When it comes to using electricity and natural gas, Central Hudson has a long and successful tradition of helping customers better manage their energy use. Under this new proposal, we are offering comprehensive programs to help customers become even more energy efficient in their homes and businesses. We surveyed our customers to identify the most compelling ways that we can assist them and then used that information to design programs modeled on the most effective energy efficiency offerings in the nation – with an overarching goal to help Central Hudson customers not only lower their electric and natural gas bills but also lessen their impact on our natural environment. We are committed to energy efficiency – it’s the right thing to do for our customers and it’s a program we can do very well.

Our proposed energy efficiency programs are also designed to meet the state’s Energy Efficiency Portfolio Standard, which enlists utilities in helping customers reduce their energy use and meet the state’s “15 X15” energy reduction goal of 15 percent of projected use by 2015. 

The proposal includes rebates and incentives to homeowners for high efficiency gas and electric heating and cooling systems; assistance programs for small and mid-sized businesses; a recycling program for old refrigerators and window air conditioning units; and special programs for low-income families.  Three of the programs – Residential HVAC, Residential Gas Equipment and Small Commercial Business – are utility programs marked by state for expedited approval.

Incentives would be offered on the installation and purchase of high efficiency central air conditioning systems, air-source heat pumps, ground-source heat pumps and heat pump water heaters. Incentives for natural gas equipment would include high efficiency furnaces, boilers and water heaters. Small and mid-sized businesses would be offered an energy audit and financial assistance of up to 70 percent on installed energy efficiency measures. Low income families would also be offered an energy audit and financial assistance on installed energy efficiency measures (such as weatherization and appliances) as well, which they may combine with additional incentives offered by New York State. The appliance recycling program would offer a payment incentive to have old refrigerators and window air conditioners removed and recycled. A coupon program would encourage customers to trade in their older, inefficient window air conditioners for a newer, high efficiency models. Finally, a special lighting program is also proposed, to help local community service organizations by providing them with compact fluorescent lamps which they can sell as a fundraiser, with the added benefit of encouraging the use of efficient lighting. Over the life of the installed measures, these programs have the potential to save enough electricity to power 134,000 homes and heat 11,000 homes with natural gas for one full year.

The costs of providing these proposed efficiency programs would be included on bills through the systems benefit charge or another mechanism – so it is important that customers take advantage of these incentives to realize a savings. Also, reduction in energy use by many residents and businesses has the potential reduce overall demand, which could lead to moderation in energy supply prices, benefiting all customers.

For complete information on our proposal click here.

Haven’t rates increased already? I’m paying more this year than I did last year.

The market prices we all pay for electricity and natural gas are rising, and residents and business in the Mid-Hudson Valley have certainly seen the effects of these increases in their energy bills. While delivery prices have remained relatively stable, with only moderate annual increases each of the last three years in accordance with our most recently approved rate order, the supply prices for electricity and natural gas have fluctuated based on market conditions. While Central Hudson strives to keep its costs as low as possible, energy prices are still subject to national and international market forces. (To learn why energy prices are rising nationally, click here).

The costs of fuels used to generate electricity are rising, and demand for electricity is rising as well. These factors influence the market price for electricity and natural gas, which fluctuates with market conditions. The charts below show the level and variations in supply prices compared with delivery rates. The recent increase in energy bills are due to higher market supply prices for electricity and natural gas:

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The above chart shows the delivery and supply cost of a typical residential bill of 500 kilowatt-hours per month. Supply charges comprise the majority of bills, and have increased in recent months.

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The chart above shows the seasonal nature of natural gas bills, with lower delivery and supply amounts in the summer months when usage is lower, and higher amounts in the winter months when usage is higher. The supply portion comprises the majority of bills.

For more information on why energy costs are rising, visit our web page “Rising Energy Costs” by clicking here.

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With higher energy costs, what is Central Hudson doing to help?

On the delivery side, Central Hudson has worked hard to keep operating expenses low while improving service reliability and customer service. For example, operating expenses as a percent of revenues are also below the state average, and Central Hudson serves more customers with fewer employees today than in 2002:

Increased productivity and expense management: Central Hudson serves more customers with fewer employees. In 2002 for example, Central Hudson served nearly 283,000 electric customers and 67,000 natural gas customers with 870 employees; in 2007, 298,000 electric and 73,000 natural gas customers were served with 39 fewer employees (831). Operating expenses, as a percent of revenues for both gas and electric, are also below the state average.

Significant reduction in labor costs: Central Hudson worked with its employees in 2007 and 2008 to help reduce the cost of labor. Reductions in employee benefits are expected to produce $75 million in savings for customers over the next five years.

On the supply side, Central Hudson provides a measure of price stability in the way electricity and natural gas is purchased. Although Central Hudson does not control the price of electricity or natural gas, the utility uses a variety of purchasing methods, such as energy contracts, hedging and real-time purchases, to dampen market swings in energy costs. The chart following shows how Central Hudson's purchasing methods (hedging) have historically produced supply prices for our customers that are below market:

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