Tuesday, November 7, 2000

Electric bills jump due to fuel Businesses, homes are hit By Craig Wolf Poughkeepsie Journal

Electric bills took a big jump in October as a little-noticed line that is normally quiet as a mouse started roaring. It's the "electric cost adjustment'' line, which normally amounts to such a small fraction of a penny that no one cares. It's even a refund sometimes, rebating money to customers.

Not now. Rising fuel costs are blamed for the spike.

Louis Gallo owns Dairy Queens in Wappingers Falls and Newburgh. His bills startled him last month, and when he analyzed why they were higher, the answer was found in the electric cost adjustment line.

''For years it was $10 to $11. This time it was $250. I figured they made a mistake,'' he said.

No mistake. At Central Hudson, spokeswoman Denise Van Buren said the charge went up in October to $0.01853, which is shy of two cents per kilowatt hour, and a far cry from the $0.0009 cent (less than a tenth of a cent) in September.

Fight may yield savings

''So clearly, the fuel cost adjustment is fluctuating and has gone up,'' Van Buren said. The utility is fighting a part that stems from a $4.6 million ''true-up'' charge for power bought from the New York Independent System Operator.

If successful, Central Hudson will pass savings to customers through the same cost adjustment mechanism, Van Buren said.

It's fossil fuels that are pushing costs up. ''It's not unique to New York or the Northeast -- it's really a national trend,'' said David Flanagan at the state Public Service Commission.

Oil's average price on spot markets was about $19 a barrel in September 1999 and jumped 47 percent in a year to $28, Van Buren said.

The cost-adjustment charge enables Central Hudson to pass along to consumers changes in the cost of fuel to produce electricity. In four months in 1999, it passed on a credit, reducing bills.

Impact obvious

Right now it's cost, and it's happening to home bills, too.

''On a $300 bill it would have been negligible or a positive or a negative of $1 or $2. Now it's a positive of $25,'' Gallo said.

Van Buren, though, said fuel cost adds about 3 percent to residential customer bills.

Charles North said he had not received any calls at the Poughkeepsie Area Chamber of Commerce, where he is president.

''But I think most people are resigned to the fact that if the cost of fuel goes up, it's automatically related to the cost of electrical energy,'' he said.

Counterpart Beth Coleman at the Greater Southern Dutchess Chamber of Commerce said, ''The costs in New York state have been higher than in other states and if they go higher still, that's a concern for anybody else doing business. And it's a huge, huge concern for manufacturers.''

AT A GLANCE

UTILITY COST ADJUSTMENTS

- To see what you pay in fuel-based ''cost adjustments'' to Central Hudson, look for a line that says ''electric cost adjustment.'' It is one of three components that add up to the total charge and follows the other two, which are the ''monthly customer charge'' and a line that will start with something like ''First x kwh @ $.''

- The electric cost adjustment in October commercial bills was $.01853 per kilowatt hour, or about 1.8 cents for power to burn 10 light bulbs of 100 watts for an hour.

http://www.poughkeepsiejournal.com/today/business/stories/bu110700s1.shtml

-- Martin Thompson (mthom1927@aol.com), November 08, 2000