LIPA trustees on Wednesday approved new consumer-protection measures for solar-energy customers, passed a 2019 budget with a 2.4 percent delivery-charge increase, and approved a new policy for a coming wave of smart meters that sets fees for those who opt out.
LIPA at its final meeting of the year also saw the departure of a longtime trustee, Jeffrey Greenfield, approved $740 million in new debt issuance, and expanded bill-paying and other customer services to Amazon's Alexa voice-prompt technology.
As reported in Newsday Monday, the new consumer protection measures include requiring solar and related energy companies to register with the state, provide customers with clear-language terms and refrain for fraudulent or misleading claims in selling or leasing systems. A Newsday investigation this summer reported that some customers were unaware of the complex terms of some leasing agreements in the $1 billion Long Island solar market.
Mike Bailis, a co-founder of SUNation Solar Systems, applauded the move but urged trustees to enact measures to oversee and enforce them.
Trustees also approved LIPA’s $3.59 billion 2019 budget that includes a 2.4 percent increase in the delivery charge portion of bills, even as other elements of bills are projected to offset the increase. LIPA estimates that, if its prediction of flat natural gas charges next year holds true, customers could ultimately see a reduction in monthly bills of $3.67 cents. A portion of that reduction reflects the return of overcollections from 2018.
LIPA also approved measures that allow residential customers to opt out of receiving new smart meters as PSEG Long Island embarks on an aggressive plan to install them in all 1.1 million customer locations by 2023. Commercial customers can’t opt out.
Under the new rules, customers would pay a $10 per month meter-reading fee if they decide they don’t want the new meters, which use radio-frequency signals to send a regular stream of user data back to PSEG throughout the day. Customers who decide after a smart-meter has been installed that they no longer want it must pay a $65 charge for its removal.
Rick Walden, vice president for customer services at PSEG, said the utility has seen a low opt-out rate of 0.5 percent since it began accelerated installation of the meters this year. “We’ve had very few customers say no [smart meter] in my residence,” Walden said.
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PSEG also announced that it became the first U.S. utility to allow customers to pay their bills using the Alexa smart home speaker system. Customers who’ve registered with PSEG’s MyAccount system can link the service to their Alexa or other smart-speaker system, and use basic voice prompts in their homes to request information on PSEG bills, usage and due dates. They can then use the system to pay a bill.
Fred Daum, director of contact and billing for PSEG, said future iterations will include the ability to report outages and other features.
In other LIPA news, six-year trustee Jeffrey Greenfield, a State Senate appointee, announced his retirement from the board, effective at year's end. Greenfield, who has advocated for renewable energy and many customer issues, recommended in a parting statement that state lawmakers expand the board by two seats to include elected customer advocates, one for Suffolk and one for Nassau. The nine-member board has five governor appointees, two Senate and two Assembly.
LIPA also approved a measure to allow the utility to issue up to $740 million in new borrowings in 2019, pushing its debt by next year's end to nearly $8.3 billion.
Most of the new borrowings, around $540 million, would be used by LIPA to finance system improvements, including strengthened power lines and new smart meters. LIPA also plans to refund about $200 million in short-term borrowings, for an expected annual savings of $1.6 million, according to LIPA documents. LIPA’s total borrowings at this year's end stand at just over $8 billion.
One longtime critic of LIPA's borrowing wasn't pleased.
"The continued upward direction of LIPA debt as well as rates creates significant risk for the Long Island economy," said state Assemb. Fred Thiele (I-Sag Harbor). "Another increase in debt inevitably leads to increased rates. It is a spiral that is unsustainable."
LIPA trustee Tom McAteer pointed to LIPA's investment of $868 million next year amid the estimated bill declines, saying, "That’s a combination that has improved customer satisfaction each of the last five years and earned LIPA its first credit rating upgrade in over a decade."
LIPA’s 2019 capital budget includes about $715.2 million in system-improvement projects and $153.6 million in storm hardening. LIPA plans to finance about $191 million of the projects from its operating budget next year, while a grant from the Federal Emergency Management Agency will pay for about $138 million. That leaves about $540 million to be funded by new debt, LIPA said in papers filed for board members. It said debt next year is expected to increase by $225 million.