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New York

Expensive Electricity

Christa Besson's home is a tidy cocoon, reflecting her love of Africa.

Ebony animal figurines and a zebra print blanket hanging on the wall remind her of missionary trips to Kenya. The zebra blanket and other cloths tacked onto walls and over windows also have a utilitarian purpose--they keep out the wind and help insulate the apartment to lower her electricity bill.

"Quilts, blankets, afghans, you name it," said Besson, 78, a retired nurse and ordained minister who lives in Delmar. "If I don't pack it, the cold comes in."

Even with government assistance, the electric bill for her one-bedroom apartment runs $80 a month.

New York's electric rates are the second highest in the continental United States, behind only Connecticut. AARP is calling for reforms in how those rates are determined and is urging lawmakers to hold the New York Independent System Operator (NYISO) more accountable to consumers.

NYISO may not be as familiar to consumers as their power company, such as Con Edison. The not-for-profit NYISO manages the flow of power on 11,000 miles of high-voltage transmission lines and administers how electricity is bought and sold in the New York grid.

Its revenue in 2008 was $140 million, most of it financed by electric customers like Besson.

NYISO's practices have come under scrutiny by lawmakers and consumer advocates, who say the auction process and corporate structure add $2.2 billion a year in unnecessary costs to customers. Their arguments were bolstered when NYISO reported last fall that three upstate power companies abused the bidding process and were overpaid $2.7 million.

"They're using consumer money to run a competitive marketplace that is supposed to produce lower energy prices. And what has happened? New Yorkers pay some of the highest rates in the country," said Bill Ferris, AARP New York state legislative representative.

Thomas Rumsey, NYISO spokesman, said there is adequate state and federal oversight. He also said the cost of wholesale electricity has dropped and is at a record low, thanks to competitive markets.

But Ferris said that under the current system, "We believe there is no accountability to the public or any real remedy if price manipulation occurs in the marketplace."

AARP is seeking transparency in the bidding process; two-day public disclosure of bids to curb market manipulation; a board of directors appointed by the governor and legislature; and Public Service Commission review of the NYISO budget and fees charged to consumers.

Meanwhile, New Yorkers on fixed incomes are struggling to pay utility bills.

"I spend more on National Grid than I do for food," said Geneva Conway, 77, of Menands. "I buy no name-brand foods. I buy the cheapest gas for my car I can find. I eat out much less."

Conway conserves energy by not using her clothes dryer and by replacing old light bulbs with the energy-efficient variety. "I feel like I'm doing everything right," she said. Still, her monthly bill runs more than $200 for her four-bedroom home. … Back to Article

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