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Unprecedented Provisions to Hold FERC Accountable for Rate Hikes Pass Congress & Head to President’s Desk

Dec 15, 2014
Press Release
Gibson, Maloney, Schumer: FERC Must Listen to Congress and Go Back to the Drawing Board

Washington –  Representative Sean Patrick Maloney (NY-18), Representative Chris Gibson (NY-19) and Senator Charles E. Schumer announced Congress has passed unprecedented provisions to hold the Federal Energy Regulatory Commission (FERC) accountable to ratepayers in the Hudson Valley. Specifically, the provision, which passed as part of the Fiscal Year 2015 Omnibus Appropriations bill, reasserts Congressional authority over FERC by requiring it to report quarterly on actions and costs to consumers related to the new capacity zone in New York’s Hudson Valley.  Historically, FERC has had little obligation to report on the impacts of its decisions to elected leaders and ratepayers – and this provision will help ensure that these bureaucrats are held accountable. Republican House leadership also committed to working with Reps. Gibson and Maloney to further address the issue in the 114th Congress. The bill now heads to the President’s desk to be signed into law.

“We cannot let FERC make unilateral decisions that result in unwarranted rate hikes for already hard-hit Hudson Valley ratepayers,” said Senator Schumer. “And this provision helps us keep better tabs on FERC moving forward. Together with Reps. Maloney and Gibson, I will keep fighting FERC to roll back its harmful plan.”

“Finally getting some accountability from FERC is an encouraging first step, but make no mistake, this fight continues. Congressman Gibson, Senator Schumer, and I have been partnering on this from day one, and we will not back down until we get relief for struggling neighbors and businesses facing this reckless price hike,” said Rep. Sean Patrick Maloney. “This is a shot across FERC’s bow – they must once and for all listen to the concerns of Congress and the New Yorkers we’re fighting for, and go back to square one to reverse this reckless hike.”

“The federal regulators who decide whether to raise our electric rates, causing significant impacts on hardworking families, need to be held accountable,” said Congressman Gibson. “This legislation is a positive step forward, but we will continue this fight in 2015 to see that FERC reverses these rate hikes and proceeds with a transparent, common-sense approach to improving our energy infrastructure in New York.”

“FERC has clearly demonstrated its disdain for transparency and open government.   As I have stated previously, I have never interacted with a less accessible, less accountable government entity, seemingly impervious to legislative and public scrutiny.   Congressmen Maloney’s and Gibson’s efforts, in partnership with Senator Schumer, to force FERC to report on its actions and its costs on our citizens is a necessary step and I commend their efforts.    The fight against FERC’s energy capacity zone is not a fight we will walk away from.   We will ensure the  concerns of the Hudson Valley are heard and addressed,” said Dutchess County Executive Marcus J. Molinaro.

“The FERC mandate raises energy prices with no corresponding benefit to our Orange County residents and zero accountability from federal bureaucrats. Now, thanks to the efforts of our partners in the House and Senate, FERC would for the first time operate openly and transparently. I look forward to continuing our work with Senator Schumer, Congressman Maloney, and Congressman Gibson to eliminate the new capacity zone and reduce energy prices for consumers in this still-uncertain economic climate,” said Orange County Executive Steven M. Neuhaus.

In the only directive for the Federal Energy Regulatory Commission, the report states: “The Federal Energy Regulatory Commission (FERC) recently approved a request by the New York Independent System Operator (NYISO) for a new capacity zone (Docket N. ER13-1380-000). Concerns persist regarding the effect of the capacity zone on consumer costs. The FERC is not currently required to take further action in fiscal year 2015. However, should the Second Circuit U.S. Court of Appeals remand the order during 2015, the Commission would be required to issue an order in response to the decision. The FERC is directed to report to the Committees of the House and the Senate on a quarterly basis, beginning not later than 30 days after enactment of this Act, on the status of the court case, actions taken by FERC, and estimates of additional planned capacity and consumer costs.”

In 2011, FERC and the New York State Independent System Operator (NYSIO), which operates the state power grid, proposed a new capacity zone in the Lower Hudson Valley in an attempt to alleviate power constraints in the area by increasing prices to attract new power generation capacity.  The zone took effect in May 2014, and immediately after Hudson Valley residents and businesses saw their electric rates spike.

Sen. Schumer and Reps. Maloney and Gibson have been actively fighting to halt these rate hikes, working closely with Dutchess County Executive Marcus Molinaro, and local partners like Dutchess County Chamber of Commerce. In July, the House passed legislation to prohibit funds from enforcing FERC’s new capacity zone overwhelmingly passed the House of Representatives as part of the FY 2015 Energy and Water Appropriations Bill. In September, Rep. Maloney and Congressman Chris Gibson (NY-19) led a bipartisan letter supported by Governor Andrew Cuomo and signed by Senators Charles Schumer and Kirsten Gillibrand, Congresswoman Nita Lowey, and Congressman Eliot Engel calling on Federal Energy Regulatory Agency (FERC) to immediately reverse its decision creating a new “capacity zone” in the Hudson Valley. Maloney has hand delivered letters from folks across the Hudson Valley to FERC headquarters, written numerous letters, called, and met personally with FERC Chairman Cheryl LaFleur in an effort to get FERC to reverse course.