To end a deadlock with the state, a Spanish company that wants to buy an upstate utility should agree to sweeten the deal for ratepayers, and state regulators should allow the firm to generate some wind power, Sen. Charles Schumer urged today as a way keep the deal alive.
“Both sides of the table must take a few steps forward if we want to bring low rates, high service, jobs and renewable energy to New York state,” said Schumer, D-Brooklyn.
Schumer wants the company, Iberdrola, to put $640 million into a fund to offset potential rate hikes and put more money behind its announced plan to invest $2 billion in new wind-power projects.
He also wants the state Public Service Commission to drop its insistence that the company sell off its wind-generation facilities in New York and abandon plans to build more.
“The PSC needs to stop stonewalling Iberdrola’s efforts to bring absolutely vital, cutting-edge energy assets to the state,” Schumer said, “while Iberdrola needs to firm up their commitments and give a tangible incentive for the state to approve the deal.”
The proposed $4.5 billion sale to Iberdrola of Energy East, the company that owns Rochester Gas and Electric Corp. and the New York State Electric and Gas Co., has been held up by disputes about the wind-power and rate-protection issues.
The staff of the commission has recommended against approval of the merger, which already has the approval of regulators in Washington and three other states, without significant modifications. A decision by the five-member commission is expected in August or September.
Iberdrola so far has offered to put $200 million into a fund to offset rate hikes, and also has committed $100 million to wind-energy development, while saying it hopes to spend as much as $2 billion on the projects. Schumer wants $440 million more in that fund and firmer commitments to develop more wind energy.
The two utilities serve about 3 million customer upstate and in the Hudson Valley.
Schumer said he met with commission Chairman Garry Brown last Friday. He wouldn’t disclose details, but termed the session a “positive meeting.”
“As long as all involved parties here can find a way to make sure that rates don’t skyrocket for the consumer, this deal should be a no-brainer,” Schumer said. “At stake here are not just thousands of jobs and billions of dollars for New York’s economy, but our entire state’s sustainability and viability for generations to come.”
There was no immediate comment from the Public Service Commission.
By Jay Gallagher
Albany Bureau Chief
14 July 2008
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