County sues to stop rate increases

Access to upstate solar and wind energy cut off: Feds say they want to encourage more power plant construction


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  • Rates for electricity are expected to go up as much as 30 percent this summer in the new Hudson Valley Capacity Zone.



— Orange County has joined a lawsuit against the Federal Electric Regulatory Commission to stop implementation of its Hudson Valley Capacity Zone, which is expected to send rates soaring this summer.

Critics of the new zone compare it to the MTA tax that suburban and rural citizens are expected to pay, even though its transportation services primarily benefit metropolitan residents.

Local providers are now required to buy electricity from sources within the newly created zone, which lumps Orange County with the rest of the New York metropolitan area. They will be prevented from buying the cheaper solar and wind energy produced upstate.

"Simply stated, Orange County is Main Street and not Wall Street," Orange County Executive Steve Neuhaus told the court in the brief. "Our residents have not enjoyed a positive financial change over the past seven years. The indicators I cited show just the opposite."

Neuhaus listed increased unemployment and the increased need for social services, food stamps, and Medicaid.

The Town of Chester was recently notified by its contract negotiator that rates were likely increase from 30 to 60 percent over the next few months. Central Hudson estimates that increases to home consumers will be under 10 percent. Other sources say a 20 percent rise is more likely.

The Federal Electric Regulatory Commission defended the new zone and expected rate increases, saying they will entice upstate electricity producers to build more plants. The producers are reluctant to build because the profit margin is too low, FERC says.

Orange County has enjoined a suit filed by Central Hudson and Electric Corporation. Both Central Hudson and Orange & Rockland Utilities are included in the new zone.

The Public Service Commission approved the increases with a view toward expanding and improving transmission lines now caught in a bottleneck in reaching the more economical upstate wind and solar providers. Meanwhile, Central Hudson and Orange & Rockland are asking for more time to solve the problem by improving their existing corridors.

Critics of the new zone compare it to the MTA tax, in which suburban and rural citizens were expected to pay for transportation services primarily benefitting metropolitan areas.

The suit filed by Orange County and Central Hudson joins four other lawsuits as an appeal to stop its implementation, which began in May.

The brief of the lawsuit is available at the county website: www.orangecountygov.com.

- Edie Johnson

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