Customers again will be returned to Central Hudson
Philipstown residents and businesses receiving fixed-rate electricity through Hudson Valley Community Power will be transferred back to Central Hudson because the program administrator ran out of time to extend the contract.
In what is known as a community choice aggregation (CCA) program, municipalities contract with a third-party supplier to offer residents and businesses a fixed rate for electricity, although Central Hudson continues to provide delivery and billing.
Cold Spring, Nelsonville, Philipstown and nine other municipalities (not including Beacon) agreed to participate. Residents and businesses are added to the program automatically but can opt out.
Hudson Valley Community Power was negotiating to extend a contract that ends June 30. Mike Gordon, founder and chief strategy officer for the program administrator, Joule Assets, said in a letter to municipalities that “times are deeply uncertain at the moment and electricity prices rose quickly in response.” Nelsonville Mayor Chris Winward read the letter at the April 21 Village Board meeting.
Although prices have fallen more recently, Gordon said Joule lacked enough time to meet new guidelines created by the state utility regulator, the Public Service Commission, to notify and educate customers about new pricing before June 30.
Because the “political and economic environment is so volatile,” Joule does expect “opportunities to lock in some advantageous pricing” over the next two to three months. Joule will spend those months learning “how best to work through” the new PSC regulations, said Jessica Stromback, the company’s CEO.
“The order is, let everybody go back to the utility and not scramble,” she said on Wednesday (May 7). “That process is smooth; the utility understands it. There’s no interruption in service.”
Under the current contract, residents and businesses in the CCA pay a default rate of 12.24 cents per kilowatt hour for 100 percent renewable energy in Cold Spring and 11.24 cents per kilowatt-hour for 50 percent renewable energy in Nelsonville and Philipstown. Those customers will be charged Central Hudson’s variable rate starting July 1.
As of April 10, Central Hudson’s standard supply rate was 10.3 cents per kilowatt-hour. Last year’s summer rates, when electricity demand is higher, averaged 9.6 cents per kilowatt-hour. (Central Hudson charges a separate rate for delivery.)
“[The CCA] pricing was high, but it was locked in and we knew what it would be,” Winward said at last month’s meeting. “We don’t know what the volatility of Central Hudson’s rates are going to bring us.”
The July 1 transition will mark the second time residents and businesses enrolled in Hudson Valley Community Power have been sent back to Central Hudson. A former supplier, Columbia Utilities, defaulted on a contract to provide renewable energy at 6.6 cents per kilowatt-hour for residences and 7.1 cents for small businesses, including those in Beacon, Cold Spring and Philipstown. In April 2022, Columbia notified the PSC that it intended to return customers to Central Hudson.
A state judge on Dec. 5 approved a $1.5 million settlement in a lawsuit filed by the municipalities against Columbia Utilities. The company admitted no wrongdoing but agreed to a $1 million payment into a settlement fund and $50,000 monthly payments by June 1, 2025, to cover the balance. The Ulster County judge overseeing the case also approved $286,585 in attorney fees and up to $56,500 in administrative costs. Eligible customers began receiving checks for about $50 last month.
