AARP: Central Hudson Energy Merger with Canadian Utility Co. Bad News for Consumers

Complex Utility Case Latest Example of Uneven Playing Field Between Utility Cos. & Consumers, Highlights Need for Change

Apr 23, 2013, 14:13 ET from AARP New York

POUGHKEEPSIE, N.Y., April 23, 2013 /PRNewswire-USNewswire/ -- A massive utility merger affecting people all the way from the suburbs of New York City to the Capitol Region could mean bad news for consumers. Today, AARP New York weighed in on the hotly contested merger proposal between Central Hudson Gas and Electric Company and Fortis, Inc., a Canadian company, stating that the promised benefits don't outweigh the risks of the merger.  

Older adults are hit particularly hard by any fluctuations in cost and service, such as those that could result from the merger, as they spend a higher percentage of their fixed incomes on utility bills, with many relying on consistent service to power medical devices.

The Association filed comments opposing the merger, questioning the benefit to utility consumers and highlighting the need for New York to level the playing field for consumers in complex utility cases such as this.  AARP New York stated this kind of case serves as a prime example of why New York needs to establish an independent utility consumer advocate office to represent consumers' interests, as 40 other states have done. 

"While utility companies and others have the money and resources to make their cases to get their way, residential consumers lack the same tools, and often, end up losing in these matters because of it," said Beth Finkel, State Director for AARP in New York. "New York has the opportunity to change the utility game for residential consumers by establishing an independent consumer utility advocate office to make sure consumers' interests are at the table, and their voices are heard."

Among AARP's key concerns with the merger proposal:

  • There would be no significant immediate rate reduction or other concrete benefit for consumers.
  • It contains no performance standards or sanctions involving damage from storms, prevention or recovery of service.
  • It shifts 100% of the risk and cost of repair and recovery after major storm outages to consumers.

"If this merger is approved, the utility companies will do just fine, increasing their bottom-line at the consumer's expense," added Finkel. "AARP is calling on New York Legislators and the Governor to give consumers a stronger voice and a meaningful seat at the table in these matters."

Legislation setting up an independent utility consumer advocate office in New York has recently been introduced in the state legislature. Assembly Bill 6239, sponsored by Assemblyman Jeff Dinowitz (D-Bronx) and Senate Bill 4550, sponsored by Senator Diane Savino (D-Staten Island), would give New York's residential consumers a seat at the table to negotiate in utility proceedings, leveling the playing field with utility companies, and would work to save consumers money on their utility bills.

AARP's comments in the case can be found here:

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