Orange and Rockland Utilities Receives Approval for Rate Reduction Plan

Strategic Insights -

The New York State Public Service Commission approved a stipulated agreement that enables Orange and Rockland Utilities (O&R) to implement an immediate 1.8 percent electric rate reduction, eight months ahead of its originally proposed timeline. This decision marks a significant milestone in O&R's efforts to enhance its competitiveness in the market. The rate reduction will benefit residential and small commercial and industrial customers, with an average monthly decrease of approximately $0.35 for residential customers and a $3.98 reduction in quarterly bills for large commercial and industrial customers.

Key Takeaways:

  • O&R is the only electric utility in New York to propose a voluntary reduction in base rates since 1988.
  • The approved rate plan reduces electric rates by an annual rate of 1.8 percent.
  • Residential and small commercial and industrial customers will see a one-half percent reduction in their bills, resulting in an average monthly decrease of approximately $0.35 for residential customers.
  • Large commercial and industrial customers will experience a 3 percent reduction in their bills, resulting in a $3.98 decrease in quarterly bills.
  • The stipulated agreement also increases the base return on common equity from 10.6 percent to 10.8 percent, effective January 1, 1995.
  • Q&R Vice Chairman and Chief Executive Officer D. Louis Peoples attributed the rate reduction to the company's aggressive cost-cutting initiatives and operating efficiencies.

Statistics:

  • Average monthly decrease for residential customers: $0.35
  • Average quarterly decrease for large commercial and industrial customers: $3.98
  • Total population served by O&R and its subsidiaries: 660,000
  • Base return on common equity: 10.8 percent (effective January 1, 1995)
  • Population served in southeastern New York, northern New Jersey, and northeastern Pennsylvania: 660,000

Sources:

  • BUSINESS WIRE -- Aug. 1, 1995
  • Orange and Rockland Utilities, Inc. -- O&R Vice Chairman and Chief Executive Officer D. Louis Peoples.