PSEG power supply charge to increase again

Police are trying to determine who shot a

Police are trying to determine who shot a bullet though a window at a PSEG office building on Park Drive in Melville. (Jan. 22, 2014) Photo Credit: Newsday / John Paraskevas

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Already high electric costs are set to increase again next month as the power supply charge portion of bills jumps 6 percent to its highest recorded level.

PSEG Long Island customers, already straining under winter bills that some say have doubled or tripled since December, face their sixth straight month of an increase in the charge, which makes up around half of the utility bill.

For March, the power supply charge will jump to 12.3 cents a kilowatt hour, PSEG said, from 11.6 cents in February. The charge was at a 12-month low of 7 cents in October but has risen each month since. Last year, it fell every month between March and June.

For a customer who uses 775 kilowatt hours of electricity, March bills will jump around $5.50, PSEG said. Those who use more than the typical amount are bracing for the worst.

"This is astonishing," said Marion Greenberg of Long Beach, who has all-electric heat and saw a 47 percent increase in her bill over 2013. "I've never seen anything like this . . . I don't know where they're getting the power from that it costs so much -- another continent?"

Greenberg's winter 2013 bills of around $325 have leaped to $650 in the past two months, she said, even though she's kept the heat low. "It's not like we decided, Oh, let's party and put it up to 78 degrees."

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But increasing cold weather has led usage to spike along with the power supply charge. In January alone, the Long Island Power Authority reported revenue was 23 percent higher than budgeted, to $350.7 million.

Fixed-income customers say they are feeling the brunt.

"I think it will destroy seniors," said Deborah Berlin, a resident of retirement community Leisure Knolls in Ridge, where all the heating is electric. Her bill dipped this month to $583, she said, but "everybody I've spoken to here has extremely high bills, $900."


PSEG Long Island spokesman Jeff Weir advised customers to consider programs such as balanced billing, which levels the spikes in bills over 12 months by averaging them into equal payments. But most of the utility's 481,011 balanced-billing customers have seen increases in recent months, PSEG said.

PSEG Long Island, which operates the system under contract to LIPA, says the hikes are tied to soaring natural gas prices. In addition, LIPA reported on Wednesday that it exceeded its budget for fuel and purchased power in January by more than $60 million year to date, an amount that must be recovered in future months.

Market watcherssuggest the increases could continue well into the spring. Industry newsletter Megawatt Daily this month reported the spike in natural gas prices has "pushed expectations for March, April and May wholesale power [electric] prices sharply higher."

Greenberg of Long Beach and others wondered about the promised two-year rate freeze that accompanied passage of the LIPA reform act last year. The freeze applied to the delivery charge portion of bills, which rarely fluctuated over LIPA's 15-year history. The freeze "is on the wrong rate," said Greenberg, calling on Gov. Andrew M. Cuomo to cap the power supply charge.

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