Utility Commission Approves Controversial Rate Plan for Liberty Water

In a recent government meeting, a draft order was presented to establish a three-year rate plan for Liberty Utilities New York Water Corp, set to take effect from April 1, 2024, to March 31, 2027. The proposal, introduced by Judge Tara Kersey and Chief Administrative Law Judge Dakin Lee Cakes, aims to address the utility's financial needs while balancing customer affordability concerns.

The joint proposal (JP) was developed in collaboration with the Department of Public Service (DPS) staff and includes input from two other parties: the Public Utility Law Project of New York Inc. (PULP) and LI Clean Air Water and Soil Limited (CAUSE). While PULP expressed neutrality and support for low-income assistance programs, CAUSE raised concerns about the potential impact of the rate increase on municipalization efforts.

Liberty Utilities, which operates 21 water systems and one wastewater system across eight counties, has not requested a rate increase in seven years. The initial request was for approximately $39.7 million, but the JP proposes a reduced increase of $17.24 million for the first year, with specific revenue adjustments for the two service areas. The plan includes provisions for addressing public health issues, such as contamination and lead in drinking water, and mandates the exploration of renewable energy and electric vehicle integration.

Significantly, the JP establishes a low-income customer assistance program, providing eligible customers with discounts and arrearage forgiveness. It also promotes water conservation through various initiatives, including an inclining rate structure to discourage excessive outdoor water use.

The commission emphasized that the JP meets the criteria for ensuring safe and reliable service at reasonable rates, while also addressing long-term capital needs and cybersecurity upgrades. The proposal is seen as a balanced approach to maintaining service quality while considering the financial impact on customers. The commission is now open to questions regarding the proposal before final adoption.