Energy panel approves sales of utilities to Iberdrola
ALBANY — The state Public Service Commission voted unanimously this afternoon to sell two upstate New York utilities to Spanish-based Iberdrola SA as the company has pledged to invest $2 billion in wind-power projects in the state.
The long-awaited vote came after months of wrangling by the commission and the sudden resignation of one of its board members last week.
The approval means that Iberdrola will likely purchase Energy East, the holding company for Rochester Gas and Electric Corp. and New York State Electric and Gas Corp.
If the company, as expected, approves the deal, ratepayers will see a 5 percent cut in the delivery costs of their gas and electricity for five years, a total saving of $275 million.
“That’s real money,” said commissioner Maureen Harris, who expressed reservations about the bargain.
“It’s not a perfect deal, it may not even be a great deal, but it is a good deal,” she said.
As part of the agreement, Iberdrola has to spend at least $200 million on new wind-generation facilities in the state within five years. Spokesman Robert Bellafiore said the company’s plan is to spend $2 billion over that period.
Harris and other critics of the deal were concerned that letting Iberdrola both generate power as well as distribute and transmit it might give it too much market power. But in the end the commissioners decided it was worth the risk.
The commission has been weighing for more than a year whether Iberdrola should be allowed to buy Energy East. The two companies have settled on a price of $4.5 billion on the deal, which has been approved by regulators in Washington and three other states.
The commission’s approval was the last remaining hurdle.
Between them, RG&E and NYSEG serve 16 percent of the state’s electric customers and 12 percent of natural-gas users and have about 1.2 million electric and 562,000 natural-gas customers.
NYSEG handles much of eastern Dutchess County.
Last week, board member Robert Curry was ill and missed the vote and Cheryl Buley announced her resignation to get married and move out of state.
The vote was rescheduled for today.
By Jay Gallagher
Journal Albany bureau
3 September 2008
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