The New York State Public Service Commission has approved a three-year rate plan for National Grid, significantly reducing the company’s initial request for increased electric and gas delivery revenues. The new plan, developed through a joint proposal signed by 15 parties including consumer advocates and industry groups, will cut National Grid’s requested increase in electric delivery revenues by more than $340 million—a 67% reduction—and lower its gas delivery revenue request by nearly $100 million, or 63%, in the first year.
National Grid had initially sought to raise electric base delivery rates by $509.6 million and gas rates by $156.5 million for one year. Under the adopted agreement, increases to electric revenues will be levelized at $167.3 million in the first year, rising to $297.4 million in the second year and then dropping to $243.4 million in the third year. Gas revenue increases are set at $57.4 million, $64.5 million, and $71.8 million over each of the next three years starting September 1, 2025.
National Grid provides utility service to approximately 2.3 million customers across upstate New York.
Commission Chair Rory M. Christian said: “The adopted joint proposal meets the legal requirement that the company continue to provide safe and adequate service at just and reasonable rates,” adding that “the three-year rate plan is in the public interest. It is a forward-looking plan that benefits customers and includes provisions that further important state and Commission objectives, while keeping customer affordability first and foremost in mind.”
The agreement was reached with input from various stakeholders such as Multiple Intervenors, New York Solar Energy Industries Association, Alliance for a Green Economy, Independent Power Producers of New York, NYGEO, Turning Stone Enterprises, U.S. Department of Defense, Fedrigoni Special Papers North America, Empire Natural Gas Corporation, New Yorkers for Clean Power, New York Power Authority, IBEW Local 97 as well as others who did not oppose it.
The rate plan includes capital investments of about $4.3 billion for electric infrastructure and $1 billion for gas systems aimed at maintaining safety and reliability standards. The plan also enhances outreach for energy affordability programs—recently expanded—and supports state climate goals through updated performance metrics.
Governor Kathy Hochul previously stated that National Grid’s original rate proposal was too high; she directed staff at the Department of Public Service to review it with an emphasis on affordability.
Major factors driving rate changes include necessary capital investments such as leak-prone pipe replacement projects; higher operation and maintenance expenses; depreciation; property taxes; and market-based return on equity needed to finance upgrades at reasonable borrowing costs.
Customer service metrics from previous agreements will continue or be enhanced under this plan along with provisions supporting low-income consumers and promoting alternatives to traditional pipeline projects.
Electric bills are expected to rise by an average of 3.4% in year one of implementation before increasing by 5.6% in year two then moderating to a 4.6% rise in year three on a levelized basis; gas bills will see increases of 5.5%, 5.5%, and then 6% over those same periods.
Nearly 9,000 public comments were reviewed during this process alongside several public hearings both virtual and in-person as well as technical conferences before reaching today’s decision.
Further information about this case can be found on the Commission’s website (www.dps.ny.gov) using Case Number 24-E-0322 or 24-G-0323.
