NYSERDA’s impact on your power bill

Quite often you see the name of a state agency -- NYSERDA -- appearing in news articles and press releases about energy-efficiency projects, whether they are commercial (windmills, warehouse lights) or residential (appliance swap outs, solar panels) in nature.

 
Chances are you probably didn’t concern yourself with NYSERDA. But, you should.

First, grab your most recent electrical bill. Scroll down through the delivery services portion of it. You’ll notice something called "SBC". Depending on how big your household may be the SBC line item ranges from $2.50 to $5.00 a month. That’s not chump change. You’re shelling out $30 to $60 annually, money that both you and I know would be best spent by you and not the government.

You see, the SBC is a tax. The acronym means "Systems Benefit Charge". According to National Grid these funds "reflect costs associated with mandated public policy programs - low income assistance, energy efficiency programs, and certain research and development programs including the advancement of renewable energy resources." The recipient of these fees is the aforementioned NYSERDA – New York State Energy Research and Development Authority.

If you are an astute student of all things government the first thing that comes to mind is "why are we paying taxes to a public authority?" Authorities are corporate instruments of the State created by the legislature to further public interests. They are basically private enterprises with a public flair that are legally and administratively autonomous from the State, meaning they are accountable to no one but themselves. They are typically funded by user fees and should never be funded by taxes.

Yet, here’s NYSERDA being funded by a tax in your power bill. Combined with the lack of accountability to the taxpayers, that makes the systems benefit charge a classic example of taxation without representation. That’s the same kind of thing that got the colonists all fired up during the American Revolution.

And, it’s the same kind of thing that gets me fired up at the factory.

Long-time readers of this column know how I despise the competitive structure of electricity in New York. My company pays twice what our competitors in Ohio, Indiana and Utah pay for power. That’s pretty significant considering we use as much electricity as two-and-a-half villages the size of Middleport. In my ongoing analysis of what makes my power bill so high I’ve long had the SBC in my sights. Over the past half-dozen years, we’ve paid more than $55,000 per year into the SBC and last year we reached an all-time high -- over $76,000!  

Back in 2007 I was intent on putting it in front of Governor Eliot Spitzer. I was hopeful that the Wall Street Watchdog would have been just as disgusted as I about the unrepresented tax. Spitzer’s director of operations shared my concerns with the Public Service Commission.

In her response PSC Chairwoman Patricia Acampora barely addressed my concerns and instead waxed poetic about what NYSERDA supposedly does, like lowering overall electrical demand and costs for New Yorkers. She also noted that, yes, NYSERDA does collect its fees from electrical users but the State has oversight over what it does with its monies. Considering how ineffective that "oversight" is with the Thruway Authority and 700 other authorities across the state, I could only laugh.

Since then, similar correspondence sharing my concerns with Governor Cuomo has gone unanswered.

That’s what we’re up against, folks: An entity that shouldn’t be taxing us but is, and is allowed to do so at the behest of the State. The State likely allows it to happen because it’s good press for Albany (“look at everything we are doing to make homes and businesses energy efficient”). But, what they fail to tell you is that it’s homes and businesses footing the bill for all the fancy equipment.   

Whether you’re a family or a company trying to make ends meet in these tough times you should be frustrated with this tax that is - like a few others – hidden in your power bill where you might just never see it and, in turn, never care. 


From the 18 May 2015 Greater Niagara Newspapers