BALCONY - Business and Labor Coalition of New York

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July 23rd, 2009

by William Sherman

Turn on the lights or broil a burger and it will cost you more here than in any other city in the nation.

Metropolitan area consumers paid 59.1% more for electricity and 34.2% more for natural gas than the U.S. city average last month, according to the U.S. Bureau of Labor Statistics.

For example, New Yorkers paid 21 cents a kilowatt hour in June for electricity, while the average of 87 urban areas around the country was 13 cents, bureau data show. For natural gas, measured in therms, New Yorkers paid $1.42 per therm, while the average was $1.06.

Energy experts and utility company officials said the disparity is the norm, actually narrowing a bit from last year.

The relatively higher cost of fuel used by power generating plants, transmission and labor costs, and taxes are the reason for the disparities, they said.

“Power plants in most of the country use coal as fuel, while in New York State, we use more expensive natural gas and oil and only about 13% of generation comes from coal,” said Ken Klapp, spokesman for the New York Independent System Operator, which manages the state power grid.

Sal Graven, spokesman for the New York State Energy Research and Development Authority, said power delivery costs are higher here because “we’re remotely located from natural gas wells being drilled and you’ve got to deliver that gas to power plants and also to homes.”

Other areas of the nation, like the Pacific Northwest and upstate New York, have access to cheap hydroelectric power, “while we don’t,” said Ed Dumas, spokesman for the Long Island Power Authority.

Chris Olert, spokesman for Con Edison, noted that despite the disparity, the June bills for typical New York City and Westchester residents were 6.2% lower than those of June ’08.

“It was $92.57 last year and $86.85 this June,” he said. “The big difference for us in this area is higher fuel costs for generation and taxes.”