The New York State Public Service Commission (PSC) has initiated a review of utility management compensation following Governor Kathy Hochul’s request on Tuesday for the Department of Public Service (DPS) to move forward with the audit. According to the Governor’s Office, this audit follows years of work by DPS to examine utility management structures and seeks to align utility priorities with State objectives, including affordability, reliability, safety, and a cleaner environment. In a news release, the Governor’s Office said this is part of a comprehensive effort by the Governor to combat rising utility costs and protect consumers, and it builds upon her direction for DPS to reject Con Edison’s rate proposal and her demand that the New York Power Authority suspend its proposed rate increase.
“New Yorkers deserve fair and transparent utility rates,” Governor Hochul said. “This audit will ensure that utility compensation structures are working for New Yorkers, not rewarding expected behavior. We will hold utilities accountable and ensure their focus is where it should be: delivering reliable, affordable, and high-quality service. At a time when families are facing rising costs, we are taking decisive action to ensure every dollar that customers pay is justified and that utility companies are prioritizing the needs of the people they serve.”
The audit will focus on compensation for non-union utility management employees statewide and the results will inform future rate cases to protect New Yorkers from unfair rate hikes. Numerous recent management and operations audits of large, investor-owned electric and gas utilities have highlighted meaningful concerns with how utilities administer their programs.
The audit will examine compensation practices at 13 major utilities, including Con Edison, National Grid, Central Hudson, NYSEG, RG&E, and Veolia Water New York. Investor-owned electric and gas utilities have a total of 12.4 million customers in New York State. Findings from the audit will influence future rate cases, providing the PSC with insights into best practices and potential cost-saving measures.
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