readings to avoid paying at a higher rate for a portion of last month's usage.

Because LIPA reads most customer meters once every two months, it estimates how much electricity customers use during the first 30 days of the cycle. During the second month, LIPA reads the meters and bills customers for the total metered usage minus the first month's estimate.

The problem: Sometimes LIPA underestimates how much usage took place in the first month. If the power supply charge is raised in a month when the meter is read, and the prior month was underestimated, an artificially high portion of the usage gets billed to the second month -- at a potentially higher rate.

LIPA has acknowledged the problem but said it uses special algorithms to make sure estimates are close to past usage.

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