News from New York State Public Service Commission

For more information contact: James Denn, 518-474-7080

PSC Approves NFG Energy Efficiency Program

Rebates for Installation of Efficient Furnaces, Hot Water Heaters, Set-back Thermostats

ALBANY, NY (09/19/2007; 1536)(readMedia)-- The New York State Public Service Commission (Commission) today authorized National Fuel Gas Distribution Corporation (NFG) to implement a $10.8 million Conservation Incentive Program (CIP) for the 2007-2008 heating season. The CIP is designed to encourage energy efficient natural gas usage by residential and small non-residential customers of NFG.

A collaborative process will be initiated in 2008 for interested parties, including the New York State Energy Research and Development Authority (NYSERDA), to collectively design and propose the energy efficiency and conservation measures for subsequent years.

“To help ensure energy efficiency programs are made available to customers for the upcoming winter heating season, the Commission today approved, with modifications, NFG’s Conservation Incentive Program,” said Commission Chairwoman Patricia L. Acampora. “Under the new program, NFG’s customers are provided rebates to encourage them to install more efficient furnaces, hot water heaters, and set-back thermostats as soon as possible. NFG’s conservation program provides for more efficient use of natural gas resources and it is consistent with the State’s desire to encourage energy conservation.”

In January 2007, NFG filed a $52 million petition to increase rates for natural gas delivery service that also included a proposal for a $12 million Conservation Incentive Program (CIP). The Commission will consider the rate proposal at a later date.

Under the CIP approved today by the Commission, NFG would spend $10.8 million by applying approximately half of the CIP funds to appliance rebates available to qualifying residential and small non-residential customers, one-quarter to a low-income customer program, and one-quarter to outreach and education for grassroots efforts and direct customer outreach.

The costs for the CIP will be recovered through a customer bill surcharge. NFG would be required to file quarterly and annual reports to allow monitoring and evaluation of each component of the CIP. The funding level for the CIP is consistent with initial funding levels for statewide electric energy efficiency programs funded by the system benefit charge.

Low-income homeowners and renters enrolled in the Low Income Customer Affordability Assistance Program (LICAAP) will be served first under the low-income usage reduction program of the CIP. The program would include heating system safety checks, energy audits and information, wall and ceiling insulation, the replacement of heating equipment and other energy conservation measures. To the extent that any additional customers can be served by this program, they must meet the eligibility requirement for the Home Energy Assistance Program (HEAP).

In the January 2007 filing, NFG also proposed a revenue decoupling mechanism (RDM) intended to remove a disincentive for company to invest in energy efficiency. The Commission will address the company’s RDM proposal when it considers the other rate issues presented in the filing.

The Commission’s decision today in Case 07-G-0141, when issued, will be available on the Commission’s www.dps.state.ny.us Web site by accessing the homepage section’s Files Room. Many libraries offer free Internet access. Commission decisions can also be obtained from the Files Office, 14th floor, Three Empire State Plaza, Albany, NY 12223 (518-474-2500).

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