National Fuel customers continue to challenge proposed rate hike

Oct 27, 2016

Local residents and customers of National Fuel gas are trying to challenge the company’s proposed rate hike. They shared their concerns during a hearing by the Public Service Commission at Buffalo’s downtown central library on Wednesday.

Residents coming in to Wednesday's PSC hearing on the proposed National Fuel rate increase.
Credit Avery Schneider / WBFO News

If approved, the National Fuel estimates customers would see an average $5.75 extra on their monthly bill beginning in April next year. It’s meant to fund upgrades to service through updated infrastructure, new technology, increased low-income programs, and service in more rural areas.

Clarence resident and 10-year home-owner Jay Wopperer considers the increase “extreme” at a time when he’s seen no inflation in his social security.

“You look at the papers – nothing has gone up that way and they’re asking for this increase,” said Wopperer.” And it seems like people are mentioning the lower amount of gas you use, the higher a price you will pay.”

Sara Schultz, vice chair of Sierra Club Niagara, said called it outrageous that the company would seek more revenue from customers when she sees so much poverty in Western New York.
Credit Avery Schneider / WBFO News

Sara Schultz, vice chair of Sierra Club Niagara, said called it outrageous that the company would seek more revenue from customers when she sees so much poverty in Western New York.

East Side Buffalo resident Gary Cutright can relate. He described himself as a low-income customer and said the outlook will be bleak for his family if the rate increase is approved. Cutright said he no longer qualifies for New York’s heating assistance programs because of last year’s increase to the minimum wage. Even though he’s still behind on paying off last year’s bill, Cutright said the best situation for his family of six would be for rates to remain the same.

“Even though they are a little steep, I’d like to see them keep it. Because this is a company – yeah, I understand they’re trying to make money – but New York, there’s more residents moving to. They’re making that profit. They’ll make that profit either way. But I don’t want to see them make it as fast as they want to. So if they keep the rates the same, they will eventually get the money to pay for these pipeline upgrades.”

Cutright said he’s satisfied with the service he receives from the National Fuel, but doesn’t get his money’s worth because his rented home is poorly insulated. If the rate increase takes effect, he’ll likely switch to electric heaters and other appliances. He said electric rates are cheaper than gas.

Schultz was among those who raised concerns over what National Fuel will end up doing with money collected from the rate increase. All totaled, delivery rates would go up by an estimated $41.7 million, and Schultz is convinced that much of that money will go to National Fuel’s top employees.

“Their salaries are so high, and the shareholders are getting nice dividends, so there’s no reason why they have to put this on the backs of the rate payers,” said Schultz.

Schultz is also convinced that part of the money will go towards National Fuel’s Northern Access Pipeline project, passing gas from Pennsylvania’s Marcellus Shale, through New York, and on to Canada.

Between 20 and 30 residents attended the afternoon session of PSC hearings on the proposed rate increase.
Credit Avery Schneider / WBFO News

National Fuel Spokesperson Karen Merkel said much of what she heard from customers at Wednesday’s hearing was misinformation. She said less than one percent of the estimated $41.7 million would go towards earnings, while the remainder would be put towards the needed improvements.

“Everything else is to pay for critical infrastructure and technology enhancements, as well as low-income programs and additional infrastructure so that we can continue to expand natural gas service to customers in rural areas,” said Merkel.

Merkel said none of the funds would have anything to do with the Northern Access Pipeline and pointed out that the company hasn’t levied a rate hike on customers since 2007. If approved, the rate increase would take effect in April 2017.