Con Edison has submitted plans for major investments to protect critical equipment and customers from devastating storms like Superstorm Sandy that have struck Greater New York in recent years.
The company provided the New York State Public Service Commission (PSC) with details on long-term projects -- including putting flood-proof equipment in low-lying areas, building higher flood walls around facilities, reinforcing overhead equipment and/or putting some overhead lines underground to limit outages during storms.
The plans call for $1 billion in investments through 2016, some of which could be recovered through federal funding. As part of the $1 billion, Con Edison has already committed to spend $250 million this year and next on storm protection measures. The company said it was also committed to providing customers with more accurate, individual restoration times, as well as offering text messaging and other mobile communications for customers who prefer them.
To provide initial funding for the storm-protection effort, Con Edison proposed one-year delivery rates for electric, gas and steam services. The submission of new rate plans, which was delayed due to the company's focus on recovery from Sandy, reflects Con Edison's cost-control efforts and its obligation to invest in its systems for customers.
Con Edison President Craig S. Ivey said the company has sharpened its focus on controlling costs in recent years. The 13,000 men and women of Con Edison weave cost-consciousness into every task and project, Ivey said.
"Although the economy is improving, we are still working diligently to hold down costs for our customers," Ivey said. "At the same time, the increased frequency and damage of storms assaulting our area presents a major challenge. We must invest in our systems in new ways to maintain the safe, reliable service our customers deserve."
The rate plans, subject to an 11-month review by the PSC and other interested parties, would cover the period January 1, 2014 to December 31, 2014. (To view the filings, click here: http://www.coned.com/publicissues/2013ratefilings.asp.)
The filing seeks an additional $375 million in revenue to run the electric delivery system, the company's smallest electric delivery rate request since 2004, which would represent an overall customer bill increase of 3.3 percent. The typical monthly bill for a New York City resident (300kWhr) would rise from $81.64 to $84.55; for a typical Westchester residential customer (450 kWhr), the monthly bill would rise from $114.41 to $118.00. The typical monthly bill for a small business (600kWhr) would rise from $157.55 to $169.31.
The company expects the increase to be mitigated when certain contracts with non-utility generator units begin to expire in 2014. The expiration of these contracts is expected to save customers an estimated $46 million in 2014, and more in future years.
The filing also includes plans for approximately $800 million of storm-protection capital expenditures through 2016 for the electric system, including projects to place certain overhead distribution lines below ground; increase the height of flood walls for certain facilities; raise critical equipment; install submersible equipment; install additional switches and related smart grid technology; and reconfigure certain distribution networks.