New York was one of the first states to become deregulated in The United States. There had been calls for change for many decades, with major companies holding a monopoly over the state, they could charge whatever price they wanted, which was unfair to customers who had to accept rising prices.
Many years of poor service and inefficient electricity grid, such as blackouts in 1965, led to the residents of the state demanding deregulation. So, it happened and The New York Public Service Commission passed the legislation that opened the energy markets in 1996 to competition between suppliers.
Once passed, the monopolies at the state level were broken, with the majority of the plants sold on to third parties. Later, in 1997, the competitive wholesale electricity market began.
The very first company that stepped forward to offer choice in New York was Orange & Rockland. Next came New York State Electric & Gas (NYSEG) and then shortly after Niagara Mohawk (National Grid). It took a few years until the majority of New York residents having the ability to decide their providers.
Currently, over 24% of consumers have switched to an alternative ESCO electricity supplier, this is more than 1 million residents and businesses deciding to take advantage of the energy deregulation in New York. However, there are many households and companies that have decided to not switch and purchase their energy supply from their utilities.
With over 200 alternative ESCO and traditional suppliers to choose from in New York state, there is plenty of competition for customers. New York still has some of the highest energy prices in the entire United States. Across the last five years, electricity prices up to 56.9 per cent more than the national average.
These high prices are blamed on the outdated infrastructure in New York. With blackouts in 2003, there are projects to focus on innovations in the state’s energy generation and delivery systems.
If we look at the statistics from October 2021, current electricity rates for New York are 58% higher than the national average at 18.36 ¢/kWh. In comparison, residential electricity rates were 41% higher than the national average at 19.6 ¢/kWh.
But has energy deregulation had an impact on electricity prices for the better in New York? There has been a 16% decline in electricity prices per kilowatt-hour (kWh) between 1996 and 2004, with inflation taken into account.
When combined, natural gas, nuclear power, and hydroelectricity account for 90% of New York’s electricity net generation. Renewable energy in the state is overseen by the New York Power Authority.
As of today, roughly 28% of the total electricity in New York is from renewable sources. Around 80 per cent of this comes from large legacy hydropower facilities. There are plans in place to construct over 20 renewable energy projects, with a focus on sourcing 70% of the state’s electricity from renewable sources by 2030.
Some of the electricity utility companies that consumers can choose from in New York are:
- Central Hudson Gas & Electric Corporation
- ConEdision
- PSEG Long Island (LIPA)
- New York State Electric & Gas Corporation (NYSEG)
- Niagara Mohawk (National Grid)
- Orange and Rockland Utilities
- Rochester Gas & Electric (RG&E)