Albany, NY – A bill co-sponsored by AM Shrestha (A8888) that prohibits utilities from passing the cost of a new gas hook up to all the customers has passed in the Assembly following passage in the Senate. The bill is a narrow version of the much more comprehensive NY Heat Act, which does not have the votes it needs to pass in the Assembly.

“When someone’s building is within 100 ft of an existing gas pipeline and they request a new gas connection from their utility, the cost of that connection is not borne solely by the customer who requested it—it is divided among all existing gas customers of that utility. In 2023, when Central Hudson filed for a rate increase, it asked for an increase of $44.3 million over five years to pay for such ‘customer requested service connections,’ and in 2024, it asked for an increase of $29 million over five years for the same reason. Right now, we see in the Joint Proposal that gas delivery rates are going up by higher than electricity delivery rates, and that’s because gas infrastructure is much more expensive to own and maintain. If we keep subsidizing the expansion of this infrastructure, not only are customers on the hook to pay for the cost of new connections, they’re also on the hook for additional costs attached to the expansion, such as additional authorized profits calculated from the value of that new asset, the property taxes and interests owed on the new asset, as well as the cost of doing maintenance on that new asset—even though such assets are destined to be stranded. The bill we have passed – which was a provision in the much more comprehensive NY Heat Act – still gives the customer the option of installing a new gas hookup, but it doesn’t subsidize the cost. The customer must pay for it themselves, or they can opt for alternative forms of energy such as electricity or heat pumps. It is estimated that ending this subsidy will result in an annual savings of $177 million for ratepayers statewide, and $4 million for Central Hudson ratepayers specifically.”

The bill must be signed by the Governor next. The Governor had included this provision in her 2023 Executive Budget but it did not make it in the final budget due to larger conversations happening around the NY Heat Act.